What does the cost of goods sold for Basecamp Fitness primarily include?

According to Basecamp Fitness's 2025 Franchise Disclosure Document, the cost of goods sold primarily encompasses the direct costs linked to equipment sales. This includes freight costs associated with delivering equipment to both new and existing franchisee-owned clubs and studios, both in the U.S. and internationally. This means that a significant portion of the cost of goods sold for Basecamp Fitness franchisees is directly tied to the expenses incurred in acquiring and transporting the necessary equipment for their studios. The FDD specifies that the cost of revenue changes primarily based on equipment sales volume.

For a prospective Basecamp Fitness franchisee, understanding the components of the cost of goods sold is crucial for financial planning. Since equipment is a vital part of the Basecamp Fitness studio setup, franchisees should anticipate these costs and factor them into their initial investment and ongoing operational expenses. The statement that cost of revenue changes primarily based on equipment sales volume suggests that franchisees can expect fluctuations in these costs depending on the volume of equipment they are purchasing, whether for initial setup or for upgrades and replacements.

Furthermore, the inclusion of freight costs within the cost of goods sold indicates that shipping and delivery expenses are a notable factor. Franchisees should consider the location of their studio and potential shipping distances when estimating these costs. It is also important to note that these costs are associated with both domestic and international locations, which may impact franchisees differently depending on their geographic region. By carefully monitoring equipment sales volume and associated freight costs, Basecamp Fitness franchisees can better manage their cost of goods sold and maintain profitability.