Does the 'Development Fee' for Itan include the initial franchise fees for all 'Required Salons'?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
| INITIAL FRANCHISE FEE & DEVELOPMENT FEE | ||||||
|---|---|---|---|---|---|---|
| Salon | Initial Franchise Fee | |||||
| Salon 1 | $49,500 | N/A – 3 unit minimum for ADA | ||||
| Salon 2 | $42,000 | N/A – 3 unit minimum for ADA | ||||
| Salon 3 | $38,000 | $129,500 | ||||
| Salon 4 | $36,000 | $165,500 | ||||
| Salon 5 | $34,000 | $199,500 | ||||
| Salon 6 | $32,000 | $231,500 | ||||
| Salon 7+ | $30,000 (per Salon) | $261,500 (plus additional $30,000 for each Salon in excess of 7) |
* The initial franchise fee for the first Required Salon is reduced to $39,500 if you are an existing franchisee who signed a Franchise Agreement with us prior to execution of this Agreement.
The Development Fee imposed by §6 is deemed to include and satisfy the initial franchise fee imposed under each Franchise Agreement you sign for a Required Salon.
- 6. DEVELOPMENT FEE. Upon execution of this Agreement, you must pay us a development fee (the "Development Fee") in the amount set forth in Part B of ATTACHMENT "A". The Development Fee is calculated as the sum of the initial franchise fees applicable to all Required Salons listed in the Development Schedule.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, the Development Fee includes the initial franchise fees for all Required Salons. The Development Fee is paid upon execution of the Area Development Agreement and is considered fully earned and nonrefundable upon receipt by Itan.
The Development Fee is calculated as the sum of the initial franchise fees applicable to all Required Salons listed in the Development Schedule. This means that instead of paying separate initial franchise fees for each salon, the franchisee pays a single Development Fee that covers all Required Salons.
For example, the initial franchise fee for Salon 1 is listed as $49,500, Salon 2 is $42,000, and Salon 3 is $38,000. The Development Fee for all three salons would then be $129,500. For Salon 4, the initial franchise fee is $36,000, bringing the Development Fee for all four salons to $165,500. An existing franchisee who signed a Franchise Agreement with Itan prior to the execution of the Development Agreement may have their initial franchise fee for the first Required Salon reduced to $39,500.