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

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

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

Section III – Number of franchised and company-owned Batteries Plus 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 Batteries Plus franchise opportunity

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

• 2023 average merchandise margin for the 520 franchised Batteries Plus Stores that were in operation for the entire 12-month period ended December 31, 2023

• 2023 average merchandise margin for retail and commercial customers for the 535 franchised Batteries Plus Stores that were open as of December 31, 2023

• 2023 average retail and commercial revenue as a percentage of total revenue for the 535 franchised Batteries Plus Stores that were open as of December 31, 2023

• 2023 impact of commercial net revenue and retail cross-selling activity on overall average net revenue based on the results of the 520 franchised Batteries Plus Stores that were in operation for the entire 12-month period ended December 31, 2023

• 2023 average and median retail, commercial, and total sales ticket amount based on sales activity during the 2023 Fiscal Year for the 520 franchised Batteries Plus Stores that were in operation for the entire 12-month period ended December 31, 2023

• 2023 average, median, highest, and lowest net revenue for the 116 corporate, 520 franchised, and 636 corporate and franchised Batteries Plus Stores that were in operation for at least 12 full months as of December 31, 2023

• 2023 average net revenue, cost of goods sold, gross profit margin, wages and compensation, selling expense, delivery expense, facilities and office, admin expense, marketing, royalties, and EBITDA for the 112 company-owned Batteries Plus Stores that were in operation for at least 12 full months as of December 31, 2023 and that the franchisor’s affiliate owned for the entire 12-month period

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

Section I – Batteries Plus Franchise Costs

• Initial Franchise Fee:  $15,000 to $44,500
• Travel and Living Expenses During Training:  $500 to $2,900
• New Store Commercial Support (3 months):  $0 to $3,450
• Retail Management System:  $38,986
• Omni-Channel Access Fee:  $10,000
• Miscellaneous Pre-opening Expenses:  $1,800 to $5,000
• Insurance Premiums (3 months):  $1,200 to $5,000
• Delivery Vehicle:  $1,000 to $18,500
• Additional Funds (3 months):  $11,000 to $17,000
• New Store Opening Hardware Kit:  $6,000 to $9,000
• New Store Marketing Campaign Contribution:  $5,000 to $7,000
• Minimum Store Promotion Requirement:  $20,000
• Rent (security deposit and 3 months rent):  $5,000 to $24,000
• Leasehold Improvements:  $0 to $109,000
• Equipment and Fixtures:  $30,000 to $40,000
• Signage:  $6,800 to $16,000
• Inventory:  $57,500 to $74,000
• Miscellaneous Supplies:  $2,500 to $4,000
• Additional Funds (3 months):  $40,000 to $45,000
• Total Estimated Batteries Plus Franchise Costs:  $252,286 to $493,836

Section II – Batteries Plus’ Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Initial Franchise Fee:  $49,500

• Royalty and Service Fee:  5% of total Net Revenues on all products and services

• National Marketing and Promotional Fee:  1% of total Net Revenues

• Digital Marketing Program Contribution:  up to the greater of 3% of Net Revenues or the “Minimum Store Promotion Requirement”

• Advertising/Marketing Cooperative(s):  amount determined by Batteries Plus or by local cooperative (with Batteries Plus’ approval) but cannot exceed the greater of 3% of Net Revenues or the “Minimum Store Promotion Requirement,” and when combined with Digital Marketing Program contributions it cannot exceed 4% of Net Revenues

• Minimum Store Marketing Obligation:  you must spend amounts each calendar year on “approved” Store advertising and promotional activities in your market to the extent your combined contributions respecting the Digital Marketing Program and advertising cooperative are less than the “Minimum Store Promotion Requirement”

Section III – Number of Franchised and Company-Owned Batteries Plus Outlets

Franchised

2021

• Outlets at the Start of the Year:  605
• Outlets at the End of the Year:  590
• Net Change:  -15

2022

• Outlets at the Start of the Year:  590
• Outlets at the End of the Year:  609
• Net Change:  +19

2023

• Outlets at the Start of the Year:  609
• Outlets at the End of the Year:  606
• Net Change:  -3

Company-Owned

2021

• Outlets at the Start of the Year:  95
• Outlets at the End of the Year:  112
• Net Change:  +17

2022

• Outlets at the Start of the Year:  112
• Outlets at the End of the Year:  112
• Net Change:  0

2023

• Outlets at the Start of the Year:  112
• Outlets at the End of the Year:  116
• Net Change:  +4

Section IV – News Updates on the Batteries Plus Franchise

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Batteries Plus Franchise (Item 19, 2024 FDD)

• Under Part 1, the franchisor has provided merchandise margin and percentage of net revenue in total and by customer type based on franchise-owned Stores.

• Under Part 2, the franchisor has provided unaudited statements of net revenue for franchised and company-owned Stores.

• Under Part 3, the franchisor has provided an unaudited statement of net revenue, expenses, and EBITDA for company-owned Stores.

• The information below is based on performance during the period from January 1, 2023 through December 31, 2023 (“2023 Fiscal Year”).

• Information for franchise-owned Stores has been taken from their respective Retail Store Management systems. The franchisor has not audited or verified these reports.

Part 1 – January 1, 2023 to December 31, 2023 Unaudited Statement of Average Merchandise Margin and Percentage of Net Revenue by Customer Type of Franchised Stores

• The following statements are based on information reported by all franchise-owned Stores in operation during the 2023 Fiscal Year.

• There were 606 total franchised Stores open as of December 31, 2023. Of these Stores, 1 is a small market test store that Batteries Plus currently does not offer under the Disclosure Document, 55 Stores temporarily closed, were not open 350 or more days, or were not open the minimum required hours during the 2023 Fiscal Year, and 15 Stores began offering commercial sales at the end of 2023 but did not open the brick and mortar store in 2023.. The remaining 535 franchised Stores are referred to as “All Stores.”

• Of the 535 All Stores, there were 520 franchise-owned Stores that were in operation for the entire 2023 Fiscal Year (the “Same Stores”). The Same Stores do not include 4 Stores acquired by Batteries Plus’ affiliates during the 2023 Fiscal Year, 29 Stores that closed during the 2023 Fiscal Year, or 15 new Stores that opened during 2023 Fiscal Year.

A.  Statement of Average Merchandise Margin for Same Stores

• This statement includes information on the average Merchandise Margin percentage for Same Stores for both retail and commercial customers for the 2023 Fiscal Year. This statement includes information from Same Stores only (520).

• For purposes of this statement, the term “Net Revenue” means all revenues received from the sale of goods and services, whether for cash or by check, credit card, or trade, in connection with the Store, less sales tax, discounts, and customer refunds and returns.

• For purposes of this statement, the term “Merchandise Margin” is Net Revenue less product cost. Product cost is the cost of the product only and does not include other cost of goods sold such as freight, warranty expense, or inventory shrinkage.

• “Merchandise Margin Percentage” is Merchandise Margin divided by Net Revenue multiplied by 100.

2023 Same Store Merchandise Margin

• Number of Stores:  520
• Merchandise Margin Percentage:  51.5%
• Customer Type:  Retail and Commercial

B.  Statement of Average Merchandise Margin for All Stores

• This statement includes information comparing the total average Merchandise Margin percentage for All Stores retail Net Revenue with the total average Merchandise Margin percentage for All Stores commercial Net Revenue for the 2023 Fiscal Year.

• This statement includes information from All Stores (535).

2023 All Store Merchandise Margin by Customer Type

Retail Customer

• Stores:  535
• Merchandise Margin:  58%

Commercial Customer

• Stores:  535
• Merchandise Margin:  38%

C.  Statement of Average Retail and Commercial Percentage of Net Revenue for All Stores

• This statement includes information comparing average retail Net Revenue and commercial Net Revenue as a percentage of total average Net Revenue for All Stores for the 2023 Fiscal Year. This statement includes information from All Stores (535).

2023 All Store Percentage of Net Revenue by Customer Type

Retail Customer

• Stores:  535
• Percentage of Net Revenue:  67%

Commercial Customer

• Stores:  535
• Percentage of Net Revenue:  33%

D.  Impact of Commercial Net Revenue Percentage and Cross-Selling Activity on Overall Average Net Revenue

• The statement below examines the impact of Commercial Net Revenue and retail cross-selling activity on overall Average Store Net Revenue based on the results of all 520 franchised Same Stores that were in operation for at least 12 full months as of December 31, 2023.

• The data included below is based on sales activity for the 2023 Fiscal Year.

• The chart shows the Average Net Revenue for the 520 Same Stores based on the percentage of total Store Net Revenue devoted to Commercial Net Revenue. That chart shows Average Net Revenue for those Same Stores with Commercial Net Revenue exceeding 35% of total Net Revenue as well as the Average Net Revenue for those Same Stores with Commercial Net Revenue at or below 35% of total Net Revenue.

• The chart also shows the Average Net Revenue for the 520 Same Stores based on the Average Add-On Margin per each transaction. Average Add-On Margin is the amount of Merchandise Margin added to a single transaction other than the primary item the customer purchased.

More Than 35% of Total Net Revenue Is Commercial Sales

• 2023 Median Net Revenue:  $983,278
• 2023 Average Net Revenue:  $1,116,696
• Range of Net Revenue:  $204,572 to $7,773,199
• 2023 Average Merchandise Margin:  $526,992
• Number of Stores:  154
• Number and Percentage of Stores Above Average Net Revenue:  56 (36.4%)
• Average Store Age as of December 31, 2023:  15.8

Less Than or Equal to 35% of Total Net Revenue Is Commercial Sales

• 2023 Median Net Revenue:  $705,995
• 2023 Average Net Revenue:  $791,433
• Range of Net Revenue:  $176,032 to $2,857,157
• 2023 Average Merchandise Margin:  $427,382
• Number of Stores:  366
• Number and Percentage of Stores Above Average Net Revenue:  144 (39.3%)
• Average Store Age as of December 31, 2023:  14.6

More Than $1.50 Average Add-on Margin per Transaction

• 2023 Median Net Revenue:  $939,356
• 2023 Average Net Revenue:  $1,084,038
• Range of Net Revenue:  $204,572 to $7,773,199
• 2023 Average Merchandise Margin:  $562,635
• Number of Stores:  170
• Number and Percentage of Stores Above Average Net Revenue:  61 (35.9%)
• Average Store Age as of December 31, 2023:  13.8

Less Than or Equal to $1.50 Average Add-on Margin per Transaction

• 2023 Median Net Revenue:  $700,074
• 2023 Average Net Revenue:  $792,427
• Range of Net Revenue:  $176,032 to $2,857,157
• 2023 Average Merchandise Margin:  $405,515
• Number of Stores:  350
• Number and Percentage of Stores Above Average Net Revenue:  139 (39.7%)
• Average Store Age as of December 31, 2023:  15.5

E.  Sales Ticket Amount

• The data included below is based on sales activity during the 2023 Fiscal Year for the 520 Same Stores.

• The “Sales Ticket Amount” is the Net Revenue per transaction for items (products) sold in the Store (excluding coupons, core charges, labor charges, and related items).

• The chart below includes the Average and Median Sales Ticket Amount for retail customers, commercial customers, and combined retail and commercial customers.

Retail Sales Ticket Amount

• Average:  $48.98
• Number and Percentage of Stores Above Average:  239 (46%)

Commercial Sales Ticket Amount

• Average:  $222.17
• Number and Percentage of Stores Above Average:  161 (31%)

Total Sales Ticket Amount

• Average:  $63,73
• Number and Percentage of Stores Above Average:  201 (39%)

Part 2 – Unaudited Statements of Average Net Revenue for the 2023 Fiscal Year

A.  Corporate Stores

• The table below includes the Average Net Revenue for the 2023 Fiscal Year for all 116 corporate Stores that were in operation for at least 12 full months as December 31, 2023, including 4 corporate Stores that were acquired from franchisees during the 2023 Fiscal Year.

• Number of Corporate Stores:  116
• Average Net Revenue:  $985,497
• Median Net Revenue:  $921,602
• Highest Net Revenue:  $2,617,575
• Lowest Net Revenue:  $472,930
• Number and Percentage of Stores Above Average Net Revenue:  42 (36%)

B.  Franchised Stores

• The table below includes the Average Net Revenue for the 2023 Fiscal Year for the 520 franchised Same Stores that were in operation for at least 12 full months as of December 31, 2023.

• Number of Franchise Stores:  520
• Average Net Revenue:  $887,757
• Median Net Revenue:  $773,445
• Highest Net Revenue:  $7,773,199
• Lowest Net Revenue:  $176,032
• Number and Percentage of Stores Above Average Net Revenue:  213 (41%)

C.  Corporate and Franchised Stores

• The table below includes the Average Net Revenue for the 2023 Fiscal Year for the combined Stores (520 franchised Same Stores and 116 corporate Stores) that were in operation for at least 12 full months as of December 31, 2023.

• Number of Stores:  636
• Average Net Revenue:  $905,583
• Median Net Revenue:  $827,822
• Highest Net Revenue:  $7,773,199
• Lowest Net Revenue:  $176,032
• Number and Percentage of Stores Above Average Net Revenue:  265 (42%)

Part 3 – Unaudited Statement of Net Revenue, Cost of Goods Sold, Payroll, Marketing, Royalties, and Gross Profit for the 2023 Fiscal Year

• The statement in the table below discloses average annual Store Net Revenue, Cost of Goods Sold, and other expenses based on historical information for the 2023 Fiscal Year for the 112 company-owned Stores that were in operation for at least 12 full months as of December 31, 2023 and that the franchisor’s affiliate owned for the entire 12-month period (“Company-Owned Stores”).

• As of December 31, 2023, there were 116 corporate Stores in operation, but 4 corporate Stores were excluded because the franchisor’s affiliate purchased these Stores from franchisees during the 2023 Fiscal Year and did not own or operate these Stores during the entire 12-month period ended December 31, 2023.

Number of Stores:  112

Net Revenue:  $974,997 (100.0%)

Cost of Goods Sold:  $482,454 (49.5%)

Gross Profit Margin:  $492,543 (50.5%)

Operating Expenses

• Wages and Compensation:  $173,476 (17.8%)
• Selling Expense :  $17,321 (1.8%)
• Delivery Expense:  $2,516 (0.3%)
• Facilities and Office:  $78,289 (8.0%)
• Admin Expense:  $13,013 (1.3%)
• Marketing:  $48,750 (5.0%)
• Royalties:  $48,750 (5.0%)
• Total Expenses:  $366,518 (37.6%)

EBITDA:  $105,544 (10.8%)

• “Net Revenue” means all revenues received from the sale of goods and services, whether for cash or by check, credit card or trade, in connection with the Store, less sales tax, discounts, and customer refunds and returns.

• “Cost of Goods Sold” is the average of all company-owned Stores’ product costs, including the cost of the product, discounts earned, cost of customer repairs, recycling charges, restocking fees, purchase price variances, redistribution costs, core recovery, tech center supplies, freight in, warranty expense, bulb breakage, and coupon discrepancy. Cost of Goods Sold does not include inventory shrinkage and inventory scrap. Franchisees’ Stores may perform similarly but will be impacted by differences in product category sales mix, inventory management, and operational execution.

• “Gross Profit Margin” means Net Revenue less the Cost of Goods Sold.

• “Wages” include wages (including overtime), sales incentive wages, and payroll taxes for all in-store employees. Included are wages for the Store manager. There are no wages included for any dedicated employee to conduct external commercial sales activities.

• The franchisor presumes that, in a single franchised Store, the owner-operator will either be the Store manager or will be responsible for the external commercial sales activity and will not receive a separate salary or draw from Store Net Revenues. Wages also do not include 401K contributions, group health insurance, paid time off, or commissions. Franchisees may experience similar wage expenses but will be impacted by staffing model decisions (which franchisees alone must decide), market driven pay rate differences, and individual Store staff performance.

• “Selling Expenses” include credit card fees, national account administration fees, and uniform expenses. Selling Expenses do not include business meals, travel expenses, and sample equipment.

• “Delivery Expense” includes vehicle gas, vehicle insurance expenses, and shipping expenses. Delivery Expense does not include vehicle repairs.

• “Facilities and Office” includes business insurance, building rent, CAM, property tax, security, snow removal and lawn care, utilities, and waste management. Facilities and Office does not include building repairs or equipment.

• “Admin” includes IT data lines, IT maintenance fee, supplies, and telephone expense. Admin does not include bad debt, cellular phone expenses, or donations.

• The company-owned Stores do not pay a royalty fee and are not required to spend 5% of Net Revenue on marketing (which includes the Digital Marketing Fee). Franchisees would have incurred these expenses. As a result, the franchisor has included these amounts in these tables as if the company-owned Stores had incurred these expenses in the stated amounts, “Royalties” and “Marketing” respectively.

• “EBITDA” is calculated by taking the Gross Profit Margin and subtracting the Total Expenses.

• The company-owned Stores included in Item 19 are substantially similar to the Stores for which the franchisor is offering franchises in the Disclosure Document, and their products and services are the same as those offered and sold by franchised Stores. These company-owned Stores reflect a wide range of demographics and business conditions found in urban, suburban, and single-store markets.

Section VI – Batteries Plus Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️