What is the obligation regarding the opening of additional Beauty Bungalows franchises under an ADA?
Beauty_Bungalows Franchise · 2025 FDDAnswer from 2025 FDD Document
for Multi-Unit Development**
If you choose and we agree, you may purchase multiple Beauty Bungalows Franchises under an ADA. You may purchase multiple units in a group of two (2) or more units with our prior approval (two (2) is the minimum required). You will be required to sign our ADA and agree to open your additional Beauty Bungalows Franchises upon a set schedule. The Development Fee is deemed fully earned upon receipt and there are no refunds of the Development Fee under any circumstances. If you execute an ADA, you will be required to execute a Franchise Agreement for the first unit in your ADA concurrently with your execution of the ADA.
The Development Fee you must pay to us depends upon the number of Beauty Bungalows Franchises we grant you the right to develop in your Development Area in accordance with the Development Schedule set forth in the ADA, and is calculated as follows:
Development Fee Chart
| Number of Franchised Businesses | Initial Franchise Fee | Cumulative Development Fee |
|---|---|---|
| 1 | $49,900 | $49,900 |
| 2 | $40,000 | $89,900 |
| 3 | $35,000 | $124,900 |
| 4 | $30,000 | $154,900 |
| 5 | $30,000 | $184,900 |
| 6 | $30,000 | $214,900 |
| 7 | $25,000 | $239,900 |
| 8 | $25,000 | $264,900 |
| 9 | $25,000 | $289,900 |
| 10 | $25,000 | $314,900 |
You must enter into our then-current form of franchise agreement for each Beauty Bungalows Franchise you wish to open under your ADA, but you will not pay any additional Initial Franchise Fee at the time you execute each of these franchise agreements.
Source: Item 5 — INITIAL FEES (FDD pages 10–11)
What This Means (2025 FDD)
According to Beauty Bungalows's 2025 Franchise Disclosure Document, franchisees who choose to purchase multiple franchises under an Area Development Agreement (ADA) are obligated to open their additional Beauty Bungalows franchises according to a set schedule. This schedule is defined within the ADA. To qualify for a multi-unit development agreement, a minimum purchase of two units is required, subject to Beauty Bungalows's prior approval. Franchisees must also sign Beauty Bungalows's then-current form of franchise agreement for each location they plan to open under the ADA.
While franchisees entering an ADA for multiple Beauty Bungalows locations will not pay an additional initial franchise fee at the time they execute subsequent franchise agreements, they do pay a Development Fee. The Development Fee depends on the number of franchises the franchisee is granted the right to develop within their Development Area, as outlined in the Development Schedule in the ADA. The initial franchise fee for a single franchise is $49,900. However, under the ADA, the initial franchise fee varies depending on the number of franchises purchased.
For example, if a franchisee commits to opening two Beauty Bungalows franchises, the initial franchise fee for the second franchise is $40,000, bringing the cumulative development fee to $89,900. For three franchises, the initial fee for the additional franchise is $35,000, with a cumulative fee of $124,900. The initial franchise fee continues to decrease as more franchises are added to the agreement, up to 10 franchises. For 7 to 10 franchises, the initial franchise fee is $25,000 per franchise.
It is important to note that both the Initial Franchise Fee for a single unit and the Development Fee under an ADA are deemed fully earned upon receipt by Beauty Bungalows, and are non-refundable under any circumstances. This means that a prospective franchisee should carefully consider their ability to meet the development schedule and financial obligations before entering into an ADA with Beauty Bungalows.