What is the primary business of Gold Star restaurants?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
The consolidated financial statements of Gold Star Chili, Inc. (the Company) include its subsidiary, TCWW, LLC, and its consolidated entity, GSC Properties, LLC, a variable interest entity for which the Company owns no equity.
Gold Star Chili, Inc. is primarily engaged in the production and distribution of chili and related products to franchisees and Company owned chili restaurants. The Company has 9 Company stores and 48 franchise locations as of December 31, 2024. The Company also sells chili products through grocery stores. In addition, revenue is derived from franchisees in the form of initial franchise fees and royalty fees. Credit is extended to franchisees and grocery stores based on established credit policies. The Company's principal markets are Greater Cincinnati, Dayton, Ohio and Lexington, Kentucky. The Company's viability is dependent on the ability to sell additional franchises, success of stores to generate sales and the Company's ability to collect its revenue from franchisees.
TCWW, LLC franchises the right to operate Tom + Chee restaurants across the United States. There is 1 franchise location, and there are 4 Company stores. TCWW, LLC was acquired in September 2017. Revenue is derived from store sales, franchisees in the form of initial franchise fees, royalties and advertising funds.
GSC Properties, LLC rents real estate to the Company, other franchisees and third parties.
All significant intercompany transactions and balances have been eliminated.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the company is primarily involved in the production and distribution of chili and related products. These products are supplied to both franchised and company-owned Gold Star chili restaurants. As of December 31, 2024, Gold Star had 9 company-owned stores and 48 franchise locations. In addition to supplying their own restaurants, Gold Star also sells chili products through grocery stores, expanding their distribution channels. The company generates revenue from initial franchise fees and ongoing royalty fees paid by franchisees. Gold Star extends credit to franchisees and grocery stores based on established credit policies. The company's main markets are in the Greater Cincinnati, Dayton, Ohio, and Lexington, Kentucky areas.
Gold Star's financial health depends on several factors, including its ability to sell additional franchises and the success of its stores in generating sales. It is also crucial for Gold Star to effectively collect revenue from its franchisees to maintain a stable financial position. The company also owns TCWW, LLC, which franchises the right to operate Tom + Chee restaurants across the United States. As of December 31, 2024, TCWW, LLC had 1 franchise location and 4 company-owned stores. TCWW, LLC generates revenue from store sales, initial franchise fees, royalties, and advertising fees from its franchisees.
Additionally, Gold Star has a consolidated entity called GSC Properties, LLC, which is involved in renting real estate to the company, its franchisees, and third parties. This diversification into real estate provides an additional revenue stream for Gold Star. The FDD emphasizes that all significant intercompany transactions and balances are eliminated in the consolidated financial statements, ensuring a clear and accurate representation of the company's overall financial performance.