What is the Fitstop franchisee's obligation regarding payments to Approved Suppliers?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
Fee, Local Marketing Requirement and/or other marketing/advertising and/or promotional expenditures, to the extent such amounts are payable to us and/or any of our Approved Suppliers.
- 13.8 Other Amounts Payable to Third-Party Approved Supplier(s) and/or Otherwise in Connection with the Franchised Business. You must ensure that timely payment is made with respect to all amounts due and owing to: (i) any designated or other Approved Supplier for Required Items (products or services) that we designate in our Manuals or otherwise in writing, including our then-current Approved Supplier for merchant processing services, consistent with the applicable Approved Supplier's invoicing, terms and conditions; and (ii) any other third-party landlord, supplier, provider or other vendor that has been used or engaged by you in connection with the establishment and/or ongoing operation of the Franchised Business.
- 13.9 Related Acknowledgements. The parties acknowledge and agree that (i) all payments made by members in respect of Approved Products and/or Approved Services which you provide to members from your Franchise must be processed through our online ordering system via our website or our application; (ii) we may, in our reasonable discretion, allocate discounted or free memberships to members who work at our headquarters, other team members, corporate partners, athletes and ambassadors and sponsors of our brand; (iii) there is no exclusivity of members and members may openly choose to deal with any franchisee, regardless of the member's location; (iv) subject to the below, all payments received by us from members who pay for Approved Products and/or services which you provide from your Franchise through our online ordering system via our website or the application are accepted by us for and on your behalf unless advised otherwise by us in writing at any time during the Term;
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, franchisees are obligated to make timely payments to Approved Suppliers for Required Items and to other third-party vendors. Specifically, franchisees must ensure that all amounts due to designated or other Approved Suppliers for Required Items, including products or services specified in Fitstop's manuals or in writing, are paid in accordance with the Approved Supplier's invoicing terms and conditions. This includes payments to the Approved Supplier for merchant processing services.
Additionally, Fitstop franchisees must also ensure timely payment to any other third-party landlord, supplier, provider, or vendor that they use or engage in connection with establishing or operating the franchised business. This encompasses a broad range of potential service providers necessary for the Fitstop location's setup and ongoing operations.
Furthermore, Fitstop uses an Approved Supplier to manage gross revenue collection, billing, and fund distribution to franchisees. Unless otherwise specified, this Approved Supplier collects membership fees and other gross revenue, provides billing services for amounts due to Fitstop, and remits the gross revenue (less any amounts owed to Fitstop) to the franchisee. Franchisees must also participate in Fitstop's Electronic Funds Transfer (EFT) program for the payment of amounts due to Fitstop under the Franchise Agreement.