Does Fly Fitness have an obligation to place advertising in the territory where a franchisee's Fly Fitness business is located?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
sing or marketing material is deemed "disapproved".
We do not provide for placement of local advertising on your behalf, and we have no obligation to spend any amount on advertising in your area or territory. You are responsible for local advertising placement. You must list the Franchised Business in local business directories, including, but not limited to, listings on Internet search engines. If feasible, you may do cooperative advertising with other Fly Fitness franchisees in your area, with our prior written approval. You are required to establish a social media presence on sites such as Instagram, Facebook, and such other social media sites as determined by us. You are required to operate your social media presence in accordance with our brand standards as set forth in the Operations Manual.
System-wide Brand Fund (Franchise Agreement, Section 13.3)
You are required to contribute to the Brand Fund Two percent (2%) of weekly Gross Revenue. Each Fly Fitness outlet is required to contribute to the Brand Fund. Each Fly Fitness outlet operated by our affiliate or us may contribute to the Brand Fund, in our discretion, but has no obligation to do so.
The Brand Fund is administered by us. We may use Brand Fund contributions to pay any and all costs for the development, production and placement of advertising, marketing, promotional and
public relations materials, and programs. We may also use Brand Fund contributions to pay any and all costs of marketing seminars and training programs, market research, services of advertising and/or public relations agencies, and website development and maintenance. We may further use Brand Fund contributions to pay our costs (including personnel and other administrative costs) for advertising that is administered by us or prepared by us, as well as for administration and direction of the Brand Fund.
The Brand Fund will not be used to defray any of our other general operating expenses. Brand Fund contributions will not be used to solicit new franchise sales; provided however, we reserve the right to include "Franchises Available" or similar language and contact information in advertising produced with Brand Fund contributions.
The Brand Fund collects and expends the Brand Fund contributions for the benefit of the System as a whole.
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, Fly Fitness does not have an obligation to place advertising in a franchisee's territory. The FDD states that Fly Fitness does not provide for placement of local advertising on behalf of the franchisee and has no obligation to spend any amount on advertising in the franchisee's area or territory. The franchisee is responsible for local advertising placement.
Fly Fitness franchisees are required to contribute two percent of weekly gross revenue to the Brand Fund, which Fly Fitness administers. Fly Fitness may use these Brand Fund contributions for advertising, marketing, and promotional materials and programs. However, Fly Fitness has no obligation to place advertising or conduct marketing campaigns in any particular area, including the territory where the franchisee's Fly Fitness business is located.
Fly Fitness may establish a regional advertising fund or cooperative in the future, and franchisee participation may be mandatory. If a regional advertising fund or cooperative is established, contributions to it will be credited against the franchisee's required expenditures for local advertising. Franchisees are also required to spend a minimum of $15,000 on opening advertising and promotional activities and at least $500 per month on local advertising to promote their Fly Fitness business.