What is the depreciation timeframe for buildings and improvements for The Standardx?

According to The Standardx's 2025 Franchise Disclosure Document, the depreciation timeframe for buildings and improvements is between 10 and 50 years. This means that The Standardx depreciates the cost of its buildings and any improvements made to those buildings over a period ranging from 10 to 50 years for accounting purposes. Depreciation is a method of allocating the cost of an asset over its useful life.

For a prospective franchisee, understanding this depreciation timeframe is important for financial planning and forecasting. The longer the depreciation period, the smaller the annual depreciation expense, which can impact the franchisee's reported profits and tax liabilities. Conversely, a shorter depreciation period results in a larger annual expense, potentially reducing short-term profitability but also lowering taxable income.

The depreciation timeframe for leasehold improvements is different. The Standardx depreciates leasehold improvements over the shorter of either the lease term or the useful life of the asset. This is a common practice, as leasehold improvements lose value when a lease expires and the tenant no longer has control of the property. Franchisees should carefully consider the lease terms and expected useful life of any leasehold improvements to accurately account for depreciation expenses.