How does Crave Cookies handle delinquent receivables?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
on and existing economic conditions. As of December 31, 2024, there was no allowance for credit losses recorded.
Generally, the Company does not charge interest on past due accounts. Delinquent receivables are written off based on individual credit evaluation and specific circumstances of the customer. During the year ended December 31, 2024, there was no credit loss expense related to doubtful accounts receivable, where collectability was not reasonably assured.
Inventory - inventory consist of cookie boxes. Inventories are stated at the lower of cost or net realizable value.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, the company generally does not charge interest on past due accounts. Delinquent receivables are written off based on individual credit evaluations and the specific circumstances of the customer.
For the year ending December 31, 2024, Crave Cookies did not record any credit loss expense related to doubtful accounts receivable where collectability was not reasonably assured. However, in 2023, the company recorded $5,000 in credit loss expense related to doubtful accounts. In 2022 and 2021, no bad debt expense was recorded.
This means that if a franchisee owes Crave Cookies money and fails to pay on time, Crave Cookies typically won't charge interest on the overdue amount. However, if Crave Cookies determines that the debt is unlikely to be collected based on the franchisee's credit evaluation and specific situation, they will write off the receivable. The amount of receivables written off can vary from year to year, as demonstrated by the $5,000 credit loss expense in 2023 and no credit loss expense in 2024, 2022, and 2021.
Prospective franchisees should be aware of Crave Cookies' policy on delinquent receivables, as it could impact their financial relationship with the franchisor. While the absence of interest charges on past due accounts is a benefit, the potential for receivables to be written off based on individual circumstances highlights the importance of maintaining a good credit standing with Crave Cookies.