The monthly technology fee of $2,000 is substantially higher than typical for fitness franchises ($199-$716). What specific technology services and platforms does this fee cover, and are there any circumstances under which this fee could increase?
#1
Your investment score of 58 is notably below the typical range of 73-77 for fitness franchises. Can you provide a detailed breakdown of all initial investment costs beyond the $50,000 franchise fee, including equipment, buildout, and working capital requirements?
#2
The franchise has grown 72.73% in one year (from 11 to 19 units). How many of these new units are company-owned versus franchisee-owned, and what is the timeline for when you expect to reach profitability or positive unit economics?
#3
Your contract terms score is 55, below the typical range of 60-65. Can you explain the reasoning behind the 5 renewal conditions, and what specific improvements or remodeling would be mandatory to renew after the initial 10-year term?
#4
The non-compete clause extends for 3 years and 10 miles, which is longer than the typical 2-year period. What was the rationale for this extended restriction, and how is it enforced in practice?
#5
Item 19 financial performance data is not included in your FDD. Can you provide average unit volumes (AUV), average gross revenue, and profitability data for a representative sample of franchise units?
#6
With zero litigation cases over 3 years and zero unit terminations, are there any disputes, complaints, or performance issues with franchisees that have been resolved informally or through mediation rather than formal litigation?
#7
The renewal fee is $12,500 (25% of the initial franchise fee). In addition to mandatory remodeling, what other conditions must franchisees meet to qualify for renewal, and what happens to franchisees who cannot meet these conditions?
#8
Given the franchise requires personal guarantees from all owners with 25%+ ownership and potentially their spouses, what recourse do you have against guarantors, and have you ever pursued claims against personal guarantees?
#9
The franchise agreement specifies minimum performance requirements including pre-opening membership sales targets. What are the specific membership targets by location type, and what consequences result from missing these targets?
#10
Late payment fees are $100 per week plus 18% annual interest. How frequently do franchisees fall behind on royalty or technology fee payments, and what is your process for enforcing these fees?
#11
Territory is marked as protected but not exclusive. Can you clarify what 'protected' means in practice, and under what circumstances could you place another Bünda location near an existing franchisee?
#12
With such rapid growth from 5 to 19 units in 3 years, what is the current pipeline for franchise sales, and what is your projected unit count for the next 2-3 years?
#13
All disputes are subject to binding arbitration in Los Angeles County, California with a waiver of jury trial rights. How many disputes have gone to arbitration in the past 3 years, and what were the outcomes?
#14
What specific training and ongoing support do you provide to franchisees, and how do support services scale as the system grows beyond the current 19 units?
#15
The franchise is still quite young and growing rapidly. What operational issues or challenges have emerged with your first cohort of franchisees, and how have you addressed them?
#16
Can you provide references from franchisees at different tenure levels (0-1 year, 1-3 years, 3+ years) so I can understand long-term performance and satisfaction?
#17