What was the amount of credit losses for Floors To Go in 2023?

According to Floors To Go's 2025 Franchise Disclosure Document, the company experienced credit losses of $35,724 in 2023. This figure is part of the adjustments made to reconcile net income to net cash provided by operating activities. Credit losses represent the amount of money that Floors To Go was unable to collect from its customers or franchisees during that year.

For a prospective franchisee, understanding the credit losses of Floors To Go can provide insight into the financial health and stability of the company. While credit losses are a normal part of doing business, a significant increase in these losses could indicate potential issues with the company's customer base or its ability to manage credit effectively. It is important to note that this figure is just one component of the overall financial picture and should be considered in conjunction with other financial data.

Furthermore, the FDD mentions a change in accounting principle related to credit losses. Floors To Go adopted Accounting Standards Update 2016-13 on January 1, 2023, using a modified retrospective method. This update involves measuring expected credit losses based on historical experience, current economic conditions, and reasonable forecasts. However, the adoption of this standard did not have a material impact on their financial statements and disclosures. This indicates that Floors To Go is proactively managing and accounting for potential credit losses in accordance with current accounting standards.

Prospective franchisees should review the complete financial statements and related notes in the FDD to gain a comprehensive understanding of Floors To Go's financial performance and risk management practices. Consulting with a financial advisor can also help in interpreting these figures and assessing the potential risks and rewards of investing in a Floors To Go franchise.