Does the 'Additional Funds' estimate for a Deck Medic Business include compensation for the owner?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
Note 13: Additional Funds – This is an estimate of the minimum recommended levels of additional funds that may be required to cover operating expenses such as employee salaries, inventory, rent, and utilities only for the initial three month period following the opening of your Deck Medic Business. This estimate does not include compensation to you or your owners and does not include interest, finance charges, or payments that may be incurred by you if you financed the development of your Deck Medic Business. In making this estimate, we have relied on the experiences of our affiliate in developing and operating a Deck Medic Business. This is only an estimate for your initial three months of operations and more working capital and additional funds may be required depending on the sales and performance of your Deck Medic Business.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 15–19)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, the 'Additional Funds' estimate does not include compensation for the owner. Note 13 in Item 7 clarifies that the additional funds, estimated between $5,000 and $15,000 for three months, are intended to cover operating expenses such as employee salaries, inventory, rent, and utilities.
This means that prospective Deck Medic franchisees should not rely on this estimate to cover their own salary or draw during the initial three months of operation. Franchisees need to have separate funds available to cover their personal living expenses during this start-up phase. Additionally, the estimate does not account for interest, finance charges, or payments incurred if the franchisee finances the business development.
Deck Medic based this estimate on the experiences of its affiliate. However, the FDD states that this is only an estimate, and the actual working capital required may vary depending on the sales and performance of the Deck Medic Business. It is crucial for potential franchisees to conduct their own financial analysis and projections to determine the actual funds needed to sustain themselves and the business during the initial months.