What is the minimum monthly royalty fee for a Stretch Zone franchise, and when does it begin?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
not provide assistance with conforming the Business Premises to local ordinances and building codes and obtaining any required payments, and/or constructing, remodeling, or decorating the Business Premises, and/or hiring and, except for training required under this Agreement, training employees. These are your responsibility.
**ARTICLE 3
Source: Item 8 — Receipts. Any sale made must be in compliance with § 683(8) of the Franchise Sale Act (N.Y. Gen. Bus. L. § 680 et seq.), which describes the time period a Franchise Disclosure Document (offering prospectus) must be provided to a prospective franchisee before a sale may be made. New York law requires a franchisor to provide the Franchise Disclosure Document at the earliest of the first personal meeting or ten (10) business days before the execution of the franchise or other agreement or the payment of any consideration that relates to the franchise relationship. (FDD pages 99–263)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, franchisees must pay a continuing monthly royalty fee equal to 7% of gross revenues. However, there is a minimum monthly royalty fee of $900. This minimum royalty fee begins on the 1st full calendar month after the franchise's opening date.
This means that even if a Stretch Zone location's gross revenues are low in its initial months, the franchisee is still obligated to pay at least $900 in royalty fees each month. This could impact the franchisee's profitability, especially during the early stages of the business when building a client base.
It's important to note that the FDD explicitly states that this minimum royalty fee does not guarantee any particular level of gross revenues. Prospective Stretch Zone franchisees should carefully consider their financial projections and ensure they can meet this minimum obligation, especially during the initial months of operation. Understanding the local market and potential customer base is crucial for forecasting revenue and ensuring the franchise can sustain this minimum payment.