Woofie’s: $966K Average Sales vs. $129K-$246K Franchise Cost

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

Section I – Estimated initial investment (franchise costs) for a Woofie’s franchise, based on Item 7 of the company’s 2023 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Woofie’s franchise, based on Items 5 and 6 of the company’s 2023 FDD

Section III – Number of franchised and company-owned Woofie’s outlets at the start of the year and the end of the year for 2020, 2021, and 2022, based on Item 20 of the company’s 2023 FDD

Section IV – News updates on the Woofie’s franchise opportunity

Section V – Presentation and analysis of Woofie’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2023 FDD, including information on the:

• 2022 fiscal year annual gross revenue for the 2 Woofie’s franchisees (representing 2 territories) that were in operation for the entire 2022 fiscal year

• 2021 and 2022 fiscal year gross revenue by line of service (pet sitting and grooming) and the respective year-over-year growth percentage for 2 Woofie’s franchise territories that were in operation for the entire 2021 and 2022 fiscal years

• 2022 fiscal year gross revenue and certain operating expenses for the 2 company-owned Woofie’s territories for the 2022 fiscal year

Section VI – Key ratios, comparables, computations, and analyses for the Woofie’s franchise opportunity (exclusive content for Platinum subscribers)

Section I – Woofie’s Franchise Costs

• Woofie’s franchise costs, based on Item 7 of the company’s 2023 FDD:

• Franchise Fee:  $52,500
• Pre-Opening/Grand Opening Marketing:  $6,000
• Approved Mobile Unit Deposit:  $5,000 to $61,000
• Approved Mobile Unit Financing Payments:  $4,800 to $6,075
• Approved Mobile Unit Delivery Expenses:  $1,500 to $3,000
• Mobile Unit Operating Expenses:  $1,027 to $1,875
• Van Parking, Office Space, Office Equipment and Supplies:  $4,625 to $30,950
• Computer System:  $2,050
• Required Software Fees:  $960 to $2,500
• Phone Expense:  $450 to $600
• Technology Fee – 3 Months (Post Opening):  $150
• Internet Service:  $300 to $500
• Business Licenses and Permits:  $250 to $1,000
• Insurance Premiums:  $2,000 to $3,750
• Membership/Association Dues:  $400 to $600
• Initial Training Expenses:  $4,920 to $14,760
• Third-Party Training:  $0 to $550
• Initial Inventory:  $4,200 to $4,500
• Professional Fees:  $3,000 to $4,000
• Additional Funds – 3 Months:  $35,000 to $50,000
• Total Estimated Woofie’s Franchise Costs:  $129,132 to $246,360

Section II – Woofie’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Woofie’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2023 FDD:

• Initial Franchise Fee:  $52,500
• Royalty Fee:  6.5% of Gross Revenue. You are required to pay Woofie’s a minimum annual Royalty Fee (the “Annual Minimum Royalty Fee”). The Annual Minimum Royalty Fee is equal to the amount of Royalty Fees you would be required to pay to Woofie’s by achieving the applicable Minimum Performance Requirements for that period.
• Brand Fund Contribution:  currently, 2% of Gross Revenue
• Local Marketing and/or Cooperative:  starting on the Original Opening Date, you are required to pay Woofie’s $24,000 per calendar year for Local Marketing (“Annual Local Marketing Fee”), prorated for the first partial year of operation

Section III – Number of Franchised and Company-Owned Woofie’s Outlets

Franchised

2020

• Outlets at the Start of the Year:  3
• Outlets at the End of the Year:  3
• Net Change:  0

2021

• Outlets at the Start of the Year:  3
• Outlets at the End of the Year:  3
• Net Change:  0

2022

• Outlets at the Start of the Year:  3
• Outlets at the End of the Year:  9
• Net Change:  +6

Company-Owned

2020

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

2021

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

2022

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  2
• Net Change:  +1

Section IV – News Updates on the Woofie’s Franchise

• Authority Brands Signed 190 Franchise Agreements to Expand Across More Than 421 New Franchise Territories Systemwide in 2023

• Authority Brands Expands Portfolio of Home Service Companies and Looks Ahead to a Successful 2023

• Sebaot & Teferi Dejene: Woofie’s Franchise Owners of the Year 2022

• Authority Brands Acquires Woofie’s, Launches Emerging Brands Initiative

• Woofie’s Did Not Rank on Entrepreneur’s 2024 Franchise 500 List

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Woofie’s Franchise (Item 19, 2023 FDD)

• This Item sets forth certain historical information for franchisee-owned outlets and two Company-Owned Territories for the 2022 fiscal year. As of December 31, 2022, there were 6 franchisees (representing 9 Territories) and 2 Company-Owned businesses (the “Company-Owned Outlets”) operating in 2 Territories.

• Part 1 and Part 2 report 2 franchisees (representing 2 Territories) that were in operation for the entire 2022 fiscal year. Excluded from the tables are 4 franchisees (representing 6 Territories) that opened during the fiscal year.

• One franchisee included in the tables below opened 1 Territory during the 2022 fiscal year and had a total of 2 Territories at the end of the 2022 fiscal year; the Territory opened in 2022 is excluded from the tables.

Part 1 – 2022 Gross Revenue by Territory

• The table below reports the annual Gross Revenue of 2 franchisees (representing 2 Territories) that were in operation for the entire 2022 fiscal year.

2022 Gross Revenue

• Territory #1:  $1,439,330
• Territory #2:  $492,856
• Average:  $966,093

• “Gross Revenue” is generally defined in the applicable forms of franchise agreement as all revenue from the sale of products and services and all other income of every kind related to the Franchised Business, whether for cash, credit, trade, barter or other value and regardless of collection in the case of credit and even if you have contracted with third parties to provide certain of the services, less any bona fide refunds given to customers in the ordinary course of business.

• Gross Revenue also includes amounts billed to insurance or government programs.

• Further, Gross Revenue includes all revenue related to the sale of any products and the performance of any services (whether or not the products or services are approved by Woofie’s) that are provided using any portion of the Franchised Business in any manner, including the Marks (such as service vehicles, invoices, and uniforms bearing the Marks), the System, Confidential Information, any of the employees of the Franchised Business, or the telephone number of the Franchised Business.

• Gross Revenue also includes any proceeds of business interruption insurance.

• Gross Revenue is not reduced on account of any fees or commissions you pay to third parties who refer customers.

• The Gross Revenue data for a franchisee may include sales in “open” Territory, that is, territory that had not been awarded to a franchisee.

Part 2 – Gross Revenue by Line of Service and Year-Over-Year Growth, by Territory

• The table below reports the 2021 and 2022 fiscal year Gross Revenue by line of service and the respective year-over-year (“Y-o-Y”) growth percentage for 2 Territories that were in operation for the entire 2021 and 2022 fiscal years.

Territory #1: Fiscal Year 2021

Pet Sitting

• Gross Revenue:  $293,161
• Total Pet Sitting Visits:  $10,265

Grooming

• Gross Revenue:  $545,609
• Number of Vans Operated in Territory:  4
• Gross Revenue per Van:  $155,888
• Total Grooming Visits:  4,981

Totals:  $838,769

Territory #1: Fiscal Year 2022

Pet Sitting

• Gross Revenue:  $565,743
• Total Pet Sitting Visits:  18,043

Grooming

• Gross Revenue:  $873,587
• Number of Vans Operated in Territory:  5
• Gross Revenue per Van:  $194,130
• Total Grooming Visits:  6,865

Totals:  $1,439,330

Territory #1: Y-o-Y Growth Percentage

Pet Sitting

• Gross Revenue:  93%
• Total Pet Sitting Visits:  76%

Grooming

• Gross Revenue:  60%
• Gross Revenue per Van:  25%
• Total Grooming Visits:  38%

Totals:  72%

Territory #2: Fiscal Year 2021

Pet Sitting

• Gross Revenue:  $88,957
• Total Pet Sitting Visits:  3,690

Grooming

• Gross Revenue:  $186,325
• Number of Vans Operated in Territory:  2
• Gross Revenue per Van:  $106,471
• Total Grooming Visits:  1,861

Totals:  $275,282

Territory #2: Fiscal Year 2022

Pet Sitting

• Gross Revenue:  $203,389
• Total Pet Sitting Visits:  8,264

Grooming

• Gross Revenue:  $289,154
• Number of Vans Operated in Territory:  3
• Gross Revenue per Van:  $96,385
• Total Grooming Visits:  2,509

Totals:  $492,543

Territory #2: Y-o-Y Growth Percentage

Pet Sitting

• Gross Revenue:  129%
• Total Pet Sitting Visits:  124%

Grooming

• Gross Revenue:  55%
• Gross Revenue per Van:  -9%
• Total Grooming Visits:  35%

Totals:  79%

Averages: Fiscal Year 2021

Pet Sitting

• Gross Revenue:  $191,059 (34.3%)
• Total Pet Sitting Visits:  6,977.50

Grooming

• Gross Revenue:  $365,967 (65.7%)
• Number of Vans Operated in Territory:  3
• Gross Revenue per Van:  $131,179.50
• Total Grooming Visits:  3,421

Totals:  $557,025.50 (100.0%)

Averages: Fiscal Year 2022

Pet Sitting

• Gross Revenue:  $384,566 (39.8%)
• Total Pet Sitting Visits:  13,153.50

Grooming

• Gross Revenue:  $581,370.5 (60.2%)
• Number of Vans Operated in Territory:  4
• Gross Revenue per Van:  $145,257.50
• Total Grooming Visits:  4,687

Totals:  $965,936.50 (100.0%)

Part 3 – Gross Revenues, Operating Expense Ratios, and EBITDA Margins for 2022

• Part 3 reports the Gross Revenue and certain Operating Expenses for the 2 Company-Owned Territories for the 2022 fiscal year.

• The Company-Owned Territories report Gross Revenue on an individual Territory basis but share operating expenses. The P&L is reported into a single presentation to show an accurate representation of the entire operation without assumptions made on the proper allocation of expenses across the individual locations.

Fiscal Year 2022

Gross Revenue

• Gross Revenue – Grooming:  $1,481,354 (39.6%)
• Gross Revenue – Pet-Sitting:  $2,310,767 (61.8%)
• Gross Revenue – Coupons and Discounts:  $(54,616) (-1.5%)
• Total Gross Revenue:  $3,737,939 (100.0%)

Cost of Goods Sold

• Product Costs:  $26,389 (0.7%)
• Personnel Costs – Technicians:  $1,801,689 (48.2%)
• Marketing Costs:  $16,197 (0.4%)
• Program Costs:  $150,227 (4.0%)
• Franchise Fees:  $284,135 (7.6%)
• Total Cost of Goods Sold:  $2,278,637 (61.0%)

Gross Profit:  $1,459,302 (39.0%)

Overhead Expenses

• Personnel Expenses – Administrative:  $481,109 (12.9%)
• Facilities Expenses:  $12,000 (0.3%)
• General and Administrative Expenses:  $168,827 (4.5%)
• Total Overhead Expenses:  $661,936 (17.7%)

EBITDA:  $797,366 (21.3%)

• “Gross Revenue – Grooming” includes only Gross Revenue derived from providing grooming services.

• “Gross Revenue – Pet Sitting” includes only Gross Revenue derived from providing pet-sitting services.

• “Gross Revenue – Coupons and Discounts” includes the Gross Revenue reduction from providing discounted pet-sitting and grooming services.

• “Total Gross Revenue” is defined as the total of Gross Revenue – Grooming, plus Gross Revenue – Pet Sitting, less Gross Revenue – Coupons and Discounts.

• “Product Costs” is defined as the cost of all products purchased. The products in this category include technician uniforms, safety equipment, software, chemicals, equipment and equipment rental, and permits and inspections.

• “Personnel Costs – Technicians” is defined as payroll for technicians and includes taxes and benefits costs. Costs for recruiting, training, and employee relations is also included.

• “Marketing Costs” is defined as costs for promoting the business including Brand Fund Contributions, digital advertising, print, and other advertising methods. This does not include any salaries related to advertising.

• “Program Costs” is defined as the costs related to the operation of the business and providing services including vehicle-related costs (insurance, gas, lease payments, and repairs), Royalty Fee payments, and Call Center fees.

• “Franchise Fees” is defined as Royalty Fees and Technology Fees.

• “Royalty Fee” means the estimated Royalty Fee that the Company-Owned Territories would have paid during the 2022 fiscal year if the Company-Owned Territories paid Royalty Fees to Woofie’s under its current form of Franchise Agreement. Woofie’s calculated the Royalty Fee by multiplying the Total Gross Revenue generated by the Company-Owned Territories during the fiscal year by 6.5%.

• “Technology Fee” means the Technology Fee that the Company-Owned Territories would have paid during the 2022 fiscal year if the Company-Owned Territories paid the Technology Fees to Woofie’s under its current form of Franchise Agreement. Woofie’s calculated the Company-Owned Territories’ estimated Technology Fees for the 2022 fiscal year by multiplying $150 times 12 months.

• “Total Cost of Goods Sold” is defined as the sum of Product Costs, Personnel Costs – Technicians, Marketing Costs, Program Costs, and Franchise Fees.

• “Gross Profit” is defined as the Total Gross Revenue minus the Total Cost of Sales.

• “Personnel Expenses – Admin” is defined as expenses that include payroll for all team managers, accounting and sales salaries, training, and employee relations.

• “Facilities Expenses” is defined as the expenses related to the facility the business is operated from and includes payments for rent, utilities, maintenance, supplies, and taxes.

• “General and Administrative Expenses” is defined as the expenses for insurance, professional fees, bank and merchant fees, computer expenses/supplies, office supplies, postage, travel and entertainment, taxes, licenses and permits, insurance premiums for general liability, property, workers compensation, and umbrella insurance policies.

• “Total Overhead Expenses” is defined as the sum of Personnel Costs – Admin, Travel Expenses, Professional Fees Expenses, Facilities Expenses, Insurance Expenses, Office Expenses, and Other Operating Expenses.

• “Net Ordinary Income” is defined as the difference between Gross Profit and Total Operating Expenses.

• “EBITDA Percentage” is defined as Net Ordinary Income divided by Total Gross Revenue.

• Some outlets have earned this amount. Your individual results may differ. There is no assurance that you’ll earn as much.

Section VI – Woofie’s Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️