Degree Wellness
Degree Wellness offers self-care solutions combining heat, cold, light, and advanced nutrients to enhance physical and mental health. Known for innovative wellness studios, it operates in the health and fitness franchise sector.
Degree Wellness franchise FAQ
How much does it cost to open one — the total initial investment?
The total estimated initial investment to begin operation of a single Degree Wellness Studio franchise ranges from $335,800 to $848,500. This includes $57,500 that must be paid to the franchisor or its affiliates [p.1].
What is the initial franchise fee?
The initial franchise fee for a Studio is $49,500 for the first franchise purchased [p.12]. This fee is due and non-refundable upon signing the Franchise Agreement [p.89].
What are the ongoing royalty and advertising fees?
Ongoing royalty and advertising fees are based on a percentage of franchisee sales and are recorded as revenue when earned and receivable from the franchisees [p.196]. However, specific percentages or amounts are not provided in these excerpts.
How long is the initial franchise agreement, and can I renew it?
The initial franchise agreement typically has a term of 10 years [p.195]. You have the option to renew the franchise upon acceptance of new terms, which may include increased fees or contributions [p.81].
Can I sell or transfer my franchise, and what does that require?
According to the FDD excerpts, you can sell or transfer your franchise, but it requires your agreement to be bound by and guarantee the obligations under the Franchise Agreement [p.48]. Additionally, if you transfer your franchise to a third party, you may need to obtain consent from the franchisor and potentially provide guarantees for the performance of the new franchisee [p.48]. This isn't specified in the excerpts.
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the franchise agreement if there is a failure by the franchisee to comply with any lawful provision of the franchise agreement and such failure is not cured within a reasonable period, which cannot exceed 30 days [p.5]. Additionally, the franchisor has the right to terminate the fund agreement, presumably related to financial contributions, by giving 30 days' advance written notice [p.108]. This isn't specified in the excerpts for general grounds of termination applicable to the franchise agreement itself.
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts. The provided FDD does not detail specific net worth or liquid capital requirements for qualification as a franchisee.
Do I get an exclusive or protected territory?
Yes, you will be granted a Protected Territory based on the population of approximately 100,000 persons in your market. However, this exclusivity does not prevent other franchisees from operating within your Protected Territory, as the franchisor is not obligated to ensure that no other franchisees conduct business there [p.238, p.250, p.227].
What training and ongoing support does the franchisor provide?
The franchisor provides an initial training program consisting of Business Training and Studio Opening Training. This training is mandatory for franchisees and typically occurs within 90 to 120 days after a signed lease, with fees applying for additional attendees beyond two. For unlicensed franchisees, the training focuses on business operations without medical content. Ongoing support includes computer maintenance and other unspecified services [p.84]. Additionally, the franchisor administers an advertising fund where all franchisees, including those owned by affiliates, contribute to support marketing efforts [p.107].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts.
Does the franchisor share any financial performance or earnings information?
The franchisor may provide historical performance data for existing outlets, but does not make representations about future financial performance [p.61]. They are permitted to share actual records of an existing outlet if you are purchasing one, and can supplement the information provided in Item 19 under certain conditions [p.59]. However, specific financial performance or earnings projections are not shared for new franchises [p.61].
What am I restricted to selling, and where must I buy supplies?
You are required to sell only the services and products approved for your type of franchise. You must also offer all goods and services designated for your type of franchise. You cannot offer or sell any prohibited items without written consent from the franchisor. As for supplies, you may have to buy or lease certain items from the franchisor or a limited group of suppliers designated by them, which might be more expensive than other options [p.3].