As of December 31, 2023, how many company-owned Chop5 Salad Kitchen outlets were there?
Chop5_Salad_Kitchen Franchise · 2024 FDDAnswer from 2024 FDD Document
For purposes of this FPR, each Restaurant may be referred to as an "outlet." As of December 31, 2023 (the last day of the Measuring Period) there were: (a) 0 Franchised Restaurants in operation; and (b) 3 Company-Owned Restaurants in operation, 1 of which is a Qualifying Restaurant. The table below summarizes the outlet statistics and the number of Qualifying Restaurants:
| Open | Outlets | Statistica | l Changes Dui | ring 2023 | Matarialla | Orralifrina | ||
|---|---|---|---|---|---|---|---|---|
| Outlet Type | Jan 1, 2023 | Dec 31, 2023 | Outlets Opened | Outlets Closed | Materially Different Outlets | Qualifying Outlets | ||
| Franchised | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| Company-Owned | 2 | 3 | 1 | 0 | 0 | 1 | 1 | |
| Total | 2 | 3 | 1 | 0 | 0 | 1 | 1 |
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 45–48)
What This Means (2024 FDD)
According to Chop5 Salad Kitchen's 2024 Franchise Disclosure Document, as of December 31, 2023, there were 3 company-owned restaurants in operation. Of these 3 restaurants, only 1 was considered a 'Qualifying Restaurant' for the purposes of the financial performance representation (FPR). A 'Qualifying Restaurant' meets specific criteria, including being open and operating throughout the entire measuring period from January 1, 2023, to December 31, 2023, providing all requested data, not being a converted restaurant, and not being materially different from the franchised restaurant model.
The FDD provides a table summarizing outlet statistics, which shows that Chop5 Salad Kitchen had 2 company-owned restaurants open on January 1, 2023, and that number increased to 3 by December 31, 2023, with 1 outlet having opened during the year. None of the company-owned restaurants closed or were considered materially different. The document excludes data from one company-owned restaurant that opened in 2023 because it was not open for the entire measuring period. Data from another company-owned restaurant, the UCF Restaurant, was excluded because it is materially different from the standard franchise model, being larger and serving a different demographic with different pricing strategies.
For a prospective franchisee, this information highlights that Chop5 Salad Kitchen has limited experience with franchised locations, as there were no franchised restaurants in operation during the measuring period. The financial performance representation is based solely on the performance of one qualifying company-owned restaurant. This underscores the importance of carefully reviewing the financial performance data and understanding the specific conditions under which it was achieved, as well as consulting with advisors to develop independent estimates of revenue and expenses. The FDD also emphasizes that individual results may vary and there is no assurance of earning as much as the company-owned location.