Under what condition can the Initial Franchise Fee be refunded for a Chatime franchise?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
| Estimated Amount | Method of | When | Payable to | ||
|---|---|---|---|---|---|
| Type of Expenditure | |||||
| Range | Payment | Payable | Whom | ||
| Initial Franchise Fee(1) | $54,900 | Lump sum | Upon signing Franchise Agreement | Us | |
| Initial Training, Opening | $5,000 | As arranged | As incurred | Us | |
| Support and | |||||
| Related Personnel Cost(2) | |||||
| Rent(3) | $6,000 to $33,000 | As arranged | As specified in lease | Landlord | |
| Lease Security Deposit (3) | $4,000 to $22,000 | As arranged | As specified in lease | Landlord | |
| Storage Space Deposit(3) | $0 to $1500 | As arranged | As specified in lease | Third party | |
| Leasehold Improvements (4) | $135,000 to $226,000 | As arranged | As incurred | Third party or Us | |
| Equipment (5) | $33,500 to $46000 | As arranged | As incurred | Third party | |
| External Signage | $4,200 to $9,500 | As arranged | As incurred | Third party | |
| Estimated Amount | Method of | When | Payable to | ||
| Type of Expenditure | Range | Payment | Payable | Whom | |
| Opening Inventory and | $10,000 to $16,000 | As arranged | As incurred | Our affiliates | |
| Supplies(6) | |||||
| Grand opening marketing(7) | $10,000 | As arranged | As incurred | Third parties | |
| Licenses, Permits, and | $3,500 to $5,500 | As arranged | Lump sum | Third party | |
| Utility Deposits(8) | |||||
| Technology Systems(9) | $10,500 to $14,000 | As arranged | As incurred | Third party or us | |
| Uniforms | $500 to $1,500 | As arranged | As incurred | Us or third party | |
| Insurance(10) | $3,000 to $6,000 | As arranged | As incurred | Third party | |
| Professional Fees | $1,000 to $5,000 | As arranged | As incurred | Third party | |
| Additional Funds – Three | $12,000 to $24,000 | As arranged | As incurred | Third party | |
| Months(11) | |||||
| Total Estimated Initial | $ 293,100 to $479,900 | ||||
| Investment | # Notes: |
- (1) Initial Franchise Fee and Other Fees. You will pay us a non-refundable $54,900 Initial Franchise Fee. All of the fees paid to us are non-refundable except that, if you give us notice of termination within seven days after execution of your Franchise Agreement, we will return the Initial Franchise Fee within 14 days after receiving your notice of termination. Fees paid to vendors or other suppliers may be refundable
Source: Item 7 — Estimated Initial Investment (FDD pages 17–22)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the initial franchise fee of $54,900 is generally non-refundable. However, there is a specific condition under which a refund may be obtained.
Should a prospective Chatime franchisee decide to terminate the Franchise Agreement, they must provide written notice to Chatime within seven days of signing the agreement. If this condition is met, Chatime is obligated to return the initial franchise fee within 14 days of receiving the termination notice.
It is important to note that this refund condition applies solely to the initial franchise fee paid to Chatime. Fees paid to other vendors or suppliers, such as those for equipment or leasehold improvements, may be refundable depending on the individual policies of those vendors and suppliers, but are not guaranteed. Franchisees should carefully review the terms and conditions of all agreements with third-party vendors to understand their refund policies.
This seven-day window provides a limited opportunity for franchisees to reconsider their investment decision shortly after committing to the franchise. Prospective franchisees should use this time to conduct further due diligence, consult with advisors, and ensure they are fully comfortable with the terms of the Franchise Agreement before the rescission period expires.