Investment costs score 53, significantly below the typical range of 73-77 for fitness & wellness franchises. Can you provide a detailed breakdown of initial investment costs beyond the $45,000 franchise fee to clarify what accounts for this lower-than-typical investment score?
#1
Your bottom quartile sales of $542,051 exceed the typical range for this category. How many locations fall into this bottom quartile, and what factors do you attribute to their higher-than-expected performance?
#2
The total potential contract term is 10 years, below the typical 15-20 year range. What is the rationale for the shorter initial term and total potential term compared to industry standards?
#3
Your non-compete restriction is 2 years / 5 miles, narrower than the typical 10-25 mile radius. Has this shorter restriction resulted in any issues with former franchisees opening competing facilities nearby?
#4
The agreement lists 23 termination causes, above the typical 15-21 range. Can you specify the most frequently cited termination causes and provide examples of circumstances that have triggered termination?
#5
The ad fund rate is 3.0%, above the typical 2.0% for this category. What specific marketing and advertising activities does this fund support, and how are funds allocated across franchisees?
#6
Despite zero litigation cases over 3 years, the dispute resolution clause mandates binding arbitration in Oklahoma City with waived class actions and jury trial rights. Why are these restrictions necessary given the litigation-free history?
#7
The franchise agreement requires personal guarantees from all owners with 5% or greater interest and their spouses. Can you explain the conditions under which these guarantees might be called and provide information on any guarantees that have been enforced?
#8
You have 6 renewal conditions, below the typical 7-9. What are these renewal conditions, and are there any non-financial performance metrics that could prevent renewal?
#9
Franchisees must purchase from approved suppliers across 7 mandatory categories. How many suppliers are approved for each category, and can franchisees request approval of alternative suppliers?
#10
Your system grew from 40 units to 82 units in 3 years with zero terminations. What percentage of growth came from new franchise sales versus transfers, and how many franchise applications were rejected during this period?
#11
The renewal fee is $10,000 and transfer fee is $10,000. Are renewal terms and conditions renegotiable, or do franchisees accept the same terms they originally signed?
#12
Can you provide the Item 19 financial performance data showing the number of units reporting, the year of data, and whether results are audited or company-prepared?
#13
Given the 23 termination causes in the agreement, can you provide a summary of which causes are non-curable versus curable with specific cure periods?
#14
The financial performance shows median gross sales of $726,118. What percentage of the system reported this data, and does this figure include or exclude tanning service revenues and retail product sales separately?
#15
The technology fee is $250 monthly. What technology systems does this cover, and are franchisees locked into GLO Tanning's specified software or do they have options?
#16
You require exclusive territory with encroachment protection. How is territory size determined, and are there any circumstances under which the franchisor has added locations within existing franchisee territories?
#17
Post-term restrictions prohibit competing tanning salons for 2 years within 5 miles plus any other GLO Tanning location. How is 'any other GLO Tanning location' defined—does this include locations not yet opened but planned?
#18
Can you explain why System Health scored 80 (above the typical 50-75 range) while Investment Costs scored 53 (below typical 73-77)? What factors drove these outlier scores?
#19
Support & Training scored 81, slightly below the typical 82-93 range. What specific training and ongoing support is provided to franchisees, and what are the costs beyond the $250 monthly technology fee?
#20