Snip-its Franchise Costs, Fees & FDD

Year Business Began: 1995

Franchising Since: 2003

Headquarters: Burnsville, Minnesota

Estimated Number of Units: 40

Franchise Description: The Snip-its Franchise Company, LLC is the franchisor. Snip-its Salon franchisees operate businesses providing haircare services for children along with branded entertainment. The distinguishing characteristics of the system include a specially-designed building or facility for hair care, spa services, and entertainment operations.
Training Overview: Franchisees or their operating partner and any salon manager or representative that the franchisor requires must complete the initial training to the franchisor’s reasonable satisfaction, as determined by the specific program instructors, before they open their Snip-its Salon business. The franchisor also provides “Staff Training” for the first Snip-its salon business and any second Snip-its salon business franchisees open. Currently, the Owner/Operating Partner and Salon Manager Initial Training Program consists of 20 hours of classroom training at the franchisor’s headquarters in Burnsville, Minnesota or via webinar. Staff Training currently consists of 21 hours of on-the-job training at the franchisee’s salon or an approved training location or via webinar. From time to time, the franchisor may require that franchisees or their operating partner, salon managers and other employees attend system-wide refresher or additional training courses. Some of these courses may be optional, while others may be required. In addition to participating in ongoing training, franchisees will be required to attend any national or regional meeting or conference of franchisees.

Territory Granted: Franchisees may operate their Snip-its salon business only at the approved location. The territory is determined based on the geographic area and population properties within that area and other relevant demographic characteristics and will typically be a two-mile radius for an urban location for the Snip-its salon business, and a five-mile radius for a suburban location for the Snip-its salon business, though this may vary.

Obligations and Restrictions: The franchisor requires that franchisees either directly operate their Snip-its salon business or designate a manager has been approved by the franchisor. The operating partner is an individual who will be principally responsible for communicating with the franchisor about the Snip-its salon business. The operating partner must have the authority and responsibility for the day-to-day operations of the Snip-its salon business. If franchisees are individuals, they are the operating partner. If franchisees are a legal entity, they must appoint an individual that has at least a 25% equity interest in the legal entity to be the operating partner. Franchisees must sell or offer for sale only those products and services authorized by the franchisor, and which meet its standards and specifications. Authorized products may differ among franchisees and may vary depending on the geographic location of the Snip-its salon business or other factors. Franchisees must follow the franchisor’s policies, procedures, methods, and techniques.

Term of Agreement and Renewal: The length of the initial franchise term is 10 years. If franchisees are in good standing and they meet other requirements, they may add two successor terms of five years.

Financial Assistance: The franchisor does not offer direct or indirect financing. The franchisor does not guarantee a franchisee’s note, lease or obligation. If franchisees are an honorably discharged veteran who meets the qualifications for a franchise, they will receive a one-time $3,500 discount on the initial franchise fee.

Estimated Initial Investment

Name of Fee	Low	High
Initial Franchise Fee	$35,000	$35,000
Security Deposit and Rent	$7,500	$20,000
Staff Recruiting	$500	$3,500
Initial Training	$1,000	$3,000
Staff Wages During Training	$2,500	$3,000
Optional Construction Project Management	$0	$27,500
Base Construction and Leasehold Improvements	$47,975	$100,775
Millwork	$35,200	$52,000
“Snipification” of Salon	$20,700	$23,100
Computer Hardware/POS System	$2,600	$4,000
POS Software System Fee	$165	$250
Exterior Signage	$4,300	$6,450
Furniture, Fixtures, Equipment & Decor	$8,300	$10,000
Audio Visual Equipment	$2,000	$2,900
Proprietary Products	$1,830	$3,225
Other Initial Inventory & Salon Supplies	$3,550	$7,525
Shipping	$4,900	$14,000
Insurance	$1,500	$2,500
Professional Services	$500	$6,500
Grand Opening Program	$15,000	$15,000
Additional Funds (3 Months)	$5,450	$20,600
ESTIMATED TOTAL	$200,470	$360,825

 
Other Fees

Type of Fee	Amount
Royalty	5% of gross sales for the first year, and 6% of gross sales for the balance of the franchise agreement.
Marketing Fund Contribution	1.5% of gross sales for the first year, and 2% of gross sales for the balance of the franchise agreement.
Local Advertising Payment	The difference between the amount franchisees spent on local advertising each year and their required local advertising expenditure ($1,875 per calendar quarter).
Local and Regional Advertising Cooperatives	Established by cooperative members, between 1% and 2% of gross sales.
Unauthorized Advertising Fee	$500 per occurrence.
Insurance	Reimbursement of the franchisor’s costs, plus a 20% administration charge.
Additional Training or Assistance Fees	The then-current fee (currently $500 per additional person for initial training and $500 per attendee per day for additional training).
Technology Fee	The then-current fee (not currently charged).
POS Software System Fee	The then-current fee (currently $165 to $250 per month).
Convention Fee	The then-current fee (up to $500 for the operating partner and up to $300 for a staff member).
Supplier Testing	The reasonable costs of inspection and the actual cost of any tests conducted.
Customer Issue Resolution	The reasonable costs the franchisor incurs for responding to a customer complaint.
Late Payment Fee	$100 per occurrence, plus the lesser of the daily equivalent of 1.5% per month simple interest or the highest rate allowed by law
Non-Sufficient Funds Fee	$50 per occurrence.
Failure to Submit Required Report Fee	$100 per occurrence and $100 per week.
Audit Expenses	Cost of audit and inspection, any understated amounts, and any related accounting, legal and travel expenses.
Management Fee	The then-current fee. Currently 1.5% of gross sales made during the time the interim manager manages the franchise business, plus costs and expenses.
Professional Fees and Expenses	Will vary under circumstances.
Indemnification	Will vary under circumstances.
Renewal Fee	15% of the then-current initial franchise fee.
De-Identification	All amounts incurred by us related to de-identification.
Transfer Fee	50% of the then-current initial franchise fee plus any applicable broker/referral commission or fee.
Liquidated Damages	Will vary under circumstances.
Non-Compliance Fee	$100 per day.
Broker Fees	The franchisor’s actual cost of the brokerage commissions, finder’s fees or similar charges.

The above information has been compiled from the FDD of Snip-its. Year of FDD: 2025.
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