What was the net cash used in operating activities for Pearce Bespoke in 2022?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
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| Contributions | - | | 54,245 | | Members' Equity (Deficiency), Ending | $ (471,984) | $ | 7,880 |
PEARCE BESPOKE FRANCHISING, LLC STATEMENTS OF CASH FLOWS
| Years Ended December 31, | ||||
|---|---|---|---|---|
| 2023 | 2022 | |||
| Operating Activities: | ||||
| Net Loss | $ (479,864) | $ | (46,365) | |
| Adjustments to reconcile net loss to net cash | ||||
| provided by (used in) operating activities: | ||||
| Net change in right-of-use asset | 150 | - | ||
| Changes in assets and liabilities: | ||||
| Accounts receivable | (22,188) | - | ||
| Deposits | (2,198) | - | ||
| Deferred consulting fee | (666,186) | (25,000) | ||
| Accounts payable | 72,934 | 7,591 | ||
| Accrued payroll taxes | 18,282 | 5,339 | ||
| Deferred franchise fee revenue | 1,201,715 | 51,000 | ||
| Net Cash Used in Operating Activities | 122,645 | (7,434) | ||
| Financing Activities: | ||||
| Related party payables | 692 | - | ||
| Member contributions | - | 54,245 | ||
| Net Cash Provided by Financing Activities | 692 | 54,245 | ||
| Increase in Cash | 123,337 | 46,811 | ||
| Cash - Beginning of Period | 46,811 | - | ||
| Cash - End of Period | $ 170, |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 39)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, the net cash used in operating activities for the year ended December 31, 2022, was $7,434. This figure indicates the cash outflow resulting from the company's core business operations during that period.
For a prospective franchisee, understanding the net cash used in operating activities provides insight into the financial health and operational efficiency of Pearce Bespoke. A negative value, such as the $7,434 used in 2022, suggests that the company's operational expenses and other cash outflows exceeded its cash inflows from core business activities during that year. This could be due to various factors, including initial setup costs, marketing expenses, or other investments necessary to establish the franchise system.
It's important to note that this figure is just one piece of the financial picture. A franchisee should also consider other factors such as the company's overall profitability, cash flow from financing and investing activities, and its future growth prospects. Reviewing these figures over several years, as provided in the FDD, can help a potential franchisee identify trends and assess the long-term financial stability of Pearce Bespoke. Consulting with a financial advisor is recommended to fully understand the implications of these financial statements.