Where in the Chatime FDD can I find information about temporary operation by the franchisee?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
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, Item 23 discusses the circumstances under which Chatime may temporarily operate a franchise. Specifically, if the franchisee does not appoint and train a new Managing Owner or Operating Manager, or if Chatime believes the franchised business is not being managed properly, Chatime has the right, but not the obligation, to appoint a manager for the Franchised Business.
This means that Chatime can step in to manage the store if the franchisee fails to maintain proper management or during transitions in management personnel. The franchisee would be responsible for paying for this management, as described in clause 14 of the agreement, although the specific payment details are not provided in this excerpt.
This clause protects Chatime's brand and operational standards by ensuring that a poorly managed store does not negatively impact the reputation of the entire franchise system. For a prospective franchisee, this highlights the importance of having a qualified and well-trained management team in place to avoid the franchisor taking over operations temporarily.