From the filings
Happy Lemon operates 118 US locations, 106 of them franchised, under CEO Andy Chiang and COO Yute Wood Chen. With 16 multi-unit operators running larger footprints and average unit sales of $465,911 disclosed via a financial performance representation in Item 19, this California-based bubble tea chain offers vendors a sizeable pitch target across its 2026 FDD.
For software vendors selling into US franchise brands.
Live signals
Ongoing fee load
The recurring percentage of gross sales named in this filing, before rent, labour or any technology fee.
3%of gross sales (FY2026)
15% reference
Franchisor behaviours
26 requirements the franchisor states in this filing, each in its own words; 4 explicit no's; 4 questions the text does not settle, which is not a no.
Accounting
Must the franchisee use an accounting or bookkeeping system designated or approved by the franchisor?
YesItem 11
You must purchase and use required hardware and software programs meeting our specifications and compatibility requirements, all of which can change over time and may require additional investment.
Does the franchisor have direct or independent electronic access to the franchisee's financial, sales or customer records?
YesFranchise agreement
Franchisor reserves the right to have full access to all of Franchisee’s computer data, Computer System and related information via direct access either in person or electronically by telephone, Internet or other electronic access system, as selected by Franchisor, including customer related information/data.
Must the franchisee submit periodic financial statements (monthly, quarterly or annual) to the franchisor?
YesFranchise agreement
Franchisee shall maintain an accurate record of Gross Revenues and shall deliver to Franchisor in the manner Franchisor specifies a signed and verified statement of monthly Gross Revenues (“Gross Revenues Report”) for the royalty period in a form that Franchisor approves or provides in any Manual or through other…
How the franchisor buys
Is the franchisor or an affiliate itself a supplier of required products, services or systems?
YesItem 8
As of the date of this Disclosure Document, we and our Affiliate, HL West, are Approved Suppliers, each of whom will make a reasonable profit margin on the goods and services it provides to you.
Does the franchisor reserve the right to change designated suppliers or systems at any time?
YesFranchise agreement
Franchisor has the unrestricted right to change, eliminate or modify any elements of the System, any Manual or the Marks.
Does the franchisor or an affiliate receive rebates, commissions or other revenue from designated or approved suppliers?
YesItem 8
We and our Affiliates have the right to receive rebates, incentive amounts, discounts and other economic benefits from any supplier to Happy Lemon Stores and to earn a profit on the sale of Designated Goods we sell to you and other Happy Lemon Stores.
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?
75Item 8
We also estimate that the required purchases and leases you make on an ongoing basis will represent approximately 75% of all purchases and leases you make in operating the business on an ongoing basis.
Does the franchisor charge a fee to evaluate a proposed supplier?
YesFranchise agreement
Franchisor may charge Franchisee a reasonable fee for inspecting, evaluating, and testing new products or suppliers proposed by Franchisee, estimated not to exceed One Thousand Dollars ($1,000) per inspection/test.
Can a franchisee propose a new supplier for the franchisor's approval?
YesFranchise agreement
If Franchisee proposes to offer for sale or use at the Store any product or service or to use any supplier or equipment that is not then approved by Franchisor, Franchisee shall first notify Franchisor in writing and request Franchisor’s consent to do so.
Communications
Does the franchisor own or control the business telephone numbers, or take them over when the agreement ends?
YesItem 17
assign phone and fax numbers, email addresses and domain names to us
Franchise management
Must the franchisee participate in a customer-satisfaction or net-promoter survey program?
YesFranchise agreement
System Standards may involve requirements relating to Product preparation, storage, handling, packaging and storage; catering and delivery services (if approved); signage; use and display of the Marks; logo wear requirements; hours of operation; required participation in research, surveys, campaigns, conventions and…
Does the franchisor conduct periodic inspections, audits or evaluations of the franchised business?
YesItem 11
Perform routine performance audits to ensure drinks and ingredients meet our quality standards.
Can the franchisor change the operations manual and brand standards unilaterally?
YesFranchise agreement
Franchisor has the unrestricted right to change, eliminate or modify any elements of the System, any Manual or the Marks.
Must the franchisor approve the franchisee's site or location before opening?
YesItem 11
You cannot open your Happy Lemon Store for business until you have our written consent to do so.
Marketing
Is the franchisee prohibited from operating its own website or social media accounts, or required to use pages the franchisor provides?
YesItem 11
Unless you get our prior written consent, you are not allowed to establish or maintain a separate website, splash page, any kind of presence on the Internet or presence through any social media or social media site relating to the operation of the business.
Must the franchisee participate in a customer loyalty or rewards program?
YesFranchise agreement
Franchisee agrees to implement any gift card, gift certificate, customer loyalty or similar rewards program for its Store as required by Franchisor.
Operations
Must the franchisee buy products from a designated distributor?
YesFranchise agreement
Franchisee shall purchase such Proprietary Products exclusively from Franchisor, Franchisor Associate(s) or Franchisor’s designated supplier, as applicable.
Must equipment be purchased from designated or approved suppliers?
YesItem 8
You cannot use, offer or sell any Designated Goods at your Happy Lemon Store that we have not approved.
Payments
Are royalties and other fees collected by automatic bank debit (ACH or electronic funds transfer) from the franchisee's account?
YesItem 6
Unless otherwise noted, all fees are payable to us by the method we select, including possibly electronic funds transfer.
Must the franchisee participate in a gift card program?
YesFranchise agreement
Franchisee agrees to implement any gift card, gift certificate, customer loyalty or similar rewards program for its Store as required by Franchisor.
People
Does the franchisor require minimum staffing levels or specific roles?
YesItem 15
You must have at least 2 Store Managers to manage and supervise the Happy Lemon Store, one of whom may be the Designated Owner.
Must employees wear uniforms specified by the franchisor?
YesItem 8
The Designated Goods include, but are not limited to, packaging and serving materials (e.g., bags, cups, etc.), certain proprietary ingredients, mixes, seasonings, flavorings, and other raw materials, supplies, kitchen equipment, computer hardware and software, uniforms and signage.
Point of sale
Must the franchisee use a specific point-of-sale system designated or approved by the franchisor?
YesItem 11
You must purchase and use required hardware and software programs meeting our specifications and compatibility requirements, all of which can change over time and may require additional investment.
Does the franchisor have independent access to the data in the franchisee's POS or computer system?
YesItem 11
We have the right under the Franchise Agreement to have independent access all of the information generated Happy Lemon Franchise Disclosure Document 23 and stored in your POS systems.
Training
Can the franchisor charge the franchisee for additional, refresher or remedial training?
YesItem 11
We may offer or require that you and your Store Managers attend remedial training and additional training programs offered on-line, at our training facilities or elsewhere so you remain up to date on Products, Services and brand standards.
Is attendance at an annual convention or conference mandatory for the franchisee?
YesFranchise agreement
Franchisee must attend the annual meeting if Franchisor requires it.
Who buys here
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.
HQ leadership: CEO/President + VP Ops/Franchise + a first dedicated IT/systems owner.
Talk to FranCloud for a ranked list of similar quick-service targets scored against your ideal customer profile.
Questions vendors ask
Every number on this page traces back to this document. Read it in full, page by page. Buy the original PDF to download, search, and annotate it.
View only A one-time purchase: the original filing, yours to keep.
FDD alert
We’ll email you the moment Happy Lemon files a new annual FDD, usually the freshest signal of a vendor change.
Operator footprint
79 operators run 107 mapped locations. 16 of them are multi-unit. Aggregate counts from the filing; no names.
Operators by units owned
Top states by locations
| CA | 44 |
|---|---|
| WA | 22 |
| TX | 16 |
| OR | 5 |
| CO | 5 |
Ownership
unknown of yummy town holding.
Related Quick service restaurant brands
Primary franchise filings · updated September 2026. Every figure is source-traceable and QA-checked.