On what experience does Chatime base its estimate of 'Additional Funds Three Months'?

According to Chatime's 2025 Franchise Disclosure Document, the estimate for 'Additional Funds Three Months' is based on Chatime's experience in developing three affiliate-owned locations in Southern California in 2023. Chatime also considered information from existing franchisees of their affiliate, Chatime USA LLC, regarding local market conditions and seasonal preferences.

The 'Additional Funds Three Months' estimate, which ranges from $12,000 to $24,000, covers business expenses (excluding owner's salary or draws) during the first three months of operation. These expenses include sales and operating costs such as payroll, utilities, and taxes. The FDD notes that actual costs may be higher and cash flow may not be adequate during the initial phase.

Chatime states that a franchisee's actual costs will vary depending on factors such as adherence to Chatime's recommended methods, management skills, local economic conditions, market demand, competition, local cost factors, and the Chatime store's sales levels. The FDD also states that there is no guarantee that the specified amounts will be adequate and that additional investment may be necessary during the initial three months or afterwards. This is a standard disclaimer in franchise FDDs, highlighting the inherent risks and uncertainties in starting a new business.