Can Fitstop require franchisees to purchase materials/services from Approved Suppliers using the Initial Marketing Spend?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
or which is not in a clean or satisfactory condition and state of repair.
6.3 Initial Marketing Spend; Other Initial Marketing/Promotional Efforts.
- 6.3.1 Initial Marketing Spend. You are required to spend a minimum of $10,000 in various online and/or other marketing activities that we prescribe as part of our System and that we expect will be paid to our Approved Supplier (the "Initial Marketing Spend"). Typically, we expect that you will be required to expend these amounts 30 to 90 days prior to opening and continuing through the grand opening of your Franchised Business – as we discuss and specify prior to any opening or operation of your Franchised Business in the Manual(s) or otherwise in writing. We may require that you expend any portion of the Initial Marketing S
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 spend a minimum of $10,000 on online or other marketing activities as part of the Fitstop system. This expenditure is termed the "Initial Marketing Spend" and Fitstop expects it to be paid to their Approved Supplier.
The FDD states that Fitstop typically expects franchisees to expend these funds between 30 to 90 days before opening and continuing through the grand opening of their Fitstop franchise. These expectations are discussed and specified prior to the opening or operation of the franchise, either in the Manual(s) or in writing.
Fitstop retains the right to mandate that any portion of the Initial Marketing Spend be used for materials or services purchased from their Approved Suppliers. This means a franchisee may have limited or no control over where this initial marketing money is spent, as Fitstop can direct it to specific vendors they have approved.
This requirement ensures that Fitstop maintains control over brand consistency and quality in marketing efforts. However, it also means that franchisees may not be able to negotiate better deals with other suppliers or use local marketing providers they might prefer. Prospective franchisees should consider this when evaluating the overall cost and flexibility of the Fitstop franchise.