What distinguishing characteristics were used to measure the financial performance of Stretch Zone franchises?

According to Stretch Zone's 2025 Franchise Disclosure Document, the financial performance representations are based on specific distinguishing characteristics. The two characteristics used to measure the financial performance of the group are the time in operation and whether the unit is a Franchised Unit. The financial performance data presented in Item 19 is for the fiscal year ended December 31, 2024. The group measured includes all Franchised Units that have been operating for 12 or more months. As of December 31, 2024, there were 377 Franchised Units operational, but the financial results exclude 37 units due to non-compliance in reporting accurate annual revenues. The item 19 notes clarify that individual results may differ, and there is no assurance that a franchisee will achieve the same level of sales or earnings.

The data is derived from financial reports submitted by Stretch Zone franchisees. The financial performance representation includes 'Gross Revenues,' which is defined as the entire amount of revenues from the franchise operation, including proceeds from business interruption insurance. Sales taxes collected and paid to the taxing authority are excluded from Gross Revenues. Deductions are allowed for cash refunds, credit given to customers, and uncollectible receivables, provided these were previously included in Gross Revenues on which Royalty Fees and Advertising Contributions were paid. Gross Revenues are considered received when the goods, products, merchandise, or services are delivered or rendered, or when the sale takes place, whichever is earlier.

Prospective franchisees should note that the sales figures presented do not reflect the costs of sales, operating expenses, or other costs that must be deducted to determine net income or profit. Stretch Zone encourages prospective franchisees to contact existing franchisees to discuss their experiences. The FDD also states that written substantiation for the financial performance representation will be made available to the prospective franchisee upon reasonable request. If a prospective franchisee receives any financial performance information or projections outside of Item 19, they are advised to report it to Stretch Zone's management, the Federal Trade Commission, and the appropriate state regulatory agencies.