If Fly Fitness receives rebates from suppliers in the future, who keeps the rebates?

According to Fly Fitness's 2024 Franchise Disclosure Document, Fly Fitness and its affiliates do not currently receive any revenue, rebates, discounts, or other material consideration from any suppliers based on franchisees' required purchases. However, Fly Fitness states that they may do so in the future. If Fly Fitness does receive rebates or discounts from suppliers in the future, the document specifies that Fly Fitness may keep these rebates at their sole discretion.

For a prospective Fly Fitness franchisee, this means that while you are required to purchase from approved suppliers, any potential financial benefits (in the form of rebates or discounts) that Fly Fitness receives from those suppliers as a result of your purchases will not be passed on to you. This is a fairly common practice in franchising, as franchisors often negotiate volume discounts or rebates with suppliers due to the collective purchasing power of their franchise network.

It is important to note that the FDD does not specify how Fly Fitness would use these rebates. They could be used to offset other costs, invest in the brand, or increase profitability for Fly Fitness. As a potential franchisee, you would not have a direct claim to these rebates, and they would not directly reduce your costs of goods or supplies. This arrangement is fully at Fly Fitness's discretion.

Prospective franchisees may want to inquire with Fly Fitness about their long-term plans for supplier rebates and how these funds might indirectly benefit franchisees through enhanced services, marketing support, or other initiatives. Understanding the franchisor's intentions can provide a clearer picture of the overall value proposition.