Plato's Closet: $1.30M Average Sales vs. $287K-$417K Franchise Cost

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

Section I – Estimated initial investment (franchise costs) for a Plato’s Closet franchise, based on Item 7 of the company’s 2024 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Plato’s Closet franchise, based on Items 5 and 6 of the company’s 2024 FDD

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Section III – Number of franchised and company-owned Plato’s Closet outlets at the start of the year and the end of the year for 2021, 2022, and 2023, based on Item 20 of the company’s 2024 FDD

Section IV – News updates on the Plato’s Closet franchise opportunity

Section V – Presentation and analysis of Plato’s Closet’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2024 FDD, including information on the:

2023 average, median, high, and low gross sales and average and median gross profit for the 469 franchised Plato’s Closet stores in the United States and Canada that had been in operation by the same franchisee or owners for the 12-month period ended December 30, 2023, grouped by year opened (2022, 2021, 2020, 2019, 2018, and 2017 and prior)

2023 average, median, high, and low gross sales and average and median gross profit for the first, second, third, and fourth quartiles of the 469 franchised Plato’s Closet stores in the United States and Canada that had been in operation by the same franchisee or owners for the 12-month period ended December 30, 2023

number and percentage of franchised Plato’s Closet stores in the United States and Canada that had been in operation by the same franchisee or owners for the 12-month period ended December 30, 2023, grouped by range of gross sales ($0 to $250,000; $250,001 to $500,000; $500,001 to $1,000,000; $1,000,001 to $2,000,000; $2,000,001 to $3,000,000; and greater than $3,000,000)

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

Section I – Plato’s Closet Franchise Costs

Plato’s Closet franchise costs, based on Item 7 of the company’s 2024 FDD:

Initial Franchise Fee: $25,000
Fixtures and Supplies: $45,000 to $60,000
Signs: $8,000 to $12,000
Security Cameras: $2,000 to $5,000
Point-of-Sale System: $22,300 to $29,300
Leasehold Improvements: $12,000 to $22,000
Build-Out: $25,000 to $52,000
Deposits and Business Licenses: $3,000 to $15,000
Opening Inventory: $65,000 to $80,000
Miscellaneous Pre-Opening Expenses: $35,000 to $60,000
Rent for First 3 Months: $15,000 to $24,000
Additional Funds for 3 Months: $30,000 to $33,000
Total Estimated Plato’s Closet Franchise Costs: $287,300 to $417,300

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

Plato’s Closet’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2024 FDD:

Initial Franchise Fee: $25,000
Continuing Fee: 5% of Gross Sales
Marketing Fee: $1,500 per year
Cooperative Advertising: maximum amount is 5% of Gross Sales
Local Marketing Expenses: minimum amount, when combined with cooperative advertising expenses, is 5% of Gross Sales
Advertising Fee: if Winmark imposes this fee, you will pay up to 2% of Gross Sales

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

Franchised

2021

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Outlets at the Start of the Year: 485
Outlets at the End of the Year: 489
Net Change: +4

2022

Outlets at the Start of the Year: 489
Outlets at the End of the Year: 500
Net Change: +11

2023

Outlets at the Start of the Year: 500
Outlets at the End of the Year: 506
Net Change: +6

Company-Owned

2021

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

2022

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

2023

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

Section IV – News Updates on the Plato’s Closet Franchise

Winmark – the Resale Company Named to Fortune’s 2023 Change the World List

Plato’s Closet Hits Milestone with 500th Store

Plato’s Closet Ranked No. 365 on Entrepreneur’s 2024 Franchise 500 List

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Plato’s Closet Franchise (Item 19, 2024 FDD)

The following is a financial performance representation titled “Plato’s Closet Statement of Average Annual Sales and Gross Profit.”

The gross profit figures in this Item 19 do reflect the cost of sales but do not reflect the operating expenses that must be deducted from the gross profit figures to obtain your net income or profit.

The following statement of average annual sales and gross profit includes average gross sales and gross profit during the 12-month period ended December 30, 2023 as reported by the 469 franchised Plato’s Closet Stores located in the United States and Canada that commenced operations during the years 1998 through 2022, and were not transferred during 2023. This represents a subset of the 506 Plato’s Closet Stores in the United States and Canada that were open and operating as of December 30, 2023.

This statement includes information from only those Plato’s Closet Stores located in the United States and Canada that had been in operation by the same franchisee or owners for the 12-month period ended December 30, 2023.

There are no material financial and operational characteristics of the U.S. Stores that differ materially from the Canadian Stores included in this financial performance representation.

No other Plato’s Closet Stores are included in this statement due to insufficient history of operations (not in operation for the 12-month period ended December 30, 2023 or transferred during this period).

There were 469 franchised Plato’s Closet Stores which had been in operation by the same franchisee or owners at least 12 months as of December 30, 2023. All of the 469 Stores are reflected in the average.

This financial performance representation does not include information for the 37 Plato’s Closet Stores that opened or transferred in 2023. No Stores closed in 2023 after being opened less than 12 months.

Part 1 – Statement of Average Gross Sales and Gross Profit of 469 Franchised Plato’s Closet Stores for the Fiscal Year Ended December 30, 2023

Year Opened – 2022

Number of Stores Reported: 36
Number and Percentage of Stores Attaining or Exceeding Average Gross Sales: 6/17%
Number and Percentage of Stores Attaining or Exceeding Average Gross Profit: 6/17%
2023 Average Gross Sales: $1,064,440
2023 Median Gross Sales: $976,584
2023 Average Gross Profit: $667,401
2023 Median Gross Profit: $609,882
Average Gross Profit Percentage: 62.70%
Sales Range: $563,243 to $2,327,587

Year Opened – 2021

Number of Stores Reported: 32
Number and Percentage of Stores Attaining or Exceeding Average Gross Sales: 13/41%
Number and Percentage of Stores Attaining or Exceeding Average Gross Profit: 11/34%
2023 Average Gross Sales: $1,228,975
2023 Median Gross Sales: $1,141,616
2023 Average Gross Profit: $764,835
2023 Median Gross Profit: $702,025
Average Gross Profit Percentage: 62.23%
Sales Range: $369,408 to $2,574,167

Year Opened – 2020

Number of Stores Reported: 15
Number and Percentage of Stores Attaining or Exceeding Average Gross Sales: 4/27%
Number and Percentage of Stores Attaining or Exceeding Average Gross Profit: 4/27%
2023 Average Gross Sales: $1,149,891
2023 Median Gross Sales: $1,081,617
2023 Average Gross Profit: $717,200
2023 Median Gross Profit: $695,480
Average Gross Profit Percentage: 62.37%
Sales Range: $697,495 to $1,801,862

Year Opened – 2019

Number of Stores Reported: 25
Number and Percentage of Stores Attaining or Exceeding Average Gross Sales: 7/28%
Number and Percentage of Stores Attaining or Exceeding Average Gross Profit: 6/24%
2023 Average Gross Sales: $1,102,269
2023 Median Gross Sales: $1,053,978
2023 Average Gross Profit: $695,530
2023 Median Gross Profit: $634,638
Average Gross Profit Percentage: 63.10%
Sales Range: $501,348 to $1,915,531

Year Opened – 2018

Number of Stores Reported: 29
Number and Percentage of Stores Attaining or Exceeding Average Gross Sales: 13/45%
Number and Percentage of Stores Attaining or Exceeding Average Gross Profit: 13/45%
2023 Average Gross Sales: $1,309,484
2023 Median Gross Sales: $1,220,050
2023 Average Gross Profit: $828,546
2023 Median Gross Profit: $782,167
Average Gross Profit Percentage: 63.27%
Sales Range: $572,898 to $3,292,647

Year Opened – 2017 and Prior

Number of Stores Reported: 332
Number and Percentage of Stores Attaining or Exceeding Average Gross Sales: 153/46%
Number and Percentage of Stores Attaining or Exceeding Average Gross Profit: 156/47%
2023 Average Gross Sales: $1,353,323
2023 Median Gross Sales: $1,274,387
2023 Average Gross Profit: $857,741
2023 Median Gross Profit: $789,543
Average Gross Profit Percentage: 63.38%
Sales Range: $337,821 to $3,702,849

Total

Number of Stores Reported: 469
Number and Percentage of Stores Attaining or Exceeding Average Gross Sales: 196/42%
Number and Percentage of Stores Attaining or Exceeding Average Gross Profit: 196/42%
2023 Average Gross Sales: $1,300,065
2023 Median Gross Sales: $1,199,040
2023 Average Gross Profit: $821,845
2023 Median Gross Profit: $757,162
Average Gross Profit Percentage: 63.22%

“Gross Sales” means all revenues the franchisee receives from the sale of goods and services, whether by cash or by check, credit card or trade, in connection with the Store, less sales tax and customer refunds and returns.

Average Gross Profit equals Gross Sales less Cost of Goods Sold. Average Gross Profit does not reflect any expenses related to the operation of a Plato’s Closet Store other than Cost of Goods Sold.

Part 2 – Statement of Sales Ranges by Quartile for the 469 Franchised Plato’s Closet Stores Open on December 30, 2023 That Had Been in Operation for at Least 12 Months by the Same Franchisee or Owners for the 12-Month Period Ended December 30, 2023

Quartile refers to that portion of the total number of Stores open that represents 25%. For example, the first quartile identifies those Stores that were in the top 25% of all Stores in Gross Sales.

1st Quartile

Number of Stores: 117
2023 Gross Sales Range by Quartile: $1,571,206 to $3,702,849
2023 Quartile Average Gross Sales: $1,999,194
2023 Quartile Median Gross Sales: $1,868,427
Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Sales: 45/38%
2023 Quartile Average Gross Profit: $1,264,396
2023 Quartile Median Gross Profit: $1,182,714
Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Profit: 45/38%
Quartile Average Gross Profit Percentage: 63.25%

2nd Quartile

Number of Stores: 117
2023 Gross Sales Range by Quartile: $1,199,480 to $1,568,694
2023 Quartile Average Gross Sales: $1,372,406
2023 Quartile Median Gross Sales: $1,361,278
Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Sales: 54/46%
2023 Quartile Average Gross Profit: $866,396
2023 Quartile Median Gross Profit: $863,887
Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Profit: 58/50%
Quartile Average Gross Profit Percentage: 63.13%

3rd Quartile

Number of Stores: 117
2023 Gross Sales Range by Quartile: $958,717 to $1,199,040
2023 Quartile Average Gross Sales: $1,072,927
2023 Quartile Median Gross Sales: $1,069,289
Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Sales: 56/48%
2023 Quartile Average Gross Profit: $678,391
2023 Quartile Median Gross Profit: $668,914
Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Profit: 54/46%
Quartile Average Gross Profit Percentage: 63.23%

4th Quartile

Number of Stores: 118
2023 Gross Sales Range by Quartile: $337,821 to $953,440
2023 Quartile Average Gross Sales: $760,346
2023 Quartile Median Gross Sales: $796,303
Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Sales: 72/61%
2023 Quartile Average Gross Profit: $481,109
2023 Quartile Median Gross Profit: $506,548
Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Profit: 73/62%
Quartile Average Gross Profit Percentage: 63.28%

Part 3 – Number of Stores, Average and Median Gross Sales, Lowest and Highest Gross Sales Amount in Each Range, and Percentage of Total Number of Stores That Fell Within Certain Ranges of Gross Sales for 2023

Based on information reported by the 469 Plato’s Closet Stores which had been in operation by the same franchisee or owner for the 12-month period ended December 30, 2023, the following chart sets forth the number of Stores, average and median Gross Sales, the lowest and highest Gross Sales amount in each range, and the percentage of total number of Stores that fell within certain ranges of Gross Sales for 2023:

2023 Range of Gross Sales: $0 to $250,000

Number of Stores Falling Within Range: 0
Average Gross Sales for Stores Within Range: $0
Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range: 0/0%
Gross Sales for Lowest Store Within Range: $0
Gross Sales for Highest Store Within Range: $0
Median Gross Sales for Stores Within Range: $0
Percent of Total Number of Stores (469) Within Range: 0.00%

2023 Range of Gross Sales: $250,001 to $500,000

Number of Stores Falling Within Range: 8
Average Gross Sales for Stores Within Range: $415,241
Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range: 4/50%
Gross Sales for Lowest Store Within Range: $337,821
Gross Sales for Highest Store Within Range: $497,325
Median Gross Sales for Stores Within Range: $406,280
Percent of Total Number of Stores (469) Within Range: 1.71%

2023 Range of Gross Sales: $500,001 to $1,000,000

Number of Stores Falling Within Range: 134
Average Gross Sales for Stores Within Range: $819,361
Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range: 75/56%
Gross Sales for Lowest Store Within Range: $501,348
Gross Sales for Highest Store Within Range: $997,345
Median Gross Sales for Stores Within Range: $859,086
Percent of Total Number of Stores (469) Within Range: 28.57%

2023 Range of Gross Sales: $1,000,001 to $2,000,000

Number of Stores Falling Within Range: 283
Average Gross Sales for Stores Within Range: $1,382,685
Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range: 125/44%
Gross Sales for Lowest Store Within Range: $1,002,890
Gross Sales for Highest Store Within Range: $1,999,549
Median Gross Sales for Stores Within Range: $1,333,585
Percent of Total Number of Stores (469) Within Range: 60.34%

2023 Range of Gross Sales: $2,000,001 to $3,000,000

Number of Stores Falling Within Range: 39
Average Gross Sales for Stores Within Range: $2,270,754
Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range: 17/44%
Gross Sales for Lowest Store Within Range: $2,003,832
Gross Sales for Highest Store Within Range: $2,896,881
Median Gross Sales for Stores Within Range: $2,219,108
Percent of Total Number of Stores (469) Within Range: 8.32%

2023 Range of Gross Sales: Greater Than $3,000,000

Number of Stores Falling Within Range: 5
Average Gross Sales for Stores Within Range: $3,351,007
Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range: 2/40%
Gross Sales for Lowest Store Within Range: $3,035,602
Gross Sales for Highest Store Within Range: $3,702,849
Median Gross Sales for Stores Within Range: $3,292,647
Percent of Total Number of Stores (469) Within Range: 1.07%

These results relate to specific Plato’s Closet Stores located in the United States and Canada.

Some Stores have sold or earned these amounts. Your individual results may differ. There is no assurance that you will sell or earn as much.

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

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Plato’s Closet: $1.30M Average Sales vs. $287K-$417K Franchise Cost

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Section I – Plato’s Closet Franchise Costs

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