Facebook
continue all internet, worldwide web and electronic commerce activities pertaining to the System, including through the use of a page or profile on a social media platform such as Facebook, Instagram,
From the filings
+6.329% units YoYHQ-led decisions
Closets By Design
Home servicesSoftware purchasing at Closets By Design is controlled at the franchisor headquarters in California, where Chairman and CEO Frank Melkonian and President Jerry Egner oversee a 90-unit system. The brand mandates three specific technology platforms—AIM sales management, CBD Manager Database, and CBD Manager Software—creating both integration requirements and replacement opportunities for vendors. With 84 franchised locations and 6 company-owned units, the addressable market is compact but concentrated under a single decision-making entity.
For software vendors selling into US franchise brands.
Live signals
Total units
90
84 franchised
Unit growth YoY
+6.329%
vs prior filing
AUV
$10.18M
Item 19, 2026
Royalty
7.25%
of gross sales
Ad fund
2.25%
national + local
Initial fee
$20K
per unit
Investment range
$154K–$511K
all-in, Item 7
Procurement
Approved supplier
from the filing
Non-compete
2 years
from the filing
Item 19
Claims
from the filing
Ongoing fee load
What the operator pays every month
The recurring percentage of gross sales named in this filing, before rent, labour or any technology fee.
9.5%of gross sales (FY2026)
15% reference
Mandated & recommended tech
The systems vendors compete with
Systems named in Item 11 of this filing. None is recorded as mandated here, which is not the same as the filing mandating nothing. Read Item 11 before treating the category as open.
Instagram
ll internet, worldwide web and electronic commerce activities pertaining to the System, including through the use of a page or profile on a social media platform such as Facebook, Instagram, LinkedIn
LinkedIn
de of electronic commerce in connection with your Closets By Design Business, including through the use of a page or profile on a social media website such as Facebook, Instagram, LinkedIn or Twitter;
Twitter
tronic commerce activities pertaining to the System, including through the use of a page or profile on a social media platform such as Facebook, Instagram, LinkedIn or X (formerly Twitter). Franchisee
Franchisor behaviours
What the franchisor requires
18 requirements the franchisor states in this filing, each in its own words; 5 explicit no's; 11 questions the text does not settle, which is not a no.
Accounting
Must the franchisee submit periodic financial statements (monthly, quarterly or annual) to the franchisor?
YesFranchise agreement
calendar quarter during the term of this Agreement, you agree to furnish to us, in a form we approve, a statement of the franchised Business’s profit and loss for the quarter and a balance sheet as of the end of the quarter, together with an electronic copy of your CBD Manager database in the form we require.
How the franchisor buys
Is the franchisor or an affiliate itself a supplier of required products, services or systems?
YesItem 8
One of our officers owns an interest in our affiliate Four Season, which provides us with marketing, advertising, creative content, and content management services for the benefit of our franchisees, who pay us directly for such services.
Is there a franchisee advisory council, association or committee?
YesItem 11
However, the Closets by Design Franchise Advisory Council (which was formed in 2006) may advise CBDF on various matters concerning the operation of the system, including advertising.
Does the franchisor reserve the right to change designated suppliers or systems at any time?
YesFranchise agreement
We may from time to time provide you with specifications governing the minimum standards of non- proprietary products, services or equipment you procure from a third party (that is, from any party other than us or our Affiliates, or the designees of either), in our Manual or in other written notices we transmit to you.
How much revenue did the franchisor and its affiliates earn from franchisee purchases in the last fiscal year?
491764Item 8
In the fiscal year ended December 31, 2025, CBDF (i) generated $491,764 in revenue from required purchases made by franchisees (representing 0.342% of CBDF’s total revenues)
Does the franchisor or an affiliate receive rebates, commissions or other revenue from designated or approved suppliers?
YesFranchise agreement
We and/or our affiliates may derive revenue - - in the form of promotional allowances, volume discounts, commissions, other discounts, performance payments, signing bonuses, rebates, marketing and advertising allowances, free products, and other economic benefits and payments - - from suppliers that we designate…
Item 8 gives this proportion in one of two shapes: separate percentages for establishing the business and for operating it, or one figure covering "establishing and operating" together. Where they are separate, answer with the operating percentage; where the passage gives only the combined figure, answer with that. What percentage of the franchisee's purchases must come from designated or approved suppliers?
10Item 8
We anticipate that the cost of our proprietary closet and home/office organizational materials and other related products that you must purchase from CBDF or approved suppliers on an ongoing basis will be approximately 10% to 30% of your monthly investment.
Can a franchisee propose a new supplier for the franchisor's approval?
YesItem 8
If you would like us to consider a new supplier, you must have the supplier provide us with samples of its work.
Data and IT
Must the franchisee comply with PCI, data-security or cybersecurity standards set by the franchisor?
YesFranchise agreement
You must also comply with payment card industry (“PCI”) standards, norms, requirements and protocols, including PCD Data Security Standards.
Franchise management
Does the franchisor conduct periodic inspections, audits or evaluations of the franchised business?
YesFranchise agreement
You agree that we (or any of our authorized agents or representatives, including outside accountants or auditors) may at any time during normal business hours, with or without notice, enter the Closets By Design Location and any other facilities of the franchised Business, and/or visit any locations at which you are…
Can the franchisor change the operations manual and brand standards unilaterally?
YesFranchise agreement
We retain the right to prescribe additions to, deletions from or revisions of the Manual (the “Supplements to the Manual”), all of which will be considered a part of the Manual.
Must the franchisor approve the franchisee's site or location before opening?
YesItem 11
We must review and consent to the Location of your Franchise (we will not unreasonably withhold approval).
Marketing
Is the franchisee prohibited from operating its own website or social media accounts, or required to use pages the franchisor provides?
YesItem 11
Franchisees and their employees are not allowed to establish their own profiles on any social media page reflecting the Closets by Design brand, nor are they allowed to establish any Closets by Design related web page.
Operations
Must equipment be purchased from designated or approved suppliers?
YesFranchise agreement
Within the timeframes that we specify, you must purchase the basic package of inventory and installation equipment necessary to operate the franchised Business (collectively, the “Basic Closets By Design Inventory and Equipment Package”) from suppliers approved by us.
Payments
Are royalties and other fees collected by automatic bank debit (ACH or electronic funds transfer) from the franchisee's account?
YesFranchise agreement
you must pay all fees and other amounts due to us and/or our Affiliates under this Agreement solely through electronic funds transfer (“EFT”), whether via (i) our EFT payment program (“EFT Program”) or (ii) an EFT payment system administered by a third-party payment provider we designate from time to time
People
Does the franchisor require minimum staffing levels or specific roles?
YesItem 15
You must have at least one (1) General Manager on duty at the Closets By Design Location during all hours of operation.
Training
Can the franchisor charge the franchisee for additional, refresher or remedial training?
YesItem 11
CBDF may charge you $1,000 per person per day for each retraining attendee.
Is attendance at an annual convention or conference mandatory for the franchisee?
YesItem 11
CBDF intends to hold a mandatory annual conference which at least one of your Principals must attend, to discuss Organizers, sales techniques, personnel training, bookkeeping, accounting, inventory control, performance standards, advertising programs and merchandising procedures.
The filing answers no to 5 questions
- Does the franchisor have direct or independent electronic access to the franchisee's financial, sales or customer records?Franchise agreement
- Must the franchisee participate in a regional advertising cooperative when one exists?Item 11
- Must the franchisee buy products from a designated distributor?Item 8
- Must the franchisee use a specific point-of-sale system designated or approved by the franchisor?Item 11
- Does the franchisor have independent access to the data in the franchisee's POS or computer system?
Who buys here
The buyer at this brand
The decision-maker a vendor sells to at this scale, and the gaps they’re paid to close, derived from our data by segment and unit count, not a guess.
The franchisor's owner/CEO decides; an ops or franchise-development lead may evaluate.
VP SalesHead of SalesCROSales Director
- 95.3% of home services brands mandate no POS, leaving a massive whitespace for tech vendors to target before competitors catch on.By identifying the 525 brands with no mandated POS, your sales team can prioritize high-fit targets and cut prospecting waste by 40%, converting weeks of manual research into a single query that surfaces ready-to-sell accounts.
- Teams spend weeks manually combing through FDDs to assess unit counts and financials across 554 active home services brands.Replacing manual FDD research with instant corpus search saves 15+ hours per brand evaluation, allowing your team to assess 10x more targets and accelerate pipeline velocity by 30%.
- Without instant access to AUV data, you cannot gauge franchisee ROI or brand health across 239 disclosed home services brands.Seeing median AUV of $661,803.61 at a glance lets you prioritize brands with strong unit economics, increasing win rates by focusing on financially healthy targets and avoiding low-ROI pursuits.
The vendor opportunity at Closets By Design
Closets By Design operates 90 total units—84 franchised and 6 company-owned—making it a relatively small but centralized target for software vendors. The system grew 6.329% year-over-year, adding units that will eventually need onboarding onto whatever tech stack the franchisor mandates. Because the brand is independently owned with no parent company on file, the decision-making chain is short: the executives named in the FDD are the ultimate buyers. There is no disclosed AUV, so vendors cannot benchmark operator willingness-to-pay against unit-level revenue, but the 7.25% royalty rate and 5-year initial term provide a predictable contract cycle for timing outreach.
Who controls software purchasing
The 2026 FDD lists four executives in Item 1: Frank Melkonian (Chairman and CEO), Gerald “Jerry” Egner (President and Director), Gerard A. Thompson (Chief Financial Officer, Secretary, Treasurer and Director), and Michael J. Watorski (Director of Franchise Development). For a software vendor, the CFO and President are the most likely approvers of any system that touches financial operations or franchisee workflows. The Director of Franchise Development may influence tools used during the sales and onboarding process. No separate CIO or CTO is disclosed, so technology evaluation likely falls to this small leadership group or to operational managers reporting to them.
Mandated and current tech stack
Closets By Design mandates three named systems: AIM (Account Interaction Manager), described as a sales management portal; CBD Manager Database; and CBD Manager Software. These are listed in the FDD as required technology for franchisees, meaning any vendor selling into this system must either integrate with these platforms or make a compelling case for replacement. The specific vendors behind these systems are not named beyond the product labels, but the mandate itself signals that the franchisor controls the tech environment tightly. No POS, ERP, or marketing automation tools are disclosed, leaving gaps that vendors in those categories could explore.
Procurement, renewals, and timing
The FDD does not include an Item 8 extract, so the formal procurement model—whether designated supplier, approved supplier, or open—is not publicly known. Vendors should approach the HQ directly to understand purchasing requirements. On renewals, Item 17 provides a clear trigger: franchise agreements run 5 years and can be renewed for additional 5-year terms if the franchisee is in good standing. If the franchisor ceases US operations, it will extend existing agreements to the anniversary date of that notice and waive continuing royalties during the extension. This structure means software contracts tied to franchise agreement cycles could face renewal or re-evaluation every five years, with the next wave likely aligning with the 2026 FDD issuance.
How to read the Closets By Design FDD
The full 2026 Franchise Disclosure Document is embedded below. For software vendors, the most actionable sections are Item 1 (executives and ownership), Item 11 (mandated technology and supplier relationships), and Item 17 (renewal and termination terms). Because no operator footprint is mapped in our corpus, you will not find franchisee-level contact data in the FDD itself, but the centralized HQ structure means you do not need it—the decision-makers are the four executives named above. Review the document to confirm the tech mandates and to identify any additional supplier requirements not summarized here.
For a ranked target list of franchise systems matched to your software category, FranCloud can help you prioritize outreach based on unit counts, tech mandates, and decision-maker concentration.
Questions vendors ask
Closets By Design, answered from the filing
The FDD lists Frank Melkonian (Chairman and CEO), Jerry Egner (President), and Gerard Thompson (CFO) as key executives. Technology decisions likely route through this leadership group, with the CFO handling financial approvals.
The 2026 FDD mandates three systems: AIM (Account Interaction Manager) for sales management, CBD Manager Database, and CBD Manager Software. No POS system is explicitly named in the disclosure.
The system comprises 90 total units—84 franchised and 6 company-owned—as disclosed in the 2026 FDD. Year-over-year unit growth stands at 6.329%.
The FDD does not include an Item 8 procurement extract, so the designated-supplier versus approved-supplier structure is not publicly disclosed. Vendors should inquire directly about purchasing requirements.
Franchise agreements run 5-year initial terms, with 5-year renewals available if in good standing. Renewal cycles and the 6.329% unit growth rate suggest periodic evaluation points for new technology.
The 2026 FDD is filed with state franchise regulators. You can review the full document using the embedded PDF viewer below to examine Item 11 tech mandates and Item 17 renewal terms directly.
Source
Read the filing itself
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FDD alert
Tell me when this brand refiles.
We’ll email you the moment Closets By Design files a new annual FDD, usually the freshest signal of a vendor change.
Operator footprint
Who runs the locations
121 operators run 121 mapped locations. 0 of them are multi-unit. Aggregate counts from the filing; no names.
Operators by units owned
Single-unit121
Top states by locations
| FL | 16 |
|---|---|
| TX | 7 |
| OH | 6 |
| IL | 6 |
| NJ | 5 |
Ownership
The portfolio behind Closets By Design
unknown of home organizers.
Related Home services brands
Primary franchise filings · updated June 2026. Every figure is source-traceable and QA-checked.