Great Clips

The ad fund rate of 5.0% is above the typical range of 1.0-2.5% for this category. How is the advertising fund utilized, and can you provide details on the marketing programs and initiatives funded by these contributions?

Gross sales averages of $413,389 are below the typical range for this category. What percentage of reporting units fall below this average, and what factors contribute to the lower-than-typical sales performance?

The franchise fee of $20,000 is significantly lower than the typical range of $39,500-$54,625. Does this lower fee correlate with reduced support services, training, or initial setup assistance compared to competitors?

The total potential contract term is 10 years, below the typical 15.5-20 years. How many franchisees have successfully renewed their agreements, and what are the specific renewal conditions that Great Clips requires approval for?

The renewal clause grants Great Clips discretionary renewal authority subject to franchisee approval of conditions. Can you provide the complete list of renewal conditions and examples of instances where renewal was denied or modified?

Non-compete restrictions are 1 year and 5 miles, both below typical ranges. If a franchisee does not renew or is terminated, what specific activities are prohibited, and in what geographic area?

The transfer fee of $1,500 is significantly below the typical $7,500-$20,000 range. Does this lower fee indicate less franchisor involvement in approving and facilitating unit transfers, or are there additional undisclosed transfer-related costs?

Personal guarantees are required from all shareholders with any equity interest. In cases of franchisee default, has Great Clips pursued these personal guarantees, and what has been the typical recovery rate?

With 128 closures in 2022, 89 in 2023, and 98 in 2024, what are the primary reasons units are closing? Are these primarily voluntary closures due to low profitability or franchisor-initiated?

The territory is protected but not exclusive. Can Great Clips open additional company-owned locations or approve competing franchisees in the same territory? If so, what are the guidelines?

Territory score of 60 is below the typical range of 75.0-85.0. What specific territorial protections are provided, and has Great Clips granted exclusive territories to any franchisees as exceptions?

Units have remained relatively flat over 3 years (4,447 in Year 3 to 4,439 currently). What is Great Clips' growth strategy, and what support will the franchisor provide to help individual franchisees improve profitability?

Item 19 financial data is provided. What is the range of sales performance, and what percentage of franchisees achieve or exceed the median gross sales of $393,907?

With no litigation in the past 3 years, has this been typical for Great Clips historically? What types of disputes or grievances have been resolved informally or through arbitration?

The Investment Cost score is 85, above the typical range of 74.0-75.0. What does this score reflect, and are there hidden startup costs not reflected in the initial franchise fee?

Spouses are obligated under personal guarantees according to the legal clause. Can spouses limit their liability, and are there state-law protections that override this requirement?

The non-renewal rate is 0.02%, suggesting very few franchisees are allowed to simply not renew. What happens if a franchisee chooses not to renew but wishes to continue operating independently, and are non-compete restrictions enforced?

Can you provide details on the 4 terminations in 2024, including the reasons for termination and whether franchisees had opportunity to cure violations?

The system shows encroachment protection despite the territory not being exclusive. What specific encroachment protections exist, and have franchisees filed complaints about encroachment?

Technology fee of $250 monthly is stated separately from royalties. What technology services does this cover, and can franchisees opt out or use alternative systems?