How can a Fly Fitness franchisee obtain a financial statement of the Brand Fund?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
The Brand Fund is not audited. An annual unaudited financial statement of the Brand Fund is available to any franchisee upon written request.
If we spend more or less than the total of all contributions to the Brand Fund in any fiscal year, we may carry-forward any surplus or deficit to the next fiscal year.
As of our fiscal year ended December 31, 2023, no Brand Fund contributions were required, made, or expended. Although the Brand Fund is intended to be of perpetual duration, we may terminate it at any time and for any reason or no reason. We will not terminate the Brand Fund, however, until all monies in the Brand Fund have been spent for advertising or promotional purposes or returned to contributors, without interest, on the basis of their respective contributions.
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, an annual unaudited financial statement of the Brand Fund is available to any franchisee upon written request. The Brand Fund collects contributions from Fly Fitness franchisees, with each outlet contributing two percent of weekly gross revenue. These funds are used for various advertising, marketing, and promotional activities to benefit the Fly Fitness system as a whole.
Fly Fitness retains the right to use these contributions for advertising in national, regional, or local media, as well as for marketing campaigns through various channels, including internet and direct mail. However, Fly Fitness has no obligation to ensure that franchisees directly or proportionally benefit from these advertising efforts. Any technology or intellectual property resulting from the Brand Fund's activities becomes the property of Fly Fitness.
It's important to note that the Brand Fund is not audited, and while it is intended to be perpetual, Fly Fitness reserves the right to terminate it at any time. If terminated, any remaining funds will be used for advertising or promotional purposes or returned to the contributors based on their respective contributions. As of the fiscal year ended December 31, 2023, no Brand Fund contributions were required, made, or expended.