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.
At the beginning of 2018, the Murphy brand operated with 129 franchisee licenses in the USA. During 2018, there were a total of 14 licenses terminated for various reasons (expiration, non-renewal) and 7 new licenses were added to end 2018 with a total of 122 licenses. The table below reflects franchise entities. A franchise entity may own multiple franchise licenses.
- The data reflects 99 franchise entities with a full year of operation.
- 12 franchise entities own 28 franchise licenses. 87 franchise entities own a single franchise license.
- 7 of the 33 top third franchisee entities have more than one license. 2 entities have 3 licenses while 5 entities have 2 licenses.
- 3 of the 33 middle third franchisee entities have more than one license. All 3 entities have 2 licenses each.
- 2 of the 33 low third franchisee entities have more than one license. Both entities have 3 licenses.
- There is one company-operated franchise not reported in item 19.
- For item 19 reporting of profitability, gross profit figures are compiled by using commission revenue reported to Murphy by franchisee entities. Murphy has not audited or verified the reports.
- The Murphy brand also has 11 Regional Developers who also operate single unit Franchises/licenses. Their single unit licenses/franchises are included in item 19 in the same way as any other franchisee/license.
- The gross profit data in item 19 does not include any commissions or revenue achieved by Regional Developers for their oversight of their regions.
- Regional Developers may in some cases have “remote agents” and the revenue/commissions of remote agents are not included at the franchise license level.
Top, Middle, and Low Thirds
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.
Some franchisees have achieved these Gross Profits. Your individual results may differ. There is no assurance that your business will achieve the same or comparable results.
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.