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Oasis Face Bar
How much does Oasis Face Bar cost?
Initial Investment Range
$163,945 - $384,462
Franchise Fee
$20,000 to $42,000
You will own, develop, and operate a business under the Oasis Face Bar marks and system which will operate an open-concept, express skincare spa offering 30‑minute targeted and customizable facial treatments.
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Oasis Face Bar May 1, 2025 FDD Risk Analysis
Free FDD Library AI Analysis Date: August 21, 2025
DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.
Franchisor Stability Risks
Start HereDisclosure of Franchisor's Financial Instability
High Risk
Explanation
The franchisor has a negative net worth of -$55,715 as of year-end 2024 and very low cash reserves. The FDD explicitly discloses that its financial condition calls into question its ability to support you. Several states have required the franchisor to defer collecting initial fees due to this financial weakness. This presents a significant risk that OFB may be unable to fulfill its support obligations or invest in the brand's growth.
Potential Mitigations
- A franchise accountant must thoroughly analyze the audited financials in Exhibit H, paying close attention to the negative equity and cash flow statements.
- It is crucial to have your attorney explain the implications of the state-mandated fee deferrals and the protections they offer.
- Discuss the franchisor's plan for achieving financial stability and capitalization with their management, and review their responses with your business advisor.
High Franchisee Turnover
High Risk
Explanation
Item 20 data from 2023 shows a significant turnover rate. Two out of nine franchised outlets at the start of that year either were terminated or ceased operations, representing a 22% churn rate. This high rate of franchisee departure in a single year could indicate potential issues with the business model's profitability, franchisor support, or franchisee satisfaction. You should investigate the reasons for these departures thoroughly.
Potential Mitigations
- A business advisor should help you analyze the turnover data in Item 20 and compare it to any available industry benchmarks.
- Contacting former franchisees listed in Exhibit G is critical to understanding their reasons for leaving the system; an attorney can help you formulate key questions.
- Discuss the high 2023 turnover rate directly with the franchisor and evaluate their explanation with your attorney.
Rapid System Growth
High Risk
Explanation
The franchise system has grown very rapidly, from 3 to 14 franchised units in just two full years, as shown in Item 20. When combined with the franchisor's disclosed weak financial condition, this rapid expansion raises concerns about their ability to provide adequate and timely training, site selection assistance, and ongoing operational support to all franchisees. Support resources could be stretched thin, potentially affecting your business's ramp-up and performance.
Potential Mitigations
- In discussions with the franchisor, inquire specifically about how they have scaled their support staff and systems to manage this rapid growth.
- Question a wide range of existing franchisees, both new and established, about the current quality and responsiveness of franchisor support.
- Your accountant should review the franchisor's financial statements to assess if they are investing revenue back into support infrastructure.
New/Unproven Franchise System
High Risk
Explanation
Oasis Face Bar Franchising, LLC (OFB) began offering franchises in 2020, making this a relatively new and emerging franchise system. As disclosed in Items 1 and 20, the system has a limited operational track record with a small number of franchisees and a short history. This introduces risks associated with unproven systems, minimal brand recognition, and potential franchisor instability, which may be compounded by the financial weakness disclosed in Item 21.
Potential Mitigations
- A thorough investigation into the backgrounds of the management team, particularly their experience in franchising, is essential; a business advisor can assist.
- Speaking with the earliest franchisees listed in Item 20 is crucial to understand their experience with the evolving system.
- Your attorney should help you assess the risks associated with investing in a young system with limited brand power.
Possible Fad Business
Medium Risk
Explanation
The business model focuses on a niche trend: express, 30-minute facial treatments. While the broader skincare industry is established, the long-term consumer demand and viability for this specific "facial bar" concept are not as proven. There is a risk that the concept could be a passing trend. Your investment's success is tied to the sustained popularity of this express service model.
Potential Mitigations
- Engaging a business advisor to conduct independent market research on the long-term sustainability of the express spa concept is recommended.
- You should evaluate the franchisor's plans for innovation and service evolution to adapt to changing consumer preferences.
- Consider the business's resilience to economic downturns when consumers might cut back on discretionary spa services.
Inexperienced Management
Medium Risk
Explanation
The founder, while experienced in operating the facial bar concept since 2018, has limited experience managing a franchise system. However, the franchisor has recently (late 2024) hired a President and a Franchise Sales Developer with extensive careers in the franchise industry. While this new expertise is a positive step, the system's core leadership is still relatively new to franchising, which could impact strategic support and system development.
Potential Mitigations
- Inquire about the specific roles and influence of the new, experienced management team in day-to-day franchisee support and strategy.
- A discussion with franchisees who have been in the system both before and after the new management arrived could provide insight into changes in support quality.
- Your business advisor can help you evaluate whether the new management additions adequately compensate for the founder's limited franchising track record.
Private Equity Ownership
Low Risk
Explanation
This risk was not identified. The FDD does not indicate that a private equity firm owns or controls the franchisor. However, it is important to understand that if the franchisor is sold in the future, the new owners, who could be a PE firm, may have different priorities that might not align with your long-term interests as a franchisee.
Potential Mitigations
- It is important for your attorney to review the "Assignment" clause in the Franchise Agreement to understand the franchisor's rights to sell the system.
- During your due diligence, asking current franchisees about their understanding of the franchisor's long-term ownership plans can be insightful.
- A business advisor can help you research the background of the current ownership to confirm the absence of PE involvement.
Non-Disclosure of Parent Company
Low Risk
Explanation
This risk was not identified in the FDD package. The franchisor explicitly states in Item 1 that it does not have a parent company. The financial statements provided in Exhibit H are for the franchisor entity itself. This transparency is a positive factor, as you are able to directly assess the financial health of the entity granting you the franchise.
Potential Mitigations
- It is still a good practice for your attorney to conduct a corporate search to verify the ownership structure of the franchisor entity.
- Your accountant should confirm that the provided audited financial statements are for the correct legal entity, Oasis Face Bar Franchising, LLC.
- Asking the franchisor to confirm its ownership structure during due diligence calls is a prudent step.
Predecessor History Issues
Low Risk
Explanation
This risk was not identified. Item 1 discloses predecessor entities, and their history appears to be a straightforward evolution of the brand concept before franchising began. The FDD does not indicate any negative history, such as litigation or bankruptcy, associated with these predecessors. This clear lineage is generally a positive sign.
Potential Mitigations
- Your attorney should review the predecessor information in Items 1, 3, and 4 to confirm the absence of any disclosed issues.
- Independent online research of the predecessor names could provide additional context, which your business advisor can assist with.
- Asking long-term employees or the founder about the transition from the predecessor entities can sometimes yield useful information.
Pattern of Litigation
Low Risk
Explanation
This risk was not identified. Item 3 of the FDD explicitly states that there is no litigation that requires disclosure. The absence of lawsuits involving the franchisor, especially claims from other franchisees, is a positive indicator for the health of the franchise system and its relationships.
Potential Mitigations
- Although no litigation is disclosed, your attorney can conduct independent searches of court records as a final due diligence step.
- Asking current and former franchisees about any past or pending legal disputes, even those not meeting the threshold for disclosure, is a prudent measure.
- A business advisor can help you perform online searches for any news articles or complaints that might indicate undisclosed disputes.
Disclosure & Representation Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Financial & Fee Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Legal & Contract Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
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Territory & Competition Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Regulatory & Compliance Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Franchisor Support Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Operational Control Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Term & Exit Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Miscellaneous Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
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