Who comprises a Fly Fitness regional cooperative?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
Currently, our System has no regional advertising fund or cooperative. However, we may decide to establish a regional fund or cooperative in the future and your participation may be mandatory, in our sole discretion. A regional cooperative will be comprised of all Fly Fitness franchisees in a designated geographic area. Our affiliate-owned outlets may participate in a regional cooperative, in our sole discretion, if we have a Fly Fitness in the area. Each Fly Fitness outlet, whether affiliateowned or franchisee-owned, will have one vote in the cooperative. We will determine in advance how each cooperative will be organized and governed. We have the right to form, dissolve, merge or change the structure of the cooperatives. If a cooperative is established during the term of your Franchise Agreement, you must sign all documents we request and become a member of the cooperative according to the terms of the documents.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 22–29)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, a regional cooperative will consist of all Fly Fitness franchisees located within a specific geographic area designated by Fly Fitness. The document states that Fly Fitness's affiliate-owned outlets may also participate in the regional cooperative at Fly Fitness's discretion, provided they have a Fly Fitness location in the same area. Each Fly Fitness outlet, whether it is affiliate-owned or franchisee-owned, will have one vote in the cooperative. Fly Fitness retains the authority to determine how each cooperative will be organized and governed. They also have the right to form, dissolve, merge, or change the structure of the cooperatives.
For a prospective franchisee, this means that if Fly Fitness establishes a regional cooperative in their area, they will automatically become a member and must adhere to the cooperative's terms and conditions. This includes signing all required documents and contributing financially as mandated by Fly Fitness. These contributions to the regional advertising fund or cooperative are in addition to the franchisee's contributions to the Brand Fund. However, the FDD specifies that contributions made to a regional advertising fund or cooperative will be credited against the franchisee's required expenditures for local advertising.
It's important to note that currently, Fly Fitness does not have any regional advertising funds or cooperatives. However, they reserve the right to establish one in the future, and participation may be mandatory at their sole discretion. This implies that franchisees should be prepared for the possibility of additional advertising expenses and involvement in regional marketing efforts if Fly Fitness decides to implement this structure. Franchisees should inquire about the criteria and process Fly Fitness will use to determine the geographic boundaries of any future regional cooperatives, as well as the expected financial contributions and decision-making processes involved.