What is the significance of '0' in all the columns for Red Wagon Club in this table?
Red_Wagon_Club Franchise · 2024 FDDAnswer from 2024 FDD Document
| State | Year | Outlets at Start of Year | Outlets Opened | Terminations | Non- Renewals | Reacquired By Franchisor | Ceased Operations - Other Reasons | Outlets at End of the Year |
|---|---|---|---|---|---|---|---|---|
| All States | 2021 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| 2022 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| 2023 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| State | Year | Outlets at Start of Year | Outlets Opened | Terminations | Non- Renewals | Reacquired By Franchisor | Ceased Operations - Other Reasons | Outlets at End of the Year |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Total | 2021 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| 2022 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| 2023 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 45–47)
What This Means (2024 FDD)
According to the 2024 Franchise Disclosure Document, the prevalence of '0' across various tables for Red Wagon Club indicates limited operational history for franchised locations. Specifically, the tables detailing outlet information for the years 2021, 2022, and 2023 show '0' for categories like 'Outlets at Start of Year', 'Outlets Opened', 'Terminations', 'Non-Renewals', 'Reacquired By Franchisor', and 'Outlets at End of the Year'. This suggests that, system-wide, there were no franchised Red Wagon Club locations operating during these years.
This lack of franchised outlet activity is further supported by the 'LIST OF CURRENT FRANCHISEES AS OF MAY 31, 2024' which states 'None.' and the 'LIST OF FRANCHISE AGREEMENTS SIGNED BUT BUSINESSES NOT YET OPEN AS OF MAY 31, 2024' which also states 'None.'. This means that as of the FDD date, Red Wagon Club had no active franchisees and no signed agreements for future openings.
However, the FDD also indicates that Red Wagon Club had company-owned locations. The table regarding 'Company-Owned' outlets shows activity, with the number of outlets increasing from 0 in 2021 to 2 in 2022 and remaining at 2 in 2023. This is further clarified by a footnote explaining that two of Red Wagon Club's directors operate RWC Businesses, which are counted as company-owned locations. Additionally, the table regarding projected openings for the next fiscal year shows that Red Wagon Club anticipates opening franchised locations in several states, including Georgia, Michigan, Ohio and North Carolina.
For a prospective franchisee, this information highlights the importance of conducting thorough due diligence. While the brand is new to franchising, the presence of company-owned locations may provide some operational data for review. A potential franchisee should focus on understanding the performance of these company-owned locations, the support and training provided by Red Wagon Club, and the overall business plan for expanding the franchise system. It would be prudent to ask Red Wagon Club for detailed financial performance representations for the company-owned stores and a comprehensive plan for franchisee support and development.