Can the Body20 Brand Fund Fee be increased?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Brand Fund Fee | Currently, 2% of Gross Sales of the Studio. | The Payment Due Date | We have established and administer a Brand Fund and require you to contribute the Brand Fund Fee. We may increase the fee up to 4% of the Gross Sales of the Studio. See Note 2 for the definition of Gross Sales. |
NOTES:
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- "Gross Sales" means all revenue that you receive or otherwise derive from operating the Studio, whether from cash, check, credit or debit card, gift card or gift certificate, or other credit transactions, and regardless of collection or when you actually provide the products or services in exchange for the revenue. If you receive any proceeds from any business interruption insurance applicable to loss of revenue at the Studio, there shall be added to Gross Sales an amount equal to the imputed Gross Sales that the insurer used to calculate those proceeds. Gross Sales includes promotional allowances or rebates paid to you in connection with your purchase of products or supplies or your referral of customers. Gross Sales does not include (i) any bona fide returns and credits that are actually provided to customers and (ii) any sales or other taxes that you collect from customers and pay directly to the appropriate taxing authority. You may not deduct payment provider fees (i.e., bank or credit card company fees and gift card vendor fees) from your Gross Sales calculation.
Source: Item 6 — OTHER FEES (FDD pages 19–26)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, the Brand Fund Fee can be increased. Currently, franchisees pay 2% of Gross Sales of the Studio for the Brand Fund Fee. Body20 retains the right to increase this fee up to a maximum of 4% of the Gross Sales of the Studio.
The Brand Fund is administered by Body20, and franchisees are required to contribute to it. This fund is typically used for marketing and advertising efforts to promote the Body20 brand, which benefits all franchisees. However, the discretion to increase the fee lies with Body20, and franchisees should be aware of the potential for this increase and factor it into their financial planning.
Understanding the definition of 'Gross Sales' is crucial, as the Brand Fund Fee is calculated based on it. Gross Sales includes all revenue derived from operating the studio, irrespective of the payment method or when services are provided. It also includes proceeds from business interruption insurance related to revenue loss. However, it excludes bona fide returns and credits to customers, as well as sales or other taxes collected from customers and remitted to the appropriate taxing authority. Franchisees cannot deduct payment provider fees from their Gross Sales calculation.