Does Fitstop require franchisees to pay affiliates or approved suppliers?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
you with access to that are System-associated, contain the Proprietary Marks and/or are otherwise used in connection with the Franchised Business (each, an "Applicable Email").
- 13.4.2 In the event you are required to license and use any Required Software that is not covered by the Technology Fee above, then you must ensure that you pay our Approved Supplier directly for such licensing and other fees associated with that Required Software as and when required by that provider.
- 13.5 Fund Contribution(s). You shall contribute to our brand development Fund in an amount equal to two percent (2%) of the Gross Revenue generated by the Franchised Business, which shall be billed and collected at the same time and manner as your recurring Royalty Fee under Section 13.4 above (your "Fund Contribution"). We may adminster and use the Fund for any and all activities we determine appropriate to promote, market, advertise and/or otherwise develop the System, Proprietary Marks, System Business locations, Approved Services/Products and/or our brand generally, as we determine appropriate in our discretion. You acknowledge that we are not required to expend any particular portion of the Fund or your Fund Contributions on marketing or other services that are allocated specifically to your Designated Territory.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, franchisees are required to make several payments to both Fitstop and its approved suppliers. Specifically, franchisees must pay approved suppliers directly for any required software not covered by the Technology Fee. Additionally, franchisees are responsible for paying amounts due to approved suppliers for required items, including products and services, as designated in the manuals. This includes payments to the approved supplier for merchant processing services, adhering to the supplier's invoicing terms.
Furthermore, franchisees are obligated to ensure timely payment of all amounts owed to third-party landlords, suppliers, providers, or vendors engaged in the establishment and ongoing operation of the Fitstop franchise. During the build-out phase, franchisees must ensure they pay all amounts due, which may include payments to Fitstop's approved suppliers or directly to Fitstop itself.
These requirements ensure that Fitstop franchisees adhere to the brand's standards and maintain consistent operations by utilizing approved resources. It is important for prospective franchisees to understand these financial obligations to accurately assess the costs associated with opening and running a Fitstop franchise. Franchisees should clarify with Fitstop which specific software, items, and services must be sourced from approved suppliers and understand the payment terms associated with each.