Under what conditions is a Chatime Outlet relocation considered opening a New Outlet?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (5) Any relocation of an Outlet beyond a 2-km radius of the existing site and beyond 90 days of closing the Outlet at the original location is deemed opening a New Outlet and subject to all applicable provisions under this Agreement, and Franchisor shall be entitled to the New Outlet Fee.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, a relocation of a Chatime Outlet is considered the opening of a new outlet under specific geographical and time-based conditions. Specifically, if an existing Chatime franchisee relocates their outlet beyond a 2-kilometer radius from the original site and the relocation occurs more than 90 days after the closure of the original outlet, it is classified as opening a new outlet.
This classification has significant financial implications for the franchisee. When a relocation is deemed a new outlet, the franchisee becomes subject to all the standard provisions and fees associated with opening a new Chatime location. This includes, most notably, the 'New Outlet Fee,' which is a potentially substantial cost.
Therefore, any Chatime franchisee contemplating a relocation needs to carefully consider the distance and timeframe involved. Staying within the 2-kilometer radius and completing the move within 90 days allows the franchisee to avoid the additional expense of the New Outlet Fee. This policy encourages franchisees to remain within a reasonable proximity to their original location and to execute relocations efficiently to maintain business continuity and avoid additional costs.