In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the Brain Balance franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Brain Balance franchise, based on Item 7 of the company’s 2018 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Brain Balance franchise, based on Items 5 and 6 of the company’s 2018 FDD
- Section IV – Number of franchised and company-owned Brain Balance outlets at the start of the year and the end of the year for 2015, 2016, and 2017, based on Item 20 of the company’s 2018 FDD
- Section V – Presentation and analysis of Brain Balance’s financial performance representations, based on Item 19 of the company’s 2018 FDD, including information on the:
- 2014, 2015, 2016, and 2017 average, maximum, minimum, median, and total gross sales for all franchisee-owned Brain Balance Centers that were open for the entire 2014, 2015, 2016, and 2017 calendar year, respectively
- 2014, 2015, 2016, and 2017 actual annual gross sales for the Top 10 and Bottom 10 franchisee-owned Brain Balance Centers that were open for the entire 2014, 2015, 2016, and 2017 calendar year, respectively
- 2014, 2015, 2016, and 2017 average, maximum, minimum, median, and total gross sales for the Top Third, Middle Third, and Bottom Third of franchisee-owned Brain Balance Centers that were open for the entire 2014, 2015, 2016, and 2017 calendar year, respectively
Section I – Background Information
24 Things You Need to Know About the Brain Balance Franchise
New Locations in Texas and Florida
1. Brain Balance Achievement Centers, which continues to grow across the United States, opened new centers in Lubbock, Texas and Cooper City, Florida in 2018. The Brain Balance Achievement Center in Lubbock opened in January, while the Cooper City center opened in April.
2. Dr. Robert Melillo, co-founder of Brain Balance Achievement Centers and the man who developed the Brain Balance program, attended the grand opening celebration of the first Brain Balance in Lubbock. During the grand opening, Brain Balance Lubbock hosted an open house and Dr. Melillo was available to answer questions.
3. Dr. Melillo talked about autism and said, “Even though it’s the fastest-growing mental disorder right now, it’s the smallest. ADHD is the largest mental disorder, dyslexia, learning disabilities. Most of these problems are completely correctable with the right interventions. Basically, we use more of a global brain learning type of program. Again, these kids aren’t sick. We don’t look at these as medical conditions even though they have labels. Most of the kids don’t have a label. They’re just struggling in school and they have certain skills they’re really good at and other skills they really struggle at which is representative of this imbalance in the brain.”
4. Brain Balance Achievement Center of Cooper City celebrated its grand opening on April 26 and 27. To celebrate the grand opening, the center hosted a ribbon cutting and open house, where they had a special presentation with Dr. Melillo.
5. Monica Tapia-Mularski, center director of Brain Balance Achievement Center of Cooper City, said, “We are very excited to celebrate the grand opening of our center. We understand how frustrating it can be for parents to watch their children struggle academically, socially, or behaviorally. We look forward to being able to help children in the area by giving them the tools they need to succeed at home and in the classroom.”
National Public Radio (NPR) Publishes Results of Year-Long Investigation Into Claims Made by Brain Balance Achievement Centers
6. For several years, Brain Balance Achievement Centers has been criticized by the scientific and medical communities over the company’s claims that it can effectively treat autism and ADHD without medication. In June 2018, National Public Radio (NPR) published the results of a year-long investigation into Brain Balance’s claims. According to NPR, Brain Balance’s promises have resonated with parents averse to medication, but Brain Balance has “overstated the scientific evidence in its messaging to families.”
7. According to Brain Balance, its customer satisfaction scores are high, an 8.5 on a 10-point scale. NPR found that this was in line with the 18 parents they interviewed, as well as the comments in online forums.
8. In addition to interviewing parents, NPR did some digging into Brain Balance founder Dr. Robert Melillo’s medical credentials. Dr. Melillo has a doctorate and active license in chiropractic and also claims to be an expert in the field of functional neurology, chiropractic’s controversial alternative to mainstream neurology. Melillo also has master’s degrees in neuroscience and clinical rehabilitation neuropsychology.
9. NPR discovered that Melillo’s master’s in neuroscience came from the Carrick Institute for Graduate Studies, a chiropractic academy in Florida that isn’t accredited by any of the agencies recognized by the Department of Education. Melillo’s other master’s degree is from a now-defunct program at Touro College, a private educational organization based in New York.
10. NPR also noted that Melillo claims “ADHD, dyslexia, and even autism, among others, can
become a thing of the past” with the Brain Balance program. However, a dozen experts in autism spectrum disorder, ADHD, dyslexia, and childhood psychiatry interviewed by NPR all identified flaws in Brain Balance’s approach. These experts say that Brain Balance’s “idea of imbalanced hemispheres was too simplistic and built upon the popular, discredited myth of the logical left brain and the intuitive right brain.”
11. Brain Balance also uses a nutritional program to treat these disorders, but the experts that NPR interviewed said there is no solid evidence suggesting gluten, dairy, or sugar consumption affects ADHD, autism, or dyslexia.
12. Melillo has disagreed with the experts’ opinions. “I think they’re completely wrong,” he says. He also doesn’t believe the medical consensus that autism, ADHD, and dyslexia aren’t caused by hemispheric differences and that gluten doesn’t affect such disorders. According to Melillo, “I can show you a lot of papers that actually say that there is a relationship between food sensitivities, gluten sensitivity and different types of issues and conditions. So again, it depends on the expert.”
13. Brain Balance has published two studies which show that 81 percent of children with ADHD no longer displayed symptoms after three months in the program. Melillo said, “We have two studies now. So that means that we qualify as what we call ‘evidence based’ at this point.”
14. However, Melillo co-authored the first study, which shows a conflict of interest. The studies had parents rate their own children’s improvement in ADHD symptoms but didn’t compare them with other kids who weren’t in Brain Balance. According to NPR, without a control group, a study cannot definitively determine whether an intervention — a pill or procedure or program — is the reason for improvement or whether any change is simply the placebo effect.
15. While the second study did feature a control group of children with ADHD who didn’t do Brain Balance, they were only compared to the children from the first study, which took place years earlier.
16. When NPR asked Melillo why Brain Balance hadn’t been tested more thoroughly before its nationwide expansion began in 2007, Melillo said the company was “faced with a dilemma.” Melillo added that while he did feel an obligation to validate his approach, he says he knew Brain Balance worked and didn’t want to deprive his clients of its benefits while waiting for clinical trials.
17. Melillo also disputed the idea that Brain Balance’s own data may require third-party review. “Data is data,” he says. “There’s no bias in the way we collect this.”
18. At the time of the report, NPR said that a new study of a computerized version of Brain Balance was underway at a Harvard-affiliated hospital and features a concurrent control group of children.
19. NPR concluded that while Brain Balance’s program doesn’t appear to pose any physical or developmental harm to children, it does siphon away time and money from parents and their children. Brain Balance also prolongs “the hope in some parents that their child may one day shed his or her disorder.”
20. Brain Balance Achievement Centers was founded in 2007 by Dr. Robert Melillo and William Fowler. The program offered at Brain Balance was first developed by Dr. Melillo in the early 1990s when he noticed that there was a marked increase in children with learning and behavioral issues visiting his practice.
21. Dr. Melillo conducted extensive research into disorders like ADHD, dyslexia, processing disorders, and autism spectrum disorders. After many years, Dr. Melillo developed the Brain Balance program, which uses three key activities to stimulate and promote brain development: Sensory Motor Stimulation, Academic Stimulation, and Nutrition.
22. In 1994, Dr. Melillo began implementing this integrated approach to helping children with learning and developmental disorders in his own practice. He spent the next 12 years refining the program and by 2006, Dr. Melillo was ready to offer the Brain Balance program on a larger scale. Brain Balance Achievement Centers opened its first location the following year and immediately started franchising.
23. Today, there are Brain Balance Achievement Centers across the United States. Despite the company’s success, the Brain Balance program has faced widespread criticism in the scientific and medical communities for claiming that the program helps treat children with autism spectrum disorders and ADHD.
Entrepreneur’s Franchise 500
24. Brain Balance did not rank on Entrepreneur’s 2018 Franchise 500 list.
Section II – Estimated Costs
- Please click here for detailed estimates of Brain Balance franchise costs, based on Item 7 of the company’s 2018 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on Brain Balance’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2018 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
- Outlets at the Start of the Year: 62
- Outlets at the End of the Year: 76
- Net Change: +14
- Outlets at the Start of the Year: 76
- Outlets at the End of the Year: 94
- Net Change: +18
- Outlets at the Start of the Year: 94
- Outlets at the End of the Year: 107
- Net Change: +13
- Outlets at the Start of the Year: 4
- Outlets at the End of the Year: 4
- Net Change: 0
- Outlets at the Start of the Year: 4
- Outlets at the End of the Year: 5
- Net Change: +1
- Outlets at the Start of the Year: 5
- Outlets at the End of the Year: 3
- Net Change: -2
Section V – Financial Performance Representations (Item 19, 2018 FDD) and Analysis
- Brain Balance is providing historical revenue information (without including expense items) for all franchisee-owned Centers that were open for the entire year for each year stated below.
- The first chart shows the highest performing Center, the lowest performing Center, the average performance of the full group, and the median Gross Revenue number for the group for each year. The total number of Centers that were open for the entire year is shown as “Number of Centers.”
- The second chart shows the top and bottom ten performing Centers by Gross Revenue for each year.
- The third chart shows each group for each year, divided into performance categories.
- The numbers provided in this Item 19 were compiled from the voluntary reporting information that the franchisees provided to Brain Balance pursuant to the Franchise Agreement, data Brain Balance pulled from its required Customer Relations Management System, or, in a few instances, from the results of an audit Brain Balance conducted of a particular Center’s financials. In general, these revenue numbers have not been verified by Brain Balance or independently audited.
- A new franchisee’s individual financial results may differ from the results provided below.
- The earnings claims figures do not reflect the costs of sales, operating expenses, or other costs or expenses that must be deducted from the gross revenues or gross sales figures to obtain your net income or profit.
Part 1 – Gross Sales (Whole Group)