How much did Bft receive in allowances, rebates, or other consideration from vendors in connection with franchisee purchases during the fiscal year 2024?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
als from franchisees to add new suppliers if we believe that approval would not be in the best interests of the System.
We and/or our affiliates may receive payments or other compensation from Approved Suppliers or any other suppliers on account of these suppliers' dealings with us, you, or other Studios in the System, such as rebates, commissions or other forms of compensation, which may comprise of fixed payments and/or percentages of overall sales transactions. During the fiscal year 2024, we received $154,772 in allowances, rebates, or other consideration from vendors in connection with purchases by franchisees, which constituted 6.3% of our total revenue of $2,447,103 during the year, and our Predecessor received $594,663 in similar allowances, rebates, and other consideration. Additionally, Xponential received $6,837,252 in allowances, rebates, or other consideration from vendors in connection with purchases by franchisees of all Xponential Brands in the U
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 32–36)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, during the fiscal year 2024, Bft received $154,772 in allowances, rebates, or other consideration from vendors related to franchisee purchases. This amount represented 6.3% of Bft's total revenue, which was $2,447,103 for the year. In addition, Bft's Predecessor received $594,663 in similar allowances, rebates, and other consideration. Xponential received $6,837,252 in allowances, rebates, or other consideration from vendors in connection with purchases by franchisees of all Xponential Brands in the United States and Canada. Bft retains the right to use these amounts for any purpose it deems appropriate.
This arrangement means that Bft benefits financially from the purchasing activities of its franchisees through negotiated vendor agreements. These benefits can take the form of rebates, commissions, or other compensation. While franchisees are required to purchase certain goods and services from approved suppliers, Bft may also profit from these arrangements.
For a prospective franchisee, this highlights the importance of understanding the relationships Bft has with its suppliers. While Bft states it may negotiate prices that benefit both the company and its franchisees, the franchisor also has the right to use the funds it receives from vendors for any purpose. This raises questions about how these funds are used and whether they directly benefit the franchisees. It is important to note that Bft did not receive any revenue from the sale of goods and services to franchisees, but its Predecessor received $4,727,544 from franchisees.
Prospective franchisees should inquire about the specifics of these vendor agreements, including the criteria for selecting approved suppliers and how the rebates or allowances received by Bft are utilized. Understanding these financial arrangements can provide a clearer picture of the overall costs and benefits associated with the Bft franchise.