The Wellness Way

The franchise fee of $15,000 is significantly lower than the typical range of $39,500-$54,625 for health and beauty franchises. What additional startup costs should a franchisee expect beyond the stated franchise fee?

What is the breakdown of the 3 units that ceased operations in 2024? Were these financial difficulties, health/compliance issues, ownership changes, or other circumstances?

The contract lists 23 non-curable defaults. Can you provide the complete list and explain which specific operational or financial violations trigger immediate termination without cure periods?

Why does the agreement include a 3-year non-compete restriction (10-mile radius) when the typical range for this category is 2 years? How is 'any business offering wellness consulting' defined if a franchisee seeks to operate in a different health service sector?

The total potential contract term is only 7 years with no renewal options specified. After 7 years, what is the process for renewal, and are terms and fees renegotiated or held constant?

Can you clarify why the contract grants encroachment protection but territory is marked as non-exclusive? What specific exclusions apply, and could the franchisor open competing locations within the protected territory?

The top quartile units report $4,036,577 in gross sales, more than double the category average. What specific operational practices, location types, or market conditions distinguish these top performers?

Minimum performance requirements are tied to maintaining territorial rights. What specific sales or revenue thresholds must be met annually, and what is the consequence of failing to meet them?

The system grew from 12 units in 2022 to 49 units in 2024. What was the franchisee recruitment strategy, and how thoroughly were new franchisees vetted given this rapid expansion rate?

Mandatory binding arbitration with required mediation is included in dispute resolution. What are the estimated costs of arbitration, and can franchisees recover attorney fees if they prevail?

All owners with 5% or greater interest must execute unlimited personal guarantees. Does this remain in effect after the initial 7-year term, and are personal assets at risk for franchisor claims unrelated to franchisee conduct?

Late payment penalties are 1.5% monthly (18% annually). In the past 3 years, how many franchisees have incurred late fees, and what triggered these payment delays?

The agreement allows the franchisor to establish maximum and minimum pricing for products and services. Provide examples of how pricing controls have been applied and whether these have affected franchisee profitability.

The turnover rate of 6.1% shows 4 closures/transfers in one year. Are there any common factors among the 3 units that ceased operations—geographic region, franchisee experience level, financial performance metrics?

Item 19 financial performance data is provided. How many units reported sales data, what is the age distribution of reporting units, and how does the median ($668,412) compare to break-even or target profitability thresholds?

The support and training score is exceptionally high at 97/100. What specific training programs, ongoing support services, and technology platforms are included, and what are the associated costs beyond the 5% royalty?

Participation in marketing cooperatives is mentioned as a financial obligation. Is participation mandatory, what are typical monthly/annual costs, and how is cooperative fund spending decided and reported?

The franchise agreement indemnifies the franchisor against claims 'alleged to be caused by the franchisor's conduct.' Does this language protect the franchisor even if negligence or wrongdoing is proven?

Since no litigation cases have been filed against the franchisor in the past 3 years, are there any informal complaints, regulatory inquiries, or unresolved disputes filed with state franchise authorities?