Are there pre-determined escalation amounts for the continuing franchise fees for Bath Tune Up?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
Continuing franchise fees – consist of service fees, renewal and transfer fees, and NAF fees paid by franchisees, as determined by the franchise agreements. The service fees relate to the performance obligations for the Company to provide monthly access to services that may include IT support, phone and call center support, and other related services. These fees are typically fixed per the franchise agreements and do not have predetermined escalation amounts. These fees are recognized monthly as the franchise utilizes the right to access the services.
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 51–52)
What This Means (2025 FDD)
According to the 2025 Bath Tune Up FDD, the continuing franchise fees are typically fixed and do not have pre-determined escalation amounts. These fees are determined by the signed franchise agreement and are billed and due monthly.
The continuing franchise fees cover the monthly access to services related to technology and marketing that Bath Tune Up provides to its franchisees. These services may include IT support, phone and call center support, and other related services.
Since the fees are fixed, franchisees can expect a consistent monthly expense for these services, which aids in financial planning. The FDD states that these fees are recognized over time on a monthly basis as the franchisee utilizes the right to access the aforementioned services.