Opening a Franchise: What It Takes for a New Franchise Location - MassageLuXe

Opening a Franchise: What It Takes for a New Franchise Location

While becoming a franchisee makes business ownership less overwhelming, the process of opening a franchise does comprise many steps. Franchisors are well-equipped to assist with the task but having a clear understanding of the details involved with opening a franchise can streamline the process. This is a comprehensive guide about what to expect with not only general franchise opening information but specifically, opening a leading spa franchise like MassageLuXe.

Steps in the Franchise Process

  1. Research. In any business venture, the more research done, the better. Homework will entail finding franchise businesses that align with your goals and interests.
  2. Application. This is the screening process. When you fill out a franchise application, it’s a way for the franchise to get to know you and your business intentions. The franchisor looks at finances, background, interest level and site preference. This is a collection of details that assist the franchisor in guiding you through the process.
  3. Discovery day meeting. This is an opportunity for prospective franchisees to meet franchise leaders in person at corporate headquarters or virtually when needed. It’s also the time you’ll want to take advantage of your one-on-one access to ask as many questions as you’d like.
  4. Financing. You will apply for financing and receive a letter of intent from the bank. This is a written acknowledgement that the bank intends to finance you. The full financing process won’t begin until a lease is signed and a general contractor is chosen.
  5. Draft a business entity. This is typically an easy process that can be completed online. Most franchisees set up an LLC or an S Corp.
  6. Review the Franchise Disclosure Document (FDD). This document outlines 23 items that must be disclosed to franchisees including fees, the legal relationship, and the history of the company. The FDD must be disclosed to a potential franchisee within 14 days of signing an agreement.
  7. Review and return franchise paperwork. Often, franchisees will have an attorney look over the agreement to ensure they have a clear understanding of the contract.
  8. Site selection. Your franchisor will assist with the location of your franchise unit. At MassageLuXe, for example, we look at population, competition, demographic and psychographic information in your market to find the ideal location for your spa.
  9. Construction. Total build of your brick-and-mortar franchise unit
  10. Training. Your franchise will provide information you need to begin your business. As a MassageLuXe franchisee, you will receive support at every level from site selection and grand openings to ongoing training, marketing, coaching and more.
  11. Opening. MassageLuXe offers a grand opening advertising program as well as ongoing marketing support to get you started on the best foot. Many franchises will have you do a soft opening. A grand opening will typically occur a few months after that with the local chamber of commerce.

How Long Does It Take to Open a Franchise?

Depending on the franchise you buy, the time from signing the franchise agreement to opening your doors will vary. At MassageLuXe our total timeframe will be six to 12 months. The most challenging and perhaps time-consuming part of this equation is site selection. Finding a location for a brick-and-mortar unit is an involved process and should not be rushed. After all, your location will be key to building your customer base and ultimate success.

Setting up a Franchise

The steps it takes to open a business are just more proof of why franchising is a preferable business ownership option. This is not an independent effort. At MassageLuXe, we partner with you every step of the way, showing you how to open a spa.

Few first-time business owners have the acumen to know about submitting a letter of intent and negotiating with the landlord in the purchase process. As a franchisee, however, there is expert guidance to help with everything from signing the lease and navigating the permitting process to getting general contractors to bid on the project.

Costs of Opening a Franchise

Another strength of franchising is that you will have a clear budget in front of you and be fully aware of your financial commitment when you get started. You’ll pay a franchise fee as your entry fee into the business and then deal with initial costs and ongoing royalties. At MassageLuXe, for example, our initial franchise fee is an affordable $42,500.

It’s important to ensure that you have enough liquidity to qualify for loans to fund the beginning stages of the process. At MassageLuXe, you need to have at least $100,000 that you can inject into the business. Outside of liquidity, many banks want to see past bank statements and tax returns as part of the qualification process. It’s best to have that paperwork ready. Financing opportunities will include conventional or SBA loans.

Your costs opening a massage business depend on a variety of factors, including spa equipment, supplies, leasehold improvements, and insurance.

The estimated initial cost to open a MassageLuXe will range from $414,700 to $768,000, depending on variables like real estate costs or lease deposits. Our competitors are higher in many areas. We do our best to keep costs down by using discount purchasing when possible.

One of the distinctive benefits of franchising with MassageLuXe is that you, as the owner, don’t have to be in the spa to be successful. We’ve designed our model for owners to be semi-absentee if they choose.

Of course, if you’re a business owner you need to keep your hand on the pulse of the operation, but technology allows you to do that without physically being in the spa. You have the freedom to choose a franchise that offers a mobile-friendly dashboard, strong management structure and a solid point of sales system.

MassageLuXe is a growing brand in the health and wellness business, designed to help our clients relax, remove pain, and restore health through the healing properties of massage.

To learn more about spa franchise opportunities with MassageLuXe, fill out the form on this page.


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