Is the initial franchise fee for Fly Fitness refundable?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
ITEM 5: INITIAL FEES**
We will charge you an initial franchise fee ("Initial Franchise Fee") when you sign the Franchise Agreement. The Initial Franchise Fee is $50,000. This payment is fully earned by us and due in lump sum when you sign the Franchise Agreement. The Initial Franchise Fee is not refundable under any circumstance.
From time to time, we may offer special incentive programs as part of our franchise development activities. We reserve the right to offer, modify or withdraw any incentive program without notice to you. We currently offer a 20% discount from the Initial Franchise Fee for Fly Fitness franchisees in good standing who wish to open 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 initial franchise fee is not refundable under any circumstances. The initial franchise fee is $50,000, which is due in a lump sum when signing the Franchise Agreement. This fee is considered fully earned by Fly Fitness upon signing.
Fly Fitness may offer special incentive programs that include a 20% discount on the initial franchise fee for existing franchisees in good standing who want to open another unit. Fly Fitness also charges a development fee for multi-unit development agreements. This fee is $50,000 for the first unit, plus 50% of the discounted initial franchise fee for each additional Fly Fitness outlet the franchisee commits to develop. For example, a three-unit commitment has a development fee of $75,000. Like the initial franchise fee, the development fee is fully earned when the Development Agreement is signed and is not refundable under any circumstance.
Prospective franchisees should carefully consider the non-refundable nature of these fees. It is important to conduct thorough due diligence and ensure they are fully committed to the Fly Fitness franchise before signing any agreements and paying these upfront costs. Understanding the terms and conditions, including the lack of refundability, is crucial for making an informed investment decision.