When calculating revenues for the Crawlspace Medic financial performance representation, are expenses such as royalties, brand fund payments, or technology fees included?

According to Crawlspace Medic's 2024 Franchise Disclosure Document, the revenue figures presented in the financial performance representation are calculated as gross sales less sales tax. It's explicitly stated that these revenue calculations do not include any deductions for expenses such as royalties, brand fund payments, or technology fees. This means the revenue figures represent the total income before these common franchise-related expenses are accounted for.

For a prospective Crawlspace Medic franchisee, this is an important distinction. The average and median revenues presented for fiscal years 2020 through 2023 represent the gross income potential before deducting costs like royalties, which franchisees must pay to Crawlspace Medic. To determine potential profitability, a franchisee must carefully consider these additional expenses and subtract them from the stated revenues.

For example, while the average revenue for 2023 is reported as $986,715, a franchisee's actual take-home income would be lower after paying royalties, brand fund contributions, and technology fees. It is important to factor in these costs to estimate net profit. The FDD does not specify the exact royalty structure, brand fund contributions or technology fees, so prospective franchisees should discuss these costs with the franchisor to understand the full financial picture.