Does Desi District include operating expenses for Company Owned Outlets in Item 19?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
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- This Item 19 does not include any operating expenses for operating the Company Owned Outlets. You would need to account for these costs in order to understand Net Income. Operating Costs would include rent, cost of goods sold, labor, insurance, advertising and other expenses.
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- Our Affiliates do not pay royalties or marketing fees to us; however, we have shown the estimated expenditures (4%
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 48–49)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, Item 19 does not include operating expenses for the Company Owned Outlets. The financial performance representations provided are based on gross sales from January 1, 2023, through December 31, 2023, for company-owned outlets.
The FDD explicitly states that operating expenses are not included in Item 19. These costs, which a franchisee would need to consider to understand net income, include rent, cost of goods sold, labor, insurance, advertising, and other expenses. The document provides gross sales figures for several company-owned locations, such as Desi District LLC with gross sales of $7,526,994.07 and Premier Meat Bazaar 423 Inc with $2,050,736.60 in gross sales. Estimated royalty fees are also listed for each location, calculated at 4%.
Prospective franchisees should recognize that the figures presented only reflect gross sales and estimated royalty fees. To estimate potential profitability, franchisees must independently determine and subtract all operating expenses relevant to their specific location and business circumstances. Desi District emphasizes that individual results may vary and there is no guarantee of achieving similar sales or earnings.