Sun Tan City
Sun Tan City offers tanning salons with UV and spray tanning services, red light therapy, and wellness products. Known for providing tanning solutions and skin care, it operates in the beauty and wellness industry.
Sun Tan City franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operations of a SUN TAN CITY franchise ranges from $1,048,790 to $1,797,750. This includes a mandatory payment of between $30,000 and $48,000 to the franchisor or its affiliate. [p.1]
What is the initial franchise fee?
The initial franchise fee is a lump sum nonrefundable payment of $30,000 due in full upon signing the Franchise Agreement [p.13]. This fee is also part of the development fee when entering into an Area Development Agreement, where you pay an additional $10,000 for each additional Salon beyond the first one [p.13, p.23].
What are the ongoing royalty and advertising fees?
Ongoing royalties and production fees are based on a percentage of monthly franchise salon sales over the term of the related franchise agreement and are recognized at a point in time as franchise salon sales occur [p.224, p.225]. Additionally, initial franchise fees and area development fees are nonrefundable one-time fees recognized as revenue on a straight-line basis over the term of the respective agreement [p.224]. Regarding advertising, local advertising cooperative assessments may be used to pay for various marketing activities in your area, but these funds will not be used to defray any of our general operating expenses [p.85]. This isn't specified in the excerpts for ongoing royalty and advertising fees beyond this.
How long is the initial franchise agreement, and can I renew it?
This isn't specified in the excerpts.
Can I sell or transfer my franchise, and what does that require?
You cannot sell or transfer your franchise without the franchisor's prior written approval [p.88]. The approval is conditioned on the prospective transferee agreeing to sign the current form of franchise agreement with the franchisor at their discretion [p.88]. This includes any voluntary, involuntary, direct, or indirect assignment, sale, gift, or other disposition of your interest in the franchise [p.88].
On what grounds can the franchisor terminate the agreement?
According to [p.172] and [p.164], a franchisor can terminate the agreement on any grounds available by law, but such termination must be for good cause. Good cause includes the failure of the franchisee to comply with lawful provisions of the franchise agreement and failing to cure such failure after receiving written notice and a reasonable opportunity to do so, which cannot exceed 30 days.
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts.
Do I get an exclusive or protected territory?
No, you do not receive an exclusive territory. You may face competition from other franchisees, outlets owned by the company, or other competitive brands that the company may own or control [p.36].
What training and ongoing support does the franchisor provide?
The franchisor provides 40 hours of initial training and support for the first salon opening, which includes new salon setup and organization, as well as Salon Director support and training [p.70]. Additionally, there is no cost for a 40-hour grand opening training program administered by Certified Training Salon Directors [p.35]. This training is overseen by the Learning and Development Department, which has relevant experience in the subject matter taught [p.35].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts. The FDD provides details about franchisees who ceased doing business within the last fiscal year [p.3], but it does not give a total number of current franchised outlets or specify how many have closed or been terminated.
Does the franchisor share any financial performance or earnings information?
The franchisor, STC Franchising, LLC, does not make any financial performance representations other than those contained in Item 19. They do not authorize their employees or representatives to make such representations either orally or in writing [p.52]. However, if you are purchasing an existing Salon, they may provide actual records of that specific location [p.52].
What am I restricted to selling, and where must I buy supplies?
You are not restricted to selling specific products but may have operating restrictions such as controlling your location, access to customers, what you sell, marketing methods, and hours of operation [p.3]. For supplies, while there is generally no obligation to purchase from the franchisor or affiliates, certain items like initial inventory and selling supplies for new and existing locations might be voluntarily purchased from an affiliate [p.24]. In some states like Indiana, you are not required to buy goods, supplies, inventories, or services exclusively from the franchisor if comparable quality items are available elsewhere, but approval may be needed for non-approved suppliers [p.156]. This isn't specified in the excerpts for other states.