What is a 'mandatory vendor' for Basecamp Fitness?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
r specifications and quality standards. We do not impose any fee for our consideration of an item not previously approved.
We may require you to purchase certain furniture, equipment, inventory, supplies, services and other products used or offered at your studio from vendors we approve, in which case we will provide you with a list of approved suppliers. These will include mandatory vendors (persons from whom you must purchase certain items or services), designated vendors (for items or services that must be purchased from vendors we approve), and preferred vendors (for vendors we have approved, but in categories where we do not require you obtain our approval of the vendor). These suppliers may pay vendor rebates to us and they may include our company and affiliates of ours. We may modify our mandatory, designated, and/or preferred vendor(s) at any time. We may require you to offer additional services or products and some of those products or services may require that you purchase additional equipment or training for your staff.
When we have a designated vendor (other than a mandatory vendor), if you want to purchase from other vendors the items or services for which that vendor has been designated, you must notify us in writing and obtain our approval. If you seek approval of a new supplier (or if the supplier applies directly to us for approval), we will require the supplier pay us a nonrefundable fee of $300 before we will consider approving their application. This fee is intended to defer our cost of reviewing t
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 28–32)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, a mandatory vendor is a supplier from whom franchisees must purchase specific items or services. Basecamp Fitness also uses 'designated vendors' for items or services that must be purchased from approved vendors, and 'preferred vendors' for vendors that Basecamp Fitness has approved, but where franchisees are not required to use approved vendors. These approved vendors may include Basecamp Fitness itself or its affiliates.
Basecamp Fitness can modify its list of mandatory, designated, and/or preferred vendors at any time, and may require franchisees to offer additional services or products that necessitate purchasing additional equipment or training for staff. If a franchisee wishes to purchase items or services from a vendor other than a designated vendor, they must notify Basecamp Fitness in writing and obtain approval. Basecamp Fitness may require a nonrefundable fee of $300 from new suppliers seeking approval to defer the cost of reviewing the supplier.
Basecamp Fitness generates revenue from franchisee purchases from mandatory, designated, or preferred suppliers, potentially receiving up to 15% of franchisee purchases as rebates. For the fiscal year ended December 31, 2024, Basecamp Fitness received $102,583 in revenue from these purchases, which was 1.97% of their total revenues of $5,198,013. ProVision, an affiliate, received $516,320, and SEB Distribution received $111,139 in revenue from these purchases. This revenue data was taken from internal financial records and has not been modified for ASC 606 purposes.
Prospective Basecamp Fitness franchisees should be aware that a significant portion of their initial and ongoing expenses will be directed towards purchases from these approved vendors. The FDD indicates that over 90% of initial purchases and between 70% and 90% of ongoing expenses will be for items meeting Basecamp Fitness's specifications. Franchisees should carefully evaluate the costs and terms associated with these mandatory vendor relationships, as well as the potential for vendor changes, to fully understand the financial implications of operating a Basecamp Fitness franchise.