Hand & Stone Massage and Facial Spa Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$578,507 - $871,602
Total US Locations
595
Business Summary
Hand and Stone Massage and Facial Spa operates spas that offer professional massage, facial, waxing, skincare, face and body contouring, and face and body sculpting services to the general public. Hand and Stone Massage and Facial Spa also sells related retail products through its member and non-member programs.
Corporate History
Hand and Stone Franchise LLC was originally incorporated in New Jersey on April 6, 2005, as Hand and Stone Franchise Corp., specifically to offer HAND AND STONE MASSAGE AND FACIAL SPA franchises. Hand and Stone Franchise Corp. offered franchises from 2005 until June 2022. The company also previously offered a Regional Developer program, which ceased in 2015. On June 22, 2022, following a Parent Merger, Hand and Stone Franchise Corp. converted into Hand and Stone Franchise LLC. The company's principal business address is in Trevose, Pennsylvania, and it currently has wholly-owned subsidiaries operating 15 HAND AND STONE franchises in New Jersey and Florida.
Financial Overview
Investment Range
$578,507 - $871,602
Franchise Fee (High)
$49,500
Royalty %
6%
Marketing %
1%
Equipment Costs (Low)
$414,499
Equipment Costs (High)
$566,835
Working Capital
$110,965
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Hand and Stone Franchise LLC has reported substantial net losses for both 2023 and 2024, with a net loss of over $60 million in 2023 and over $55 million in 2024. The company also operates with negative working capital, meaning its current liabilities significantly exceed its current assets. For example, in 2024, current assets were approximately $10.4 million while total current liabilities were about $41.1 million. Despite these financial challenges, the independent auditor's report did not include a 'going concern' qualification, indicating that the auditors do not believe there is substantial doubt about Hand and Stone Franchise LLC's ability to continue as a going concern.
Financing Details
Hand and Stone Franchise LLC does not offer any direct or indirect financing to franchisees, nor does it guarantee their notes, leases, or other obligations. Franchisees are responsible for securing their own funding for the initial investment and ongoing operations.
Performance Metrics
Total US Locations
595
Franchised Units
580
Corporate Units
15
Avg Square Footage
2,700
Franchising Since
2005
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Count
1
Litigation Summary
Hand and Stone Franchise LLC has no pending litigation. Its prior legal history includes one arbitration case, Joseph Muti, et al. v. Hand and Stone Franchise Corp., which was filed in May 2017 and settled in April 2018. This case involved former franchisees who asserted claims such as breach of contract, fraud, negligent misrepresentation, and violations of various franchise and consumer protection laws, seeking to rescind their franchise agreement and monetary damages. Hand and Stone Franchise LLC denied the claims and filed a counterclaim for breach of contract. The matter was settled with Hand and Stone Franchise LLC agreeing to purchase the franchisees' spa for $380,000 and assuming certain debts of $280,000, while the claimants agreed to non-competition and non-solicitation terms.
Bankruptcy History
Hand and Stone Franchise LLC has no bankruptcy history to report. The FDD explicitly states that no bankruptcy information is required to be disclosed in this item.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew the franchise agreement, Hand and Stone Massage and Facial Spa franchisees must have substantially complied with all material provisions of their current agreement and not have been in default more than twice. They must also have the right to occupy an approved location for the renewal term, make any necessary capital expenditures to meet current system standards, and have satisfied all financial obligations to Hand and Stone Franchise LLC. Franchisees are required to give written notice of their intent to renew between nine and twelve months before the current agreement ends. They must also sign Hand and Stone Franchise LLC's then-current franchise agreement, which may have different terms and conditions but will maintain the same territory boundaries, and meet current qualifications and training requirements. Finally, a general release of claims in favor of Hand and Stone Franchise LLC and its affiliates is required.
Training & Support Program
Franchisor Assistance
Before opening, Hand and Stone Massage and Facial Spa assists with designating the protected territory, approving the site and lease, and providing standard build-out plans and specifications. It offers an initial two-week operations training program for the designated manager and up to three assistants, along with a two-day massage protocol training for therapists. Hand and Stone Massage and Facial Spa also provides approximately five days of on-site assistance for the grand opening and conducts the grand opening advertising campaign on the franchisee's behalf. After opening, Hand and Stone Massage and Facial Spa provides ongoing general guidance via telephone, email, and newsletters. It conducts discretionary periodic visits for consultation and operational assistance, makes ongoing training programs and system updates available, and supplies formats for advertising and promotional materials. Hand and Stone Massage and Facial Spa also administers system-wide marketing and local advertising funds.
Initial Training Hours
142
Training Location
Corporate headquarters in Trevose, Pennsylvania, or at an operating spa, with some on-site training at the franchisee's location.
Ongoing Support
Hand and Stone Massage and Facial Spa provides ongoing support to franchisees through periodic advice and general guidance via telephone, email, and newsletters. It also conducts discretionary periodic visits to franchised businesses for consultation, assistance, and guidance in various aspects of operation and management. Hand and Stone Massage and Facial Spa makes operations assistance and ongoing training programs available as deemed necessary, and communicates changes and additions to the System to franchisees. Additionally, it periodically provides formats for advertising and promotional materials. Franchisees may be required to attend refresher-training programs, typically not more than two sessions or seven days per year, with franchisees responsible for associated travel and living expenses.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
retail
Owner Participation
Supervisory
Territory Type
Protected
Territory Size Requirements
Hand and Stone Massage and Facial Spa territories are typically defined as an eight-minute drive time around the specific business location. In highly dense areas, such as downtowns and cities, the protected territory may be smaller than an eight-minute drive time.
Staffing Notes
Hand and Stone Massage and Facial Spa requires that the business always be under the direct full-time supervision of either the franchisee or a Designated Manager. The franchisee is solely responsible for all employment decisions and compliance with state, federal, and local hiring laws for their employees and independent contractors, including hiring, firing, training, wage and hour requirements, compensation, promotion, record-keeping, supervision, and discipline. If a Designated Manager or Lead Therapist is replaced, the new individual must complete Hand and Stone Massage and Facial Spa's initial training program to its satisfaction within 30 days. The franchisee is also responsible for training their own employees and other management personnel.