When aspiring business owners are determining whether or not a brand’s investment opportunity is the right fit for them, there’s one document that they focus on: the Franchise Disclosure Document (FDD). There’s no shortage of information packed into these documents. From investment costs to information on leadership teams, FDDs provide candidates with a full picture of what a brand’s business ownership opportunity is all about. But there’s one section of the FDD that prospective franchisees often turn to first, and that’s the Item 19.
It’s no surprise that Item 19 is a must-read for aspiring franchisees. The section breaks down a concept’s franchise performance representations, answering the question of what existing franchisees are making. Closet & Storage Concepts and More Space Place both disclose their earnings in the Item 19 of their FDDs, showing that the brands are proud of their success. In their most recent FDDs – which highlight performance numbers for 2016 – Closet & Storage Concepts/More Space Place list an average unit volume of $1,735,414 and $1,311,615, respectively. Closet & Storage Concepts also reports an EBITDA of $336,691, or 19.4 percent, and More Space Place reports an EBITDA of $163,861, or 12.5 percent.
“We believe that it’s incredibly important for prospective franchisees to review our financial performance as they’re going through the due diligence process. Through a proven business model, we offer franchisees strong support from day one, also helping them to realize a return on their investment as quickly as possible,” said Bob Lewis, President and CEO of Closet & Storage Concepts/More Space Place. “We want to be a true partner in our franchisees’ success.”
The team behind Closet & Storage Concepts/More Space Place has been working to help set its franchisees up for financial success for the past three decades. Established in 1987, Closet & Storage Concepts has a long history of raising the bar in the home improvement and organization industries. And through its acquisition of More Space Place, the brands have been able to carve out a unique niche for themselves in the space-saving home furnishings industry and stay ahead of the competition.
In addition to being a leader in the home improvement space, part of what enables Closet & Storage Concepts/More Space Place franchisees to realize strong financial performance is its unique business model. Closet & Storage Concepts expanded the types of business models available under its franchise opportunity. Franchisees can now choose to operate under three distinct models. One allows local owners to simply run a showroom and purchase products from the corporate brand’s manufacturing facility. Another gives franchisees the opportunity to run their showroom and make their own products in-house. The final business model allows franchisees to operate their traditional showroom while also serving as the manufacturer for both themselves and other franchisees in their area. By giving franchisees that level of flexibility and access to multiple revenue streams, Closet & Storage Concepts/More Space Place provides its local owners with another competitive edge.
Closet & Storage Concepts/More Space Place also provide an affordable investment opportunity for those looking to become franchisees. Initial investments for the brands range from $73,000 to $492,600 and $90,950 to $172,150, respectively.
“Ensuring that our franchisees are profitable is one of the most important things that we do as a corporate team. That means providing aspiring local business owners with a proven system for an affordable price that has the potential to lead to financial success,” said Lewis. “We’re constantly looking for ways to enhance our franchise system, and we’re looking forward to working with our franchisees as we continue to grow in the years to come.”