Financial Performance Representation
The FTC’s Franchise Rule permits a franchisor to provide information about the actual or potential financial performance of its franchised and/or franchisor-owned entities, if there is a reasonable basis for the information, and if the information is included in the disclosure document. Financial performance information that differs from that included in Item 19 may be given only if: (1) a franchisor provides the actual records of an existing entity you are considering buying; or (2) a franchisor supplements the information provided in this Item 19, for example, by providing information about possible performance at a particular territory or under particular circumstances.
The data used in preparing this financial performance representation was compiled from information submitted to us by the franchisees in the closing submissions reports. While we believe that these closing submission reports contain accurate information, we have not independently verified the information. Written substantiation of the data used in preparing this financial performance representation will be made available to a prospective franchisee on reasonable request.
There were 129 Murphy Business franchise units in operation as of January 1, 2018. Of those, 14 were terminated or expired and were not renewed during 2018. The following financial performance representation includes the 115 franchise units that began operation on or before January 1, 2018, and operated continuously through December 31, 2018. Some of our franchisees operate multiple franchise units, each pursuant to a separate franchise agreement. Each multi-unit franchisee, however, provides us with a combined financial report that consolidates the gross revenue of all of their franchise units. The typical time for a Murphy Business franchise to close on their first business transfer is 8-9 months, however, they are able to generate revenue from other ancillary services. Below is 2018 Gross Profit data for our 115 franchise units that operated the full 12 months from January 1 – December 31, 2018. Gross Profit means all revenue and receipts derived from the franchisee’s operation of the Murphy Business, less the
10% royalty paid to us.
Top, Middle, and Low Thirds
* 5 franchisees each operate 2 franchise units, and 2 franchisees each operate 3 franchise units
** 3 franchisees each operate 2 franchise units
*** 2 franchisees each operate 3 franchise units
Sole Proprietor vs. Office with Agents
Some franchisees operate as sole proprietors and some operate with independent contractor agents. The table below shows Average Gross Profits as outlined above for the two different operating methods.
Individual franchisee gross profits vary. The revenues of franchisees will be affected by many factors, including, but not limited to (a) geographic location; (b) competition from similar businesses in your area; (c) your marketing efforts; (d) your ability to generate customers; (e) your operational skills and management methods; (f) changing demographics; and (g) governmental regulations and requirements.
Therefore, we recommend that you make your own independent evaluation and investigation to determine whether or not your business is likely to be profitable. You should use the above information only as a reference in conducting your analysis and preparing your own projected cash flow. We strongly suggest that you consult your own financial advisor or personal accountant concerning financial projections.
Written substantiation for the financial performance representation will be made available to the prospective franchisee upon reasonable request.
Some franchisees have achieved these Gross Profits. Your individual results may differ. There is no assurance that you’ll earn as much.
Other than the preceding financial performance representation, we do not make any financial performance representations. We also do not authorize our employees or representatives to make any such representations either orally or in writing. If you are purchasing an existing franchise, however, we may provide you with the actual records of that franchise. If you receive any other financial performance information or projections of your future income, you should report it to our management by contacting Thomas J. Coba, CEO, Murphy Business & Financial Corporation LLC, 407 N. Belcher Road, Clearwater, FL 33765, 727-725-7090, the Federal Trade Commission, and the appropriate state regulatory agencies.