BATH FITTER FRANCHISING INC FRANCHISE AGREEMENT

Item 7 outlines a substantial entry point: $225,500 to $515,500 total investment, including an $80,000 franchise fee. Ongoing costs stand out favorably—no royalty today (though the franchisor reserves the right to impose up to 2.5% of gross revenues), just a 3% national marketing fund and ad contribution that starts as fixed monthly payments ($2,000-$12,500 based on territory population) before shifting to 3% of gross sales with minimums. The absence of Item 19 earnings disclosure is a major gap; without validated revenue or profit figures, you're left estimating viability in a competitive home improvement niche reliant on quick-install tub liners and showers for residential and commercial clients. That single SBA loan on record, averaging $50,000, suggests limited franchising debt exposure but also low franchisee financing volume, potentially indicating cautious lender interest.

System maturity since 1992 hasn't translated to explosive growth: just 99 franchised locations in 2024, up a mere 1% from 98 the prior year, alongside 42 corporate outlets for a total of 141. This sluggish expansion in a category often fueled by housing booms raises flags about market saturation or execution challenges, especially versus peers scaling faster. For due diligence, the no-royalty perk shines for cash flow in year one, but weigh it against the wide investment range (driven by territory size and build-out) and lack of financial transparency—key hurdles for anyone eyeing Bath Fitter as a steady, low-fee play in renovations.