What is the range of the Development Area Fee for a C3 Wellness Spa Multi-Unit Development Agreement?
C3_Wellness_Spa Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Expenditure | Amount | Method of Payment | When Due | |
|---|---|---|---|---|
| To Whom Payment is Made | ||||
| Development Area Fee (Note 1) | $40,000 – $145,000 | Lump sum | When Franchise Agreement and Multi- Unit Development Agreement are signed | |
| Estimated Initial Investment to Open One Spa Location Franchise (Note 2) | $652,928 – $856,616 | Estimated Initial Investment is based on estimate contained in Table A, above, of this Item 7, for a Franchise Agreement. See, Table A |
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 21–25)
What This Means (2024 FDD)
According to C3 Wellness Spa's 2024 Franchise Disclosure Document, the Development Area Fee for a Multi-Unit Development Agreement ranges from $40,000 to $145,000. This fee is paid in a lump sum when the Franchise Agreement and Multi-Unit Development Agreement are signed.
The Development Area Fee compensates C3 Wellness Spa for granting the franchisee the rights to develop multiple locations within a specific territory. The fee varies depending on the number of additional spa location franchises the franchisee is authorized to develop beyond the initial spa location franchise. The minimum number of spas a franchisee may be authorized to develop is two, and the maximum is five.
It's important to note that the Development Area Fee is in addition to the initial franchise fee for the first spa location. The FDD specifies that the Development Area Fee ranges from $40,000 for the second spa to $35,000 for each spa over the second one. This fee structure incentivizes franchisees to commit to developing more locations, while also providing C3 Wellness Spa with upfront capital for supporting the expansion.