What was the remaining lease term for Craters & Freighters as of December 31, 2023?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
nd for the years ended December 31, 2024 and 2023, is as follows:
| As of December 31, | 2024 | 2023 |
|---|---|---|
| Lease cost: | ||
| Operating Lease Cost | $ 52,971 $ | 59,437 |
| Variable Lease Costs | 28,885 | 34,706 |
| Total Lease Costs | $ 81,856 $ | 94,143 |
| Remaining Lease T |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, as of December 31, 2023, the remaining lease term was 1.75 years. This information is based on the company's financial statements, which include details about their operating lease. The lease covers office space that Craters & Freighters leases from a third party.
It's important to note that the option to renew the lease is at the sole discretion of the lessor, meaning the landlord has the power to decide whether or not to extend the lease. Craters & Freighters has not included an option to renew in the measurement of the ROU (Right-of-Use) asset and lease liability because renewal is not reasonably certain to occur. This indicates some uncertainty regarding the long-term availability of the current office space.
For a prospective franchisee, this means that Craters & Freighters' financial stability and operational planning are tied to a relatively short lease term. The franchisee should consider the implications of a potential relocation or renegotiation of the lease, as these events could impact the franchisor's costs and operational efficiency. Understanding the terms of the lease and the potential for renewal is crucial for assessing the long-term viability of the franchise system.