What constitutes 'Materials Expenses' for a Kitchen Solvers franchise, as defined in Item 19?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
nd highest outcome experienced for each category.
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- "Job" means a customer contract for one job.
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- "Materials Expenses" means the cost of all direct materials purchased by the Item 19 Outlet to complete all customer projects during the Measurement Period.
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- "Installation Expenses" means the total amount of money spent on all subcontracted and employed labor needed to install and fulfill customers contract obligations by the Item 19 Outlet.
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- For purposes of Table 1, "Gross Revenue Less Disclosed Expenses" is defined as Gross Sales less Materials Expenses and Installation Expenses.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 40–44)
What This Means (2025 FDD)
According to Kitchen Solvers' 2025 Franchise Disclosure Document, 'Materials Expenses' are defined within Item 19, which covers financial performance representations. Specifically, 'Materials Expenses' refers to the cost of all direct materials purchased by a Kitchen Solvers outlet to complete customer projects during the defined 'Measurement Period'.
This definition is important for prospective franchisees as it clarifies what costs are included when Kitchen Solvers presents financial performance data. Understanding this definition allows franchisees to accurately compare their own expenses against the averages provided in Item 19's financial tables. This is particularly relevant when assessing 'Gross Revenue Less Disclosed Expenses,' which is calculated by subtracting both 'Materials Expenses' and 'Installation Expenses' from Gross Revenue.
Kitchen Solvers also clarifies that a franchisee is considered to have met or exceeded the average if their total expenses are equal to or less than the averages presented in the tables. This provides a benchmark for franchisees to evaluate their financial performance against their peers. The FDD emphasizes that the percentages of gross sales disclosed in Table 1 are intended to allow for factoring in the materials expenses incurred during job performance.
Prospective franchisees should carefully consider 'Materials Expenses' as a significant factor in their overall profitability. By understanding what constitutes these expenses, franchisees can better manage their costs and improve their financial outcomes. It is also important to note that the Item 19 data is based on a survey of a subset of Kitchen Solvers franchisees, and individual results may vary.