Lemon Tree franchise unit economics
Lemon Tree franchisees run family hair salons that sell haircare services and hair care products for every member of the family.
Lemon Tree franchise at a glance
The 2026 FDD from Lemon Tree Development LLC reports 2025 gross revenue by quartile for 34 franchised salons, along with their answers to surveys on rent, payroll and supplies.
Lemon Tree’s 34 franchised salons open all of 2025 averaged $357,824* of gross revenue, by Averan’s weighting of the four quartile averages, according to Item 19 of Lemon Tree’s 2026 FDD, issued 26 March 2026. The 34 in that group are 94%* of Lemon Tree’s 36 franchised salons. Fees paid to Lemon Tree come to about 9.72%* of sales.
- A Lemon Tree franchise costs $184,794 to $277,939 to open, including a $35,000 initial franchise fee, according to the 2026 FDD.
- Lemon Tree charges a royalty of the greater of $75 a week or 6% of gross revenue, plus $135 a week to the Brand Fund.
- A Lemon Tree franchisee also pays $250 a month of local marketing, a $100 monthly digital marketing fee and $150 a month for software, among other charges.
- Lemon Tree’s top-quartile salons averaged $631,326 in 2025 and its bottom-quartile salons $161,331; the highest salon had $753,056 and the lowest $61,767.
- A Lemon Tree salon pays $13,308* a year in fixed brand, marketing and technology charges before the royalty.
- Lemon Tree had 36 franchised salons and 12 affiliate-owned salons at the end of 2025.
These figures come from Lemon Tree's 2026 Franchise Disclosure Document, as the brand reported them, and were read by Averan Advisors. The $357,824 average for all 34 salons (weighted from the four quartile means) and the $13,308 of fixed annual charges.
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Talk to Averan → Averan Lemon Tree Conversion Package →- Top-quartile salons averaged $631,326 of 2025 gross revenue, 3.91 times* the bottom quartile’s $161,331. Each of those quartiles holds nine salons. The highest salon had $753,056 and the lowest $61,767.
- The FDD prints no average or median for all 34 salons; the quartile figures give an average of $357,824* and a median of $297,326*. The average weights each quartile mean by its number of salons. The median is the midpoint of the 17th and 18th salons, which are the lowest salon in the second quartile ($299,669) and the highest in the third ($294,984)*.
- The lowest answers offered in the rent and payroll surveys add up to $76,000 a year*. That is $2,000 a month of rent and $1,000 a week of payroll. It equals 47.1%* of the bottom quartile’s average revenue and 12.0%* of the top quartile’s. The lowest salon reported $61,767 of revenue.
- Fixed charges for the Brand Fund, local and digital marketing, software, technology and email come to $13,308 a year*. With the 6% royalty, Averan puts the total at 14.25%* of revenue at the bottom-quartile average and 8.11%* at the top-quartile average.
- Year-on-year growth for the franchised salons averaged 3.4%, and the median was -0.2%. Item 19 prints both figures for 2025 without a breakdown by salon.
Revenue by quartile
How much does a Lemon Tree franchise make?
| Quartile | Salons | Mean | Median | High | Low |
|---|---|---|---|---|---|
| Quartile 1 (top) | 9 | $631,326 | $599,600 | $753,056 | $516,173 |
| Quartile 2 | 8 | $362,796 | $353,241 | $467,009 | $299,669 |
| Quartile 3 | 8 | $266,220 | $269,803 | $294,984 | $224,758 |
| Quartile 4 (bottom) | 9 | $161,331 | $171,022 | $215,511 | $61,767 |
| All 34 | 34 | $357,824* | $297,326* | $753,056 | $61,767 |
Quartile rows as printed in Item 19. Gross revenue is total sales less sales taxes and discounts, taken from the salons’ computer system and unaudited. The All 34 mean and median are Averan calculations from the quartile rows.
The 34 franchised Lemon Tree salons open all of 2025 averaged $357,824* of gross revenue. The FDD does not print this figure. Averan weighted the four quartile means by their salon counts (9, 8, 8 and 9).
The top quartile averaged $631,326 and the bottom quartile $161,331. The highest salon had $753,056 and the lowest $61,767.
The 34 are the franchised salons that were open and reporting for a full year. Item 19 leaves out two franchised salons that opened during 2025. Two of the 34 moved from affiliate to franchise ownership during 2025, and Item 19 includes their results for the whole year.
Item 19 does not report profit. It reports gross revenue, year-on-year growth and franchisee answers to three expense surveys.
Expense surveys
Rent, payroll and supplies surveys, 2025
| Survey | Range | Share of salons | Salons | A year |
|---|---|---|---|---|
| Monthly rent | $2,000–$3,000 | 47.1% | 16* | $24,000–$36,000* |
| Monthly rent | $3,001–$4,000 | 41.2% | 14* | $36,012–$48,000* |
| Monthly rent | $4,001–$5,000 | 8.8% | 3* | $48,012–$60,000* |
| Monthly rent | $5,001–$6,000 | 0%* | 0* | $60,012–$72,000* |
| Monthly rent | $6,001 or more | 2.9%* | 1* | $72,012 or more* |
| Weekly payroll | $1,000–$2,000 | 29.4% | 10* | $52,000–$104,000* |
| Weekly payroll | $2,001–$3,000 | 29.4% | 10* | $104,052–$156,000* |
| Weekly payroll | $3,001–$4,000 | 26.5% | 9* | $156,052–$208,000* |
| Weekly payroll | $4,001–$5,000 | 8.8% | 3* | $208,052–$260,000* |
| Weekly payroll | $5,001–$6,000 | 5.9%* | 2* | $260,052–$312,000* |
| Weekly supplies | $0–$500 | 44.1% | 15* | $0–$26,000* |
| Weekly supplies | $501–$1,000 | 20.6% | 7* | $26,052–$52,000* |
| Weekly supplies | $1,001–$1,250 | 20.6% | 7* | $52,052–$65,000* |
| Weekly supplies | $1,251–$1,500 | 8.8% | 3* | $65,052–$78,000* |
| Weekly supplies | $1,501–$2,000 | 5.9%* | 2* | $78,052–$104,000* |
Ranges and printed shares are from the Item 19 pie charts, which are images. Shares marked * are slices printed without a label, taken as the remainder to 100%. Salon counts apply each share to 34, and the annual column multiplies monthly ranges by 12 and weekly ranges by 52. Rent covers base rent and common area charges.
Each salon in the system was asked to answer three surveys, and Item 19 prints the answers of the 34 reporting salons. The figures are self-reported ranges, not amounts from the accounts.
The lowest range offered was $2,000 to $3,000 a month for rent and $1,000 to $2,000 a week for payroll. Together the lower ends come to $76,000 a year*: 47.1%* of the bottom quartile’s $161,331 average, 21.2%* of the $357,824* average for all 34 and 12.0%* of the top quartile’s $631,326.
47.1% of salons reported monthly rent of $2,000 to $3,000, and 41.2% reported $3,001 to $4,000. Item 7 bases its rent deposit on a location of 800 to 1,200 square feet at $22 to $37 a square foot.
58.8% of salons reported weekly payroll of $3,000 or less, and 44.1% reported weekly supplies of $500 or less. The surveys do not link answers to revenue, so a salon’s rent or payroll cannot be matched to its quartile.
Spread of results
How revenue spreads across the quartiles, 2025
| Quartile | Salons | Rank | Low | High | Width of range | Mean as a multiple of quartile 4 |
|---|---|---|---|---|---|---|
| Quartile 1 (top) | 9 | 1–9 | $516,173 | $753,056 | $236,883* | 3.91* |
| Quartile 2 | 8 | 10–17 | $299,669 | $467,009 | $167,340* | 2.25* |
| Quartile 3 | 8 | 18–25 | $224,758 | $294,984 | $70,226* | 1.65* |
| Quartile 4 (bottom) | 9 | 26–34 | $61,767 | $215,511 | $153,744* | 1.00 |
Low and high as printed in Item 19. Rank, width and multiple are Averan calculations.
The top-quartile mean of $631,326 is 3.91 times* the bottom-quartile mean of $161,331. The highest salon’s $753,056 is 12.2 times* the lowest salon’s $61,767.
The third quartile is the narrowest band, at $224,758 to $294,984. The 16 salons in the second and third quartiles fall between $224,758 and $467,009.
The median of all 34 is about $297,326*. With 34 salons the median sits between the 17th and 18th. Those are the lowest salon in quartile 2 ($299,669) and the highest in quartile 3 ($294,984).
Year-on-year growth averaged 3.4% and the median was -0.2%. Item 19 prints both figures for the franchised salons and does not show growth by quartile.
Brand charges
Brand charges
| Charge | Amount | A year | Quartile 4, $161,331 | All 34, $357,824* | Quartile 1, $631,326 |
|---|---|---|---|---|---|
| Royalty | Greater of $75 a week or 6% of gross revenue | 6% of revenue | $9,680* | $21,469* | $37,880* |
| Brand Fund | $135 a week | $7,020* | $7,020* | $7,020* | $7,020* |
| Local marketing (minimum spend) | $250 a month | $3,000* | $3,000* | $3,000* | $3,000* |
| Digital marketing fee | $100 a month | $1,200* | $1,200* | $1,200* | $1,200* |
| Software and applications | $150 a month | $1,800* | $1,800* | $1,800* | $1,800* |
| Technology fee | $144 a year | $144 | $144 | $144 | $144 |
| Email address | $144 a year | $144 | $144 | $144 | $144 |
| Total, and share of revenue | $13,308* plus royalty | $22,988* (14.25%*) | $34,777* (9.72%*) | $51,188* (8.11%*) |
Amounts as printed in Item 5 and Item 6. Software, technology and email fees are subject to increase with provider charges. Not included: quality review services of up to $95 a month if the brand requires them, advertising cooperative costs (none formed), training, transfer and other fees charged as incurred.
The royalty is the greater of $75 a week or 6% of the prior week’s gross revenue, collected weekly on Tuesday. The $75 minimum equals 6% of $1,250* of weekly revenue.
The Brand Fund contribution is a flat $135 a week, $7,020 a year*. It does not change with revenue: it is 4.35%* of the bottom-quartile average and 1.11%* of the top-quartile average.
Fixed charges come to $13,308 a year*, about $256 a week*. That is 8.25%* of the bottom-quartile average and 2.11%* of the top-quartile average. With the royalty, Averan puts total charges at 14.25%* of revenue for the bottom quartile, 9.72%* at the all-salon average and 8.11%* for the top quartile.
Other fees apply when incurred. A transfer costs $10,000 plus a $1,000 transfer request fee, which is applied to the transfer fee if the transfer is approved. A late charge is $50, interest is 18% a year and a returned payment is $75. Interim management is $500 a day or 10% of gross revenue, whichever is greater.
Cost to open
Cost to open
| Line | Low | High | Paid to |
|---|---|---|---|
| Leasehold improvements, construction and remodeling | $63,100 | $120,000 | Suppliers, contractor or landlord |
| Initial franchise fee | $35,000 | $35,000 | Lemon Tree |
| Operating expenses and additional funds, 4 months | $30,000 | $40,000 | Utilities, advertisers, employees, agencies, suppliers |
| Furniture, fixtures and equipment | $27,000 | $32,000 | Suppliers |
| Exterior and interior signage | $7,000 | $10,000 | Suppliers |
| Premises deposits | $4,500 | $9,500 | Landlord, utility providers |
| Grand opening advertising | $4,000 | $8,000 | Suppliers |
| Initial inventory | $4,000 | $5,000 | Suppliers |
| Professional fees | $3,500 | $5,000 | Attorney, accountant, others |
| Insurance | $3,000 | $6,000 | Insurer |
| Business licenses and permits | $800 | $2,295 | Government agencies |
| Training expenses | $1,000 | $2,000 | Suppliers |
| Computer systems | $1,000 | $2,000 | Suppliers |
| Security and surveillance system | $750 | $1,000 | Suppliers |
| Email address | $144 | $144 | Lemon Tree |
| Total | $184,794 | $277,939 |
As printed in Item 7; both columns add to the printed totals. The cover states that $35,144 of the total is paid to the franchisor or its affiliates.
Item 7 puts the cost to open one Lemon Tree salon at $184,794 to $277,939. That includes the $35,000 initial franchise fee and $30,000 to $40,000 for the first four months of operation.
Leasehold improvements are $63,100 to $120,000. Their $56,900* difference is 61.1%* of the $93,145* gap between the low and high totals. The low end assumes a retrofit of space that already has a suitable layout, restrooms and utilities, or a landlord allowance.
The equipment package typically includes 6 styling stations and 2 shampoo basins. The initial inventory estimate covers about two months of hair care and styling products.
The initial fee falls for further salons. It is $25,000 for a second franchise agreement signed within eighteen months of the first and $10,000 for a third signed within eighteen months of the second, $70,000* for three. Active members and honorably discharged veterans of the U.S. Armed Forces receive 10% off the initial fee, and one 2025 agreement used that discount.
Item 11 estimates 270 days from signing to opening. A franchisee must sign a lease within 120 days of signing the franchise agreement. Item 7 notes that a franchisee can expect to put more cash into the business during at least the first three to six months.
Locations
Locations, 2023 to 2025
| Year | Franchised at start | Opened | Terminated | Ceased, other reasons | Franchised at end | Affiliate-owned at end | Total at end |
|---|---|---|---|---|---|---|---|
| 2023 | 32 | 2 | 0 | 0 | 34 | 12 | 46 |
| 2024 | 34 | 1 | 0 | 1 | 34 | 12 | 46 |
| 2025 | 34 | 4 | 2 | 0 | 36 | 12 | 48 |
As printed in Item 20, Tables 1 and 3. No non-renewals or reacquisitions were reported. Affiliate-owned salons are operated by the franchisor’s affiliates.
Lemon Tree had 36 franchised salons and 12 affiliate-owned salons at the end of 2025, 48 in all. The franchised count was 32 at the start of 2023.
In 2025, 4 franchised salons opened and 2 were terminated, both in New York. The 4 openings were 2 in New Jersey, 1 in California and 1 in Texas. In the same year the affiliates opened 2 salons in Connecticut and sold 2 in New Jersey to franchisees.
New York held 24 of the 36 franchised salons at the end of 2025. Texas had 5, Florida and New Jersey 2 each, and California, Ohio and Oklahoma 1 each.
Three franchise agreements were signed but not opened at the end of 2025. Item 20 projects 8 franchised and 3 affiliate-owned openings in the next fiscal year. One transfer between franchisees took place, in New York in 2023.
Questions we get asked
Questions owners ask
How much does a Lemon Tree franchise cost to open?
Item 7 of the 2026 FDD puts one salon at $184,794 to $277,939. That includes the $35,000 initial franchise fee, $63,100 to $120,000 of leasehold improvements and $30,000 to $40,000 for the first four months of operation.
What fees does a Lemon Tree franchisee pay?
A royalty of the greater of $75 a week or 6% of gross revenue, $135 a week to the Brand Fund, $250 a month of local marketing, a $100 monthly digital marketing fee, $150 a month for software and $144 a year each for technology and email. The fixed charges come to $13,308 a year*. Averan puts the total at 9.72%* of revenue at the $357,824* all-salon average.
How much revenue does a Lemon Tree salon make?
The 34 franchised salons open all of 2025 averaged $631,326 in the top quartile and $161,331 in the bottom quartile. The FDD prints no overall average; weighting the quartiles gives $357,824*. The highest salon had $753,056 and the lowest $61,767.
Does the Lemon Tree FDD show profit?
No. Item 19 reports gross revenue, year-on-year growth and the salons’ answers to surveys on monthly rent, weekly payroll and weekly supplies. It does not report profit or expenses as a share of revenue.
What do Lemon Tree salons spend on rent and payroll?
In the Item 19 surveys, 47.1% of the 34 salons reported monthly rent of $2,000 to $3,000 and 41.2% reported $3,001 to $4,000. For weekly payroll, 29.4% reported $1,000 to $2,000 and 29.4% reported $2,001 to $3,000.
How many Lemon Tree locations are there?
Item 20 reports 36 franchised salons and 12 affiliate-owned salons at the end of 2025. Four franchised salons opened in 2025 and two were terminated, and three agreements were signed but not opened.
Questions worth putting to Lemon Tree
These are questions the filing leaves open. An owner or a buyer can put them to the franchisor directly.
- Is the revenue in Item 19 gross sales or collected revenue, and how many locations sit below the average?
- Which factors does Lemon Tree see in its highest-selling locations, such as territory, years open and staffing?
- How long does a new location take to reach the average you publish, and what does the build-up look like month by month?
- At what level of sales do the minimum charges stop applying and the percentage take over?
- How many Lemon Tree locations closed, were sold, or changed hands last year, and why?
Run your own numbers.
The Franchise Numbers Check runs the same checks on your own numbers. It scores where you stand and compares you with Item 19 of your brand’s FDD. It works out what one location earns and spends, and builds a 13-week cash forecast. It also checks whether you are ready to open another one. It is free and it runs in your browser.
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Questions owners ask next
The figures above raise these, and each one is answered on its own page.
- At what level of sales does a minimum fee stop costing me more than the percentage?It works out the sales level where a minimum fee stops applying.
- How much cash do I fund before a new location covers its own costs?It builds a 13-week forecast for the months before break-even.
- What does this location earn on the money I put into it?It works out the payback period and cash-on-cash return for one unit.
- How much of Item 19 can I rely on?It explains what an Item 19 financial performance representation tells you and what it leaves out.
Where these figures come from
Every figure here comes from Lemon Tree Development LLC’s 2026 FDD and is unaudited by us. We are unaffiliated with the brand. Calculations of our own are labeled where they appear. The figures describe past performance at other businesses and are not a projection of yours. This page is an educational summary. It is not an offer to sell a franchise, and it is not financial, legal or tax advice. Lemon Tree is a trademark of its owner. How Averan reads a Franchise Disclosure Document.
These figures come from the brand's disclosure. They are not a forecast, an offer to sell a franchise or advice. Source: Lemon Tree Development LLC, 2026 Franchise Disclosure Document, issued 26 March 2026.