If a Fitstop franchisee is not the full-time operator, what are they required to do?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
If you are not willing to be the full-time operator of your business, then you will be required to engage a manager and have them complete our training program (the "Designated Manager"). The Designated Manager is not required to hold an equity interest in the franchisee entity.
Any and all Designated Manager(s) must sign our then-current prescribed form of Confidentiality and Non-Competition Agreement. If and when a Designated Manager leaves his/her/their employment at your Franchised Business, you must recruit a new Designated Manager within thirty (30) days and submit the replacement's qualifications to us for our review and approval (which may be conditioned on completion of certain "Management Criteria") before substituting a new Designated Manager at any of your locations (unless you resume taking over the day-to-day operations of the Franchised Business on a full-time basis).
Your Franchised Business must always be managed and staffed with at least one (1) individual who has successfully completed the components of the Initial Training Program associated with being an owner/operator or, if appropriate, Designated Manager. In the event you develop more than one (1) System
franchise, you must have a properly trained Designated Manager at each Franchised Business you have the right to own and operate (but are not serving as its on-site manager).
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 40–41)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, if a franchisee is not willing to be the full-time operator of their business, they are required to engage a manager and have that manager complete Fitstop's training program. This individual is referred to as the "Designated Manager" and is not required to hold an equity interest in the franchisee entity.
Any Designated Manager must sign Fitstop's current Confidentiality and Non-Competition Agreement. If a Designated Manager leaves their employment, the franchisee must recruit a new Designated Manager within thirty (30) days. The franchisee must then submit the replacement's qualifications to Fitstop for review and approval before the new Designated Manager can be substituted, unless the franchisee resumes taking over the day-to-day operations on a full-time basis.
Fitstop requires that each franchised business always be managed and staffed with at least one individual who has successfully completed the components of the Initial Training Program, whether that individual is the owner/operator or a Designated Manager. If a franchisee develops more than one Fitstop franchise, they must have a properly trained Designated Manager at each franchised business they have the right to own and operate but are not serving as its on-site manager.