Risk Score
Pending analysis
Investment Range
$944,579 - $1,642,970
Franchise Fee
$89,550
Min Cash Required
$80,000
Total US Locations
9
Business Summary
Town Square Franchised Businesses operate high-quality adult day care facilities that provide adult day care and support services to families affected by Alzheimer's and other forms of memory impairment diseases. These facilities feature a unique indoor, interactive, simulated urban environment with various storefronts and stations designed to resemble a mid-century American town. Participants engage in activities, socialize, enjoy entertainment, and receive services, all utilizing reminiscence therapy. Services include assistance with daily living activities, counseling, educational and exercise programs, health monitoring, social activities, meals, and transportation.
Corporate History
Town Square Franchising LLC was formed in Delaware on December 19, 2023, and began offering franchises for its Town Square Franchised Businesses on May 7, 2024. Its parent company, SH Town Square Franchising, Inc., was formed earlier in March 2018 and operated as the franchisor for Town Square businesses from June 2018 until March 2024, at which point it ceased offering new franchises. An affiliate, Town Square Corporate Company, Inc., opened its own Town Square Center in Baltimore, Maryland, in November 2019.
Financial Overview
Investment Range
$944,579 - $1,642,970
Franchise Fee (Low)
$89,550
Franchise Fee (High)
$200,000
Minimum Cash Required
$80,000
Royalty %
7%
Marketing %
1%
Equipment Costs (Low)
$587,579
Equipment Costs (High)
$1,055,000
Working Capital
$115,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Town Square Franchising LLC's financial statements for the year ended December 31, 2024, show total assets of $159,919 and total liabilities of $199,003.01, resulting in a negative Members' Equity of ($39,084). The franchisor explicitly notes in the FDD's Special Risks section that its financial condition, as reflected in these statements, calls into question its ability to provide services and support to franchisees. Despite this, management believes it has adequate liquidity for the next twelve months based on existing cash and projected income from current franchisees, with current assets covering existing short-term liabilities at the balance sheet date.
Financing Details
Town Square Franchising LLC does not offer any direct or indirect financing to its franchisees. Additionally, it does not guarantee any notes, leases, or other obligations of its franchisees.
Performance Metrics
Total US Locations
9
Franchised Units
8
Corporate Units
1
Avg Square Footage
6,000
Franchising Since
2024
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Town Square Franchising LLC has no litigation information required to be disclosed in Item 3 of its Franchise Disclosure Document, indicating a lack of material legal disputes or actions.
Bankruptcy History
Town Square Franchising LLC has no bankruptcy information required to be disclosed in Item 4 of its Franchise Disclosure Document, indicating no history of bankruptcy for the franchisor or its key personnel.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their franchise agreement, Town Square Franchised Businesses must be in substantial compliance with their current agreement and all System Standards. They need to provide notice of their intent to renew between 180 and 270 days before the agreement expires. Franchisees must also maintain or secure a new Center location that meets current System Standards, and they will be required to sign the then-current successor franchise agreement, which may include terms and conditions that differ materially from their previous agreement, though the royalty rate will remain the same. A general release of claims against Town Square Franchising LLC and its affiliates will also be required.
Training & Support Program
Franchisor Assistance
Town Square Franchising LLC provides extensive assistance to its franchisees. Before opening, this includes mandatory and suggested specifications for the Center's layout and design, engaging a designated third-party vendor to manage the facility's build-out, and conducting a new owner training program. After opening, ongoing support includes retaining third-party providers for services, a two-day visit from a company representative within the first six months, and continuous guidance on operations, advertising, employee training, and administrative procedures. Town Square also sets maximum prices for services, administers the Marketing Fund, and helps develop local advertising and marketing strategies.
Initial Training Hours
173
Training Location
Remote and at corporate headquarters in Perry Hall, MD
Ongoing Support
After opening, Town Square Franchising LLC offers ongoing support by potentially retaining third-party providers for services and support. Within the first six months, a company representative will visit the franchised business for up to two days to assist with operations. The franchisor provides continuous guidance based on franchisee reports and observations, covering standards, specifications, operating procedures, marketing, employee training, recruiting, and administrative, bookkeeping, and accounting procedures. Franchisees are also supported through the Operations Manual, administration of the Marketing Fund, and assistance in developing annual advertising and marketing plans for their specific territory.
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
Full-Time
Territory Type
Protected
Staff Count
5
Territory Size Requirements
Town Square Franchised Businesses typically receive a territory defined by a circular boundary extending outwards from their Center, encompassing approximately 25,000 seniors. However, the precise size and scope of each territory are determined by various factors including population, demographics, local competition, the presence of existing Town Square Franchised Businesses, and site availability. While Town Square Franchising LLC grants territorial protection within a two-mile buffer from the territory's border, it retains broad rights to operate or license other businesses outside this buffer and to sell products and services through dissimilar channels, including online, both within and outside the territory.
Staffing Notes
Town Square Franchised Businesses require dedicated management and staff to provide high-quality adult day care services. The franchisee or an appointed Operating Principal must provide full-time general oversight of the business. Each center also needs a full-time Center Director, who can be the franchisee, Operating Principal, or another approved individual, responsible for direct, on-premises supervision. If the franchisee operates multiple locations, each must have an approved and certified Center Director. Key positions that a Town Square Franchised Business may need to hire include a Center Director, Programming Manager, RN/LPN, Enrollment Manager, Center Coordinator, and direct care staff. The investment estimates are based on a 75-member capacity center with a 7:1 program assistant to member ratio, assuming five staff members. Staffing ratios, however, can vary based on state and payor requirements. Additionally, Town Square Franchising LLC may require the hiring and retention of a full-time Activities Director, Enrollment Director, an RN/LPN, and an administrative assistant/receptionist. All management personnel, including the Operating Principal and Center Director, must complete mandatory training programs (40 hours each for new owners and Center Directors) and receive certification from Town Square Franchising LLC. They must also satisfactorily complete all state and local government-required training and meet all necessary licensing requirements. If certified personnel are decertified, they must complete retraining. Town Square Franchising LLC requires franchisees to use an approved third-party payroll, tax, and employee services administrator for consistent reporting and benefits administration. Franchisees retain sole discretion over employment decisions, including hiring, firing, compensation, and scheduling.