CBD American Shaman Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$88,100 - $184,400
Franchise Fee
$10,000
Total US Locations
212
Business Summary
CBD American Shaman operates retail establishments known as Shaman Stores that specialize in selling curated and proprietary hemp-derived cannabidiol (CBD) products. These stores offer a wide range of concentrated and terpene-rich CBD products, produced using proprietary nanotechnology. Each Shaman Store typically occupies between 1,000 and 1,500 square feet and features a customer education lounge where patrons can learn about and sample the hemp-derived products.
Corporate History
American Shaman Franchise System, LLC was incorporated in Nevada on March 2, 2017, and later converted to a Nevada limited liability company on January 6, 2020. The company began offering CBD American Shaman franchises in April 2018. The franchisor's parent company, SVS Enterprises, LLC, is wholly owned by its founder, Stephen Vincent Sanders. Sanders has licensed the trade name, service marks, trade dress, operating methods, and intellectual property used by CBD American Shaman businesses to the franchisor, with permission to sublicense to franchisees. Sanders also licensed these to CBD American Shaman, LLC (CBDAS), an affiliate that operates 40 CBD American Shaman locations. Other affiliates, such as Shaman Botanicals, LLC (SB) and The Company in Wyoming (TCIW), process and distribute hemp-derived products, including the Zen Master product line, which are supplied to franchisees. CBD American Shaman itself does not operate any company-owned locations, but its affiliate, CBDAS, does.
Financial Overview
Investment Range
$88,100 - $184,400
Franchise Fee (Low)
$10,000
Franchise Fee (High)
$10,000
Equipment Costs (Low)
$32,500
Equipment Costs (High)
$95,000
Working Capital
$23,700
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
CBD American Shaman has provided audited financial statements which received an unqualified opinion from its independent auditor. This indicates that the financial statements present fairly, in all material respects, the financial position and results of operations in accordance with generally accepted accounting principles. No specific concerns such as 'going concern' qualifications or material financial weaknesses were highlighted by the auditors.
Financing Details
CBD American Shaman does not offer any direct or indirect financing for the fees or costs associated with purchasing, developing, or operating a franchise. The franchisor also does not guarantee any lease or other financial obligations incurred by the franchisee.
Performance Metrics
Total US Locations
212
Franchised Units
169
Corporate Units
43
Avg Square Footage
1,250
Franchising Since
2018
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
5
Litigation Summary
CBD American Shaman has five active or recently resolved legal and regulatory issues. This includes an ongoing arbitration initiated in February 2022 by a former franchisee, Vitality Advantage Holladay, LLC. The former franchisee is claiming violations of franchise laws, fraud, and other issues, seeking damages between $500,000 and $1,000,000, while CBD American Shaman has filed counterclaims including for trademark infringement. The arbitration is currently in discovery. Additionally, an affiliate of CBD American Shaman, CBDAS, received an FDA Warning Letter in November 2022 concerning the marketing and sale of certain CBD-infused edibles and a topical sunscreen, and is engaging with the FDA to resolve the concerns. Three government actions have also been brought against CBD American Shaman: a Consent Order to Cease and Desist from the Wisconsin Department of Financial Institutions in May 2021 for selling a franchise while unregistered and failing to disclose a former executive's 2012 bankruptcy; a June 2021 action by the Washington Department of Financial Institutions Securities Division for similar reasons, for which CBD American Shaman is negotiating a settlement; and a February 2022 Consent Desist and Refrain Order from the California Department of Financial Protection and Innovation for failing to disclose the same executive's bankruptcy in a 2019 registration application, which resulted in an administrative penalty being paid.
Bankruptcy History
CBD American Shaman has no bankruptcy history to report.
Agreement Terms
Initial Term
5 years
Renewal Term
5 years
Renewal Conditions
To renew, a CBD American Shaman franchisee must provide written notice at least 210 days before the current term expires. They must also sign the franchisor's then-current Renewal Franchise Agreement, which may include different terms like higher royalty or advertising fees. Additionally, the franchisee needs to sign the franchisor's General Release and Covenant Survival Acknowledgment (unless prohibited by law) and pay a renewal fee equal to 20% of the then-current initial franchise fee. The franchisor may refuse renewal if the franchisee has received two or more default notices in any 12-month period or more than five default notices throughout the term, regardless of whether they were cured, or if the franchisee is in default at the time of renewal.
Training & Support Program
Franchisor Assistance
Before opening, CBD American Shaman provides franchisees with an Onboarding Packet that includes site selection criteria, helps review proposed locations and leases, and offers layout, design, and décor specifications for the Shaman Store. They provide lists of required furniture, fixtures, equipment (FFE) and approved suppliers, along with an opening inventory list. Mandatory initial training is provided for the franchisee or operating partner and a manager, covering operations, sales, marketing, and CBD legal compliance. Franchisees also receive the proprietary Shaman Manual, access to Proprietary Product Websites for ordering inventory, access to Franchise Resources (an online cloud-based storage for materials), and approval for initial local advertising. A Wholesale Affiliate Link (WAL) is also provided for customer referrals. During operation, ongoing support includes approval for grand opening promotions and proposed local advertising, and the development of System-wide marketing and promotional campaigns that franchisees must participate in. CBD American Shaman maintains and administers a National Marketing Fund, and updates the Shaman Manual and operating techniques as needed, with updates uploaded to Franchise Resources. Franchisees receive additional and/or periodic refresher training as requested (for a fee) and their Shaman Store is listed on the franchisor's main Website. Franchisees or their Operating Partners must attend an annual meeting that includes training courses and updates.
Initial Training Hours
72
Training Location
Hybrid: Classroom at the Shaman Office in North Kansas City, Missouri; online certification course; and in-store training at an affiliate-owned Shaman Store in Overland Park, Kansas or the Kansas City metropolitan area.
Ongoing Support
After opening, CBD American Shaman franchisees can receive additional and/or periodic refresher training, for which a fee is charged and franchisees are responsible for travel and living expenses. The franchisor continuously updates the Shaman Manual and standard operating techniques, making these updates available through Franchise Resources. The franchisee's Shaman Store is listed on the franchisor's main Website. CBD American Shaman reviews and approves all local advertising material proposed by franchisees. The franchisor also develops and conducts System-wide marketing, advertising, public relations, and promotional campaigns that franchisees are required to participate in. The franchisor maintains and administers a National Marketing Fund and works with the Franchisee Association. Franchisees or their Operating Partners must attend an annual meeting that includes training courses and updates.
Franchise Requirements
Ideal Candidate Profile
CBD American Shaman seeks franchisees who will strictly adhere to its specific practices, procedures, methods, and standards of quality and performance in all aspects of developing, maintaining, and operating a Shaman Store. Franchisees or their approved Operating Partners must be personally present and operate their Shaman Store for at least 40 hours per week during the first six months. After six months, they must remain personally responsible for day-to-day oversight and administration, including weekly store visits, or ensure the store is managed daily by a qualified Manager for at least 40 hours per week.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Hands-On
Territory Type
Non-Exclusive
Territory Size Requirements
CBD American Shaman franchisees do not receive an exclusive territory. The franchisor and its affiliates can establish and operate other Shaman Stores or retail outlets selling similar products anywhere, regardless of proximity to a franchisee's location. Each CBD American Shaman franchisee is granted the right to operate only one Shaman Store at a single, approved street address, which is not exclusive.
Staffing Notes
CBD American Shaman requires that if the franchisee or Operating Partner is not personally present and running the Shaman Store daily after the first six months, it must be managed by a Manager. This Manager must be present at the Shaman Store at least 50 weeks per year, 40 hours each week, and 8 hours a day, actively supervising, overseeing, administering, and managing operations. This Manager must have completed the franchisor's training program and signed a Nondisclosure Agreement. Franchisees are solely responsible for hiring, firing, training, and compensating all other managerial and non-managerial personnel and ensuring they perform competently to maintain uniform quality of service. If employees wear branded apparel, it must be purchased from the franchisor or its affiliates. All employees must maintain good personal hygiene, be appropriately groomed, and adhere to high sanitation standards to protect the System's reputation.