What were the total advertising expenses for Craters & Freighters for the year ended December 31, 2023?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
Picture_0.jpeg)
| Years Ended December 31, | Amount | % | Amount | % | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Franchise Revenues | $ | 1,791,736 | 30.1 % $ | 2,101,299 | 32.2 9 | |
| Royalty Revenues, net of Royalty Rebates | Ţ | 4,048,135 | 68.2 | 4,232,547 | 66.4 | |
| Initial Franchise Fee and Transfer Fee Revenue | 98,255 | 1.7 | 39,000 | 1.4 | ||
| Total Revenues | 5,938,126 | 100.0 | 6,372,846 | 100.0 | ||
| Costs of Revenues | ||||||
| Franchise Support | 2,036,715 | 1,519,545 | ||||
| Advertising | 957,288 | 951,719 | ||||
| Insurance Program | 733,842 | 737,736 | ||||
| Technology Support | 95,025 | 59,866 | ||||
| Total Costs of Revenues | 3,822,870 | 64.4 % | 3,268,866 | 51.2 % | ||
| Gross Profit | 2,115,256 | 35.6 % | 3,103,980 | 48.8 % | ||
| General and Administrative Expenses | ||||||
| Depreciation and Amortization | 158,990 | 128,123 | ||||
| Credit Losses (Recovery) | (30,000) | 10,000 | ||||
| Bank Charges | 11,002 | 5,271 | ||||
| Donations | 57,300 | 57,863 | ||||
| Dues and Subscriptions | 5,273 | 1,553 | ||||
| Employee Benefits | 12,158 | 12,081 | ||||
| Equipment | 31,246 | 42,542 | ||||
| Insurance | 75,629 | 75,156 | ||||
| Legal and Professional Fees | 328,824 | 216,207 | ||||
| Office Supplies | 30,584 | 104,945 | ||||
| Rent | 81,856 | 94,143 | ||||
| Repairs and Maintenance | 164,272 | 11,668 | ||||
| IT and Software | 121,168 | 52,324 | ||||
| Taxes and Licenses | 1,978 | 1,978 | ||||
| Telephone and Utilities | 45,458 | 63,012 | ||||
| Travel and Entertainment | 67,796 | 25,568 | ||||
| Total General and | 07,730 | 23,300 | ||||
| Administrative Expenses | 1,163,534 | 19.6 % | 902,434 | 14.1 % | ||
| ncome from Operations | 951,722 | 16.0 % | 2,201,546 | 34.5 % | ||
| Other Income (Expense) | ||||||
| Shared Services Revenue | 133,347 | 290,000 | ||||
| Interest Income | 110,402 | 19,711 | ||||
| Interest Expense | (628) | - | ||||
| Investment Income | 26,159 | 13,827 | ||||
| Investment Expenses | (1,203) | (5,598) | ||||
| Gain on Sale of Marketable Securities | 26 | 841 | ||||
| Unrealized Holding Gain (Loss) on | ||||||
| Marketable Securities | 135,511 | 97,174 | ||||
| Gain on Disposal of Property and E |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, the company's total advertising expenses for the year ending December 31, 2023, were $957,288. This figure is part of the costs of revenues, which totaled $3,822,870, representing 64.4% of total revenues for that year. Total revenues for Craters & Freighters in 2023 amounted to $5,938,126.
For a prospective franchisee, understanding these advertising expenses is crucial. It provides insight into how much Craters & Freighters invests in marketing and promoting the brand, which can directly impact a franchisee's business. A higher advertising expenditure by the franchisor could lead to increased brand awareness and customer traffic for individual franchise locations.
However, it's also important to consider the effectiveness of these advertising expenses. Franchisees should inquire about the specific advertising strategies employed by Craters & Freighters, the channels used (e.g., digital, print, local), and the results of past campaigns. This will help them assess whether the advertising investment is yielding a positive return and how it benefits their franchise.
Furthermore, prospective franchisees should clarify whether they are required to contribute to these advertising expenses through a separate advertising fund or if these costs are covered by the standard royalty fees. Understanding the allocation of advertising funds and the decision-making process behind advertising campaigns is essential for making an informed investment decision with Craters & Freighters.