Is all inventory considered collateral for Bath Tune Up?

According to Bath Tune Up's 2025 Franchise Disclosure Document, all inventory is considered collateral. The agreement specifies that 'all Inventory' is included in the collateral. This means that if a franchisee takes out a loan or other financial obligation where collateral is required, the inventory of the Bath Tune Up business can be used as security for the debt.

This has significant implications for a prospective franchisee. It means that the franchisor or a lender has a legal claim on the franchisee's inventory in the event of default on a loan or other financial obligation. The franchisee would need to be aware of this when seeking financing and understand that their inventory is at risk if they cannot meet their financial obligations.

This is a fairly standard practice in franchising, as it provides security to lenders and franchisors. However, it is crucial for potential Bath Tune Up franchisees to fully understand the implications of pledging their inventory as collateral and to carefully manage their financial obligations to avoid potential loss of assets.