When are Fitstop merchant payment processing costs payable?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
| Indemnification | The costs and expenses we incur in connection with your breach or default under your Franchise Agreement or otherwise in the ownership and operation of your Franchised Business. | As incurred by you. | You are solely responsible and must indemnify and hold us harmless for all loss, damage, claims or demands arising from your Franchise including, but not limited to, any joint employment claims. |
|---|---|---|---|
| Annual Convention Fee | We expect this amount to be around $1,500 to $2,000 per attendee | Paid monthly by you. | You will also be responsible for covering the costs that attendees incur in connection with attending any such event. |
| Merchant payment processing costs | Then-current amount charged by our Approved Supplier (if applicable) Currently, these fees are estimated to be between 2% and 4% of Gross Revenue generated by your Franchised Business on an ongoing basis | Payable immediately once collected by the Current Billing/POS Provider | These amounts are payable to our third-party Approved Supplier for such services as of the Issue Date. |
Source: Item 6 — OTHER FEES (FDD pages 11–15)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, merchant payment processing costs are payable immediately once collected by the Current Billing/POS Provider. These fees are the then-current amount charged by Fitstop's Approved Supplier, if applicable. Currently, these fees are estimated to be between 2% and 4% of Gross Revenue generated by your Franchised Business on an ongoing basis. These amounts are payable to Fitstop's third-party Approved Supplier for such services as of the Issue Date.
In simpler terms, as a Fitstop franchisee, you'll need to pay the merchant payment processing costs as soon as the billing or point-of-sale (POS) system collects them. These costs, which range from 2% to 4% of your gross revenue, cover the expenses associated with processing customer payments. The exact amount will depend on the rates charged by Fitstop's approved supplier at that time.
This payment structure means that these costs are ongoing and directly tied to your sales volume. It's important to factor this percentage into your financial projections and pricing strategies. Since the fees are paid to a third-party supplier, Fitstop franchisees should ensure they understand the supplier's terms and conditions, as well as any potential changes to the fee structure.
Prospective Fitstop franchisees should confirm which specific billing/POS providers and payment processors are approved by Fitstop, and carefully evaluate the contracts and fee structures of those providers to fully understand their obligations. Understanding these costs and payment terms is crucial for managing cash flow and profitability as a Fitstop franchisee.