What are the two options for the fee Fitstop charges for evaluating a franchisee's proposal?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
tting your request. If you make such a proposal, we reserve the right to charge you the greater of (a) the costs/expenses we incur in evaluating/testing your proposal, and (b)
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 19–23)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, if a franchisee proposes to offer non-approved products/services or purchase required items from a non-approved supplier, Fitstop reserves the right to charge an evaluation fee. This fee is structured in one of two ways, and Fitstop will charge the greater of the two.
The first option is that Fitstop may charge the franchisee the actual costs and expenses Fitstop incurs while evaluating or testing the franchisee's proposal. This would cover any direct costs Fitstop incurs to assess the proposed product, service, or supplier. The second option is a flat fee of $1,000 per proposal.
This means that if Fitstop's costs to evaluate the proposal are less than $1,000, the franchisee will still be charged $1,000. However, if Fitstop's evaluation costs exceed $1,000, the franchisee will be responsible for the higher amount. This policy ensures that Fitstop is compensated for its time and resources in considering franchisee requests to deviate from approved products, services, or suppliers.