In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:
Section I – Estimated initial investment (franchise costs) for a Massage Envy franchise, based on Item 7 of the company’s 2023 FDD
Section II – Initial franchise fee, royalty fee, and marketing fee for a Massage Envy franchise, based on Items 5 and 6 of the company’s 2023 FDD
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Section IV – News updates on the Massage Envy franchise opportunity
Section V – Presentation and analysis of Massage Envy’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2023 FDD, including information on the:
- 2022 average, median, highest, and lowest gross sales for the 186 smaller format Massage Envy businesses that were open and operational for at least 1 year as of December 31, 2022, by quartile
- 2022 average, median, highest, and lowest gross sales for the 15 smaller format Massage Envy businesses that were open and operational for 1-5 years as of December 31, 2022, by quartile
- 2022 average, median, highest, and lowest gross sales for the 31 smaller format Massage Envy businesses that were open and operational for 5-10 years as of December 31, 2022, by quartile
- 2022 average, median, highest, and lowest gross sales for the 140 smaller format Massage Envy businesses that were open and operational for 10+ years as of December 31, 2022, by quartile
Section VI – Key ratios, comparables, computations, and analyses for the Massage Envy franchise opportunity (exclusive content for Platinum subscribers)
Section I – Massage Envy Franchise Costs
- Massage Envy franchise costs, based on Item 7 of the company’s 2023 FDD:
- Initial Franchise Fee: $45,000
- Initial Opening Package: $46,000 to $66,000
- Computer System: $57,600 to $82,000
- Security Deposits: $6,000 to $17,000
- Three Months’ Lease Rent: $13,000 to $32,200
- Leasehold Improvements: $287,000 to $554,000
- Signage (excludes interior signage that is part of the building materials included in Leasehold Improvements): $6,000 to $17,000
- Business Licenses and Permits: $250 to $5,000
- Professional Fees: $7,000 to $30,000
- Grand Opening Advertising Program: $15,000
- Insurance: $10,000 to $35,000
- Initial Training: $1,000 to $6,000
- Additional Funds – 3 Months: $61,000 to $75,000
- Total Estimated Massage Envy Franchise Costs: $554,850 to $980,000
Section II – Massage Envy’s Initial Franchise Fee, Royalty Fee, and Marketing Fee
- Massage Envy’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2023 FDD:
- Initial Franchise Fee: $28,000 to $45,000
- Royalty: 6% of Gross Sales
- Marketing Fund/National Advertising Fund Contributions: 2% of Gross Sales
- Supplemental Marketing Fund: 2% of Gross Sales
- Regional Advertising Cooperative Contributions: established by advertising cooperative members
Section III – Number of Franchised and Company-Owned Massage Envy Outlets
Franchised
2020
- Outlets at the Start of the Year: 1,154
- Outlets at the End of the Year: 1,127
- Net Change: -27
2021
- Outlets at the Start of the Year: 1,127
- Outlets at the End of the Year: 1,109
- Net Change: -18
2022
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- Outlets at the End of the Year: 1,083
- Net Change: -26
Company-Owned
2020
- Outlets at the Start of the Year: 0
- Outlets at the End of the Year: 0
- Net Change: 0
2021
- Outlets at the Start of the Year: 0
- Outlets at the End of the Year: 0
- Net Change: 0
2022
- Outlets at the Start of the Year: 0
- Outlets at the End of the Year: 0
- Net Change: 0
Section IV – News Updates on the Massage Envy Franchise
Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Massage Envy Franchise (Item 19, 2023 FDD)
- As of December 31, 2022, there were a total of 1,083 franchised Massage Envy Businesses open and operating and, of that number, 1,071 Massage Envy Businesses were in operation continuously throughout fiscal year 2022 and had been open and operating for at least 12 calendar months as of December 31, 2022.
- Massage Envy’s 2022 fiscal year was January 1, 2022 through December 31, 2022.
- 186 of these 1,071 Massage Envy Businesses reflect the new smaller size and layout for Massage Envy Businesses (ranging in size from 2,300 to 2,800 square feet) that prospective franchisees are required to develop moving forward. Massage Envy calls these 186 Massage Envy Businesses the “Smaller Format Businesses” in this Item 19.
- For purposes of these tables, “Gross Sales” means the total of all revenue and receipts derived from the operation of the Massage Envy Business, including, but not limited to, all amounts received at or away from the physical location of the Massage Envy Business, or through or by means of the business conducted at the Massage Envy Business, such as fees for massage services, facial services, membership fees, fees for optional member services and charges, gift card sales, and revenue derived from products sales, whether in cash or by check, credit card, debit card, barter or exchange, or other credit transactions, but excluding only (1) sales taxes collected from customers and paid to the appropriate taxing authority, (2) all customer refunds and credits your business makes, and (3) tips received by massage therapists and aestheticians.
- Without limiting the generality of the foregoing, “Gross Sales” includes all amounts that third-party marketing agencies, such as, for example, Groupon, receive and retain from your customers for marketing products or services that these customers purchase from your business.
Part 1 – Average Gross Sales for Fiscal Year 2022 for Smaller Format Businesses Open 1 Year or More
- Part 1 presented below shows Gross Sales information from fiscal year 2022 for the 186 Smaller Format Businesses that were open and operational for at least 1 year as of December 31, 2022.
Top Quartile
- Average Gross Sales: $1,716,193
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 19 / 46 (41.3%)
- Median Gross Sales: $1,696,585
- Highest Gross Sales: $2,436,232
- Lowest Gross Sales: $1,338,322
2nd Quartile
- Average Gross Sales: $1,148,210
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 23 / 47 (48.9%)
- Median Gross Sales: $1,131,882
- Highest Gross Sales: $1,327,645
- Lowest Gross Sales: $984,598
3rd Quartile
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- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 22 / 46 (47.8%)
- Median Gross Sales: $857,535
- Highest Gross Sales: $966,717
- Lowest Gross Sales: $755,917
Bottom Quartile
- Average Gross Sales: $553,522
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 25 / 47 (53.2%)
- Median Gross Sales: $564,143
- Highest Gross Sales: $753,621
- Lowest Gross Sales: $182,537
Total
- Average Gross Sales: $1,067,100
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 82 / 186 (44.1%)
- Median Gross Sales: $975,658
- Highest Gross Sales: $2,436,232
- Lowest Gross Sales: $182,537
- Parts 2, 3, and 4 presented below show Gross Sales information from fiscal year 2022 for the Smaller Format Businesses that were open and operating for various periods of time as of December 31, 2022: (i) at least 1 year, but not more than 5 years, (ii) at least 5 years, but not more than 10 years, and (iii) at least 10 years.
Part 2 – Average Gross Sales for Fiscal Year 2022 for Smaller Format Businesses Open 1-5 Years
- Part 2 below reflects the Gross Sales during fiscal year 2022 for the 15 Smaller Format Businesses that first opened for business between January 1, 2018 and December 31, 2021, meaning they were open and in operation continuously for at least 1 year but not more than 5 years as of December 31, 2022.
Top Quartile
- Average Gross Sales: $1,137,007
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 2 / 3 (66.7%)
- Median Gross Sales: $1,241,030
- Highest Gross Sales: $1,277,379
- Lowest Gross Sales: $892,612
2nd Quartile
- Average Gross Sales: $697,486
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 2 / 4 (50.0%)
- Median Gross Sales: $691,331
- Highest Gross Sales: $843,138
- Lowest Gross Sales: $564,143
3rd Quartile
- Average Gross Sales: $414,815
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 1 / 4 (25.0%)
- Median Gross Sales: $387,341
- Highest Gross Sales: $519,832
- Lowest Gross Sales: $364,747
Bottom Quartile
- Average Gross Sales: $286,154
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 3 / 4 (75.0%)
- Median Gross Sales: $302,026
- Highest Gross Sales: $358,024
- Lowest Gross Sales: $182,537
Total
- Average Gross Sales: $600,323
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 6 / 15 (40.0%)
- Median Gross Sales: $519,832
- Highest Gross Sales: $1,277,379
- Lowest Gross Sales: $182,537
Part 3 – Average Gross Sales for Fiscal Year 2022 for Smaller Format Businesses Open 5-10 Years
- Part 3 below reflects the Gross Sales during fiscal year 2022 for the 31 Smaller Format Businesses that first opened for business between January 1, 2013 and December 31, 2017, meaning they were open and in operation continuously for at least 5 years but not more than 10 years as of December 31, 2022.
Top Quartile
- Average Gross Sales: $1,295,684
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 2 / 7 (28.6%)
- Median Gross Sales: $1,159,703
- Highest Gross Sales: $1,900,544
- Lowest Gross Sales: $1,057,959
2nd Quartile
- Average Gross Sales: $853,238
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 4 / 8 (50.0%)
- Median Gross Sales: $856,841
- Highest Gross Sales: $943,226
- Lowest Gross Sales: $741,527
3rd Quartile
- Average Gross Sales: $652,652
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 6 / 8 (75.0%)
- Median Gross Sales: $666,635
- Highest Gross Sales: $733,119
- Lowest Gross Sales: $516,019
Bottom Quartile
- Average Gross Sales: $400,085
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 3 / 8 (37.5%)
- Median Gross Sales: $390,291
- Highest Gross Sales: $508,779
- Lowest Gross Sales: $305,720
Total
- Average Gross Sales: $784,438
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 13 / 31 (41.9%)
- Median Gross Sales: $733,119
- Highest Gross Sales: $1,900,544
- Lowest Gross Sales: $305,720
Part 4 – Average Gross Sales for Fiscal Year 2022 for Smaller Format Businesses Open 10+ Years
- Part 4 below reflects the Gross Sales during fiscal year 2022 for the 140 Smaller Format Businesses that opened prior to January 1, 2013, meaning they were open and in operation continuously for at least 10 years.
Top Quartile
- Average Gross Sales: $1,797,388
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 15 / 35 (42.9%)
- Median Gross Sales: $1,740,560
- Highest Gross Sales: $2,436,232
- Lowest Gross Sales: $1,499,614
2nd Quartile
- Average Gross Sales: $1,253,463
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 16 / 35 (45.7%)
- Median Gross Sales: $1,245,119
- Highest Gross Sales: $1,477,215
- Lowest Gross Sales: $1,096,288
3rd Quartile
- Average Gross Sales: $956,543
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 16 / 35 (45.7%)
- Median Gross Sales: $932,975
- Highest Gross Sales: $1,089,983
- Lowest Gross Sales: $849,007
Bottom Quartile
- Average Gross Sales: $711,413
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 20 / 35 (57.1%)
- Median Gross Sales: $752,966
- Highest Gross Sales: $842,398
- Lowest Gross Sales: $483,331
Total
- Average Gross Sales: $1,179,702
- Number and Percentage of Locations Attaining or Exceeding Average Gross Sales: 58 / 140 (41.4%)
- Median Gross Sales: $1,093,136
- Highest Gross Sales: $2,436,232
- Lowest Gross Sales: $483,331
- Some Massage Envy Businesses have sold or earned this amount. Your individual results may differ. There is no assurance that you will sell or earn as much.
- The figures Massage Envy used to complete the tables of these financial performance representations were submitted to Massage Envy by the franchisees operating the Massage Envy Businesses represented in the tables. Massage Envy has not audited or independently verified any of the financial reports or information it received from franchisees nor has it asked questions of the submitting franchisees to determine whether they are in fact accurate and complete, although it has no information or other reason to believe that they are unreliable. No certified public accountant has audited these figures or expressed his or her opinion concerning their content or form.
- These figures do not reflect the costs of sales, operating expenses, or other costs or expenses that might be deducted from the Gross Sales figures to obtain your net income or profit.
Section VI – Massage Envy Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️
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