Our concerns arose initially from the disclosure by the Small Business Administration that Planet Beach franchisees have a default rate of 57% on SBA-backed franchise loans.
Three other tanning salon franchises also have high SBA default rates: Executive Tans (81%), Image Sun (70%), and Hollywood Tans (37%).
A review of the PLANET BEACH Franchise Disclosure Document (FDD) for 2012 and marketing materials also raised red flags for us, namely the decline in the number of Planet Beach locations (from 375 domestic franchises in 2007 to 247 franchises in 2012).
We were concerned with the amount of franchise litigation disclosed in the FDD.
And we felt some of the company’s franchise marketing copy was intentionally misleading.
However, our goal is to give voice to both sides of an issue, whenever possible, so that our readers can make up their own minds.
For that reason, we are pleased that the tanning franchisor has accepted our standing offer to provide a response to our opinions.
Planet Beach Corporate Response from Senior V.P. of Sales Nancy Price
Senior Vice President of Sales Nancy Price emailed this response to our Planet Beach franchise posts:
As a representative of the Planet Beach Franchise system, I felt it was necessary to provide a written response to the allegations on this website.
The Planet Beach brand began in 1996 as a tanning salon franchise. Since then, we have evolved to an automated spa franchise, filling a niche in the industry for quality spa treatments in less time and at a much lower cost than traditional day spas.
With this change we are now able to capitalize on the ever – growing multi-billion dollar wellness and beauty industry. I invite you to see some statistics on the industry here: http://www.experienceispa.com/media/facts-stats/
Our franchise system has changed and expanded over the years. But like any franchise system, there are locations that do not follow our tested and proven system in place that is designed to help franchisees succeed once opening a spa. When this happens, there are unfortunate consequences including but not limited to location closures.
Although we strive to keep all of our locations open and profitable, it is up to the franchise owner to uphold his or her part as franchisee of our system. However; it has been and will continue to be our intention to provide every franchise owner the support needed to be successful.
As franchisor, we provide all of the tools necessary for franchise success including: ongoing consulting and training, annual networking conventions, marketing & operational support, and much more. We encourage all of our franchisees to take advantage of the resources we provide to build and sustain profitable locations.
We encourage you to review our website for more information on how we support our franchisees at www.myplanetbeachfranchise.com and if you’d like to learn more about what our spas offer customers, visit www.planetbeach.com.
We appreciate Ms. Price’s willingness to join in the discussion here at UnhappyFranchisee.com
UPDATE: A review of the Franchise Disclosure Document for 2016 reveals that the turnover rate for franchisees hasn’t improved, and remains around 50%. We will be publishing more on this and will be inviting Nancy Price to reply. In the meantime, you may review the Item 20 of the franchise disclosure document here:
WHAT DO YOU THINK? PLEASE SHARE YOUR OPINION OF PLANET BEACH – POSITIVE OR NEGATIVE – BELOW.