Merle Norman Cosmetics Franchise Costs, Fees & FDD

Year Business Began: 1931

Franchising Since: 1934

Headquarters: Los Angeles, California

Estimated Number of Units: 800

Franchise Description: The franchisor is Merle Norman Cosmetics, Inc. (MNC). A Merle Norman studio is an independently owned retail store licensed to use the Merle Norman name, which specializes in the sale of multiple lines of high quality skin care, color and other cosmetic products and offers customers free individualized instruction relating to skin care and the use of Merle Norman products. In certain circumstances, a Merle Norman studio may be operated in a location that also houses a separate retail business.
Training Overview: Before the studio opens for business, franchisees, or a manager, are required to satisfactorily complete initial training. This initial training is also required of any person who becomes a studio owner by purchase from an existing owner. Currently, initial training consists of on-line training modules to be reviewed and completed in week 1 plus eight virtual training classes in weeks 2 and 3. The on-line training modules are recorded and can be viewed in any order, but the virtual training classes are offered live. As part of the on-line training modules, franchisees will be required to take and pass an on-line performance evaluation of the material covered in each on-line training module. In addition, franchisees must take and successfully complete all virtual training classes. In addition to the initial training program, franchisees must complete the on-line MN POS software tutorial program. The on-line tutorial program consists of two 4.5 hour sessions. The franchisor also provides a wide variety of continuing training seminars, which are available to franchisees and, in some cases, their employees.

Territory Granted: Franchisees will not receive an exclusive territory. They may face competition from other franchisees, from outlets owned by the franchisor, or from other channels of distribution or competitive brands controlled by the franchisor. The franchisor grants franchisees a nonexclusive right to operate a studio at a specified location, which must be approved by the franchisor in advance. Franchisees may only sell MN products to customers who are physically present at the studio location and to customers at MNC approved marketing events; franchisees may not use any other method or channel of distribution, except as approved by MNC.

Obligations and Restrictions: Franchisees are not required to participate personally in the direct operation of the studio, but if the studio is not under their direct daily supervision, they must hire a manager. If franchisees are not active in the operation of the studio, the manager must complete initial training. Franchisees must purchase an initial inventory of Merle Norman products and certain required supplies from the franchisor. While the franchisor does not prohibit the sale of other merchandise (in addition to MN products) or the offer of other services (in addition to free makeover lessons using the lesson material provided by the franchisor), they must obtain the franchisor’s prior written approval of any additional merchandise or services.

Term of Agreement and Renewal: The length of the initial franchise term is 10 years from the date the franchised studio opens. Franchisees can renew for a single renewal term of 10 years if requirements are met.

Financial Assistance: The franchisor offers the following financing programs. Except as described, the franchisor does not offer direct or indirect financing. The franchisor does not guarantee a franchisee’s note, lease or obligation.

For New Studio Owners

Item Financed	Amount Financed	Down Payment	Term (Months)	Apr %	Monthly Payment
Initial Package	45%	55%	3	None	Equal Installments
MN POS Software and Hardware	80%	20%	12-36	10%	Equal Installments

For Branch Studio Owners

Item Financed	Amount Financed	Down Payment	Term (Months)	Apr %	Monthly Payment
Initial Package	70%	30%	3	None	Equal Installments
MN POS Software and Hardware	80%	20%	12-36	10%	Equal Installments

Estimated Initial Investment

Name of Fee	Low	High
Real Estate	Variable
Initial Package of Inventory and Supplies	$23,438	$45,111
Millwork Fixtures	$8,082	$23,025
Acrylic Organizers	$4,720	$6,730
Tables & Chairs	$1,160	$1,685
Graphics	$350	$620
Mirrors	$350	$500
Merchandising Pieces	$759	$1,201
Flooring	$0	$5,300
Lighting	$1,850	$2,600
Interactive Play Table	$2,500	$2,500
Digital Compu Stick	$0	$250
Exterior Signage	$300	$6,000
Construction	$0	$84,000
Computer (hardware/software)	$1,800	$5,390
Working Capital, Deposits, Insurance, and Advertising	$1,733	$63,525
ESTIMATED TOTAL*	$47,566	$260,437

*The estimated initial investment range covers from a studio within an existing business up to a regional mall location. The estimate does not include real estate costs.

Other Fees

Name of Fee	Amount
Purchase of Additional Merle Norman Products	Variable.
Delinquency Fee	As required by MNC's then-current payment policies.
Merle Norman POS Software Program Cost	$1,800
Merle Norman POS Software Program Annual Upgrades/Support	$300
Initial Training	The franchisor currently does not charge a tuition fee for initial training, but it may do so in the future.
Additional Training	The franchisor currently does not charge a tuition fee for additional training courses or attendance at regional or other meetings, but it may do so in the future.
Merle Norman Point of Sale (POS) Training	The franchisor currently does not charge a tuition fee for MN POS training, but it may do so in the future.
Social Media Management Service	Annual fee of $144.
Digital Email Marketing Service	Annual fee of $336.
SMS Texting Marketing Service (add-on of Digital Email Marketing Service)	Annual fee of $168.
Non-Cash Payment System	All costs associated with non-cash payment systems.
Indemnification	All liability, damages, costs and expenses incurred by the franchisor and its officers, directors, etc.

The above information has been compiled from the FDD of Merle Norman Cosmetics. Year of FDD: 2025.
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