How does Bft weight the Membership Attrition Rate for each month when calculating the annual Membership Attrition Rate for each Qualified Studio?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
We calculated the average monthly Membership Attrition Rate as follows: (a) we calculated the Membership Attrition Rate for each calendar month during the Measurement Period for each such Qualified Studio by calculating the percentage of members that cancelled their memberships in a particular calendar month at each such Qualified Studio; then (b) we calculated an annual Membership Attrition Rate for each such Qualified Studio by determining a weighted average of each such Qualified Studio's Membership Attrition Rate for the twelve months during the 2024 calendar year by allocating weight to the particular month's Membership Attrition Rate based on the number of members that such Qualified Studio had during that month (for example, if a Qualified Studio had 200 members as of January 31, 2024 and had 300 members as of February 29, 2024, the Qualified Studio's Membership Attrition Rate for February 2024 was weighted 1.5 times greater than the Qualified Studio's Membership Attrition Rate for January 2024, as a 300 membership base is 1.5 times greater than a 200 membership base); then (c) we calculated a simple average of all such Qualified Studios' weighted average monthly Membership Attrition Rate to determine the average Monthly Membership Attrition Rate for all 29 Qualified Studios noted above. We also show the range and median of Monthly Membership Attrition Rates for such Qualified Studios.
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 67–75)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the annual Membership Attrition Rate for each Qualified Studio is calculated using a weighted average of the monthly attrition rates. This weighted average accounts for the number of members each Qualified Studio had during each month of the 2024 calendar year.
Specifically, Bft allocates weight to each month's Membership Attrition Rate based on the studio's membership base during that month. For example, if a Bft studio had 200 members at the end of January 2024 and 300 members at the end of February 2024, the Membership Attrition Rate for February is weighted 1.5 times greater than that of January. This is because a 300-member base is 1.5 times larger than a 200-member base.
After calculating the weighted average monthly Membership Attrition Rate for each Qualified Studio, Bft then calculates a simple average of these weighted averages across all 29 Qualified Studios to determine the overall average Monthly Membership Attrition Rate. This approach provides a comprehensive view of membership trends across the Bft franchise system.