Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

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FDD Talk 2013: Selected Streams of Revenue for KidzArt Franchised Businesses (2013 FDD)

by Franchise Chatter on November 23, 2013

in Art-Related Franchise, Child-Related Franchises, Franchise Earnings



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Highlights of KidzArt’s Item 19 Financial Performance Representations (2013 FDD) – Part 3

Explanatory Notes for Part IV – Selected Streams of Revenue

  • The following tables illustrate information about two selected streams of revenue for the Reporting Franchisees during the Measurement Period. The franchisor encourages all franchisees to pursue a number of streams of revenue to increase the value and profitability of their Franchised Business.
  • Two of these streams of revenue include revenue derived from (i) grants from school districts (“Grant Revenue”); and (ii) instruction provided at camps (“Camp Revenue”).

Grant Revenue

  • Kidz Art 2This table shows that 9 Reporting Franchisees were able to secure grants from school districts during the Measurement Period.
  • The Average Grant Revenue is calculated by taking the sum of the Grant Revenue earned by these 9 Reporting Franchisees and dividing that sum by 9.
  • The Median Grant Revenue means the amount that falls in the middle when all other amounts disclosed are arranged highest to lowest. In other words, half of the Reporting Franchisees exceeded the median value and half did not.
  • Of the 9 Reporting Franchisees who received Grant Revenue, 1 Reporting Franchisee, or 11%, exceeded the Average Grant Revenue.
  • One Reporting Franchisee receives a substantial grant to service an entire local school district (as referenced in Part II). While this is a higher grant than most other Reporting Franchisees receive, this is a stream of revenue that the franchisor highly encourages all franchisees to pursue.

Camp Revenue

  • This table shows that 8 “Teach” Reporting Franchisees and 20 “Teach Plus” Reporting Franchisees were able to derive revenue from providing instruction at camps during the Measurement Period.
  • The Average Camp Revenue is calculated by taking the sum of the Camp Revenue earned by the Reporting Franchisees for each offering (i.e. “Teach” vs. “Teach Plus”), divided by the number of Reporting Franchisees for each offering that received Camp Revenue during the Measurement Period.
  • The Median Camp Revenue means the amount that falls in the middle when all other amounts disclosed are arranged highest to lowest. In other words, half of the Reporting Franchisees exceeded the median value and half did not (for each offering).
  • Of the 8 Reporting Franchisees operating a KidzArt “Teach” franchise, 4 Reporting Franchisees, or 50%, exceeded the Average Camp Revenue.
  • Of the 20 Reporting Franchisees operating a KidzArt “Teach Plus” franchise, 5 Reporting Franchisees, or 25%, exceeded the Average Camp Revenue.

Part IV- Selected Streams of Revenue

Grant Revenue



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