What is included in the estimated initial investment for a single Chatime store, as it relates to the Multi-Unit Development Agreement?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
lti-Unit Development Agreement | Us | | Estimated Initial Investment to Open Initial Chatime Store | $238,200 to $425,000 | This is the total estimated initial investment for a single Chatime Store in Table A above (not including the initial franchise fee which is covered by the multi-unit development fee). | |---|---|---| | Total | $373,100 to $699,900 | | | Estimated | | | | Initial | | | | Investment for | | | | a three to ten | | | | location Multi- | | | | Unit | | | | Development | | | | Agreement | | |
Explanatory notes to Multi-Unit Development Agreement chart above:
- If you sign a multi-unit development agreement, you will pay us, when you sign that agreement, a non-refundable fee for the right to development multiple franchise units. You agree to open and operate the agreed number of Chatime Stores within a specific geographic area according to an agreed development schedule. The amount of the multi-unit development fee will depend on the number of locations to be opened. For each location, you will have to sign a separate individual unit franchise agreement in our then-current form of franchise agreement, which may be different than our current form of franchise agreement. The multi-unit development fee will serve as a full credit against the initial franchise fee for each location (including the first location), so that you will not be required to pay an initial franchise fee at the time you sign each Franchise Agreement for each location.
The Multi-Unit Development fee is as follows: For two locations, the fee is $98,900. For three locations, the fee is $134,900. For more than three locations, the fee is $134,900 plus $20,000 for each additional location. The multi-unit development fee is fully-earned by us upon receipt and is not refundable under any circumstances, regardless of the number of units you open.
- This estimate assumes that you will not require separate office space to operate the multi-unit development business.
Source: Item 7 — Estimated Initial Investment (FDD pages 17–22)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the estimated initial investment to open the initial Chatime store under a Multi-Unit Development Agreement ranges from $238,200 to $425,000. This figure represents the total estimated initial investment for a single Chatime store, excluding the initial franchise fee, which is covered by the multi-unit development fee. The total initial investment for a multi-unit development agreement for three to ten locations ranges from $373,100 to $699,900.
The low-end figure of $373,100 represents the estimated initial investment for a multi-unit development agreement for three locations. This includes a Multi-Unit Development Fee of $134,900, plus the low-end estimated initial investment for the first location, which is $238,200. The high-end figure of $699,900 is the high-end estimated initial investment for a multi-unit development agreement for ten locations. This includes the Multi-Unit Development Fee for ten locations, which is $274,900, plus the high-end estimated initial investment for the first location, which is $425,000.
These calculations are based on expenses listed in Item 7 of the FDD, but do not include the Initial Franchise Fee. The Multi-Unit Development Fee serves as full credit against the initial franchise fees for each location, including the first location. This means that franchisees entering into a multi-unit development agreement do not have to pay a separate initial franchise fee for each store they open. Chatime estimates that franchisees will not require separate office space to operate the multi-unit development business, and that it will initially be operated from the franchisee's home, and then from the office space of one of their Chatime stores after the first store is opened.