What was the gross amount of Software Development Costs for Craters & Freighters as of December 31, 2024?

According to Craters & Freighters' 2025 Franchise Disclosure Document, the gross amount of Software Development Costs as of December 31, 2024, was $631,405. This figure represents the total historical cost of software development assets before accounting for accumulated amortization. These costs are related to the development of software used in the Craters & Freighters business operations.

It is important to note that these software development assets are carried at historical cost, less any accumulated amortization and recognized impairment loss. Amortization is the process of expensing the cost of an intangible asset over its useful life, which in this case, Craters & Freighters amortizes software development costs on a straight-line basis over three years. This means that the initial $631,405 is not the current value of the software, but rather the original cost.

For a prospective franchisee, understanding the investment in software development is crucial. While the gross amount provides insight into the initial investment, the net value (after accumulated amortization) gives a clearer picture of the remaining value of these assets. As of December 31, 2024, the accumulated amortization was $434,154, resulting in a net software development value of $197,251. This indicates that a significant portion of the initial software development costs has already been expensed.

Franchisees should consider how Craters & Freighters' ongoing technology investments and software updates will impact their operations and potential costs. Understanding the amortization schedule and the lifecycle of the software can help franchisees anticipate future technology-related expenses. Additionally, it would be prudent to inquire about any planned software upgrades or replacements and how these costs will be managed within the franchise system.