What are examples of alternative distribution channels that Fly Fitness may use?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
We and our affiliates may sell products and services under the Marks within or outside the Territory or development area through any method of distribution other than a dedicated Fly Fitness outlet location, such as distribution through retail outlets, including but not limited to, grocery stores; in captive market locations, such as airports and malls; and the Internet ("Alternative Distribution Channels"). You will receive no compensation for our sales through Alternative Distribution Channels in the Territory or development area.
You may only solicit sales from customers in your Territory. You may not use Alternative Distribution Channels, such as the Internet, catalog sales, telemarketing, or other direct marketing to make sales outside your Territory; however, we will include a listing on our website of your Fly Fitness outlet location. Your local advertising must target customers in your Territory, although the reach of your local advertising may extend beyond your Territory.
Source: Item 12 — TERRITORY (FDD pages 29–31)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, Fly Fitness and its affiliates retain the right to sell products and services through various alternative distribution channels, even within a franchisee's territory or development area. These alternative channels are defined as any method of distribution other than a dedicated Fly Fitness outlet location.
Examples of alternative distribution channels that Fly Fitness may use include retail outlets such as grocery stores, captive market locations like airports and malls, and the Internet. A significant implication for franchisees is that they will not receive any compensation for sales made through these alternative distribution channels within their territory. This means that even if Fly Fitness generates substantial revenue through online sales or sales in local grocery stores within a franchisee's designated area, the franchisee will not directly benefit from those sales.
Furthermore, franchisees are restricted from using alternative distribution channels to make sales outside their territory. They are permitted to solicit sales only from customers within their designated territory. However, Fly Fitness will include a listing of the franchisee's outlet location on its website. This setup means that while Fly Fitness can leverage various channels to reach customers, the franchisee's sales efforts must remain geographically focused, potentially limiting their overall market reach and revenue potential. Franchisees should inquire about Fly Fitness's strategy regarding alternative distribution channels and how it might impact their business.