Scissors & Scotch

## Executive Summary

Scissors and Scotch is an innovative barbershop franchise that combines premium mens grooming services with a fully stocked bar, creating a unique social experience that transcends the traditional haircut. Founded in 2015 and franchising since 2017, the brand has grown to 28 locations by offering haircuts, shaves, spa treatments, and craft cocktails in a sophisticated lounge environment. This distinctive concept targets affluent male consumers seeking more than just a routine haircut.

## Investment Overview

| Investment Category | Amount | |-------------------|--------| | **Initial Franchise Fee** | $40,000 - $50,000 | | **Total Initial Investment** | $631,000 - $845,000 | | **Net Worth Requirement** | $1,000,000 | | **Liquid Capital Required** | $300,000 | | **Royalty Fee** | 4% - 6.5% of gross sales | | **Advertising Fee** | 2% of gross sales | | **Construction Costs** | $200,000 - $325,000 | | **Furniture/Equipment** | $130,000 - $145,000 | | **Initial Marketing** | $30,000 | | **Working Capital** | $25,000 - $50,000 |

## Financial Performance

Based on FDD Item 19 financial performance representations:

- **Average Unit Volume (AUV):** $968,000 per year - **Estimated Payback Period:** 5.3 - 7.3 years - **Revenue Model:** Combination of grooming services, spa treatments, and bar sales - **Multiple Revenue Streams:** Haircuts, shaves, facials, massages, cocktails, beer, and coffee

The near-$1 million AUV demonstrates strong revenue potential for this premium-positioned concept.

## Training and Support

Scissors and Scotch provides comprehensive franchisee preparation:

- **Initial Training:** Two weeks at Austin, Texas headquarters - **Total Training Hours:** 80 hours of classroom and on-the-job training - **Operational Procedures:** Complete brand standards and operations training - **Bar Operations:** Training on beverage service and alcohol compliance - **Ongoing Support:** Continued operational guidance and marketing assistance - **Technology Systems:** Point-of-sale, scheduling, and customer management tools

## Network Statistics

| Metric | Value | |--------|-------| | **Year Founded** | 2015 | | **Franchising Since** | 2017 | | **Total Locations** | 28 | | **Franchised Units** | 16 | | **Company-Owned Units** | 12 | | **Headquarters** | Austin, Texas | | **Geographic Expansion** | Multiple states across US |

## Competitive Analysis

### Strengths - **Unique Concept:** Only major franchise combining barbershop with full bar - **Premium Positioning:** Targets affluent male consumers willing to pay more - **Strong AUV:** Near $1 million average revenue demonstrates concept viability - **Multiple Revenue Streams:** Grooming services plus beverage sales diversify income - **Social Experience:** Creates destination appeal beyond basic haircut needs - **Growing Trend:** Mens grooming market expanding toward luxury experiences - **Company Investment:** 12 corporate locations show franchisor commitment

### Weaknesses - **High Investment:** $631K-$845K limits qualified franchisee pool - **Liquor License Complexity:** Alcohol service adds regulatory requirements - **Niche Market:** Limited to affluent male demographic - **Smaller Network:** 28 locations limits brand recognition - **Economic Sensitivity:** Luxury positioning vulnerable during downturns - **Staffing Complexity:** Requires both skilled barbers and bartenders

### Key Competitors 1. **Floyds 99 Barbershop** - Rock-and-roll themed barbershop chain 2. **Vs Barbershop** - Upscale traditional barbershop experience 3. **18|8 Fine Mens Salons** - Premium mens grooming franchise 4. **Hammer and Nails** - Mens grooming lounge with similar concept 5. **The Boardroom** - Mens salon and grooming franchise

## Risk Factors

1. **Alcohol Licensing:** Liquor license requirements vary by state and municipality 2. **Dual Business Complexity:** Managing both salon and bar operations simultaneously 3. **Economic Sensitivity:** Premium services may decline during recessions 4. **Staffing Challenges:** Finding skilled barbers AND bartenders is complex 5. **Liability Concerns:** Alcohol service creates additional liability exposure 6. **Regulatory Compliance:** Ongoing alcohol compliance requirements 7. **Market Limitations:** Concept requires affluent demographic density

## Investment Recommendation

Scissors and Scotch represents a compelling premium franchise opportunity for investors seeking a differentiated position in the mens grooming market. The unique barbershop-bar concept, strong AUV approaching $1 million, and growing brand awareness create attractive unit economics for well-capitalized franchisees.

**Best Suited For:** - High-net-worth investors with $1M+ net worth - Entrepreneurs experienced in hospitality or retail management - Investors comfortable with alcohol licensing complexity - Franchisees targeting affluent urban or suburban markets - Operators seeking differentiated positioning in grooming industry

**Key Considerations:** - Research liquor license requirements and costs in target market - Evaluate local demographic data for affluent male population - Assess competition from other premium mens grooming concepts - Consider staffing market for both barbers and bartenders - Review insurance requirements for alcohol service operations

The innovative concept and strong financial performance make Scissors and Scotch attractive, but success requires comfortable navigation of the dual-business model and alcohol service complexities. Prospective franchisees should conduct thorough due diligence on local regulatory requirements before committing.