Who has authority and control over the day-to-day operations of the Chatime Franchised Business and its employees?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
aging Owner of our initial training program at Franchisee's expense.
- (2) Operating Manager. Franchisee will appoint at least one "Operating Manager". The Managing Owner and Operating Manager may be the same person. Franchisee's Operating Manager may but need not be an owner of your business. You will ensure that the day-to-day operation of the Franchised Business is always actively managed by an Operating Manager who has attended and successfully completed such training as we may require from time to time. The Operating Manager will actively devote his or her full time, attention and effort to the Franchised Business and provide direct, day to-day supervision of the operation of the Franchised Business as provided in the then-current Operations Manual. The current Operations Manual requires the Operating Manager to devote at least 38 hours per week to the day to day operations of your Chatime Store. The Operating Manager shall not directly or indirectly engage in any other business or other activity that requires any significant management responsibility or time commitments or that may otherwise conflict with Franchisee's obligations under this Agreement.
- (3) The Operating Manager will ensure at all times the proper levels of customer service in accordance with the Operations Manual and this Agreement.
- (4) Franchisee must ensure that the Operating Manager exerts their full-time efforts to the franchising, development, and operation of the Chatime Network and does not directly or indirectly engage in any other business or other activity that requires any significant management responsibility or time commitments or that may otherwise conflict with Franchisee's obligations under this Agreement.
- (5) If the Managing Owner or Operating Manager does not satisfactorily complete the initial training program or if we determine that such person cannot satisfactorily complete the training program, or if the Managing Owner or Operating Manager ceases to act as such, then Franchisor may elect to train, at Franchisee's expense, a qualified replacement (who must be reasonably acceptable to us) within 30 days. Pending the appointment and training of a new Managing Owner or Operating Manager or if, in our judgment, the Franchised Business is not being managed properly, we have the right, but not the obligation, to appoint a manager for the Franchised Business and require you to pay in the manner described in clause 14.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the day-to-day operations of a Chatime franchise are primarily managed by an Operating Manager. This individual is responsible for the active, full-time supervision of the business, adhering to the guidelines set forth in the Operations Manual. The Operations Manager's role is crucial in ensuring the smooth functioning of the store and maintaining customer service standards. The Operations Manager must devote at least 38 hours per week to the daily operations of the Chatime store.
While the Operating Manager handles the daily tasks, the Managing Owner also plays a significant role. This person, who must be an equity owner approved by Chatime, represents the business in its dealings with the franchisor and oversees the overall operation. The Managing Owner and Operating Manager can be the same person. The franchisee is responsible for ensuring that either the Managing Owner or the Operating Manager satisfactorily completes Chatime's initial training program. If neither fulfills this requirement, Chatime may train a replacement at the franchisee's expense.
Chatime also retains certain rights and oversight. If the franchised business is not being managed properly, Chatime has the right to appoint a manager, with the franchisee bearing the cost. Furthermore, franchisees must use a point-of-sale system approved by Chatime, ensuring that all data is accessible to Chatime's central polling server. This allows Chatime to monitor sales and operational data, maintaining brand consistency and quality across all franchise locations. Chatime, its affiliates, consultants, and agents also have the right to inspect the Outlet and the construction work from time to time during the course of construction to verify the progress of construction and Franchisee's compliance with the terms of this Agreement.