What amount of direct and incremental costs does Engel & Volkers expect to recognize in 2026?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2025 | $ | 171,689 | |
|---|---|---|---|
| 2026 | 163,056 | ||
| 2027 | 144,703 | ||
| 2028 | 124,875 | ||
| 2029 | 107,054 | ||
| Thereafter | 262,771 | ||
| Total | $ | 974,148 |
The direct incremental costs, principally consisting of commissions, are included in "Prepaid commissions" in the accompanying
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the direct and incremental costs expected to be recognized over the remaining term of the associated franchise agreements at December 31, 2024, are detailed in a table. The amount listed for the year ending December 31, 2026, is $178,751. These costs primarily consist of commissions and are included in "Prepaid commissions" on the consolidated balance sheets.
This figure represents Engel & Volkers' estimate of costs they will incur related to franchise agreements that will be recognized in 2026. These costs are associated with securing and maintaining franchise agreements, reflecting the ongoing investment in their franchise network. For a prospective franchisee, this indicates the level of financial planning and forecasting Engel & Volkers undertakes.
In addition to the general figure, the FDD also lists estimated deferred admission fees expected to be recognized. However, the provided excerpts do not specify whether the $178,751 figure includes these deferred admission fees or represents a separate category of costs. A prospective franchisee should clarify with Engel & Volkers whether this figure encompasses all direct and incremental costs or if there are other cost components to consider for 2026.