Are the fixed fees under the Aira Fitness Franchise Agreement subject to adjustment?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
All fixed fees (those not calculated as a percentage of sales) under this Agreement, including the Local Advertising expenditure and Local Marketing Fund or Cooperative contribution, are subject to adjustment based on any increase in the Consumer Price Index (meaning the annual average of the Consumer Price Index for All Urban Consumers, Other goods and services, 1982- 1984=100, published by the Bureau of Labor Statistics of the United States Department of Labor).
If the Bureau of Labor Statistics ceases publishing the Consumer Price Index, then the successor or most nearly comparable index as we select will be used.
Fees will be changed no more than once per year.
The increase will be based on the increase in the Index from January 1 of any year to January 1, 2025 or the previous CPI adjustment.
We will provide you with reasonable notice of such adjustment.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, certain fixed fees are subject to adjustment based on the Consumer Price Index (CPI). This means that the amount a franchisee pays for these fees can increase over time to account for inflation. The specific fixed fees that are subject to this CPI adjustment include the Local Advertising expenditure and Local Marketing Fund or Cooperative contribution.
The CPI used for these adjustments is the annual average of the Consumer Price Index for All Urban Consumers, Other goods and services, 1982-1984=100, published by the Bureau of Labor Statistics of the United States Department of Labor. If this index is discontinued, Aira Fitness will select a successor or comparable index. These fees will be adjusted no more than once per year, with the increase based on the change in the Index from January 1 of any year to January 1, 2025, or the date of the previous CPI adjustment.
Aira Fitness is required to provide franchisees with reasonable notice before implementing any such adjustment. This provision allows Aira Fitness to maintain the real value of these fixed fees over time, but it also means that a franchisee's costs can increase during the term of the franchise agreement. Franchisees should factor in potential CPI increases when projecting their expenses and profitability.