When is the Multi-Unit Development Fee due for a Chatime franchise?

According to Chatime's 2025 Franchise Disclosure Document, the Multi-Unit Development Fee is due at the signing of the Multi-Unit Development Agreement. The fee ranges from $134,900 to $274,900 for development agreements covering three to ten locations. This fee is paid in a lump sum to Chatime.

This fee grants the franchisee the right to develop multiple Chatime stores within a specific geographic area, following an agreed-upon development schedule. It's important to note that the Multi-Unit Development Fee is non-refundable and is fully earned by Chatime upon receipt, regardless of how many units the franchisee ultimately opens. This fee serves as a full credit against the initial franchise fee for each location, meaning franchisees won't have to pay a separate initial franchise fee when they sign individual franchise agreements for each store.

For prospective multi-unit franchisees, understanding the terms of the Multi-Unit Development Agreement is crucial. The agreement requires opening and operating a pre-determined number of Chatime stores within a defined area and timeframe. Failing to meet these development obligations could have consequences, even though the initial fee is non-refundable. Therefore, franchisees should carefully evaluate their capacity to meet the development schedule before entering into such an agreement.

It is also important to note that for each location, the franchisee will have to sign a separate individual unit franchise agreement in Chatime's then-current form, which may differ from the current franchise agreement. This means that the terms and conditions of operating each individual Chatime store may evolve over the course of the development agreement, potentially impacting the franchisee's operational and financial planning.