Where can I find more details about the initial franchise fee for a Fitstop franchise?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
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- Initial Franchise Fee. Please see Item 5 of this Disclosure Document for additional details regarding this initial fee and the terms associated with the same. This amount must be paid in connection with each Franchised Business you are awarded the right to independently own and operate at the time such rights are awarded, and such amounts are deemed fully earned upon payment under your signed Franchise Agreement.
| YOUR ESTIMATED INITIAL INVESTMENT | ||||
|---|---|---|---|---|
| Type of Expenditure | Amount | Method of Payment | When Due | To Whom Payment is to be Made |
| Initial Franchise Fee1 | $50,000 | Lump sum | Upon execution | Us |
| Initial Marketing Spend2 | $10,000 | Lump sum | Prior to opening | Approved Supplier for digital/online marketing; Third-Party Provider for other expenditures |
| Other Initial Marketing and Promotional Activities2 | $1,000 to $10,000 | As arranged | As invoiced or agreed | Approved Supplier and/or other Third-Party Providers (videographer, etc.) |
| Training-Related Costs and Expenses3 | $1,000 to $7,500 | As arranged | Prior to Opening | Third-Party Providers for Travel, Lodging, Meals and Local Transportation |
| Site Selection Assistance | $0 to $10,000 | Lump sum | Prior to opening | Approved Supplier or other Third-Party Provider |
| Security Deposit and other Pre-Opening Amounts under Lease for Approved Premises5 | $8,000 to $75,000 | As arranged between you and the landlord. | As negotiated and agreed in the lease | Third-Party Landlord |
| Design and Layout | $3,000 to $10,000 | As arranged | Prior to opening | Approved Supplier(s) and/or Other Third-Party Provider(s) |
| Operational Equipment and | $70,000 to $100,000 | Lump sum | Prior to opening | Approved Supplier(s) |
| Supplies Package6 | ||||
| Leasehold Improvements7 | $100,000 to $325,000 | As arranged | As invoiced | Third-Party Contractor and Other Third-Party Vendors/Providers |
| Signage: Exterior/Interior8 | $10,000 to $50,000 | As agreed | As invoiced | Approved Supplier(s) |
| Computer System and Required Software – Initial Costs9 | $3,000 to $7,000 | Lump sum | As invoiced and prior to opening | Approved Supplier(s) |
| Other FFE | $0 to $10,000 | As arranged | As incurred | Approved Supplier(s) and/or other Third-Party Vendor(s) |
| Utility Deposits (water, | $1,000 to $3,000 | As | Prior to opening | Utility Providers |
| electricity, gas) | incurred | |||
| Insurance Premiums | $2,000 to $10,000 | As arranged | As incurred and invoiced | Third-Party Insurance Carrier/Provider |
| Business Licenses & Permits | $500 to $10,000 | Lump sum | Prior to opening | Local, state, and/or federal government agencies |
| Total Estimated Initial | $306,000 to $823,500 | |||
| Investment |
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, Item 7 provides an overview of the estimated initial investment, including the initial franchise fee. Specifically, it directs prospective franchisees to Item 5 for additional details regarding the initial franchise fee and its associated terms. Item 7 also includes a table that lists the initial franchise fee as $50,000, payable in a lump sum upon execution of the agreement to Fitstop. This fee is part of the total estimated initial investment, which ranges from $306,000 to $823,500.
Item 7 further breaks down the initial investment into various components beyond the franchise fee. These include expenses such as the initial marketing spend ($10,000), other initial marketing and promotional activities ($1,000 to $10,000), training-related costs ($1,000 to $7,500), site selection assistance ($0 to $10,000), and security deposits for the leased premises ($8,000 to $75,000). There are also significant costs associated with design and layout ($3,000 to $10,000), operational equipment and supplies ($70,000 to $100,000), leasehold improvements ($100,000 to $325,000), and signage ($10,000 to $50,000).
Prospective Fitstop franchisees should note that the initial franchise fee is non-refundable and is deemed fully earned by Fitstop upon payment under the signed Franchise Agreement. The FDD emphasizes the importance of carefully reviewing all figures in light of local conditions and the local economy, and consulting with an accountant. Understanding the full scope of the initial investment, including the franchise fee and other pre-opening expenses, is crucial for assessing the financial feasibility of the franchise.
While Item 7 provides a detailed breakdown of the initial investment, the specific details and terms related to the initial franchise fee itself are found in Item 5 of the FDD. Therefore, prospective franchisees should carefully review Item 5 to fully understand the conditions under which the fee is paid, whether any portions are refundable under specific circumstances, and any other obligations tied to the fee.