Is the Continuing Royalty Fee for a Fly Fitness franchise refundable?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
All fees and expenses described in this Item 6 are nonrefundable and are uniformly imposed.
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Continuing Royalty Fee | 7% of weekly Gross Revenue | Weekly on Wednesday for Gross Revenue of the prior week (Monday through Sunday). | Payable to us. See footnote 1. |
Source: Item 6 — OTHER FEES (FDD pages 8–14)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, the Continuing Royalty Fee is not refundable. Item 6 states that all fees and expenses are nonrefundable and uniformly imposed. The Continuing Royalty Fee is 7% of weekly Gross Revenue, payable weekly on Wednesday for the prior week's Gross Revenue (Monday through Sunday). This fee is paid directly to Fly Fitness.
This means that once a Fly Fitness franchisee pays the Continuing Royalty Fee, they cannot get it back under any circumstances. This is a standard practice in franchising, as royalty fees are the primary way the franchisor generates revenue and supports the franchise system.
Prospective franchisees should carefully consider this nonrefundable policy and ensure they understand the terms and conditions for paying the Continuing Royalty Fee. They should also factor this cost into their financial projections and business plan.