FDD Talk 2018: Goddard School Franchise Review (Financial Performance Analysis, Costs, Fees, and More)

In this FDD Talk post, you’ll learn the following:

• Section I – Background information on the Goddard School franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for a Goddard School franchise, based on Item 7 of the company’s 2018 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Goddard School franchise, based on Items 5 and 6 of the company’s 2018 FDD

• Section IV – Number of franchised and company-owned Goddard School outlets at the start of the year and the end of the year for 2015, 2016, and 2017, based on Item 20 of the company’s 2018 FDD

• Section V – Presentation and analysis of Goddard School’s financial performance representations, based on Item 19 of the company’s 2018 FDD, including information on the:

• 2017 average gross sales, payroll, occupancy costs, miscellaneous expenses, total expenses, and EBITDA for the 443 Goddard Schools that had been open and operating for over 18 months as of December 31, 2017

• 2017 average gross sales, payroll, occupancy costs, miscellaneous expenses, total expenses, and EBITDA for the 443 Goddard Schools that had been open and operating for over 18 months as of December 31, 2017, grouped by occupancy level (less than 70%, 70% to 80%, 80% to 90%, 90% to 100%, and greater than 100%)

• average monthly EBITDA and average EBITDA for the first full year of operations for all 24 Goddard Schools that had their first full month of operation in 2016

Section I – Background Information

17 Things You Need to Know About the Goddard School Franchise

Adds New Educational Advisory Board Member

1.  At the end of August 2018, Goddard School welcomed Dr. Helen Hadani to its Educational Advisory Board (EAB). Goddard School’s EAB consists of educators, researchers, and experts from a wide range of early childhood fields, including early learning, child development, technology integration, brain development, parent engagement, and health and nutrition. The valuable information the EAB provides helps Goddard School maintain its best-in-industry, play-based F.L.EX. Learning Program (Fun Learning Experience) as the science of learning advances.

2.  As a member of the EAB, Dr. Hadani will enhance the EAB’s contributions with research on creative thinking and child development. Craig Bach, vice president of education for Goddard Systems, Inc., said, “The EAB provides tremendous support to ensure that The Goddard School preschools provide the highest-quality education to prepare children for success in school and in life. We look forward to having Dr. Hadani join our team of educators, researchers and experts as they continue to advance our unique play-based curriculum.”

3.  Dr. Hadani, who holds a doctorate in developmental psychology from Stanford University and is a well-respected researcher, has more than 20 years of experience in cognitive, social, and emotional research. Her experience includes conducting research with parents and children to develop products for toy retailers like Hasbro, Apple, Leapfrog, and LEGO.

4.  Currently, Dr. Hadani is the director of research for the Center of Childhood Creativity (CCC), where she guides program and curriculum development for the CCC’s museum partner, the Bay Area Discovery Museum, and the museum’s on-site preschool. She is the lead author of parent- and teacher-facing publications on creative thinking and child development, including the CCC’s white papers Inspiring a Generation to Create, Reimagining School Readiness, and The Roots of STEM Success.

Hires New Vice President of Information Technology

5.  In early December 2017, Goddard Systems, Inc. (GSI), franchisor of Goddard School, announced the hiring of Renee Benedict as the system’s vice president of information technology. The position is new for the GSI senior management team and Benedict will be tasked with strategically positioning information technology as a growth enabler.

6.  Joseph Schumacher, CEO of Goddard Systems, Inc., said, “We’ve been quite impressed with Renee’s robust IT experience, collaborative work style, and true sense of intellectual curiosity. I’m confident that Renee will be a great addition to our IT and Senior Management teams, and we are all looking forward to her contributions.”

7.  Benedict has an extensive background in information technology (IT) and comes to Goddard School with over 25 years of experience in the global healthcare and consumer packaged goods industries. Before joining the Goddard School franchise, Benedict most recently held the position of vice president, business transformation at DanoneWave, responsible for leading the business process and application systems integration following Danone’s acquisition of WhiteWave Foods, where Benedict served as the head of IT.

Surpasses Previous Year’s Donation to Toys for Tots

8.  At the beginning of 2018, Goddard School announced that it had surpassed its previous year’s donation to Toys for Tots by 50 toys. Two hundred and thirty toys, including 100 of last year’s winning Toy Test toy, Melissa & Doug Star Diner Restaurant Play Set, were donated to Toys for Tots last year to help Toys for Tots fulfill its mission of providing gifts to less-fortunate children during the holiday season. Goddard Systems, Inc. employees donated 130 toys, which was up from the 80 toys donated in 2016.

9.  Since 2008, Goddard School has hosted an annual Toy Test to determine the best educational toys of the year with help from the most discerning toy critics: preschoolers. The Goddard School Toy Test Committee evaluates dozens of toys submitted by the world’s most popular toy manufacturers every year.

10.  Committee members select educational toys that best support child-initiated play and collaboration, among other criteria, to pass to the next round of judging. Preschoolers from 50 Goddard School locations nationwide then play with the toys, and their teachers help them select the top 10 toys. The public then votes on the best toy from the 10 finalists to select a winner.

11.  Following the November 2017 announcement of the winning Toy Test toy, GSI purchased 100 Melissa & Doug Star Diner Restaurant Play Sets to donate to Toys for Tots. Every year, GSI purchases 100 of the winning Toy Test toy and donates the toys to the program, which is run by the United States Marine Corps Reserve.

12.  Craig Bach, vice president of education for Goddard School, said, “Fun, interactive programs like our annual Goddard School Preschooler-Approved Toy Test are successful because they allow children to think critically while developing their social, creativity and collaboration skills. This experience provides children with the opportunity to engage with the top educational products on the market that are aligned with The Goddard School’s philosophy of learning through play.”

Company History

13.  Goddard School was founded in 1983 by Lois Goddard Haines in Malvern, Pennsylvania. Haines wanted to offer higher-quality childcare services and the original Goddard School incorporated a variety of teaching methods and progressive ideologies from all areas of child psychology and neurology to create a warm yet individualized experience to meet each child’s needs. The daily curriculum was supplemented with art, theater, music, garden to table, and made use of the traveling programs of The Philadelphia Museum of Art, The Please Touch Museum, and The Franklin Institute.

14.  In 1988, Haines sold Goddard School to entrepreneur Anthony A. Martino, founder of the AAMCO Transmissions and MAACO Auto Painting and Bodyworks franchises. Martino established Carousel Systems, Inc. (named after the carousel horse that Haines had installed at the entrance of the original school) to start franchising the Goddard School concept. In 1996, Philip Schumacher became president of Carousel Systems and eventually CEO of the company.

15.  In 2002, Wind River Holdings, LP acquired the franchise assets of Carousel Systems, Inc. Wind River Holdings changed the name of the franchise company to Goddard Systems, Inc. As all of these changes took place, Goddard School continued to expand across the United States and by 2005, the company had opened its 200th school.

16.  At the beginning of 2010, Phil Schumacher’s brother, Joseph Schumacher, took over as CEO of Goddard Systems, Inc. and remains in the position today. A few years later, in 2013, Goddard School hit another milestone with the opening in Highland Heights, Ohio of its 400th school. Today, Goddard School has locations in over 37 states.

Entrepreneur’s Franchise 500

17.  Goddard School ranked No. 77 on Entrepreneur’s 2018 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of Goddard School franchise costs, based on Item 7 of the company’s 2018 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on Goddard School’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2018 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2015

• Outlets at the Start of the Year:  419
• Outlets at the End of the Year:  436
• Net Change:  +17

2016

• Outlets at the Start of the Year:  436
• Outlets at the End of the Year:  461
• Net Change:  +25

2017

• Outlets at the Start of the Year:  461
• Outlets at the End of the Year:  473
• Net Change:  +12

Company-Owned

2015

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2016

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2017

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

Section V – Financial Performance Representations (Item 19, 2018 FDD) and Analysis

• The following are Statements of Gross Revenue and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) for The Goddard Schools.

• The first report is a Statement of Gross Revenue and EBITDA for the Schools in operation over 18 months for the year ended December 31, 2017 (“Mature Schools”).

• The second report is a Statement of Average Gross Revenue and EBITDA for Mature Schools by Occupancy Group for the year ended December 31, 2017.

• The third report is a Statement of Average EBITDA for the first 12 months of operation for Schools opened in 2016 and following them for their first 12 full months of operations in 2016 and/or 2017, depending on what month the School opened.

Part 1 – 2017 Average Gross Revenue, Payroll, Occupancy, and Miscellaneous Operating Expenses for Mature Goddard School Businesses Operating as of December 31, 2017

• The following is a report identifying the actual gross revenue, payroll, occupancy (representing rent plus property tax expense), and miscellaneous operating expenses prepared on a cash basis for all mature The Goddard School businesses (open over 18 months) operating as of December 31, 2017.

• The net result of these items is “EBITDA” which is defined as gross revenue less all expenses directly related to operating the School excluding interest, taxes, depreciation, and amortization.

• The items included in the expense category identified as miscellaneous items include bank charges, office supplies, telephone, transportation, payroll taxes, employee costs, advertising, royalties, repairs and maintenance, school supplies, snacks, technology, marketing, and professional fees.

• The expenses reported may also include miscellaneous items that are subject to the discretionary spending of the individual franchisee.

• The report has not been audited.

• As of December 31, 2017, there were 472 The Goddard School businesses in operation, all of which 472 schools were owned by franchisees. Of these 472 Schools, 443 Schools had been open and operating for over 18 months as of December 31, 2017 and are considered Mature Schools.

• Five Mature Schools closed during 2017, none of which had been open for less than 12 months. Information from these five closed Mature Schools is not included in the report. None of the Schools open and operating 18 months or less as of December 31, 2017 closed during 2017.

2017 Average – 443 Mature Franchise Schools

💼Corporate Executives: Your Management Experience Is Your Greatest Franchise Asset

Whether navigating a career transition or planning your next chapter, franchise ownership gives you a proven system to put decades of management experience to work for yourself. Severance packages, 401k rollovers, and SBA loans make funding more accessible than most executives realize. Enter your ZIP code to explore franchise opportunities still available in your area and find out which brands are actively seeking experienced business leaders like you.

The Best of Franchise Chatter

🥇The Most Profitable Franchises of 2026

🥈Franchises Ranked by Average Revenues

🥉Franchises Ranked by Average Profits

🏆Franchise Winners, Survivors & Losers

Subscribe Now or Log In

🎖️Military Veterans: Your Service Prepared You for Franchise Ownership Better Than You Think

Franchisors actively seek out veterans because the discipline, leadership, and ability to follow a proven system that the military instills are exactly the qualities that make franchise owners successful. Through the VetFran program, many leading brands offer significant incentives including reduced franchise fees and special financing. Enter your ZIP code to explore franchise opportunities still available in your area and find out which brands are actively looking for veterans like you.







Franchise Chatter is reader-supported. We may receive a commission for leads generated from affiliate links and banners on our site.