What are 'Affiliate-Owned Studios' categorized as in Item 20 for Beem Light Sauna?
Beem_Light_Sauna Franchise · 2025 FDDAnswer from 2025 FDD Document
Our fiscal year ends on December 31 of each year. As we acquired the franchise system in January 2025, Predecessor was the franchisor for fiscal years 2022, 2023, and 2024. In that period, Predecessor's affiliates owned and operated Studios, which we have categorized as "Affiliate-Owned Studios" in this Item 20. After our acquisition of the system, those Affiliate-Owned Studios became Franchised Studios operated under an arms-length agreement with us.
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 66–70)
What This Means (2025 FDD)
According to Beem Light Sauna's 2025 Franchise Disclosure Document, Item 20 categorizes studios owned and operated by the predecessor's affiliates as "Affiliate-Owned Studios" for the fiscal years 2022, 2023, and 2024. The FDD clarifies that this categorization applies to the period before the current franchisor acquired the franchise system in January 2025. After the acquisition, these Affiliate-Owned Studios transitioned into Franchised Studios, operating under an arm's-length agreement with the new franchisor.
This distinction is important for prospective franchisees as it provides transparency regarding the historical ownership and operational structure of the Beem Light Sauna franchise system. Understanding the number and status of Affiliate-Owned Studios versus Franchised Studios can offer insights into the franchise's evolution and the franchisor's strategic approach to growth. For example, a high number of affiliate-owned studios transitioning to franchised studios might indicate a strategic shift towards franchising as the primary growth model.
Item 20 includes tables that detail the status and changes in both Franchised Studios and Affiliate-Owned Studios over the past three years. Reviewing these tables can help potential franchisees assess the stability and growth patterns within each category. Specifically, Table No. 1 provides a system-wide studio summary, while Table No. 4 focuses on the status of Affiliate-Owned Studios. This information enables a more informed evaluation of the Beem Light Sauna franchise opportunity.