What was the reported operating lease cost for a Pump It Up franchise in 2024?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
tal | $ 751,063 | |
NOTE 5 MEMBER'S EQUITY
The Company has one class of membership interests and is 100% owned by a single member.
NOTE 6 OPERATING LEASES
The Company leases space for its corporate headquarters; this lease expires at the end of June 2027 with a five-year renewal option. The facility lease provides for increases in future minimum monthly rental payments at a rate of 3% annually. Monthly payments also include certain common area maintenance charges.
The following table provides quantitative information concerning the Company's leases.
| 2024 | 2023 | |
|---|---|---|
| Operating |
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, the reported operating lease cost for a franchise in 2024 was $133,691. This figure represents the cost associated with leasing the physical location where the Pump It Up business operates. In addition to the operating lease cost, there was also a variable lease cost of $44,560, bringing the total lease cost to $178,251 for 2024.
For a prospective franchisee, understanding these lease costs is crucial for financial planning. The operating lease cost is a fixed expense, while the variable lease cost may fluctuate based on factors such as revenue or usage. It's important to note that these figures are based on past performance and may not be indicative of future lease costs, which can be affected by market conditions and negotiation with landlords.
The FDD also provides additional information related to lease liabilities, such as cash paid for amounts included in the measurement of lease liability, operating cash flows from operating leases, and right-of-use assets obtained in exchange for new operating lease liability. These details can help a franchisee assess the overall financial obligations associated with leasing a location for their Pump It Up franchise.
Furthermore, the FDD includes weighted-average remaining lease term and discount rate for operating leases, which are 7.4 years and 1.63% respectively. These metrics provide insight into the terms and financial structure of the leases held by Pump It Up franchisees, offering a more comprehensive view of the leasing landscape.