What was the reported total lease cost for Craters & Freighters as of December 31, 2023?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
due under the lease contracts include fixed payments.
Information on the operating lease as of and for the years ended December 31, 2023 and 2022, is as follows:
| As of December 31, | 2023 | 2022 |
|---|---|---|
| Lease cost: | ||
| Operating Lease Cost | $ 59,437 $ | 85,687 |
| Variable |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, the total lease costs as of December 31, 2023, amounted to $94,143. This figure is comprised of two components: operating lease costs and variable lease costs. The operating lease cost was $59,437, while the variable lease costs totaled $34,706.
These lease costs reflect Craters & Freighters' obligations for office space, which they lease from a third party. The option to renew this lease is at the sole discretion of the lessor, and Craters & Freighters has not included a renewal option in their calculations of assets and liabilities because renewal is not reasonably certain. The lease agreements include fixed payments, and there are no material residual value guarantees or restrictive covenants.
Prospective franchisees should note that these figures represent Craters & Freighters' lease expenses as a franchisor. As a franchisee, your lease costs will depend on the specific location and terms you negotiate for your own business premises. It is important to carefully consider lease terms and potential renewal options when establishing your Craters & Freighters franchise to ensure sustainable operations.