Tracking every franchise fee against the FDD you signed
Updated 16 October 2026
The FTC's Franchise Rule requires a franchisor to give a buyer a Franchise Disclosure Document (FDD) before a sale. Item 5 of the FDD lists the initial fees. Item 6 lists every ongoing fee. A franchisee who keeps the FDD signed for each location, and one account for each fee, can show which charges match it and which do not. This page covers the records. For legal questions about your franchise agreement, talk to a franchise attorney.
The FTC staff guidance on undisclosed fees
On 12 July 2024, FTC staff published guidance on fees a franchisor imposes after signing. The guidance addresses new fees introduced through the operations manual. It states that collecting a fee that was not disclosed in the FDD and not included in the franchise agreement may be an unfair practice under Section 5 of the FTC Act. The guidance is a staff opinion, and it is not a court ruling.
Club Pilates' 2026 FDD discloses a $550 monthly technology fee that may rise up to 10% a year. After one full increase it is $605 a month, and after two it is $665.50. Those rises are disclosed in the FDD. A Club Pilates owner records the fee in its own account, so each rise shows as a dated change that can be checked against the 10% limit.
The 2026 Xponential settlement
In March 2026 the FTC announced a settlement with Xponential Fitness over Franchise Rule violations. The Commissioners approved the consent order on 18 March 2026, and the federal court for the Central District of California approved it on 2 April 2026. The settlement returns $17 million to franchisees, the largest amount returned in a franchise case. The FTC's allegations concerned what was disclosed before signing, including the time needed to open a studio, executive background, and the contact details of franchisees whose studios had closed. Xponential neither admitted nor denied the allegations.
Averan's library holds 2026 FDDs for five Xponential brands. Their royalty and brand fund rates are listed in the table below. A franchisee in any of them checks each month's charges against the rates in the FDD signed for that studio.
| Brand | Royalty | Brand fund | Local advertising | Technology fee a month |
|---|---|---|---|---|
| Club Pilates | 8% | 2% | 2% | $550 |
| StretchLab | 8% | 2% | 2% | Listed in the FDD |
| Pure Barre | 7% | 2% | 2% | $304 |
| YogaSix | 7% | 2% | 2% | $334 |
| BFT | 7% | 2% | 2% | $715 |
Keep the FDD signed for each location
Each location's agreement is governed by the FDD in force when it was signed. An owner who signed six agreements over four years may hold four different fee schedules. The FDD for each signing date is the record that a later charge is checked against.
BFT's 2026 FDD lists a $715 monthly technology fee, $8,580 a year. An owner who signed an earlier BFT agreement checks the fee charged on that studio against the earlier FDD's Item 6. A difference between the two documents is visible only if both are kept.
One account for each fee
The chart of accounts is the list of categories a business records its money in. Royalty, brand fund, local advertising, technology, required supplier programs and training each get their own account. A new charge then appears as a new line in a known month.
Pure Barre's fees total 11% of sales on its 2026 FDD figures. At its average studio sales of $393,761, that is $43,314 a year. A $100 monthly charge added through a manual update would be $1,200 a year, 2.8% of that total. A combined fee account shows only the new total, with no separate line for the ,200.
A yearly reconciliation
Once a year, list every brand charge paid at each location and set it beside Items 5 and 6 of the FDD signed for that location. Note any charge that is not in the FDD, the month it started, the amount, and the document that introduced it. Keep a dated copy of the operations manual pages that set the charge.
A YogaSix studio at the $531,641 average pays a 7% royalty, $37,215 a year, plus 2% to the brand fund, $10,633, and $4,008 in technology fees. Those three lines total $51,856. The yearly reconciliation checks each one against the YogaSix FDD's Item 6.
What this means for an owner
Items 5 and 6 of the FDD signed for each location list the fees that location owes. FTC staff guidance from July 2024 treats fees added outside the FDD and the agreement as a possible unfair practice. The 2026 Xponential settlement returned $17 million to franchisees over disclosure before signing. An owner keeps each signed FDD, records each fee in its own account, notes the start date of any new charge, and reconciles all charges once a year.
Check one location
The Franchise Numbers Check is a free tool on this site. It takes one location's figures and sets them against the brand data Averan has published.
Where to next
Want the books off your plate?
Book a short call, and we'll give you an expert view of your situation.
Free Consult →Want this handled? Averan does the bookkeeping for franchise owners and multi-unit operators.
Planning another location? Fractional CFO covers the forecast and the cash plan behind it.
If you want this done for you
What happens next
Reading about it and having it done are different things. Here is exactly what happens if you want the second one.
- The call takes thirty minutesYou describe the business and where the numbers are letting you down. We give you an expert view of your situation, and what we would start with. There is no pitch deck.
- We look at the fileYou give us read access to the books as they are. We come back with what is wrong, what it will take to fix, and whether the answer is bookkeeping, controller work, or something else.
- We send a written scope and a priceIt lists what we do each month, what you get, the date it lands and the fee. We agree it before anything starts, and it does not change unless you agree.
- We take over the books and close the first monthWe set up access and systems and enter the opening balances. The first close lands on the date in the scope, and every one after it does too.