What is the noncurrent portion of Closet Storage Concepts' long-term debt obligations?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
| The following is a summary of long‐term debt obligations at December 31, 2022: | |
|---|---|
| Note payable to GM Financial. The loan is payable over 72 months at $493 per | 981 |
| month at 4.9% interest and matures February 2023. The loan is collateralized by | |
| a | |
| vehicle. | |
| Note payable to GM Financial. The loan is payable over 72 months at $519 per | 9,372 |
| month at 5.99% interest and matures July 2024. | |
| The loan is collateralized by a | |
| vehicle. | |
| Note payable to GM Financial. The loan is payable over 72 months at $519 per | 9,372 |
| month at 5.99% interest and matures July 2024. | |
| The loan is collateralized by a | |
| vehicle. | |
| Note payable to Bank of West. The loan is payable over 84 months at $1,456 per | 27,809 |
| month at 5.34% interest and matures August 2024. The loan is collateralized by | |
| equipment. The | |
| loan | |
| can | |
| be | |
| voluntarily | |
| prepaid | |
| after | |
| the | |
| initial | |
| 12 | |
| payments. | |
| Note payable to Ford Motor Credit. The loan is payable over 60 months at $634 | 18,885 |
| per month at 2.9% interest and matures August 2025. The loan is collateralized | |
| by | |
| a | |
| vehicle. | |
| Note payable to Leaf Capital Funding. | 100,911 |
| The loan is payable over 72 months at | |
| $1,754 | |
| per | |
| month | |
| at | |
| 5.5% | |
| interest | |
| and | |
| matures | |
| July | |
| 2028. | |
| The | |
| loan | |
| is | |
| collateralized | |
| by | |
| equipment. |
The followin
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 59)
What This Means (2025 FDD)
According to Closet Storage Concepts' 2025 Franchise Disclosure Document, the noncurrent portion of their long-term debt obligations as of December 31, 2022, was $115,266. This figure represents the amount of Closet Storage Concepts' total long-term debt ($167,330) that is not due within the next 12 months (current portion of $52,064).
For a prospective Closet Storage Concepts franchisee, understanding the franchisor's debt structure is crucial. The noncurrent portion of long-term debt indicates the financial obligations extending beyond the upcoming year. A substantial noncurrent debt might suggest a long-term investment strategy or significant financial commitments.
Franchisees should consider this information in conjunction with other financial metrics to assess the overall financial health and stability of Closet Storage Concepts. It is important to analyze trends in debt levels over time and compare them to industry benchmarks to evaluate the franchisor's financial management practices. Reviewing the complete financial statements and seeking professional financial advice can provide a more comprehensive understanding of the franchisor's financial position and its potential impact on the franchise system.