What is the Development Fee for a Beem Light Sauna Development Agreement, and how is it calculated?
Beem_Light_Sauna Franchise · 2025 FDDAnswer from 2025 FDD Document
e $35,000 per studio.
In 2024, Predecessor collected Franchise Fees, each in the amount of $59,900.
Development Fee. If you enter into a Development Agreement, you must pay us, upon signing the Development Agreement, a development fee equal to 100% of the aggregate of all of the Franchise Fees due for each Studio that you agree to develop (the "Development Fee"). The Development Fee will range between $165,000 to $350,000 if you commit to develop between three to 10 Studios. The Development Fee will be credited towards the Franchise Fee due for each Studio developed under the Development Agreement, and there will be no additional
Source: Item 5 — INITIAL FEES (FDD pages 18–20)
What This Means (2025 FDD)
According to Beem Light Sauna's 2025 Franchise Disclosure Document, if a franchisee enters into a Development Agreement, they must pay a Development Fee upon signing the agreement. This fee is equal to 100% of the total Franchise Fees due for each Beem Light Sauna studio the franchisee commits to develop. The Development Fee ranges from $165,000 to $350,000 if the franchisee commits to developing between three and ten studios.
Essentially, the Development Fee is an upfront payment that covers the franchise fees for all the studios a developer plans to open. For example, if a franchisee commits to opening five studios and the franchise fee is $55,000 per studio, the Development Fee would be $275,000 (5 x $55,000). This upfront payment secures the rights to develop those studios within a specific territory and timeframe.
The FDD specifies that the Development Fee will be credited towards the Franchise Fee due for each studio developed under the Development Agreement. This means that franchisees will not have to pay an additional Franchise Fee when they sign individual Franchise Agreements for each studio they develop. The initial Development Fee covers these individual franchise fees.
This structure is common in franchising, as it allows franchisors to secure commitments for area development and provides developers with a clear path for expanding the brand. Prospective Beem Light Sauna developers should carefully consider the number of studios they can realistically develop within the agreed-upon timeframe to determine the appropriate number of studios to commit to in the Development Agreement.