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Considering a MassageLuXe Spa Franchise? Don’t Overlook These 20 Important Franchise Fees

by Franchise Chatter on July 19, 2017

in Franchise Fees, Massage Franchise



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Don't Invest in a Franchise Until You Check Out This List

Massage Luxe Photo from Massage Luxe

If you are considering a MassageLuXe Spa franchise, don’t get blindsided by these 20 important franchise fees (from the initial franchise fee, to the royalty fee, to 18 other fees found in Items 5 and 6 of MassageLuXe Spa’s 2017 FDD).

1.  Initial Franchise Fee:  $0 to $38,000



  • You must pay MassageLuXe a lump-sum initial franchise fee in the amount of $38,000, which is due in full upon signing the Franchise Agreement.
  • The initial franchise fee is fully earned by MassageLuXe when you sign the Franchise Agreement and is not refundable under any circumstances.
  • If you sign a Multi-Unit Development Agreement, the initial franchise fee for your first Spa is $38,000 and the initial franchise fee for each additional Spa developed under the Multi-Unit Development Agreement will be $19,000.
  • All of these fees will be paid as part of the MUD Fee and credited to you as described below.
  • If you sign an Area Development Agreement, the initial franchise fee for your first Spa is $0 and the initial franchise fee for each additional Spa developed under the Area Development Agreement will be $19,000.
  • The Area Development program is offered under a separate franchise disclosure document.

2.  Certain Products and Services:  $76,225 to $101,750

  • Before your Spa opens, you must purchase through MassageLuXe or its affiliate Luxe, certain products and services. The products that you will have to purchase through Luxe include almost all signs, computer hardware and software, spa equipment, furniture and decor, and fixtures that you will need to open your Spa.
  • Your estimated cost for pre-opening purchases will range from $76,225 to $101,750.
  • Currently, Luxe requires that you pay a deposit on the products when you sign the lease for the premises in which you will operate your Spa.

3.  Construction Support Fee:  $3,000

  • Luxe also charges a Construction Support Fee to provide onsite assistance during the buildout and construction of your Spa. MassageLuXe estimates this fee will be $3,000 based on Luxe sending a representative to your Spa twice during this period of time.
  • Additional onsite trips could become necessary depending on the quality of the contractor’s work, in which case additional charges will be incurred.

4.  Multi-Unit Development Fee:  $76,000 for the first 3 Spas, plus $19,000 for each additional Spa to be developed under the Multi-Unit Development Agreement

  • When you sign the Multi-Unit Development Agreement, you must pay MassageLuXe a nonrefundable development fee (the “MUD Fee”).
  • The minimum MUD Fee is $76,000 (for a minimum of a 3-Spa mandatory development schedule, calculated as follows: $38,000 for your first Spa, plus $19,000 for your second Spa, and $19,000 for your third Spa).
  • The total amount of the MUD Fee is equal to $76,000 for these first 3 Spas, plus $19,000 for each additional Spa to be developed under the Multi-Unit Development Agreement.
  • You must pay the MUD Fee immediately upon signing the Multi-Unit Development Agreement. The MUD Fee is credited to the initial franchise fee due for each Spa that is to be developed under the Multi-Unit Development Agreement at the time that you sign the Franchise Agreement for each such Spa.
  • The MUD Fee is fully earned by MassageLuXe when you sign the Multi-Unit Development Agreement and is not refundable under any circumstances.

5.  Royalty:  5% of Gross Revenue commencing on the first day of operations

  • Due Date:  Each Friday for the preceding week, running as Saturday through Friday.
  • Paid via debit draft of your account as initiated by MassageLuXe.

6.  Refresher Training Fees:  $400 per day per trainer

  • Due Date:  As MassageLuXe and you agree.
  • Paid if you need additional or refresher training. You will be responsible for all travel and living expenses.

7.  Per Day Fee:  $400 per day per trainer



  • Due Date:  As MassageLuXe and you agree.
  • If you request MassageLuXe to provide assistance or if MassageLuXe requires your employees to be trained.

8.  Regional Ad Fee:  2.5% of Gross Revenue commencing on the first day of operations

  • Due Date:  Each Friday for the preceding week, running Saturday through Friday.
  • Paid via debit draft of your account as initiated by MassageLuXe.

9.  National Ad Fee:  1% of Gross Revenue commencing on the first day of operations

  • Due Date:  Each Friday for the preceding week, running Saturday through Friday.
  • Paid via debit draft of your account as initiated by MassageLuXe.

10.  POS System Software Fees:  (for each Spa) initial fee of $375 and an ongoing fee of $75 per
week

  • Due Date:  Prior to opening and then each Friday for the preceding week, running Saturday through Friday.
  • The ongoing fee of $75 per week may be increased no more than 5% annually.
  • Paid via debit draft of your account as initiated by MassageLuXe.

11.  Alternative Supplier or Product Approval Fee:  $500 plus reasonable fee based on MassageLuXe’s costs if expenses incurred are greater than $500

  • Due Date:  Upon submitting request for alternative supplier or alternative product, and expenses on receipt of invoice.
  • If you want to use an alternative supplier or an alternative product.

12.  Interest:  the lesser of 5% per month or the highest contract rate of interest permitted by law

  • Due Date:  When underlying obligation is paid.
  • Paid if you are late on any required payments to MassageLuXe.

13.  Auditing Costs:  actual costs



  • Due Date:  Reimbursement of MassageLuXe’s actual auditing costs.
  • You’ll reimburse MassageLuXe for its auditing costs if the audit discloses an understatement of more than 2%.

14.  Transfer Fee (Franchise Agreement and MUD):  25% of the then-current initial franchise fee; $5,000 per Spa to be developed under the Multi-Unit Development Agreement

  • Due Date:  Concurrently with the transfer.
  • Upon a transfer under the Franchise Agreement or Multi-Unit Development Agreement.

15.  Renewal Fee:  $5,000 under the Franchise Agreement

  • Due Date:  Concurrently with MassageLuXe granting a renewal franchise to you.
  • Paid to MassageLuXe if you want to renew the Franchise Agreement.

16.  Costs and Attorneys’ Fees (Franchise Agreement and MUD):  actual costs

  • Due Date:  Upon demand.
  • You’ll reimburse MassageLuXe for accounting, attorneys’, arbitrators’, and related fees incurred by MassageLuXe if it is forced to seek enforcement.

17.  Taxes:  actual costs

  • Due Date:  Upon demand.

18.  Liquidated Damages:  $1,000 per day

  • Due Date:  Upon demand.
  • Payable for each day unauthorized products or services are offered for sale or sold.

19.  Products and Fixtures:  per the price list, which is subject to change

  • Due Date:  As incurred.
  • You will purchase products and fixtures from MassageLuXe’s affiliate Luxe.

20.  Online Continuing Education Programs:  $100 to $500 per therapist per training program

  • Due Date:  As incurred.
  • If MassageLuXe provides you optional continuing education programs for your therapists.

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