What expenses are NOT included in the 'Disclosed Operating Expenses' for a Kidokinetics franchise?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
- "Disclosed Operating Expenses" refers to the expenses disclosed in Table 2A, Table 2B, and Table 2C and does not include all operating expenses or costs of goods and/or services provided.
The Disclosed Operating Expenses do not include the payroll wages of the owners and managers of these Franchise Locations and certain other expenses.
The payroll taxes paid in connection with the payroll of these owners and managers was not excluded.
For the Dallas Location, we have excluded reimbursements and wireless communication expenses as these included certain personal expenses of the business owner.
For the NW Broward Location, we deleted equipment expenses for non-standard equipment that is not used by our other Franchised Locations.
For the North Carolina Location, we excluded uncategorized discretionary operating expenses.
The expenses include actual amounts paid to locations where Kidokinetics programs are held, including revenue and profit-sharing fees and other rental fees charged by these facilities.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 46–54)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, the 'Disclosed Operating Expenses' presented in Tables 2A, 2B, and 2C do not represent all the operating expenses a franchisee might incur. Specifically, these disclosed expenses exclude the payroll wages of the owners and managers of the franchise locations. However, the payroll taxes associated with these wages are included in the disclosed expenses.
Additionally, certain expenses were excluded from the operating results of the three specific locations (Dallas, NW Broward, and North Carolina) presented in the tables. For the Dallas location, reimbursements and wireless communication expenses were excluded because they included personal expenses of the business owner. For the NW Broward location, expenses for non-standard equipment not used by other franchised locations were removed. The North Carolina location's figures exclude uncategorized discretionary operating expenses.
Prospective Kidokinetics franchisees should be aware that the 'Adjusted Net Operating Income' presented is not net profit. It does not include all operating expenses or any non-operating expenses like taxes, interest, depreciation, and amortization. Therefore, franchisees must conduct their own independent investigation to determine all costs and expenses they will incur to accurately project their potential net income or profit.