For a Stretch Zone franchise, are franchisees allowed to initiate payments through the ClubReady Electronic Payment System?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
You will open a separate operating account with a bank for the Franchise Business. You will pay all Royalty Fees, Technology Fees, and other invoices due us and our Affiliates, and make Media Fund contributions, from remittances from your members that have been deposited into your operating account by ClubReady processing payments due us (the "Payment System"). You will cooperate with us to implement the Payment System within 15 days before the Opening Date. You agree to cooperate with us in maintaining the efficient operation of the Payment System, including depositing all Gross Revenues you receive into your operating account within 1 Business Day of receipt. You cannot initiate payments through the ClubReady Electronic Payment System, but we are able to initiate payments through the ClubReady Electronic Payment System for invoices that are due us.
Source: Item 6 — ITEM -6 OTHER FEES (FDD pages 16–33)
What This Means (2025 FDD)
According to the 2025 Stretch Zone Franchise Disclosure Document, franchisees are not permitted to initiate payments through the ClubReady Electronic Payment System. However, Stretch Zone can initiate payments through this system for invoices that are due to them.
This means that while franchisees must use the ClubReady system for processing payments from members, they cannot use it to directly pay Stretch Zone. Instead, Stretch Zone will initiate the payment process for fees owed by the franchisee. This ensures that Stretch Zone maintains control over the collection of royalties, technology fees, and other payments.
The FDD specifies that franchisees must deposit all gross revenues into their operating account within one business day of receipt and cooperate with Stretch Zone to implement the payment system within 15 days before the opening date. This highlights the importance of adhering to Stretch Zone's established financial procedures and timelines. Franchisees need to be prepared to manage their finances in accordance with these requirements and should clarify any uncertainties with Stretch Zone during the initial setup phase.