What was the amount of Floors To Go's deferred revenue as of December 31, 2024?
Floors_To_Go Franchise · 2025 FDDAnswer from 2025 FDD Document
pation in an annual convention, which is sponsored by the Company. These amounts will be recognized as revenue when the convention is held and the related expenses incurred. The Company also records deferred revenue for amounts received from franchisees for member advertising fees. Revenue for these services will be recognized over the terms
Source: Item 23 — RECEIPTS (FDD pages 47–204)
What This Means (2025 FDD)
According to Floors To Go's 2025 Franchise Disclosure Document, the company's deferred revenue as of December 31, 2024, was $28,516. This figure represents revenue that Floors To Go has received but not yet earned because the services related to that revenue have not yet been fully provided.
Deferred revenue typically arises from payments received for future services or products. In the case of Floors To Go, this includes amounts from franchisees and manufacturers for participation in an annual convention, as well as member advertising fees. These revenues are recognized over time as Floors To Go fulfills its obligations, such as when the convention is held or as advertising services are provided throughout the term of the franchise agreement.
For a prospective Floors To Go franchisee, understanding deferred revenue is important because it reflects the company's financial obligations to provide future services. A decrease in deferred revenue from 2023 ($34,409) to 2024 ($28,516) could indicate that Floors To Go recognized more revenue during 2024 by fulfilling prior obligations, or that they collected less for future services. Franchisees may want to inquire about the trends in deferred revenue and how it relates to the services they can expect to receive as part of their franchise agreement.