The technology fee of $550 monthly is significantly above the typical range for this category. What specific technology services and platforms does this fee cover, and how is it justified relative to other spa franchises?
#1
Your franchise fee of $60,000 exceeds the typical range by approximately $5,400-$20,500. Can you provide a detailed breakdown of what is included in this fee compared to competitors?
#2
Can you provide specific details about the 2 litigation cases initiated against the franchisor in the past 3 years, including the nature of the disputes and their current status or resolution?
#3
Two units closed in 2024 after zero closures in 2022-2023. What factors contributed to these closures, and were they related to specific operational or market issues?
#4
One franchisee was terminated in 2024. What were the specific reasons for this termination, and does it reflect broader compliance or operational challenges within the system?
#5
Your reporting shows exceptionally high gross sales ($2.5M median) compared to the typical range ($414K-$1M) for spa franchises. How many units reported this data, and what percentage of the system is included in Item 19?
#6
The termination clause provides only 5 days to cure monetary defaults. Can you walk through specific examples of what constitutes a monetary default and the cure process in practice?
#7
There are 15 non-curable defaults versus only 5 curable defaults. Can you provide the complete list of non-curable defaults and explain why each is considered non-curable?
#8
The agreement requires personal guarantees from the franchisee's spouse. What recourse exists if a spouse is unable or unwilling to sign, and how does this affect franchise eligibility?
#9
Renewal requires mandatory refurbishment of all equipment. What is the estimated cost of this mandatory refurbishment, and are there specific standards or timelines for this requirement?
#10
You require purchase of 10 categories of items from approved suppliers only. Can you provide the complete list of these categories and the number of approved suppliers available for each?
#11
Does the franchisor have the ability to unilaterally add new approved suppliers or change supplier requirements during the franchise term, and if so, what notice period applies?
#12
The non-compete clause extends 2 years and 6 miles post-termination. Are there any circumstances under which this can be reduced, and how is the 6-mile radius measured?
#13
Three units transferred in 2023 and one in 2024. What is the franchisor's approval process for transfers, and have any transfer requests been denied in the past 3 years?
#14
The system grew from 77 to 88 units in 3 years. What is the franchisor's target unit growth rate, and what support is provided to franchisees to achieve the reported gross sales levels?
#15
Can you explain the significant disparity between your Investment Costs score (5) and Financial Performance score (90)? What accounts for this extreme variance?
#16
The renewal fee of $12,750 applies after 10 years. Are there any other material costs or requirements associated with renewal beyond the fee and mandatory refurbishment?
#17
What percentage of franchisees have renewed their agreements to date, and are there any units currently approaching the end of their first 10-year term that have not committed to renewal?
#18
How many units are currently in year 1-3, year 4-7, and year 8-10 of their franchise terms? This helps assess whether the system is approaching a renewal wave.
#19