Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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FDD Talk Daily: Average Adjusted Net Operating Income for Wild Birds Unlimited Stores

by Franchise Chatter on November 23, 2012

in Franchise Earnings, Retail Franchise



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Highlights of Wild Birds Unlimited’s Item 19 Financial Performance Representations (2012 FDD) – Part 3

First Year Advertising Expense

  • Advertising expense is defined as the out-of-pocket expense that franchisees spend to market their store, including the cost of printing and mailing customer flyers; television, radio, newspaper, and direct-mail advertising. You may decide to place other related expenses into this expense category.
  • Based on 2007, 2008, 2009, and 2010 first calendar year financial statements from 17 franchised stores who completed their first full calendar year of operation as of 12/31/07, 12/31/08, 12/31/09, or 12/31/10:
  • Average Advertising Expense:  10.04%
  • Range:  4.11% to 15.92%
  • Median:  11.14%
  • Number/Percentage of Stores Exceeding Average Advertising Expense:  9 (52.94%)
  • The advertising expense as a percentage of total Gross Sales will vary from market to market depending on the cost of media advertising and the personal decisions of individual franchisees.

First Year Wage Expense

  • Wild Birds Unlimited Franchise PhotoWage expense is defined as the out-of-pocket expense that franchisees spend to hire non-owners. You may decide to place other related expenses into this expense category.
  • Not included in this category are payroll taxes, workers’ compensation, insurance, employee training, employee benefits, or any other employee associated costs.
  • Based on 2007, 2008, 2009, and 2010 first calendar year financial statements from 17 franchised stores who completed their first full calendar year of operation as of 12/31/07, 12/31/08, 12/31/09, or 12/31/10:
  • Average Wage Expense:  8.99%
  • Range:  0.00% to 16.66%
  • Median:  8.93%
  • Number/Percentage of Stores Exceeding Average Wage Expense:  9 (52.94%)
  • The wage expense as a percentage of total Gross Sales will vary from market to market depending on the cost of hiring employees and the personal decisions of individual franchisees.

Schedule 7 – Adjusted Net Operating Income



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