If a Fitstop franchisee develops more than one franchise, what are the Designated Manager requirements?

According to Fitstop's 2024 Franchise Disclosure Document, if a franchisee develops more than one Fitstop franchise, they must have a properly trained Designated Manager at each location they own and operate, unless they are serving as the on-site manager themselves. This ensures that each Fitstop location has someone who has completed the initial training program.

This requirement means that a Fitstop franchisee expanding to multiple locations needs to factor in the cost and time of training a Designated Manager for each new franchise. The Designated Manager must complete the components of the Initial Training Program associated with being an owner/operator or Designated Manager. This could impact the profitability of additional locations, especially in the early stages, as the franchisee will need to cover the salary and training expenses for each manager.

Fitstop's emphasis on trained managers aligns with common franchise industry practices, where franchisors typically require franchisees or their managers to complete training programs to maintain brand standards and operational consistency. The Designated Manager is not required to hold equity in the franchisee entity. This allows for flexibility in hiring and managing personnel, as the franchisee is not obligated to offer ownership to the manager.

It is important for prospective Fitstop franchisees to understand these requirements and plan accordingly when considering expanding to multiple locations. They should discuss the specifics of the training program, the associated costs, and the criteria for Designated Manager approval with Fitstop to ensure they can meet these obligations.