In this FDD Talk post, you’ll learn the following:

• Section I – Background information on the Waxing the City franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for a Waxing the City franchise, based on Item 7 of the company’s 2019 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Waxing the City franchise, based on Items 5 and 6 of the company’s 2019 FDD

• Section IV – Number of franchised and company-owned Waxing the City outlets at the start of the year and the end of the year for 2016, 2017, and 2018, based on Item 20 of the company’s 2019 FDD

• Section V – Presentation and analysis of Waxing the City’s financial performance representations, based on Item 19 of the company’s 2019 FDD, including information on the:

• historical average monthly gross revenues during the first 6 months of operations for the franchised Waxing the City studios that had their first full calendar month of operations between February 2017 and December 2018 (the “Reporting Period”) and that opened their Waxing the City studios between January 2017 and December 2018

• historical average gross revenues during the first 12 months of operations for the 74 franchised Waxing Studios in operation for the entire year ended December 31, 2018

• 2018 average, median, high, and low gross revenue for the top one-third and bottom one-third of Waxing the City studios during their second, third, and fourth year of operation

• projected cost of sales, gross margin, operating expenses, and operating income for the top one-third and bottom one-third of Waxing the City studios during their second, third, and fourth year of operation, and the specific assumptions behind these projections

Section I – Background Information

14 Things You Need to Know About the Waxing the City Franchise

Introduces Lash Lift Services

1.  In mid-June 2019, Waxing the City introduced new LVL Lash Lifts to its already extensive menu of services. Waxing the City’s LVL Lash Lift is a customizable eyelash treatment designed to lift natural lashes at the root, creating the effect of longer, darker, more lustrous lashes. With immediate results lasting 6 to 8 weeks, they’re a great option for people with low-maintenance beauty routines, busy lifestyles, allergies, or those who want to make the most of their natural eyelashes without damaging them.

2.  LVL stands for Length, Volume and Lift, and Waxing the City clients will be pleasantly surprised by the instant results. By straightening natural lashes near the root, and then tinting them, LVL Lash Lifts give clients the appearance of longer, thicker lashes.

3.  Summer Vasilas, co-founder of Waxing the City, said, “Who wouldn’t be interested in ways to transform their natural lashes to be longer, fuller, thicker? Our new Lash Lifts are the perfect solution. They look beautiful and last up to two months. The best part is our trained Cerologists™ can customize their techniques based on a client’s individual needs and preferences.”

4.  With the demand for professional eyelash services up 14% since 2017, Waxing the City is excited to expand its menu of services to provide clients with a “natural” option to complete and simplify their beauty routine. Some of the key benefits of the LVL Lash Lift services are:

• Lash Lifts won’t damage clients’ natural eye lashes;
• Results are immediate;
• Services start at $90;
• Process will take 60 minutes.

5.  At the time of the announcement, about 75% of Waxing the City studios around the country had begun offering lash lift services. Nearly all Waxing the City studios will be offering the services by the end of this year.

6.  Vasilas added, “Waxing the City has spent the last fifteen years perfecting the art of body waxing and now we’re expanding the services we offer to help women and men look and feel their best in new ways. The introduction of this new service presents an opportunity for our clients to experience a lash enhancing service without having to compromise the level of service and commitment to quality results that they experience at Waxing the City.”

Aims to Become the ‘Starbucks of Hair Removal’

7.  Since Waxing the City was acquired by Self Esteem Brands, parent company of Anytime Fitness, in 2012, Waxing the City has seen accelerated growth and shows no signs of slowing down. According to an interview with The Observer in late March 2019, Waxing the City opens an average of two stores a month, making it the fastest-growing waxing franchise in the United States, second in total waxing studios only to Florida-based European Wax Center.

8.  Angela Jaskolski, brand president of Waxing the City, said, “We understand that waxing can be a bit awkward and intimidating. We know it might not be for everyone, but we also know that there is a large and growing number of women and men that want nothing to do with excess body hair. That’s where we come in, to make their experience as easy as possible. Our studios are conveniently located, safe, clean, professional and efficient. Waxing is as good for the skin as it is for the psyche. Choosing to be smooth and clean down there gives many of our clients a boost of confidence.”

9.  According to industry experts, the global waxing industry is worth nearly $10 billion, with nearly a quarter of that revenue being generated in the United States. And it’s growing: forecasts expect the hair removal industry to double or triple in size in the next decade as more and more people get familiar with the Brazilian wax and companies like Waxing the City continue their Starbucks-like expansion into strip malls across the country.

10.  According to Chuck Runyon, CEO of Self Esteem Brands, the parent company of Waxing the City, “We have just about reached the tipping point, where waxing – all types of waxing – is going very mainstream. We as an industry will soon be as commonplace as nail and hair salons in the very near future. And our growth will not just be in terms of new studios and new locations, but it will be in new product as well. We are already rolling out an array of new innovative services – just recently we unveiled our ‘lash lifts,’ which are basically a perm for the eyelashes – moves like this will ensure we maintain a leadership position in the industry.”

Company History

11.  Waxing the City was founded in 2003 by Summer Vasilas, Marilyn Hartshorn, Robin Schoh, and Alex Arlotta in the LoDo neighborhood of Denver, Colorado. Vasilas had worked in the salon industry since the late 1990s and refined her waxing skills. As Vasilas became more passionate about waxing, she dreamed of opening her own salon. With the help of her friends – Hartshorn, Schoh, and Arlotta – Vasilas was able to open Waxing the City, the first studio in Colorado to solely provide facial and body waxing services.

12.  From the start, Waxing the City’s founders wanted to provide high-quality services to ensure Waxing Standards of Excellence. Every licensed aesthetician at Waxing the City completes an extensive training course before they serve clients. Waxing the City says that its waxing techniques are so special they even have a special name: Cerology® waxing services.

13.  The first Waxing the City location was a success and three more studios were opened in the greater Denver area over the next few years. In 2010, Waxing the City began franchising and expanded into Dallas, Texas. Two years later, as Waxing the City continued to grow, the company was acquired by Anytime Fitness, the world’s largest co-ed fitness franchise. Today, there are Waxing the City studios across the United States.

Entrepreneur’s Franchise 500

14.  Waxing the City ranked No. 342 on Entrepreneur’s 2019 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of Waxing the City franchise costs, based on Item 7 of the company’s 2019 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on Waxing the City’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2019 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2016

• Outlets at the Start of the Year:  38
  
• Outlets at the End of the Year:  65
• Net Change:  +27

2017

• Outlets at the Start of the Year:  65
• Outlets at the End of the Year:  84
• Net Change:  +19

2018

• Outlets at the Start of the Year:  84
• Outlets at the End of the Year:  95
• Net Change:  +11

Company-Owned

2016

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

2017

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

2018

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  8
• Net Change:  +7

Section V – Financial Performance Representations (Item 19, 2019 FDD) and Analysis

Part 1 – Historical Average Monthly Revenues of Studios’ Initial 6 Months of Operations – 2017 to 2018 Studio Openings

• The following is a representation of historical monthly Gross Revenues during the first 6 months of operations of the franchised Waxing Studios that had their first full calendar month of operations between February 2017 and December 2018 (the “Reporting Period”) and that opened their Waxing Studios between January 2017 and December 2018.

• Gross Revenue includes all revenue generated by the Waxing Studios, excluding bona fide refunds, credits given or allowed to customers for the return of merchandise, and sales taxes collected and remitted.

2017 Class