Do the financial figures in Table 1 for Kidokinetics franchises reflect the costs of sales and operating expenses?

According to Kidokinetics's 2024 Franchise Disclosure Document, the financial figures in Table 1 do not reflect the costs of sales, operating expenses, or other costs that must be deducted from gross revenue to determine net income or profit. Table 1 presents historical financial performance for franchised locations based on the number of territories operated by each reporting franchised location and the reporting affiliate locations. It includes average Gross Sales for single, two, and three territory franchised locations, as well as reporting affiliate locations.

Gross Sales are defined as revenues from all goods, services, and products sold through the Kidokinetics business, including income from cash or credit transactions and the full redemption value of gift cards or certificates. Gross Sales do not include sales tax, documented customer refunds, or employee discounts up to 3% of Gross Sales.

Prospective franchisees should conduct an independent investigation of the costs and expenses they will incur while operating a Kidokinetics franchise. The FDD suggests that current and former franchisees, listed in the document, may be a source of this information. This is a standard disclaimer in franchise FDDs, as a franchisee's actual financial performance can vary widely based on factors like location, management skills, and local market conditions. Therefore, relying solely on the gross sales figures in Table 1 could be misleading without considering all associated costs.