What is the maximum non-compliance fee that Dermani Medspa may charge for violations of System Standards?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (Note 1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Royalty | 5% of Gross Revenue | Each Week, on or before the Wednesday of each week calculated on the Gross Revenue for the prior Week | See Note 2 for the definition of “Gross Revenue” and “Week.” |
| System Marketing Fee | Up to 2% of Gross Revenue, currently 0.25% | Same as Royalty | See Note3. |
| Local Advertising Spend | $500 each month | Monthly | This is the minimum amount that you must spend each month on local advertising and marketing. The actual amount needed for you to spend on local marketing each month may be significantly higher than this amount. You will pay this amount to various third parties, not us. We may recommend and/or require you to spend such local marketing expenditures in certain ways. |
| Social Media/ Technology Fee | Our then- current Social Media/ Technology Fee, currently $300 per month (See Note 4) | Monthly | We reserve the right to increase the Social Media/Technology Fee by no more than twenty percent (20%) each year, which in any event the maximum required Social Media/Technology Fee shall not exceed $500 each month. |
| Type of Fee | Amount | Due Date | Remarks |
| (Note 1) | |||
| Non- Compliance with System Standards | Our then- current fee, which may vary depending upon the specific required policy you violate | As incurred | Not including any monetary defaults, we may charge you our then-current non-compliance fee (which will not exceed $500 per violation), as set forth in the Manual or otherwise, in the event you fail to fully comply with any of our then- required System Standards (as that term is defined in Item 8) |
Source: Item 6 — OTHER FEES (FDD pages 14–20)
What This Means (2025 FDD)
According to Dermani Medspa's 2025 Franchise Disclosure Document, franchisees may be charged a non-compliance fee for failing to adhere to the company's System Standards. This fee is not applicable to monetary defaults. The exact amount of the fee can vary based on the specific policy that is violated. However, the non-compliance fee will not exceed $500 per violation.
This fee is intended to ensure that all Dermani Medspa locations maintain consistent standards of operation and service quality. System Standards are defined in Item 8 of the FDD. These standards cover various aspects of the business, including operational procedures, marketing guidelines, and customer service protocols.
Prospective franchisees should carefully review Item 8 of the FDD to fully understand what constitutes a System Standard and what actions could trigger a non-compliance fee. Understanding these standards is crucial for avoiding unexpected costs and maintaining a positive relationship with Dermani Medspa. Franchisees should also inquire about the specific policies that carry the highest non-compliance fees to prioritize adherence to those standards.