Does Chatime guarantee a minimum territory size to franchisees?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
ograms are regularly reviewed and updated.
Item 12: Territory
Your Franchise Agreement grants you the right to operate a single Chatime Store in a location approved by usin a designated territory ("Territory") identified in your Franchise Agreement. You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control.
The designated territorial rights to the protected territory granted to you under the Franchise Agreement are contingent upon complying with your obligations under the Franchise Agreement. We have the right to terminate or reduce your designated territorial rights or to terminate your Franchise Agreement if you fail to comply with your obligations under the Franchise Agreement.
There is no minimum Territory. Your Territory will typically be a two-mile radius around your approved location, unless your approved location is located in a major metropolitan downtown area or similarly-situated/populated central business district (a "Central Business District"). If your approved location is located in a Central Business District, your Territory may be limited to a geographic area comprised of anywhere from a radius of two blocks to two miles around your approved location, as we deem appropriate in our discretion.
Source: Item 12 — Territory (FDD pages 35–38)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, franchisees do not receive an exclusive territory and there is no guaranteed minimum territory size. For a single Chatime store, the territory is typically a two-mile radius around the approved location. However, if the location is in a major metropolitan downtown area or similarly populated central business district, the territory may be limited to a geographic area comprised of anywhere from a radius of two blocks to two miles, as Chatime deems appropriate. The size of the territory may also vary from the territory granted to other franchisees based on the location and demographics surrounding the approved location.
For franchisees who sign a Multi-Unit Development Agreement, the size of the designated Development Territory is negotiated with Chatime based on the Development Quota, which is the minimum number of Chatime stores the franchisee is obligated to open. However, even with a Multi-Unit Development Agreement, franchisees do not receive an exclusive development territory and may face competition from other franchisees, outlets that Chatime owns, or other channels of distribution or competitive brands that Chatime controls.
Chatime retains significant rights to operate or license others to operate Chatime stores in non-traditional locations such as airports, train stations, and supermarkets, even within a franchisee's territory. Chatime also retains the right to sell and distribute goods and services through alternative channels of distribution such as the Internet, without any obligation to compensate the franchisee, even if it impacts the franchisee's sales. Prospective franchisees should carefully consider these factors and evaluate the potential for competition within their designated territory before investing in a Chatime franchise.