PPV, interesting point about cost of sales (COS).
I am not an expert on how coffee restaurants should report, so I decided to look at larger companies in this industry.
- I looked up Starbucks, and found that while cost of sales included occupancy costs (presumably, rent and utilities) it did not include Store Operating Expenses, Other Operating Expenses, or Depreciation and Amortization Expenses, all of which were separately listed below the COS line, along with General and Administrative.
- For Tully's, the object of BCCI's affection a while back, I found a very old 10-Q, filed in February 2012. It separated retail cost of goods and occupancy costs, with a subtotal incorporating the two (so, the subtotal is similar to Starbucks' COS) -- and it also had following lines called Store Operating Expenses, Other Operating Expenses, Marketing General and Administrative expenses, Depreciation and Amortization Expenses -- and a line which I think it would help BCCI to show, to explain losses, store closure and lease termination expenses.
- For Peet's and Seattle's Best Coffee, I could not find financial statements, likely they are privately held.
Net -- while BCCI reporting is not specifically consistent with the 'big boys,' its practice of excluding store payroll from Cost of Sales does seem consistent. And, perhaps 'Personnel Costs' for BCCI relate to 'Store Operating Expenses' for Starbucks/Tully's and 'Operations' relates to 'Other Operating Expense,' so there is the possibility, at least, of some consistency.
Hopefully, nomenclature will directly match in future reports.
Frankly, I am more concerned about lack of an auditor's report in these 'audited' financials.
