What index is used to adjust the fixed fees for Aira Fitness?

According to Aira Fitness's 2025 Franchise Disclosure Document, the Consumer Price Index (CPI) is used to adjust fixed fees. Specifically, 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 is used. This adjustment applies to all fixed fees, which are those not calculated as a percentage of sales, including the Local Advertising expenditure and Local Marketing Fund or Cooperative contribution.

For a prospective Aira Fitness franchisee, this means that certain fees they pay, such as those for local advertising, can increase over time based on changes in the CPI. This is a fairly standard practice in franchising, as it allows the franchisor to account for inflation and maintain the real value of these fees. The FDD states that adjustments will occur no more than once per year, providing some predictability for franchisees.

The FDD also states that if the Bureau of Labor Statistics stops publishing the CPI, Aira Fitness will select a successor or comparable index. 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. Aira Fitness will provide franchisees with reasonable notice of any such adjustment.

It's important for potential franchisees to understand how these adjustments can impact their overall costs and profitability. While the CPI adjustment aims to keep pace with inflation, franchisees should factor in potential increases when projecting their expenses and revenue. Understanding the specific index used and the frequency of adjustments can help franchisees better manage their financial planning and budget accordingly.