What were the member's withdrawals for Crawlspace Medic in 2023?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
24 | $ | 216,112 | $ | 460,495 |
STATEMENTS OF CASH FLOWS CSM FRANCHISE GROUP, LLC
| 2023 | For the Years Ended December 31, 2022 | 2021 | |
|---|---|---|---|
| CASH FLOWS FROM OPERATING ACTIVITIES | |||
| Net income | $ 1,149,783 | $ 808,447 | $ 954,060 |
| Change in noncash rental assets and liability | (1,167) | - | - |
| Changes in operating assets and liabilities: | |||
| (Increase) decrease in franchisee fees receivable | (53,100) | 280,000 | (275,000) |
| Decrease in royalty fees receivable | - | 9,972 | 3,918 |
| (Increase) decrease in due from related parties | - | 9,599 | (9,599) |
| (Increase) decrease in prepaid expense | (21,437) | 6,918 | (12,168) |
| Increase (decrease) in accounts payable and | |||
| accrued expenses | 4,691 | (11,088) | 22,144 |
| Increase (decrease) in due to related party | 15,096 | (1,444) | (20,676) |
| NET CASH PROVIDED BY OPERATING ACTIVITIES | 1,093,866 | 1,102,404 | 662,679 |
| CASH FLOWS FROM FINANCING ACTIVITIES | |||
| Payment on related party financing | - | - | (21,460) |
| Member's withdrawals | (1,029,271) | (1,052,830) | (641,150) |
| NET CASH USED IN FINANCING ACTIVITIES | (1,029,271) | (1,052,830) | (662,610) |
| NET CHANGE IN CASH AND CASH EQUIVALENTS | 64,595 | 49,574 | 69 |
| Cash and cash equivalents at beginning of year | 22 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 42)
What This Means (2024 FDD)
According to Crawlspace Medic's 2024 Franchise Disclosure Document, the member's withdrawals in 2023 were $1,029,271. This figure represents the amount of money taken out of the company by its members during the fiscal year. It is important to note that member's withdrawals are distinct from expenses or salaries, and reflect a distribution of profits or capital.
For a prospective Crawlspace Medic franchisee, understanding member's withdrawals can provide insight into how the company manages its finances and distributes profits. A high level of withdrawals could indicate that the members are taking a significant portion of the profits for themselves, which could impact the company's ability to reinvest in growth or support franchisees. Conversely, lower withdrawals might suggest a more conservative approach to financial management.
It's essential to consider these withdrawals in the context of the company's overall financial performance, including revenues, expenses, and net income. Reviewing the trend of member's withdrawals over several years, as presented in the table for 2022 ($1,052,830) and 2021 ($641,150), can offer a more comprehensive understanding of the financial practices of Crawlspace Medic. A potential franchisee should discuss these figures with the franchisor to understand the rationale behind the withdrawals and their potential impact on the franchise system.