DonutNV Franchise Earnings Claims: Accurate? Or Intentionally Deceptive?
DonutNV Franchisees: Here are the earnings representations that DonutNV, Franchise Fastlane, Franchise Sidekick, and franchise consultants / brokers across the country are providing to prospective franchise investors. What do you think? Do these numbers seem accurate and reasonable based on your own experience? What do you think prospective franchisees (and their franchise advisors) should know before making this life-changing investment? by Sean Kelly
Prospective DonutNV franchise investors are making significant and life-changing decisions that could affect not only their futures, but the future of their family members, children and spouses for years to come.
Current & former DonutNV franchise owners and employees are invited to confirm whether the information they are being provided is consistent with their experience… or may be setting unrealistic expectations.
When it comes to hundreds of thousands of dollars and a ten-year contract, unrealistic expectations can result in devastating outcomes.
Please share your candid & confidential opinions and information with an anonymous comment below, or by emailing the author at UnhappyFranchisee[at]Gmail[dot]com.
DonutNV Franchisees: Are You Averaging 78.5% Net Profit (or Higher) on your Events?
The first two tables in Item 19 FINANCIAL PERFORMANCE REPRESENTATIONS included in the 2024 DonutNV Franchise Disclosure Document (FDD) include sales and profitability numbers reported for a single trailer operated by an affiliate since 2018 and includes no labor costs.
Table 1: Adjusted Net Profit Statement for 2023 – One Company Unit The following table shows certain sales and expense information for the one DonutNV trailer operated by our affiliate in 2023
DonutNV Franchisees: Do You Generate Average Per-Event Sales of $1,930 – Or Higher?
Table 2: Events Conducted in 2023 – One Company Unit The following table shows the number of events conducted by the affiliate-operated trailer in 2023, and sales per event.
DonutNV Franchisees: How Do Your Yearly Revenues Compare?
Despite claiming to have 300 franchises sold, DonutNV Franchise Disclosure Document (FDD) dated April 29, 2024 and amended November 16, 2024 includes sales data for only 15 trailers operated in 2023:
Table 3: Sales By Franchisees in 2023 This table shows certain sales information by DonutNV franchisees in 2023.
* This franchisee began operating a second trailer on November 1, 2023. ** This franchise operated two trailers for all of 2023. They did not report separate sales data for the trailers, so for Table 3 we divided sales equally between their two trailers. *** This franchisee began operating a second trailer on October 20, 2023.
Franchisor’s Notes to Tables 1 and 2: 1. There was one DonutNV trailer operated by our affiliate during 2023. 2. The following material financial and operational characteristics of the business described in Table 1 may reasonably be anticipated to differ materially from future franchise outlets: The trailer operates in Pennsylvania. It began operating under the “DonutNV” brand name in 2018. The trailer is primarily operated by a manager (rather than being owner-operated). It does not have a specific territorial boundary. It does not have any expense associated with a commissary (whereas your state or local laws may require you to have access to a commercial kitchen commissary). 3. In Table 1 and Table 2, “Sales” means total of all revenue in a period, not including discounts, taxes, voids, or refunds. It includes travel fees and gratuities (other than gratuities paid in cash). 4. “Select Expenses” means only the specific expenses listed. Table 1 does not include all costs you would incur to operate a DonutNV business, such as costs of marketing, maintenance, insurance, or professional fees (such as legal or bookkeeping). Labor cost is omitted from expenses because our affiliate’s trailer was primarily operated by a person who was paid a percentage of operating profits. 5. “Food Cost – Supplies” is the cost of all food inventory and related supplies, including donut mix and bags. Our affiliate orders from the same vendors and pays the same prices as franchisees, except that for some events it used supplies from the DonutNV retail store in Pottstown, Pennsylvania. For those events, we estimated the cost of those supplies as if the trailer business had purchased them according to the normal procedure. 6. “Adjusted Net Profit” is Gross Sales less the Select Expenses. It also does not include interest, taxes, depreciation, or amortization. 7. “Franchise Fees” are the Royalty Fee, Brand Fund Contribution, and Technology Fee that the business would have paid if it had signed the form of franchise agreement attached to this disclosure document and was in its first year of operation (reflecting a Royalty Fee of $150 per week). 8. “Adjusted Net Profit after Franchise Fees” is Adjusted Net Profit minus Total Franchise Fees.
Franchisor’s Notes to Table 3:
DonutNV FDD 2024 1. In 2023, there were 16 DonutNV trailers operated by franchisees. One franchisee temporarily closed their trailer during 2023 and therefore was not included in Table 3.
2. “Sales” means total of all sales in a period as reported to us by the franchisees.
Some outlets have sold and earned these amounts. Your individual results may differ. There is no assurance that you’ll sell or earn as much. Written substantiation of the information contained in this Item 19 will be made available to prospective franchisees upon reasonable request
Do You Believe the DonutNV Earnings Claims are Accurate & Honestly Presented?
Are you familiar with the DonutNV franchise opportunity? With Alex & Amanda Gingold?
Are you familiar with Franchise Fastlane? With Jake Hamburger? Jennifer Cain? With Mike Flowers?
Which franchise consultant / broker introduced you to this exciting opportunity?
Please leave a comment below or email us, in confidence, at UnhappyFranchisee[at]Gmail[dot]com.
Franchisors: The franchisor, its employees and agents are invited to submit correction, clarifications, rebuttals or other opinions for immediate consideration.
UnhappyFranchisee.comis not associated with this or other franchise company or seller.
Tags: DonutNV, DonutNV FDD, DonutNV Franchise Disclosure Document, DonutNV profitability? DonutNV franchise earnings, donutNV franchise opportunity, Franchise Fastlane, Alex Gingold, Amanda Gingold, Jake Hamburger, Jennifer Cain, Mike Flowers, Franchise Sidekick, Franchoice, IFPG, Kim Daly, Justin D. Csik, Klehr Harrison Harvey Branzburg LLP
