Phenix Salon Suites Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$721,109 - $1,420,469
Franchise Fee
$35,000
Min Cash Required
$10,000
Total US Locations
385
Business Summary
Phenix Salon Suites operates businesses that develop fully equipped luxury salon suites and licenses these suites to independent salon and other business professionals under the Phenix Salon Suites mark. Franchisees may also operate a Phenix Salon Store at the salon that sells Phenix Salon proprietary and private label products and other merchandise.
Corporate History
Phenix Salon Suites Franchising, LLC was formed in Colorado on February 10, 2010. The company began offering franchises and development agreements in June 2010. In November 2021, the company's ownership interests were contributed to its current parent entity, Phenix 1929 Holding LLC, which was formed in August 2021.
Financial Overview
Investment Range
$721,109 - $1,420,469
Franchise Fee (Low)
$35,000
Franchise Fee (High)
$52,500
Minimum Cash Required
$10,000
Equipment Costs (Low)
$63,028
Equipment Costs (High)
$149,766
Working Capital
$55,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Phenix Salon Suites' financial condition, as presented in its financial statements, raises questions about the franchisor's ability to provide services and support to franchisees. The auditor's report mentions that management is required to evaluate conditions that might raise substantial doubt about the company's ability to continue as a going concern, but the audit opinion itself is unqualified.
Financing Details
Phenix Salon Suites does not offer any direct or indirect financing to franchisees. The company also does not guarantee any notes, leases, or obligations for franchisees.
Performance Metrics
Total US Locations
385
Franchised Units
367
Corporate Units
32
Avg Square Footage
6,882
Franchising Since
2010
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Count
1
Litigation Summary
Phenix Salon Suites has one litigation case to disclose. In September 2019, the Attorney General of Washington investigated "no-poach" provisions in Phenix Salon Suites' franchise agreements. In October 2019, Phenix Salon Suites and the State of Washington settled the matter by entering into an Assurance of Discontinuance. As part of this agreement, Phenix Salon Suites agreed to inform all franchisees, amend franchise agreements in Washington to remove the non-solicitation of employees provision, and stop including this provision in all franchise agreements nationwide. No other litigation is required to be disclosed.
Bankruptcy History
Phenix Salon Suites has no bankruptcy history to disclose.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew, Phenix Salon Suites franchisees must provide written notice between 6 and 12 months before their agreement expires. Franchisees must sign Phenix Salon Suites' then-current franchise agreement, which may have different terms, and a general release of claims. They must not be in default of any agreement provisions, including monetary obligations. Franchisees also need to show they have the right to operate at the approved location for the renewal term, refurbish their business to meet current standards within 12 months of renewal, and attend any required refresher training within the same period. A renewal fee of $15,000 is also due upon signing the renewal agreement.
Training & Support Program
Franchisor Assistance
Phenix Salon Suites provides a range of assistance to its franchisees. Before opening, the company helps with site selection and lease negotiation, offers mandatory and suggested specifications for the business layout and design, and assists with recruiting a contractor and negotiating the final construction bid, including a site visit for the first location. If the franchisee opts to operate a Phenix Salon Store, Phenix Salon Suites sells them their opening inventory and provides contact information for approved architects and designated suppliers. The company also assists in establishing a marketing plan for salon suite rentals during construction, provides the Operations Manual, and advises on advertising for the Meet and Greet Event. Initial training is provided for the franchisee or managing owner and up to two managers. After opening, Phenix Salon Suites sends a representative for 1.5 days to assist with the initial opening of the first business. Ongoing support includes advice on business operations, guidance on System Standards, purchasing, advertising, employee training, and administrative procedures via Operations Manuals, bulletins, electronic media, or telephone. Additional guidance, assistance, and training are available upon request (which may incur a fee), issues and modifies System Standards, and is available for telephone advice. Franchisees are allowed to use Phenix Salon Suites' confidential information and Marks. The company periodically offers refresher training courses and advises on suggested leasing/licensing prices. For those with Development Agreements, Phenix Salon Suites helps with changes to site selection criteria, approves locations, and assists in negotiating lease terms for additional sites.
Initial Training Hours
28
Training Location
Las Vegas, NV, and franchisee's location
Ongoing Support
After opening, Phenix Salon Suites sends a representative to the business location for 1.5 days to assist with the initial opening of the first business. The company advises franchisees on business operations through reports and inspections, providing guidance on standards, operating procedures, purchasing, advertising, employee training, and administrative procedures via Operations Manuals, bulletins, electronic media, or telephone. Additional guidance, assistance, and training are available upon request (which may incur a fee), issues and modifies System Standards, and is available for telephone advice. Franchisees are allowed to use Phenix Salon Suites' confidential information and Marks. The company periodically offers refresher training courses and advises on suggested leasing/licensing prices. Additionally, the franchisee's managing owner is required to attend a meeting of franchisees approximately every 18 months.
Franchise Requirements
Ideal Candidate Profile
Phenix Salon Suites is looking for franchisees or their designated Managing Owner to act as the general manager of the business, responsible for direct, on-premises supervision on a full-time basis. The Managing Owner must complete all required training, attend annual franchisee meetings, and dedicate their full-time efforts to supervising and conducting the business. Franchisees will also need a full-time manager or a part-time site coordinator to work at the location for at least 25 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
Full-Time
Territory Type
Non-Exclusive
Staff Count
1
Territory Size Requirements
Phenix Salon Suites defines its protected territories based on the estimated population or daytime population within a three-mile radius from the approved location, with the radius size decreasing as the population increases, and limited by any body of water. For locations greater than 5,000 square feet, the radius ranges from 2.5 miles for populations of 100,000 or less, down to 0.25 miles for populations of 500,000 or more. For locations less than 5,000 square feet, the radius ranges from 2 miles for populations of 100,000 or less, also down to 0.25 miles for populations of 500,000 or more. The estimated population is determined using Sitewise software or similar programs.
Staffing Notes
Phenix Salon Suites requires the franchisee or their designated Managing Owner to serve as the full-time general manager, with direct, on-premises supervision of the business. The Managing Owner must complete all required training, attend annual franchisee meetings, and dedicate their full-time efforts to operating the business. Additionally, each location needs a full-time manager or a part-time site coordinator who works at least 25 hours per week. Franchisees must inform Phenix Salon Suites of any supervisory employees acting as managers or site coordinators. These managers or coordinators are not required to have an equity interest in the business, but they must sign an agreement to maintain confidentiality if requested by Phenix Salon Suites.