What were the total costs of revenues for Craters & Freighters for the year ended December 31, 2022?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
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| 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 | 0 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to Craters & Freighters' 2025 Franchise Disclosure Document, the total costs of revenues for the year ended December 31, 2022, were $3,268,866. These costs are broken down into several categories: franchise support, advertising, insurance program, and technology support.
For a prospective Craters & Freighters franchisee, understanding these costs is crucial for assessing the financial viability of the franchise. These figures represent the direct expenses Craters & Freighters incurred to support its franchise system. Monitoring these costs and their relationship to revenue can provide insights into the efficiency and profitability of the franchisor's operations.
The FDD also provides a comparison to the costs of revenues for the year ended December 31, 2023, which totaled $3,822,870. This increase in costs should be examined by a potential franchisee to understand the reasons behind the change and whether it reflects a trend that could impact future profitability. Factors contributing to this change could include increased support for franchisees, higher advertising expenses, or changes in the insurance program costs.
It is important for a prospective franchisee to analyze these costs in conjunction with the revenue figures to determine the gross profit and overall financial health of Craters & Freighters. This information, combined with other financial data in the FDD, will help in making an informed decision about investing in a Craters & Freighters franchise.