When is the Fly Fitness development fee due?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
n an additional unit.
We will charge you a development fee ("Development Fee") when you sign the Multi-Unit Development Agreement. The Development Fee is an amount equal to $50,000 for the first unit, plus 50% of the discounted initial franchise fee for each additional Fly Fitness outlet you commit to develop under the Multi-Unit Development Agreement. For a three-unit commitment, the Development Fee is $75,000 and is calculated as follows, $50,000 + ((50% x $25,000) x2) = $75,000. The remaining balance of $12,500 per outlet shall be payable as the developer's subsequent sites are approved and franchise agreements signed. The Development Fee is fully earned by us and due in lump sum when you sign the Development Agreement. The Development Fee is not refundable u
Source: Item 5 — INITIAL FEES (FDD page 8)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, the development fee is due in a lump sum when the Multi-Unit Development Agreement is signed. This fee is considered fully earned by Fly Fitness at the time of signing and is non-refundable under any circumstances.
For a prospective franchisee, this means that the full development fee must be paid upfront upon signing the agreement, which commits them to developing multiple Fly Fitness locations. The development fee covers the first unit at $50,000, plus 50% of the discounted initial franchise fee for each additional unit. For example, a three-unit commitment requires a $75,000 development fee.
It's important to note that while the full development fee is due upfront, a portion of it ($12,500 per outlet) is later credited towards the initial franchise fee for each subsequent location as those sites are approved and franchise agreements are signed. This provides some financial relief as the franchisee expands, but the initial outlay is still significant. Prospective franchisees should carefully consider their financial capacity and development plans before committing to a Multi-Unit Development Agreement with Fly Fitness, as the initial payment is non-refundable.