In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:

Section I – Estimated initial investment (franchise costs) for a Salons by JC franchise, based on Item 7 of the company’s 2024 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Salons by JC franchise, based on Items 5 and 6 of the company’s 2024 FDD

Section III – Number of franchised and company-owned Salons by JC outlets at the start of the year and the end of the year for 2021, 2022, and 2023, based on Item 20 of the company’s 2024 FDD

Section IV – News updates on the Salons by JC franchise opportunity

Section V – Presentation and analysis of Salons by JC’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2024 FDD, including information on the:

• 2023 average, median, high, and low total square feet, net rent per square foot, free rent (days), free rent total dollars, tenant improvement allowance, total leasable square footage, and leasable square footage % for the 122 franchised Salons by JC businesses that (a) were open and actively operating as of December 31, 2023, (b) leased and built out their respective facility at some point between March 2014 and December 31, 2023, and (c) had system owners that provided Salons by JC with the requested data

• 2023 average, median, high, and low total gross sales for the 112 franchised Salons by JC businesses that were open and actively operating for at least one full calendar year as of December 31, 2023, as well as 8 conversion facilities

• 2023 actual, average, and median gross sales for the 11 affiliate-owned Salons by JC businesses that were open and operating throughout the entire 2023 calendar year

• 2020, 2021, 2022, and 2023 year-end tenant occupancy rate for each of the 12 affiliate-owned Salons by JC businesses that were opened over the calendar years of 2019 through 2023

Section VI – Key ratios, comparables, computations, and analyses for the Salons by JC franchise opportunity (exclusive content for Platinum subscribers)

Section I – Salons by JC Franchise Costs

• Initial Franchise Fee:  $60,000
• Initial Training Fee (if applicable):  $0 to $1,000
• Travel and Living Expenses During Training:  $1,500 to $2,500
• Site Selection Assistance and/or Site Evaluation Expenses:  $0 to $1,000
• Security Deposits – Lease and Utilities:  $10,000 to $35,000
• Insurance Premium (3 months):  $900 to $1,500
• Business License and Permits:  $100 to $300
• Rent (3 months):  $0 to $65,000
• Blueprints, Plans, Permits, Architectural Fees:  $69,700 to $98,200
• Leasehold Improvements:  $1,080,000 to $1,620,000
• Signage and Graphics:  $18,400 to $28,300
• Furniture, Fixtures, and Equipment:  $156,200 to $214,700
• Internet (3 months):  $375 to $900
• Initial Inventory and Operating Supplies:  $2,000 to $4,000
• Initial Marketing Spend:  $15,000 to $20,000
• Additional Funds (3 months):  $10,000 to $20,000
• Total Estimated Salons by JC Franchise Costs:  $1,424,175 to $2,172,400

Section II – Salons by JC’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Initial Franchise Fee:  $60,000
• Royalty Fee:  the greater of 5.5% of Gross Sales or a minimum royalty payment of $500 per month
• Local Advertising Requirement:  up to $1,000 per month, which may include specific marketing and/or advertising deemed necessary by Salons by JC
• Brand Development Fund:  2% of Gross Sales

Section III – Number of Franchised and Company-Owned Salons by JC Outlets

Franchised

2021

• Outlets at the Start of the Year:  102
• Outlets at the End of the Year:  107
• Net Change:  +5

2022

• Outlets at the Start of the Year:  107
• Outlets at the End of the Year:  124
• Net Change:  +17

2023

• Outlets at the Start of the Year:  124
• Outlets at the End of the Year:  136
• Net Change:  +12

Company-Owned

2021

• Outlets at the Start of the Year:  10
• Outlets at the End of the Year:  11
• Net Change:  +1

2022

• Outlets at the Start of the Year:  11
• Outlets at the End of the Year:  11
• Net Change:  0

2023

• Outlets at the Start of the Year:  11
• Outlets at the End of the Year:  12
• Net Change:  +1

Section IV – News Updates on the Salons by JC Franchise

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Salons by JC Franchise (Item 19, 2024 FDD)

• Part 1A of this Item 19 discloses certain historical data regarding the premises and lease costs associated with the development of the Franchised Businesses that (a) were open and actively operating as of December 31, 2023, (b) leased and built out their respective Facility at some point between March 2014 and December 31, 2023, and (c) had System owners that provided Salons by JC with the requested data that is detailed in Part 1A (the “Part 1 Franchised Facilities”).

• Of the total Franchised Businesses open and operating as of December 31, 2023, Part 1A excludes: (i) 2 of Salons by JC’s initial Franchised Businesses that are governed by a different form of franchise agreement that does not require them to report the relevant information to Salons by JC (the “Non-Reporting Franchisees”); (ii) 2 Franchised Businesses that are owned by System franchisees that also own the building that serves as their approved premises; and (iii) 8 Franchised Businesses which were converted from a prior/existing concept and facility and, as such, could not provide applicable data (the “Conversion Facilities”).

• In a few instances, Salons by JC was unable to gather leasable square footage values, in which case it has left these values as “unknown” or “N/A” in the table below.

• Part 1B of this Item 19 discloses Gross Sales generated by those Part 1 Franchised Facilities that were open and actively operating for at least 1 full calendar year as of December 31, 2023, as well as the 8 Conversion Facilities noted above in the Background of this Item.

• Part 1B excludes: (i) the 14 Franchised Businesses that opened and commenced operations at some point in 2023 and, as such, were not open and operating over the entire 2023 measurement period; and (ii) the 2 Non-Reporting Franchisees.

• Part 2 of this Item 19 discloses the Gross Sales generated over the 2023 calendar year by each of the 11 affiliate-owned Salons by JC Businesses (“Affiliate-Owned Facility(ies)”) that were open and operating throughout the entirety of that calendar year.

• The Affiliate-Owned Facilities are not operated pursuant to a franchise agreement with Salons by JC and, as such, are not required to (a) pay Royalty Fees, Fund Contributions, or (b) expend a certain amount as a Local Advertising Requirement, that are due under those agreement(s).

• With that said, the Affiliate-Owned Facilities included in this financial performance representation offer similar services and face a similar degree of competition anticipated for the Franchised Businesses offered under the Franchise Disclosure Document.

• Part 2 excludes the 1 affiliate-owned Facility that did not open until some point during the 2023 calendar year because it was not open and operating over the entirety of that measurement period used in this Part.

• Part 3 of this Item discloses the average tenant occupancy rate for a total of 12 Affiliate-Owned Facilities that were opened over the calendar years of 2019 through 2023, as well as an average overall tenant occupancy rate for each Affiliate-Owned Facility as of the end of each calendar year it was open and operating.

• Please note that 1 Affiliate-Owned Facility in Texas relocated in 2022, and that Salons by JC has provided the Part 3 figures for both the original and relocated Facility site in Part 3, which is why there are 12 total Facilities included in the Chart (rather than 11 as set forth in Part 2 of this Item).

• Similar to Part 2, Part 3 of this Item excludes the 1 Affiliate-Owned Facility that did not commence open and operating until some point in 2023.

• Some outlets have sold or earned these amounts. Your individual results may differ. There is no assurance that you will sell or earn as much.

Part 1A – Premises and Lease Cost for Part 1 Franchised Facilities During the 2023 Calendar Year

Average

• Average Total Square Feet:  7,590
• Average Net Rent Per Square Foot:  $23.00
• Average Free Rent (Days):  103
• Average Free Rent Total Dollars:  $52,851
• Average Tenant Improvement Allowance:  $302,715
• Average Total Leasable Square Footage:  4,389
• Average Leasable Square Footage %:  59%

Median

• Median Total Square Feet:  7,402
• Median Net Rent Per Square Foot:  $21.00
• Median Free Rent (Days):  90
• Median Free Rent Total Dollars:  $39,270
• Median Tenant Improvement Allowance:  $262,280
• Median Total Leasable Square Footage:  4,321
• Median Leasable Square Footage %:  59%

High

• High Total Square Feet:  16,253
• High Net Rent Per Square Foot:  $65.00
• High Free Rent (Days):  660
• High Free Rent Total Dollars:  $528,222.49
• High Tenant Improvement Allowance:  $1,027,950.00
• High Total Leasable Square Footage:  11,615
• High Leasable Square Footage %:  71%

Low

• Low Total Square Feet:  4,116
• Low Net Rent Per Square Foot:  $7.00
• Low Free Rent (Days):  0
• Low Free Rent Total Dollars:  $ 0
• Low Tenant Improvement Allowance:  $0
• Low Total Leasable Square Footage:  2,143
• Low Leasable Square Footage %:  52%

Part 1B – Gross Sales Generated by Franchised Facilities for the 2023 Calendar Year

• Average:  $558,897.55
• Median:  $536,754.00
• High:  $2,132,410.05
• Low:  $199,365.47

• “Total Square Feet” means the total amount of square feet that a given Part 1 Franchised Facility has under management, including: (i) portions of a premises that are leased as an individual suite to potential customers (each, a “Suite”); and (ii) all other square footage that makes up the Facility for the Part 1 Franchised Facility.

• “Net Rent Per Sq. Ft.” means the net rent charged per square foot under the lease for the premises of each Part 1 Franchised Facility. Net Rent for a given Part 1 Franchised Facility (i) does not account for the corresponding Free Rent or Tenant Improvement Allowance, if any, that the landlord provided to the franchise owner of that Facility (and as disclosed more fully in the table above), and (ii) is not the same as “triple net” rent.

• “Free Rent (Days)” means the number of days, if any, that the landlord for the premises of a given Part 1 Franchised Facility (each, a “Lessor”) agreed not to charge the owner of that Facility as part of the negotiations to incentivize the owner to enter into the lease.

• If a Part 1 Franchised Facility has Free Rent (Days), then the term “Free Rent Total Dollars” means the dollar value of the Free Rent over that number of Days, which is calculated by taking the applicable rent per day and multiplying it by the number of Free Rent (Days).

• “Tenant Improvement Allowance” means the total dollar amount that the Lessor for the premises of a given Part 1 Franchised Facility agreed to pay, contribute, or credit in connection with gross construction costs associated with building out that Facility as part of the negotiations to incentivize the franchise owner to enter into a lease for that premises.

• “Leasable Square Footage” for a given Part 1 Franchised Facility means the actual square footage at that Facility that can be leased/subleased to a third party (rather than the Total Square Footage). Please note that Salons by JC only had data for 106 of the 108 Part 1 Franchised Facilities. As such, the average, median, and percentage met or exceeded are calculated using 106 as the total for this category.

• “Leasable Square Footage %” for each Part 1 Franchised Facility is calculated by taking the total Leasable Square Footage for that Facility, and dividing that figure by the Total Square Feet for that Facility. Please note that Salons by JC only had data for 106 of the 108 Part 1 Franchised Facilities.

• “Gross Sales” means the total revenue generated by your Salons by JC Business, including all revenue generated from leasing salon suites at your Facility and all amounts paid by Operators and/or their clientele for vending, laundry, and any other Approved Products or Approved Services offered at your Facility, whether such revenues are evidenced by cash, check, credit, charge, account, barter, or exchange.

• Gross Sales does not include the sale of products or services for which refunds have been made in good faith to customers, the sale of equipment used in the operation of the Franchised Business, any sales tax or other taxes collected from customers by you and paid directly to the appropriate taxing authority, or any reduction in revenue due to coupon sales.

Part 2 – Gross Sales by Each Affiliate-Owned Facility That Were Open and Operating Over the Entire 2023 Calendar Year

• Facility No. 1:  $461,840.06
• Facility No. 2:  $425,612.54
• Facility No. 3:  $540,662.90
• Facility No. 4:  $997,659.55
• Facility No. 5:  $412,805.73
• Facility No. 6:  $278,920.10
• Facility No. 7:  $622,835.28
• Facility No. 8:  $576,439.91
• Facility No. 9:  $593,338.30
• Facility No. 10:  $1,211,790.43
• Facility No. 11:  $261,312.91
• Average Gross Sales:  $580,292.52
• Median Gross Sales:  $540,662.90
• Number and Percentage Exceeding Average:  4 out of 11 (or 36.4%)
• High Gross Sales:  $1,211,790.43
• Low Gross Sales:  $261,312.91

Part 3 – Tenant Occupancy Rate and Average Year-End Tenant Occupancy Rate for Each Affiliate-Owned Facility Open All of 2023 as of the End of Each Calendar Year 2023

Facility 1

• Open Date:  9/1/1998
• Number of Suites:  44
• 2020 YE Occupancy Rate:  85%
• 2021 YE Occupancy Rate:  95%
• 2022 YE Occupancy Rate:  85%
• 2023 YE Occupancy Rate:  82%

Facility 2

• Open Date:  2/1/2000
• Number of Suites:  37
• 2020 YE Occupancy Rate:  78%
• 2021 YE Occupancy Rate:  87%
• 2022 YE Occupancy Rate:  92%
• 2023 YE Occupancy Rate:  81%

Facility 3*

• Open Date:  5/1/2002
• Number of Suites:  56
• 2020 YE Occupancy Rate:  100%
• 2021 YE Occupancy Rate:  97%
• 2022 YE Occupancy Rate:  89%
• 2023 YE Occupancy Rate:  N/A

*Facility 3 relocated in 2022 and reopened in May 2022 in Texas as Facility 12.

Facility 4

• Open Date:  5/1/2004
• Number of Suites:  42
• 2020 YE Occupancy Rate:  93%
• 2021 YE Occupancy Rate:  91%
• 2022 YE Occupancy Rate:  98%
• 2023 YE Occupancy Rate:  90%

Facility 5

• Open Date:  6/1/2007
• Number of Suites:  73
• 2020 YE Occupancy Rate:  96%
• 2021 YE Occupancy Rate:  99%
• 2022 YE Occupancy Rate:  90%
• 2023 YE Occupancy Rate:  90%

Facility 6

• Open Date:  7/1/2010
• Number of Suites:  31
• 2020 YE Occupancy Rate:  81%
• 2021 YE Occupancy Rate:  95%
• 2022 YE Occupancy Rate:  96%
• 2023 YE Occupancy Rate:  94%

Facility 7

• Open Date:  12/1/2012
• Number of Suites:  32
• 2020 YE Occupancy Rate:  75%
• 2021 YE Occupancy Rate:  83%
• 2022 YE Occupancy Rate:  90%
• 2023 YE Occupancy Rate:  81%

Facility 8

• Open Date:  3/10/2014
• Number of Suites:  44
• 2020 YE Occupancy Rate:  100%
• 2021 YE Occupancy Rate:  99%
• 2022 YE Occupancy Rate:  99%
• 2023 YE Occupancy Rate:  86%

Facility 9

• Open Date:  12/2/2014
• Number of Suites:  44
• 2020 YE Occupancy Rate:  75%
• 2021 YE Occupancy Rate:  89%
• 2022 YE Occupancy Rate:  96%
• 2023 YE Occupancy Rate:  91%

Facility 10

• Open Date:  7/1/2011
• Number of Suites:  40
• 2020 YE Occupancy Rate:  93%
• 2021 YE Occupancy Rate:  95%
• 2022 YE Occupancy Rate:  94%
• 2023 YE Occupancy Rate:  88%

Facility 11

• Open Date:  9/1/2021
• Number of Suites:  30
• 2020 YE Occupancy Rate:  N/A
• 2021 YE Occupancy Rate:  59%
• 2022 YE Occupancy Rate:  78%
• 2023 YE Occupancy Rate:  67%

Facility 12*

• Open Date:  5/25/2022
• Number of Suites:  74
• 2020 YE Occupancy Rate:  N/A
• 2021 YE Occupancy Rate:  N/A
• 2022 YE Occupancy Rate:  60%
• 2023 YE Occupancy Rate:  88%

*Facility 3 relocated in 2022 and reopened in May 2022 in Texas as Facility 12.

• The “Tenant Occupancy Rate” for each Affiliate-Owned Facility was calculated by taking the total number of Suites leased by that Facility as of December 31 of the calendar year, and dividing that number by the total number of Suites that Facility has available to lease at its respective Facility.

Section VI – Salons by JC Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️