What was the value of Petro Stopping Center's inventories in 2024?

According to Petro Stopping Center's 2025 Franchise Disclosure Document, inventories, excluding those held for short-term trading, are valued at the lower of cost and net realizable value. The cost is typically determined using the first-in, first-out (FIFO) method, encompassing direct purchase costs, production costs, and transportation expenses. This valuation method is a standard accounting practice, ensuring that the reported inventory value reflects either the actual cost or the current market value, whichever is lower, to prevent overstatement of assets.

For a prospective Petro Stopping Center franchisee, understanding this inventory valuation method is crucial for managing their own store's financials. Accurate inventory valuation impacts the franchisee's reported profits, tax obligations, and overall financial health. The FIFO method assumes that the oldest inventory items are sold first, which can affect the cost of goods sold (COGS) and, consequently, the franchisee's profitability.

While the FDD specifies the valuation method, it does not provide the actual inventory value for Petro Stopping Center in 2024. Franchisees should inquire about typical inventory levels, obsolescence rates, and inventory management systems during their due diligence. Understanding how Petro Stopping Center supports franchisees in managing inventory effectively is essential for minimizing losses and maximizing profitability.