New Studio Owener Franchising FAQ's
1. How much will it cost to become a franchisee?
You must pay us an initial franchise fee of $10,000 for the right to open a Bikram Yoga studio. This fee also covers franchise training and most pre-opening support. Your costs will vary depending on a number of factors. You should review Item 7 of the FDD carefully, which breaks down the cost estimate by individual categories of expense.
2. What ongoing fees must I pay?
The most significant ongoing fees that you must pay include the royalty fee (monthly fee equal to greater of 5% of gross revenues or $1,000), advertising fund fee (monthly fee equal to greater of 2% of gross revenues or $200) and technology fee (currently $100 per month). At this time, we have not established the advertising fund so we are not charging the advertising fund fee. We will give you at least 60 days advance notice before we begin charging the advertising fund fee. You should review Item 6 of the FDD for a complete list of the fees that you may be required to pay. In addition to these fees, you are required to spend the greater of $400 per month or 4% of your gross revenues on local advertising to promote your studio.
3. Why is Bikram now franchising?
Bikram has entertained the idea of franchising for several years. Bikram believes that the Bikram Yoga system and his reputation are suffering from a lack of uniform standards among existing studios. In the past, Bikram has allowed studio owners to operate their studios quite independently. While the majority of owners do a great job, there are a number of studios that are operating in a manner that is damaging to Bikram Yoga. By borrowing the best ideas and practices from all current studios, Bikram hopes to develop the ideal model for the operation of a Bikram Yoga studio. Bikram is optimistic that this will improve all studios and promote their long term success.
The franchise model is designed to benefit all franchisees in the long term. To see the assistance provided to franchisees, you should carefully review Item 11 of the FDD.
5. I understand that Bikram cannot offer franchises in certain states at this time. What happens if I operate a studio in one of those states?
Bikram has applied for registration to offer franchises in all states. However, some states take longer than others. If you are in a state where Bikram cannot offer franchises, you will not be given access to the FDD and you will not be able to purchase a franchised studio. If you are interested in the franchise, you should send an e-mail or letter to Bikram indicating that you are interested in becoming a franchisee. As soon as the registration is complete, Bikram will contact you and offer you the franchise. Until that time, however, Bikram cannot discuss the franchise offering with you.
6. What if I have other questions about becoming a franchisee?
The FDD includes a great deal of information about the Bikram Yoga franchise. You should closely review the FDD. However, Bikram may require that you submit an application to acquire a franchise before you are given access to the FDD.