In this exclusive Franchise Chatter FDD Talk post, you’ll learn the following:

Section I – Estimated initial investment (franchise costs) for a Stretch Zone franchise, based on Item 7 of the company’s 2024 FDD

Section II – Initial franchise fee, royalty fee, and marketing fee for a Stretch Zone franchise, based on Items 5 and 6 of the company’s 2024 FDD

Section III – Number of franchised and company-owned Stretch Zone outlets at the start of the year and the end of the year for 2021, 2022, and 2023, based on Item 20 of the company’s 2024 FDD

Section IV – News updates on the Stretch Zone franchise opportunity

Section V – Presentation and analysis of Stretch Zone’s financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2024 FDD, including information on the:

• 2023 average, median, highest, and lowest gross sales for the 235 franchised Stretch Zone units that have been operating for 12 or more months as of December 31, 2023, by quartile and overall

Section VI – Key ratios, comparables, computations, and analyses for the Stretch Zone franchise opportunity (exclusive content for Platinum subscribers)

Section I – Stretch Zone Franchise Costs

• Stretch Zone franchise costs, based on Item 7 of the company’s 2024 FDD:

• Initial Franchise Fee:  $59,500
• Prepaid Rent and Security Deposit:  $750 to $15,000
• Leasehold Improvements:  $3,000 to $35,000
• Architect’s and Engineer’s Fees:  $0 to $3,500
• Furniture, Fixtures, and Furnishings:  $5,475 to $14,000
• Computer System:  $1,850 to $2,699
• Outdoor Signage:  $2,000 to $11,000
• Indoor Signage and Graphics:  $5,500 to $8,750
• Utility Deposits:  $200 to $800
• Office and Store Supplies:  $1,055 to $2,000
• Stretching Tables and Accessories:  $23,400 to $37,400
• Insurance:  $1,750 to $2,500
• Licenses and Permits:  $200 to $3,000
• Attorney’s Fees:  $1,000 to $3,000
• Accountant’s Fee:  $200 to $2,500
• Travel, Lodging, Meals, Etc. During Franchisee Training and Manager Training Programs:  $2,500 to $5,000
• Initial Advertising Contribution to Media Fund:  $500
• Grand Opening Fee:  $14,950
• Additional Funds (3 months):  $10,000 to $20,000
• Total Estimated Stretch Zone Franchise Costs:  $133,830 to $241,099

Section II – Stretch Zone’s Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Stretch Zone’s initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2024 FDD:

• Franchise Fee:  $59,500
• Royalty Fee:  6% of Gross Revenues. For Gross Revenues accruing on or after January 1, 2025 through the balance of the initial term of the Franchise Agreement, 7% of Gross Revenues. Beginning on the first full calendar month, however, you must pay a minimum monthly Royalty Fee of $900.
• Advertising Contributions to the Media Fund:  initial contribution of $500 and 2% of monthly Gross Revenues thereafter
• Advertising Contributions to an Advertising Cooperative:  not to exceed 2% of monthly Gross Revenues, which counts towards Local Advertising requirement

Section III – Number of Franchised and Company-Owned Stretch Zone Outlets

Franchised

2021

• Outlets at the Start of the Year:  107
• Outlets at the End of the Year:  153
• Net Change:  +46

2022

• Outlets at the Start of the Year:  153
• Outlets at the End of the Year:  240
• Net Change:  +87

2023

• Outlets at the Start of the Year:  240
• Outlets at the End of the Year:  330
• Net Change:  +90

Company-Owned

2021

• Outlets at the Start of the Year:  5
• Outlets at the End of the Year:  3
• Net Change:  -2

2022

• Outlets at the Start of the Year:  3
• Outlets at the End of the Year:  3
• Net Change:  0

2023

• Outlets at the Start of the Year:  3
• Outlets at the End of the Year:  0
• Net Change:  -3

Section IV – News Updates on the Stretch Zone Franchise

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Stretch Zone Franchise (Item 19, 2024 FDD)

• This Item 19 presents information about the financial performance during our fiscal year ended December 31, 2023 (“Fiscal Year 2023”) of certain Franchise Businesses.

Average Gross Revenues by Quartile for Franchise Businesses for Fiscal Year 2023

Top Quartile

• Average Gross Revenues:  $622,911
• Median Gross Revenues:  $596,189
• Lowest Gross Revenues:  $490,704
• Highest Gross Revenues:  $968,596

2nd Quartile

• Average Gross Revenues:  $414,162
• Median Gross Revenues:  $409,811
• Lowest Gross Revenues:  $353,404
• Highest Gross Revenues:  $490,289

3rd Quartile

• Average Gross Revenues:  $311,217
• Median Gross Revenues:  $310,553
• Lowest Gross Revenues:  $269,660
• Highest Gross Revenues:  $352,717

Bottom Quartile

• Average Gross Revenues:  $221,907
• Median Gross Revenues:  $231,312
• Lowest Gross Revenues:  $126,435
• Highest Gross Revenues:  $268,048

Total

• Average Gross Revenues:  $392,549
• Median Gross Revenues:  $386,966
• Lowest Gross Revenues:  $126,435
• Highest Gross Revenues:  $968,596

• The following are the 6 elements comprising a “material” basis for the historical financial performance representations:

• Group Measured – The group measured includes all Franchised Units that have been operating for 12 or more months, out of a total of 330 Franchised Units there were operational as of December 31, 2023.

January 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

February 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

March 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

April 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

May 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

June 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

July 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

August 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

September 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

October 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

November 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

December 2023

• Franchised Outlets in System:  243
• Franchised Outlets Represented:  235

• Time Period Measured – The time period measured is calendar year 2023.

• Number of Units Measured – The number of units measured is 243.

• Number of Units Reporting – The number of units reporting is 235.

• Number and Percentage of Units – The number and percentage of units that
  achieved the stated level of performance is 235 units of 243 units currently operating.

• Distinguishing Characteristics – The distinguishing characteristics of the group measured are time in operation and Franchised Units.

• Stretch Zone had to exclude the results of operations of 5 units relocating.

• Some Franchise Businesses have sold or earned this amount. Your individual results may differ. There is no assurance that you’ll sell or earn as much.

• “Gross Revenues” means the entire amount of all of the revenues from the ownership or operation of the Franchise Business, including the proceeds of any business interruption insurance, whether the revenues are evidenced by cash, credit, checks, or gift certificates (unless exempted by Stretch Zone), and the fair market value of any services, property, or other means of exchange, except the amount of any sales taxes that are collected and paid to the taxing authority (based on the cash method of accounting).

• Stretch Zone allows the deduction of cash refunded, credit given to customers, and receivables uncollectible from customers in computing Gross Revenues to the extent that the cash, credit, or receivables were previously included in Gross Revenues on which Royalty Fees and Advertising Contributions were paid.

• Gross Revenues are considered received at the time the goods, products, merchandise, or services from which Gross Revenues are derived are delivered or rendered, or at the time that the relevant sale takes place, whichever occurs first.

• These sales figures do not reflect the costs of sales, operating expenses, or other costs or expenses that must be deducted from the Gross Revenues figures to obtain your net income or profit.

• Stretch Zone calculated the figures in the table in this financial performance representation using financial reports submitted by its franchisees.

Section VI – Stretch Zone Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️