What obligations does an Aira Fitness franchisee have regarding designated suppliers in Item 8 and how are these obligations summarized in Item 9?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition to participation in the insurance program, you must carry workers' compensation and employer liability coverage as required by the jurisdiction in which you operate the Fitness Aira Fitness Business.
All required insurance not included in the insurance program must be obtained from a responsible carrier or carriers acceptable to us (generally an AM Best rating of A- or better). All of the policies must name us and anyone else we designate with an insurable interest as additional insured and must include a waiver of subrogation in favor of each additional named insured.
Marketing and Promotional Materials
You may use only marketing and promotional materials that meet our standards (see Item 11 for more information on advertising and marketing).
Estimated Proportion of Required Purchases and Leases to all Purchases and Leases
We estimate that your required purchases will represent approximately 75 to 85% of your total purchases in connection with establishing the franchised business (excluding the franchise fee and other non-goods expenditures), and 5 to 10% of the ongoing costs that you will need to operate the business (excluding franchise fees and royalties and other non-goods expenditures).
Supplier Rebates; Description of Purchasing Cooperatives; Purchasing Arrangements
We and our affiliates also have arrangements with certain suppliers whereby we or our affiliate will receive rebates from franchisee purchases or leases, which may be a fixed amount per transaction or percentage of the purchase. We currently do not receive rebates from suppliers based on franchisee purchases but reserve the right to do so. We negotiate purchase arrangements for the benefit of the franchisees, namely forthe Initial Fitness Equipment Package. This does not guarantee that the price for these products or services will be lower than other products or services on the market. We do not have any purchasing or distribution cooperatives in the System as of the date of this Disclosure Document. We do not provide you any material benefits (such as renewal rights or the right to acquire additional franchises) based on your purchases from approved or designated suppliers.
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, franchisees are required to purchase certain goods and services from designated or approved suppliers. Item 8 outlines these restrictions on sources of products and services. Aira Fitness estimates that required purchases will represent approximately 75 to 85% of the franchisee's total purchases in connection with establishing the franchised business, excluding the franchise fee and other non-goods expenditures. For ongoing costs to operate the business, required purchases are estimated to be 5 to 10%, again excluding franchise fees, royalties, and other non-goods expenditures.
Specifically, franchisees must participate in the insurance program and carry workers' compensation and employer liability coverage as required by the jurisdiction in which they operate. If the required insurance is not included in the insurance program, it must be obtained from a responsible carrier with an AM Best rating of A- or better, acceptable to Aira Fitness. These policies must name Aira Fitness and anyone else they designate with an insurable interest as additional insured and must include a waiver of subrogation in favor of each additional named insured.
Additionally, franchisees must use only marketing and promotional materials that meet Aira Fitness's standards, as detailed further in Item 11. Aira Fitness and its affiliates may receive rebates from franchisee purchases or leases with certain suppliers, either as a fixed amount per transaction or a percentage of the purchase. While Aira Fitness does not currently receive rebates, they reserve the right to do so. They negotiate purchase arrangements for the benefit of franchisees, such as the Initial Fitness Equipment Package, but this does not guarantee lower prices than other products or services on the market. Aira Fitness does not have any purchasing or distribution cooperatives and does not provide any material benefits based on purchases from approved or designated suppliers.