Highlights of Jimmy John’s Item 19 Financial Performance Representations (2012 FDD) – Part 2
- This section relates to the actual and/or adjusted operating financial results of two sample affiliate-owned and operated Jimmy John’s restaurants. While theses specific restaurant figures have not been audited, they are included in total company-owned restaurant figures which are subjected to audit procedures at a consolidated level.
- The following presentation is intended to assist you in understanding the expense and cash flow experience from the operation of a Jimmy John’s restaurant with above average gross sales.
- The cash flows shown in the statements are before: draws for the owner, management bonuses, financing cost, amortization and depreciation, income taxes, charitable donations, travel, shipping, administrative salaries, and expenses related to unit option plans.
- The actual gross sales volumes of a Jimmy John’s restaurant vary widely. The company’s experience indicates that there are numerous factors affecting the sales of a particular Jimmy John’s restaurant, including: traffic count; accessibility and visibility of a site; the local marketplace and competition; general economic conditions; the franchisee’s management skill, experience, business acumen, and ability to promote and market Jimmy John’s restaurants effectively in the local market; and the degree of adherence to the franchisor’s methods and procedures in operating the restaurant.
- As with gross sales, the actual costs of operating a Jimmy John’s restaurant vary on a unit-by-unit basis. While the chief operating costs, for example, cost of goods sold, labor costs (employee wages, workers’ compensation, and insurance) and leasehold expenses, should operate within certain ranges, even these factors can vary depending upon the specific market and location.
Statement of Income and Cash Flows – Restaurant 1
- Restaurant 1, located in Illinois, has been operating continuously since opening in 1987.
- It is the third highest-grossing restaurant of all the affiliate-owned and operated restaurants.
- It is roughly 1,000 square feet in size and is in a strip mall on a college campus.
- As of January 3, 2012, there were 6 other Jimmy John’s restaurants in Illinois; two of these reported higher annual gross sales than Restaurant 1 for the 2011 Fiscal Year.