What is the dependency between premises build-out and Fitstop's system standards?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
General Note. The estimated investment ranges were prepared based upon and accounting for: (i) various sources of information, including (a) the experience of our affiliates developing two (2) System Businesses (each, an "Affiliate Business") over the past 18 months, (b) the experience of our Affiliate Franchisor and its System franchisees that have Franchised Businesses operating or under development in Australia, (c) information we have received from our current third-party Approved Suppliers for certain investment items or categories above, (d) information and data that we have received from various real estate brokers and/or other sources for information with respect to current real estate and commercial leasing markets, and (e) various other due diligence; and (ii) a number of expectations and reasonable assumptions that we make as part of our standard franchise offering, such as franchisee (a) securing an approved Premises and opening the Franchised Business within the prescribed timelines set forth in your Franchise Agreement (and on or before the Rent Commencement Date under the lease for the Premises), and (b) ensuring that the Premises is built out in accordance with our current System standards, specifications and processes, and (c) using our Approved Suppliers for certain Required Items as set forth in the Chart above and in Item 8 of this Disclosure Document below.
Source: Item 7 — TEM 7: ESTIMATED INITIAL INVESTMENT (FDD pages 15–19)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, a franchisee must ensure that the premises are built out in accordance with Fitstop's current system standards, specifications, and processes. This is one of the assumptions that Fitstop makes as part of its standard franchise offering when preparing the estimated investment ranges. The FDD notes that Fitstop also expects franchisees to use their approved suppliers for certain required items.
Specifically, the cost of leasehold improvements, which refers to the construction or "build out" of the facility, is estimated to be between $100,000 and $325,000. This build-out must adhere to Fitstop's standards. The cost can vary based on the location, design, layout, and size of the franchised business, as well as any upgrades or variances the franchisee requests and Fitstop allows. The standard franchise offering assumes a premises size between 1,800 and 3,000 square feet.
Fitstop also provides an estimated range of $70,000 to $100,000 for the operational equipment and supplies package, which covers the necessary items for instructors to provide approved services. The exact components of this package are detailed in Fitstop's manuals. Additionally, signage costs, which include exterior and interior signs bearing Fitstop's proprietary marks, are estimated to range from $10,000 to $50,000 and must be acquired from Fitstop's designated approved supplier.
Prospective franchisees should carefully review Fitstop's system standards and specifications, as well as consult with approved suppliers, to ensure accurate budgeting and compliance during the build-out process. Deviations from these standards or the use of non-approved suppliers could potentially lead to additional costs or delays in opening the Fitstop franchise.