The technology fee of $1,075 per month significantly exceeds typical fitness franchise fees—what specific services and systems does this cover, and how is it calculated or adjusted annually?
#1
Your royalty rate of 8.25% is above the typical 6.0-7.5% range for fitness franchises—what is the rationale for this higher rate, and are there any performance-based adjustments or discounts available?
#2
With an advertising fund rate of only 1.0% (below the typical 2.0%), how does the franchisor fund national or regional marketing, and what specific marketing support do franchisees receive?
#3
Average gross sales of $348,538 fall notably below category benchmarks—what are the factors contributing to this lower performance, and what is the revenue trajectory for newer versus established units?
#4
Your initial contract term is 10 years versus the typical 15-20 years for fitness franchises—what was the reasoning for the shorter term, and what renewal options (if any) are available at the end of the initial term?
#5
With zero litigation cases in 3 years despite rapid growth, what specific dispute resolution mechanisms or franchisee support programs have contributed to this absence of conflicts?
#6
The transfer fee of $5,000 is significantly lower than typical ($10,000-17,138)—what services or reviews are included in this fee, and are there conditions that could increase the transfer cost?
#7
You mention termination causes count of 11—what are these specific grounds for termination, and how do they compare to standard fitness franchise agreements?
#8
Renewal conditions are listed as only 4 items versus the typical 7-9—what conditions must franchisees meet to renew their contract at the end of the 10-year initial term?
#9
The 2-year/25-mile non-compete is enforced post-termination—has the franchisor ever enforced this clause, and what activities specifically does it prohibit (e.g., membership-based fitness, pole fitness instruction)?
#10
Item 19 financial performance data is included—how many franchisees reported these sales figures, and what is the range of performance across your current 7 units?
#11
Given the 51.8% 3-year CAGR, how many of your current 7 units have been operating for at least 3 years, and what is the average unit volume (AUV) for mature versus newer locations?
#12
The franchisor controls supplier selection across 8 categories—are franchisees required to use franchisor-approved vendors at franchisor pricing, or do they negotiate directly with approved vendors?
#13
Binding arbitration is required for residents of Illinois, Maryland, and Washington—what percentage of current franchisees are located in these states, and have any arbitration claims been filed or resolved?
#14
Personal guarantees with joint and several liability (including spouses) are required—are there any circumstances where this requirement can be waived or modified, such as for LLC structures?
#15
With zero terminations or non-renewals, what is the franchisor's process for underperforming units, and are there remediation programs before termination is considered?
#16
The franchise fee of $59,950 is required upfront—what is included in this fee (training, equipment, initial inventory, technology setup), and are there any financing options available?
#17
Bottom quartile units are generating only $78,153 annually—what support or interventions does the franchisor provide to units performing below expectations?
#18
Renewal fee of $5,000 is charged at the end of the 10-year term—are any of the original franchise services (training, setup, support) repeated during renewal, or is this primarily an administrative fee?
#19
The exclusive territory protection includes encroachment prevention—how does the franchisor define the protected territory boundaries, and what remedies are available if encroachment occurs?
#20