Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

  • Anytime Fitness
  • CruiseOne
  • Firehouse Subs
  • Jimmy John's
  • Massage Envy
  • Menchie's
  • Orange Leaf Frozen Yogurt
  • Planet Fitness
  • The UPS Store
  • Yogurt Land
  • And Hundreds More...

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FDD Talk: Our Latest Views on Out-U-Go!’s Average Gross Sales for Affiliate and Franchised Businesses (2014 FDD)

by Franchise Chatter on January 15, 2015

in Franchise Earnings, Pet Franchise



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Out-U-Go! Photo from angieslist

Highlights of Out-U-Go!’s Item 19 Financial Performance Representations (2014 FDD) – Part 1

  • Out-U-Go! Businesses provide pet care services, including dog walking, vacation dog care, kitty care, critter care, and house sitting services to the general public.

Explanatory Notes for Table I – Gross Sales for Affiliate-Owned Out-U-Go! Businesses During Calendar Year Ended December 31, 2013

  • As of December 31, 2013, there were 2 affiliate-owned Out-U-Go! Businesses in operation, one in Oak Park, Illinois and the other in Chicago, Illinois (the “Affiliate Businesses”). Table I reflects the total annual Gross Sales for each of these businesses for the period January 1, 2013 through December 31, 2013 (the “Affiliate Reporting Period”).
  • Both of these businesses have been open for more than 60 months as of December 31, 2013.
  • The Oak Park, Illinois Business has been operating for more than 18 years. It services a territory that includes approximately 100,000 people, which is smaller than the typical protected territory that Out-U-Go! grants to franchisees.
  • The Chicago, Illinois Business has been operating for over 8 years and services a territory that is substantially larger than the typical territory that Out-U-Go! grants to franchisees.
  • Gross Sales means all amounts billed by the Out-U-Go! Business for the sale of products and services, excluding the amount of any taxes.

Explanatory Notes for Table II – Average Annual Gross Sales for Franchised Businesses (Years 1 to 4)

  • As of December 31, 2013, there were 7 Franchised Businesses in operation. Table II reflects certain average Gross Sales results for these 7 Franchised Businesses.
  • Two of the 7 Franchised Businesses, the South Loop Franchised Business and the Downers Grove Franchised Business, were previously owned and operated by Out-U-Go! affiliates and were sold to franchisees in 2013 (the “Affiliate Conversions”). The 2 Affiliate Conversions were in operation for over 4 years.
  • The results displayed in the table below only reflect the operational results of the 2 Affiliate Conversions during their fourth year of operation, which is the only year these businesses were under franchisee ownership. The first 3 years of performance for the Affiliate Conversions have been excluded from the results displayed in Table II.
  • Of the 5 Out-U-Go! Businesses that were opened and continuously operated as franchisee-owned businesses (the “Franchisee-Opened Businesses”), (a) all 5 of the Franchisee-Opened Businesses were open and in operation for at least one full year; (b) 4 were open and in operation for 2 years; (c) 3 were open and in operation for 3 years; and (d) 2 were open and in operation for 4 years.
  • The Year 1 results in Table II display the average annual Gross Sales for all 5 of the Franchisee-Opened Businesses during their first 12 months of operations. Of the 5 Franchisee-Opened Businesses included in the Year 1 results, 3 or 60% of the Franchisee-Opened Businesses surpassed the stated average. The remaining 2 fell below the stated average.
  • The Year 2 results display the average annual Gross Sales during the second year of operations for the 4 Franchisee-Opened Businesses that were open and in operation for 2 full years. Of the 4 Franchisee-Opened Businesses included in the Year 2 results, 2 or 50% achieved the stated average. The remaining 2 fell below the stated average.
  • The Year 3 results display the average annual Gross Sales during the third year of operations for the 3 Franchisee-Opened Businesses that were open and in operation for 3 full years. Of the 3 Franchisee-Opened Businesses included in the Year 3 results, 1 or 33% achieved the stated average. The remaining 2 fell below the stated average.
  • The Year 4 results display the average annual Gross Sales during the fourth year of operations for the 2 Franchisee-Opened Businesses that were open and in operation for 4 full years, and the 2 Affiliate Conversions. Of the 4 Businesses included in the Year 4 results, 3 or 75% surpassed the stated average. The remaining business fell below the stated average.

Table I – Gross Sales for Affiliate-Owned Out-U-Go! Businesses During Calendar Year Ended December 31, 2013



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