What costs are NOT included in the results of operations for the Del Taco brand?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company's principal business consists of developing, operating and franchising our Jack in the Box and Del Taco restaurant brands, each of which is considered a reportable operating segment. The company also utilizes a shared-services model whereby each brand's results of operations are assessed separately and do not include costs related to certain corporate functions which support both brands. The segment reporting structure reflects the Company's current management structure, internal reporting method and financial information used in deciding how to allocate Company resources. Based upon certain quantitative thresholds, each operating segment is considered a reportable segment. This segment reporting is in line with our reporting units for goodwill.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 58)
What This Means (2025 FDD)
According to the 2025 Del Taco Franchise Disclosure Document, the company utilizes a shared-services model where each brand's results of operations are assessed separately. The results of operations for the Del Taco brand do not include costs related to certain corporate functions that support both the Jack in the Box and Del Taco brands. This means that some overhead and administrative expenses are handled at a corporate level and are not reflected in the individual financial performance of Del Taco restaurants.
This approach to financial reporting allows Del Taco to evaluate the performance of each brand independently. By excluding shared corporate costs, the company can focus on the revenue and expenses directly attributable to the operation of Del Taco restaurants. This can provide a clearer picture of the brand's profitability and efficiency.
For a prospective franchisee, this means that the financial statements presented may not reflect the full scope of expenses required to support the Del Taco system. While the brand-level financials offer insights into restaurant-level performance, franchisees should be aware that corporate overhead costs are allocated separately and may influence overall profitability. It would be prudent for potential franchisees to inquire about the nature and extent of these shared services and how they might impact the long-term financial health of their investment.