KidzArt

The franchise fee of $14,900 is substantially lower than the typical $40,000-$55,000 range for childcare franchises. What accounts for this significant difference, and does the lower fee reflect reduced support or different business model assumptions?

Median gross sales of $107,620 are less than half the typical range for childcare franchises. Can you provide details on the range of actual unit performance and explain whether this reflects a specific market positioning or operational challenges?

The system declined from 24 units in 2021 to 17 in 2024. What specific challenges or market conditions led to the 8 closures in 2021, and what changes have been made since then to stabilize the system?

Although no franchisees were terminated, 1 unit was closed through franchisor action in 2023 and transfers have occurred. Can you clarify the circumstances of the 2023 closure and whether there are any units currently at risk?

Can you provide copies of financial statements or Item 19 data showing the actual profitability and performance of current franchise units, segmented by location or years in operation?

The non-compete restriction extends 30 miles, which is 5 miles wider than typical. Can you explain the rationale for this broader restriction and provide examples of how it has been enforced?

What is the minimum investment required to open a KidzArt franchise beyond the $14,900 franchise fee, including working capital and real estate costs?

The technology fee is $45/month, significantly lower than typical. What systems and software are included, and are there any additional technology or marketing costs not reflected in this fee?

Can you provide contact information for at least 10-15 current franchisees, including those who have recently opened and those operating for 3+ years, so I can verify their sales and profitability claims?

What are the specific reasons cited by franchisees who did not renew their agreements in 2023 and 2024, and are there patterns in closures by geography or unit age?

The agreement includes a minimum annual gross revenue requirement of $45,000. What percentage of current units fall below this threshold, and what happens if a unit misses this target?

Can you clarify the late fee structure (15% of amount due or $50, whichever is greater, plus 1.5% monthly interest) and provide examples of how it has been applied?

How many franchisees have been required to maintain personal guarantees or spouse guarantees, and have any of these guarantees been invoked in litigation or disputes?

What designated suppliers are required for the 5 categories mentioned (signs, supplies, equipment, etc.), and what volume discounts or rebates, if any, does the franchisor receive from these suppliers?

Can you provide a list of all litigation cases involving KidzArt franchisees over the past 10 years, including claims brought by franchisees against the franchisor, claims by the franchisor against franchisees, and employment-related disputes?

How does the exclusive territory definition work in practice? Can you provide examples of territory sizes and clarify whether the franchisor has encroached on any existing franchisee territories?

The system health score of 36/100 falls significantly below the typical 50-75 range. What metrics comprise this score, and what specific improvements is the franchisor implementing to strengthen system stability?

Are there any pending litigation cases, regulatory investigations, or complaints with state franchise regulators that are not reflected in the disclosed case history?

What support and training are provided to new franchisees given the relatively low franchise fee, and are there ongoing support costs or mandatory training fees beyond the monthly technology fee?

Can you explain the transfer process, transfer fees (if any become applicable), and whether the franchisor has right of first refusal on unit transfers?