Given that the franchise currently has zero units and zero unit history, what is the status of franchisee recruitment and when do you project the first units will be operational?
#1
Can you explain the discrepancy between a $30,000 franchise fee (below typical range) and other franchisors in this category charging $40,000-$60,000? What specific support and training justify your pricing?
#2
Why is the monthly technology fee of $100 substantially lower than industry standard of $199-$716.25? What technology infrastructure and support does this cover?
#3
The franchise agreement requires non-compete restrictions of only 1 mile, which is significantly below the typical 10-25 mile range for fitness franchises. How does this narrow restriction protect other franchise units from direct competition?
#4
Territory is listed as non-exclusive with no encroachment protection. Under what circumstances would the franchisor allow a competing VibeFlow Yoga location near an existing franchisee's location?
#5
Your dispute resolution clause mandates individual arbitration with class action waivers and waives jury trial rights. What factors led to these restrictive dispute resolution terms, and are there any circumstances where franchisees can pursue class actions?
#6
The termination clause specifies 10-day cure periods for certain defaults and 19 non-curable defaults. What are examples of the non-curable defaults that would result in immediate termination without opportunity to cure?
#7
Personal guarantees are required from each owner and their spouse for all financial obligations. Does this guarantee extend to personal liability for franchisee debts, and under what conditions would the franchisor pursue personal assets?
#8
The renewal fee is 50% of the then-current initial franchise fee ($15,000 based on current pricing). If the initial franchise fee increases significantly over the initial 10-year term, how would franchisees be notified of the renewal fee amount before deciding to renew?
#9
Your agreement requires mandatory purchases from approved suppliers across 9 categories, and the franchisor reserves the right to establish pricing. What mechanisms ensure that franchisor-designated suppliers offer competitive pricing compared to open-market alternatives?
#10
No minimum performance requirements are specified in the agreement. What expectations do you have for franchisee revenue, membership growth, or operational milestones during the 10-year initial term?
#11
Late payment interest accrues at 18% per annum. Is this rate negotiable, and what payment terms and schedules are available to franchisees for initial franchise fees and ongoing royalties?
#12
The agreement requires participation in regional advertising associations with mandatory contributions. How much does regional advertising participation typically cost franchisees, and who controls the regional advertising association budget and spending?
#13
With zero units currently operating, how do you support franchisees if the system has no experienced unit-level operators? What training and ongoing support will be provided by franchisor staff?
#14
Can you provide references from any existing franchisees, even if currently non-operational? If not, what timeline exists before the first franchisee units can provide references?
#15
The ad fund rate of 3.0% is above the typical 2.0% for this category. What specifically does this ad fund cover, and how are funds allocated between national marketing, regional campaigns, and local franchisee support?
#16
The renewal clause includes 9 conditions that must be satisfied. What are these 9 conditions, and what percentage of franchisees historically renew when eligible?
#17
Are there any regulatory or licensing issues, pending investigations, or business challenges affecting VibeFlow Yoga's ability to recruit and support franchisees?
#18
What is the ownership structure and financial stability of VibeFlow Yoga itself? Can you provide audited financial statements demonstrating franchisor solvency?
#19
Given the significantly lower franchise fee and technology costs, is there a plan to increase these fees for subsequent franchisee recruits, or will early franchisees have a permanent cost advantage?
#20