What criteria must an Itan Franchised Salon meet to be considered a 'Qualifying Salon' for the financial performance representation?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
- "Measuring Period" means the period of time commencing January 1, 2024, and expiring December 31, 2024.
- "Qualifying Salon" means any Franchised Salon that satisfies each of the following criteria: (a) the outlet was open and operating throughout the entire Measuring Period; and (b) the outlet provided us with all data we requested in order to prepare the FPR.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 39–42)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, a 'Qualifying Salon' is defined specifically for the purpose of the financial performance representation (FPR). To be considered a 'Qualifying Salon,' an Itan franchised salon must meet two key criteria. First, the salon must have been open and operating for the entire 'Measuring Period,' which the FDD specifies as the period from January 1, 2024, to December 31, 2024. Second, the salon must have provided Itan with all the data requested by the company to prepare the FPR.
These criteria ensure that the financial data used in Item 19 is based on a consistent and complete set of information. By requiring salons to be open for the entire measuring period, Itan aims to present a realistic view of potential performance over a full year. The requirement to provide all requested data ensures that the FPR is based on accurate and comprehensive information, reducing the risk of skewed or incomplete financial representations.
The FDD indicates that for the 2024 measuring period, all 28 franchised salons in operation met the criteria to be considered Qualifying Salons. This suggests that franchisees are generally compliant with data reporting requirements and maintain consistent operations throughout the year. A prospective franchisee should confirm with Itan whether these criteria or the method of qualification have changed since the 2024 reporting period.
It is important for potential franchisees to understand these criteria, as the financial performance data presented in Item 19 is based solely on the performance of these 'Qualifying Salons.' If a salon does not meet these criteria, its financial data is excluded from the FPR, which could impact the overall representation of potential earnings. Therefore, franchisees should strive to maintain consistent operations and comply with all data reporting requirements to ensure accurate financial representation and potentially improve their salon's performance.