Orangetheory Fitness Franchise Costs, Fees & FDD

Year Business Began: 2010

Franchising Since: 2010

Headquarters: Boca Raton, Florida

Estimated Number of Units: 1,505

Franchise Description: The franchisor is OTF Franchisor, LLC. The franchisor is an indirect, wholly-owned subsidiary of Purpose Brands Holdings, LLC. Orangetheory studios operate as contemporary fitness studios identified by an orange color scheme and trade dress, offering members access to exercise equipment, including cardio and strength equipment, and other related services and ancillary merchandise related to the Orangetheory concept.
Training Overview: If the Franchise Agreement relates to their first studio, the franchisor will provide an initial training program on the operation of a studio for all owners who sign the agreement (including the managing owner, who must be a signatory on the agreement). The current initial training program lasts four days and may be conducted, in the franchisor’s sole discretion, online via live and/or recorded sessions or in person at its headquarters in Boca Raton, Florida. The franchisor or an area representative (if one is located in the franchisee’s market) will also provide studio launch training, which includes sales and operations training and OTFit certification training, at no charge for up to eight fitness coaches and four sales associates. If it is their first studio, franchisees, along with all owners and employees of their studio, must successfully complete the initial presales training program to the franchisor’s satisfaction before the studio begins selling memberships in presales. The current presales training program lasts four days and is presently conducted onsite at the franchisee’s studio presales location or at an area representative’s certified training facility. The franchisor may require franchisees (or their managing owner), their studio's lead trainer, and/or studio manager to attend (and, in the case of training programs, successfully complete) any conferences or supplemental or refresher training programs that the franchisor chooses to provide at locations that it designates, including its annual Orangetheory conference, its annual training summit, and its annual management training program.

Territory Granted: The Franchise Agreement grants franchisees the right to operate a single studio at a specific location in the site selection area that franchisees select and the franchisor accepts, in its sole discretion. Once the franchisor has accepted the site, it will designate a geographic territory for franchisees. The franchisor will determine the territory based on the factors that it deems relevant, which might include population, traffic flow, presence of businesses, location of competitors (including other studios), demographics, and other market conditions. The franchisor does not specify a minimum geographic or population size for the territory. As long as franchisees are in compliance with the Franchise Agreement, the franchisor and its affiliates will not operate or authorize others to operate a studio identified by the marks the physical premises of which are located within the territory, except it may operate and authorize others to operate studios located in private businesses, governmental institutions, or other limited access facilities within the territory. As long as franchisees are in compliance with the Franchise Agreement, their exclusive rights in the territory will not be modified for any reason, except by mutual written agreement signed by both parties.

Obligations and Restrictions: The franchisor does not require, but does recommend, that franchisees (or their managing owner) personally supervise the studio. Franchisees must designate a full-time, on-premises manager who (a) devotes his or her full working time and best efforts to the day-to-day, on-premises operations of the studio, (b) has satisfactorily completed the management training program, and (c) is not engaged in any other business endeavor (except passive investments which do not interfere with his or her duties as manager). Franchisees may offer in the studio to customers only the products, services, and classes that the franchisor has approved in writing. In addition, franchisees must offer the specific products, services, and classes that we require in the manuals or otherwise in writing. Franchisees must meet certain minimum performance levels during the term of the agreement.

Term of Agreement and Renewal: The length of the initial franchise term is 10 years. If franchisees meet requirements, they can renew for one additional consecutive term of 10 years.

Financial Assistance: The franchisor does not generally offer, directly or indirectly, any other financing to help franchisees establish their business. However, the franchisor does have arrangements with a number of third-party equipment lenders who provide financing to its franchisees. The franchisor does not guarantee any note, lease or other obligation franchisees incur.

Estimated Initial Investment

Name of Fee	Low	High
Initial Fee	$59,950	$59,950
3 Months Rent + Security Deposit	$21,042	$37,408
Architect & Design Fees	$10,000	$17,000
Furniture, Fixtures & Equipment	$14,215	$14,978
Office & Cleaning Supplies	$3,500	$4,500
Leasehold Improvements and Construction Costs	$380,000	$766,500
Fitness Equipment (including installation) and OT Beat Start-Up System	$105,908	$193,053
Technology – Software Licensing Fee	$4,495	$4,495
Initial Inventory of Orangetheory Fitness Retail Merchandise	$3,315	$5,850
AED and First Aid Equipment/Training	$1,000	$5,000
Interior and Exterior Signage	$10,000	$15,000
Technology System	$41,429	$55,508
Pre-Sale and Grand Opening Advertising	$36,000	$45,000
Initial Training/Presales Training, plus expenses	$6,250	$7,600
Miscellaneous Opening Costs	$6,274	$11,274
Insurance	$3,500	$5,000
Additional Funds – 3 Months	$115,744	$133,744
ESTIMATED TOTAL (excluding real estate purchase costs)	$821,622	$1,377,160

Other Fees

Type of Fee	Amount
Royalty Fee	8% of gross sales.
Brand Fund Contributions	Currently 3% of gross sales. May be increased up to 5% of gross sales.
Minimum Monthly Local Advertising Spend	Greater of 2% of the studio’s gross sales from the prior month or $2,500.
Cooperative Advertising	As determined by the cooperative, if one is formed in the franchisee’s area.
Successor Franchise Fees	50% of then-current initial franchise fee for new franchisees.
Transfer/Assignment Fee	50% of then-current initial franchise fee for new franchisees for a control transfer. 25% of the then-current initial franchise fee for all other transfers (other than transfers to an entity formed to operate the studio).
Interest and Late Fees	Lesser of 18% per annum or the highest rate permitted by law, plus $100 per week or portion of a week that the payment or report is overdue.
Audit Expenses	The cost of audit, including any charges of independent accountants, travel expenses and per diem personnel charges.
Additional Initial Training	Reasonable fee, currently $1,000 per person per session.
Studio Launch Training	Reasonable fee, currently $1,400 per person per session (for additional, replacement, or repeat trainees).
Refresher Training Fees	Reasonable fee, $250 per day per person trained.
Conference Fees	$600 to $1,500 per person depending on the event.
On-Site Evaluation Fees	The franchisor’s costs and expenses in connection with the on-site evaluation.
Insurance Premiums	Amount of unpaid premiums, plus an administrative fee of $100.
Product Purchases	Typically $4,000 to $6,000 per year, but may vary based on purchases.
Advertising Collateral	Currently, $1,000 to $5,000 per year, but may vary based on purchases.
Technology Fee	Currently, $899 per month, plus a $575 management software setup fee.
OT Beat Fees	Currently, $149 per month and a one-time setup fee of $250.
Non-Compliance Fee	Up to $3,000 per notice of violation.
Management Fee	A fee that the franchisor specifies up to 15% of gross sales plus the franchisor’s actual costs and expenses.
Indemnification	Will vary under circumstances.
Costs and Attorney’s Fees	Will vary under circumstances.

The above information has been compiled from the FDD of Orangetheory Fitness. Year of FDD: 2025.
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