What is the Fitstop franchisee's obligation regarding the Local Marketing Requirement?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
6.4 Local Marketing and Local Marketing Requirement (or "LMR").
- 6.4.1 You must market and promote the Franchised Business at your cost, including using your best endeavors to actively promote the Franchise and in particular must regularly canvass members and potential members and follow up any leads you receive or that we may provide. You must not arrange, authorize, or carry out any advertising in relation to the Franchise unless we approve the form and content of the advertising in writing or it is in conformance with the Manual(s). You shall ensure that all marketing and promotional activities conform to the standards of ethical marketing and the policies prescribed by us and are not in any way misleading or deceptive.
- 6.4.2 You must expend the minimum amount equal to 1% of the Gross Revenue generated by the Franchised Business during the preceding calendar month of operations to market, promote and advertise the Franchised Business within the Designated Territory (the "Local Marketing Requirement" or "LMR"). We may require that all or some portion of your LMR be expended on services/collateral that you must acquire from one (1) or more of our then-current Approved Suppliers. Upon our request, you must provide us with invoices or other proof of your monthly expenditures on local advertising and marketing. You must ensure that: (i) the Franchised Business has a dedicated phone line for use in connection with the Franchised Business only (and no other business, including any other System Business); and (ii) the Franchised Business is listed in the appropriate Internet-based directories that we designate in the Manual(s) or otherwise.
- 6.4.3 You may not advertise and promote the Franchised Business outside of the Designated Territory, unless (a) the geographic area wherein you wish to advertise is contiguous to the Designated Territory and that area has not been granted to any other System Business or System franchisee/developer, and (b) we otherwise provide our prior written consent.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, franchisees must market and promote their franchised business at their own cost, using their best efforts to actively promote the Fitstop franchise. This includes regularly engaging with current and potential members and following up on leads. All advertising must be approved by Fitstop or conform to the standards outlined in the manuals, ensuring ethical marketing practices.
The Local Marketing Requirement (LMR) mandates that franchisees spend a minimum of 1% of the previous calendar month's gross revenue on local marketing, promotion, and advertising within their designated territory. Fitstop may require that these funds be spent on services or materials from approved suppliers. Franchisees must provide invoices or other proof of these monthly expenditures upon request.
Additionally, Fitstop franchisees must maintain a dedicated phone line solely for the franchised business and ensure the business is listed in designated Internet-based directories as specified in the manuals. Franchisees are restricted from advertising outside their designated territory unless the area is contiguous, unassigned to another franchisee, and with Fitstop's prior written consent. These measures ensure consistent brand messaging and prevent market overlap among franchisees.