Does Fitstop require the Designated Manager to be an owner of the franchise?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
The Franchised Business must be directly supervised and managed by a person, identified to us who has undergone our training program. Based on his/her/their experience, we may choose to waive this requirement in our sole discretion. 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.
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, Fitstop does not require the Designated Manager to hold an equity interest in the franchisee entity. However, Fitstop strongly recommends that franchisees devote a substantial amount of time to their franchised location, whether or not they engage a Designated Manager.
The FDD states that if a franchisee is not willing to be the full-time operator of their business, then they will be required to engage a manager and have them complete Fitstop's training program. The Designated Manager must be identified to Fitstop and have undergone their training program. Fitstop may choose to waive this requirement based on the person's experience, in its sole discretion.
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 and submit the replacement's qualifications to Fitstop for review and approval before substituting a new Designated Manager, unless the franchisee resumes taking over the day-to-day operations of the Franchised Business on a full-time basis. The Franchised Business must always be managed and staffed with at least one individual who has successfully completed the Initial Training Program associated with being an owner/operator or Designated Manager.