Is there a renewal fee for Chatime, and if so, under what clause is it described?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (56) Renewal Outlet Fee means the fee payable by Franchisee to Franchisor upon an existing Outlet being renewed for a further term, in the amount of twenty-five percent (25%) of the then-current New Outlet Fee.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, there is a renewal fee. Clause (56) defines the "Renewal Outlet Fee" as the fee payable by the franchisee to Chatime when renewing an existing outlet for another term. The amount of this fee is twenty-five percent (25%) of the then-current New Outlet Fee.
This means that if a franchisee wants to continue operating their Chatime location after the initial franchise term, they will need to pay a renewal fee. This fee is calculated as a percentage of the current New Outlet Fee, which is the fee paid by new franchisees when they open their first location.
For a prospective Chatime franchisee, it's important to understand that the renewal fee can vary depending on what the New Outlet Fee is at the time of renewal. Franchisees should factor this potential cost into their long-term financial projections and discuss with Chatime what the New Outlet Fee is currently and how it has changed over time to estimate potential future renewal costs.