Can Itan franchisees sell gift cards that are not approved by the franchisor?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
- (d) Gift Card Program.
You must participate in any gift card program we establish and honor all gift cards, even if purchased from us or another Salon.
You may not sell gift cards we have not approved.
We have the right to: (i) determine how gift card proceeds are divided or otherwise accounted for; (ii) require that gift card proceeds be paid to us or deposited into a trust account we control for subsequent disbursement to the Salons(s) where the gift card is redeemed; and (iii) retain proceeds from unredeemed gift cards.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, franchisees are explicitly prohibited from selling gift cards that have not been approved by Itan. The FDD states, "You may not sell gift cards we have not approved." This requirement ensures brand consistency and quality control across all Itan locations.
Itan maintains significant control over the gift card program, including determining how proceeds are divided, requiring proceeds to be paid to them or deposited into a trust account, and retaining proceeds from unredeemed gift cards. This level of control allows Itan to manage the financial aspects of the gift card program and ensure that all franchisees are participating in a standardized manner.
For a prospective Itan franchisee, this means they must adhere to Itan's gift card program and cannot introduce their own versions. This could limit a franchisee's flexibility in creating promotions or customizing offerings, but it also provides the benefit of a proven system and reduces the risk of non-compliance. Franchisees should fully understand the terms and conditions of Itan's gift card program, including how proceeds are managed and what happens to unredeemed cards, before investing in the franchise.