B
Big Air Trampoline Park
Children & Education
Founded 201517 locationsCompany Profile
Year Founded:2015
Big Air Trampoline Park Franchise Cost
| Franchise Fee: | $50,000Key Metric |
| Total Investment: | $2,500,000 - $4,560,000Key Metric |
| Liquid Capital: | $605,000 |
| Royalty Fee: | 6% of gross sales |
| Marketing Fee: | 1% of gross sales |
Quick ROI Calculator
Based on Big Air Trampoline Park's actual financial data
Outlet Counts by Year
Historical outlet data extracted from FDD documents
Total US Locations:17
Scale relative to 1,000 locations
Franchised Units:15
Corporate Units:2
Additional Information
Processing Franchise Details
Our AI is extracting detailed information from franchise documents.
Company history, executive team profiles, and legal disclosures will appear here once document processing is complete.
Search Interests & Trends
Search Volume Data and Trend Analysis
Search Interest & Trends
No Trends Data Available
Trend analysis data for Big Air Trampoline Park is being collected. Check back soon for insights.
AI-Powered Due Diligence Analysis
Our advanced AI analyzes Franchise Disclosure Documents (FDDs) to identify potential risks and opportunities across 10 critical categories.
14
High Risk
Critical items
36% of total
22
Medium Risk
Monitor closely
56% of total
3
Low Risk
Manageable items
8% of total
39
Total Items
Factors analyzed
10 categories
6.41
Overall Score
Low RiskHigh Risk
010
Franchisor Stability Risks
3 risks identified
1
2
Limited Operating History and Rapid Growth Projections
High
Explanation:
- Big Air Franchising, LLC was founded in 2015, giving it a relatively short operating history in the competitive children's entertainment industry. This limited history makes it difficult to fully assess the long-term viability and resilience of the business model, especially during economic downturns or shifting consumer preferences.
- Table 5 projects significant growth with 16 new franchised outlets in the next fiscal year and 34 franchise agreements signed but not yet opened. Rapid growth can strain resources, infrastructure, and support systems, potentially leading to quality control issues, franchisee dissatisfaction, and operational challenges for the franchisor.
- While Item 21 provides audited financials, the relatively short history limits the ability to project future performance accurately. The rapid growth projections further complicate this analysis, making it difficult to determine if the franchisor has the financial capacity to support such expansion.
Potential Mitigations:
- Carefully review the provided financial statements (Item 21) to assess the franchisor's current financial health and historical performance. Look for trends in revenue, profitability, and cash flow.
- Inquire about the franchisor's plans for managing rapid growth, including training and support programs, infrastructure development, and quality control measures. Seek evidence of their capacity to handle the projected expansion.
- Consult with experienced franchise attorneys and financial advisors to evaluate the risks associated with the franchisor's limited history and ambitious growth plans.
FDD Citations:
- Item 20: Tables 4 and 5, discussion of franchise sales and openings.
- Item 21: Reference to the provided financial statements.
- General FDD: Consider the overall tone and presentation regarding growth projections.
Dependence on Company-Owned Outlets Transitioning to Franchisees
Medium
Explanation:
- Table 4 indicates that all company-owned outlets are projected to be sold to franchisees by the end of 2024. This transition could create instability if not managed effectively. The franchisor's experience primarily comes from operating company-owned units, and shifting to a purely franchise-based model requires different skills and resources.
- The FDD mentions a failed conversion attempt in Colorado, highlighting the challenges of converting existing trampoline parks to the Big Air brand. This raises concerns about the potential for similar issues with future conversions and the franchisor's ability to support franchisees in this process.
Potential Mitigations:
- Inquire about the franchisor's specific plans and timeline for transitioning company-owned outlets to franchisees. Request details on the support and training provided to new franchisees taking over existing locations.
- Investigate the reasons for the failed Colorado conversion and what lessons the franchisor learned from that experience. Assess their ability to mitigate similar risks in future conversions.
- Analyze the franchisor's experience and expertise in supporting franchise operations specifically, as opposed to managing company-owned units.
FDD Citations:
- Item 20: Table 4, discussion of company-owned outlets and the Colorado conversion.
Potential Lack of Franchisor Support for Multi-Unit Developers
Medium
Explanation:
- The FDD mentions only one Multi-Unit Developer (MUD). While this isn't inherently negative, it raises questions about the franchisor's experience and resources dedicated to supporting MUDs, who often have unique needs and require more comprehensive support than single-unit franchisees.
- The ambitious growth plans outlined in Table 5, combined with the limited experience with MUDs, could lead to challenges in providing adequate support and resources to these key franchisees, potentially impacting their success and the overall system's growth.
Potential Mitigations:
- Contact the existing MUD and inquire about their experience with the franchisor's support and resources. Ask about any challenges they faced and how the franchisor addressed them.
- Discuss with the franchisor their specific plans for supporting MUDs, including dedicated resources, training programs, and communication channels. Assess their understanding of the unique needs of multi-unit operators.
FDD Citations:
- Item 20: Mention of one Multi-Unit Developer.
Disclosure & Representation Risks
7 risks identified
3
3
1
Unaudited Interim Financials
High
Explanation:
- The FDD includes unaudited interim financials for Big Air Franchising, LLC as of March 31, 2025. These financials have not been subjected to a full audit by an independent CPA, increasing the risk of misstatements or omissions that could impact the franchisor's financial health and ability to support franchisees.
- Relying solely on unaudited data provides a less reliable picture of the franchisor's financial performance and stability.
Potential Mitigations:
- Consult with a financial advisor experienced in franchise investments to analyze the unaudited financials and assess the potential risks.
- Request audited financial statements for prior years to compare trends and identify any significant discrepancies.
- Inquire about the reasons for presenting unaudited interim financials and seek clarification on any concerning aspects.
FDD Citations:
- Item 23, Exhibit A: "UNAUDITED FINANCIALS. THESE FINANCIAL STATEMENTS ARE PREPARED WITHOUT AN AUDIT."
Limited Operating History of Franchisor
High
Explanation:
- Big Air Trampoline Park was founded in 2015. This relatively short operating history (approximately 10 years as of the 2025 FDD) presents a risk as there is limited demonstrable track record of success and sustainability in the franchising model.
- A shorter history may mean fewer established systems, less brand recognition, and potentially less experience navigating economic downturns or industry changes.
Potential Mitigations:
- Thoroughly research the franchisor's history, growth trajectory, and management team's experience.
- Speak with existing franchisees to understand their experiences and assess the franchisor's support and performance.
- Carefully evaluate the franchisor's business plan and projections, considering the limited historical data available.
FDD Citations:
- General Information (Not provided in excerpt, but assumed to be present in a full FDD): "Founded: 2015"
Dependence on Discretionary Spending
Medium
Explanation:
- The children's entertainment industry, particularly trampoline parks, is heavily reliant on discretionary spending. Economic downturns or changes in consumer preferences can significantly impact revenue and profitability.
Potential Mitigations:
- Analyze the local market demographics and competition to assess the demand for trampoline parks in your area.
- Develop a robust marketing plan to attract and retain customers, especially during challenging economic times.
- Explore diversification strategies within the facility to offer additional revenue streams and cater to a broader audience.
FDD Citations:
- General Information (Not provided in excerpt, but assumed to be present in a full FDD): "Industry: Children & Education"
High Investment Costs
Medium
Explanation:
- The investment range of $2,500,000 to $4,560,000 represents a significant financial commitment. The high initial investment increases the financial risk and extends the period required to recoup the investment.
Potential Mitigations:
- Develop a comprehensive financial plan and secure adequate funding before committing to the franchise.
- Carefully review the FDD's financial projections and compare them to industry benchmarks.
- Consult with a financial advisor to assess the investment's viability and potential return on investment.
FDD Citations:
- General Information (Not provided in excerpt, but assumed to be present in a full FDD): "Investment Range: $2500000 - $4560000"
Potential Misrepresentation of Franchisor Financial Performance
High
Explanation:
- The inclusion of "Google Ads Reimbursement" as income in the Profit and Loss statement raises concerns about the accurate representation of the franchisor's core revenue. This item may inflate the franchisor's income and doesn't reflect actual franchise-related earnings.
Potential Mitigations:
- Inquire about the nature of the "Google Ads Reimbursement" and its impact on the franchisor's overall financial performance.
- Request clarification on how this item is treated in the audited financial statements.
- Consult with a financial advisor to assess the implications of this revenue source on the franchisor's financial health.
FDD Citations:
- Item 23, Exhibit A, Profit and Loss: "Google Ads Reimbursement (For confirmation to Kurt the proper account)"
Lack of Clarity on Payroll Expenses
Medium
Explanation:
- The Profit and Loss statement shows "Payroll Expenses" totaling $252,791.21, but includes a negative value for "Insurance" (-$808.67). This inconsistency and lack of clarity raise questions about the accuracy and completeness of the reported payroll expenses.
Potential Mitigations:
- Request clarification on the negative insurance value within payroll expenses and its impact on the overall figures.
- Seek detailed breakdowns of all payroll-related costs to ensure transparency and accuracy.
FDD Citations:
- Item 23, Exhibit A, Profit and Loss: "Insurance -808.67" within Payroll Expenses section.
Reliance on NMPF (National Marketing Program Fund) Fees
Low
Explanation:
- The Profit and Loss statement includes "NMPF Fees" as "Other Income." While national marketing can be beneficial, heavy reliance on these fees for income raises questions about the franchisor's core business profitability and potential dependence on franchisee contributions rather than organic growth.
Potential Mitigations:
- Review Item 11 of the FDD (Franchisor's Obligations) to understand the details of the National Marketing Program Fund, including how funds are used and the franchisor's contribution.
- Inquire about the allocation of NMPF resources and the effectiveness of past marketing campaigns.
FDD Citations:
- Item 23, Exhibit A, Profit and Loss: "NMPF Fees" listed under Other Income.
Financial & Fee Risks
6 risks identified
2
3
1
Insufficient Surety Bond Coverage
High
Explanation:
- The FDD mentions a $100,000 surety bond required by the Washington State Department of Financial Institutions. This amount may be inadequate to cover potential liabilities related to franchisee defaults, legal disputes, or other financial obligations, especially considering the high investment range of $2.5M - $4.56M.
- A larger bond amount would provide greater protection for the franchisor and potentially for franchisees in certain circumstances.
Potential Mitigations:
- Negotiate a higher bond amount with the franchisor or explore alternative financial assurances.
- Carefully review the terms and conditions of the bond to understand its coverage limitations.
- Consult with legal counsel specializing in franchising to assess the adequacy of the bond in relation to the investment and potential risks.
FDD Citations:
- Item 18, Addendum: "The State of Washington Department of Financial Institutions requires a financial assurance... We have obtained a Surety Bond in the amount of $100,000."
Limited Information on Financial Performance Representations
High
Explanation:
- The provided FDD excerpt does not include Item 19, which typically contains financial performance representations (FPRs). The absence of FPRs makes it difficult to assess the potential profitability of the franchise and makes financial projections challenging.
- Without FPRs, potential franchisees are left to rely solely on the franchisor's claims and have limited independent data to evaluate the investment opportunity.
Potential Mitigations:
- Request the complete FDD, specifically Item 19, from the franchisor.
- If FPRs are not provided, conduct thorough independent market research and financial analysis to estimate potential revenue and expenses.
- Consult with a franchise consultant or accountant experienced in analyzing franchise opportunities.
FDD Citations:
- Item 19 (Missing): This item is typically where FPRs would be located.
Dependence on Washington State Regulatory Approval
Medium
Explanation:
- The FDD highlights a specific requirement from the Washington State Department of Financial Institutions regarding financial assurance. This suggests potential regulatory hurdles and dependencies on state-specific regulations.
- Changes in Washington state laws or regulations could impact the franchise's operations and financial stability.
Potential Mitigations:
- Research Washington state regulations related to franchising and trampoline parks to understand potential compliance requirements and risks.
- Monitor any changes in relevant state laws and regulations.
- Consult with legal counsel specializing in Washington state franchise law.
FDD Citations:
- Item 18, Addendum: "The State of Washington Department of Financial Institutions requires a financial assurance..."
Potential for Misinterpretation of Franchise Agreement Addendum
Medium
Explanation:
- The addendum in Item 18 modifies sections of the Franchise Agreement and Multi-Unit Development Agreement. The language regarding superseding "inconsistent portions" could lead to disputes over interpretation and enforcement.
- Ambiguity in the addendum could create conflicts between the franchisor and franchisee.
Potential Mitigations:
- Carefully review the addendum with legal counsel to ensure a clear understanding of its implications and how it interacts with the main agreement.
- Seek clarification from the franchisor on any ambiguous language or potential conflicts.
- Document any agreed-upon interpretations of the addendum in writing.
FDD Citations:
- Item 18, Addendum: "It is agreed that the applicable foregoing State-Specific Addendum... supersedes any inconsistent portion of the Franchise Agreement..."
Risk of Non-Compliance with Franchise Agreement
Medium
Explanation:
- The Operations Manual (Exhibit G) outlines various operational requirements and standards. Failure to comply with these requirements could lead to breaches of the franchise agreement and potential penalties, including termination.
- The complexity of the operations manual and the numerous requirements increase the risk of unintentional non-compliance.
Potential Mitigations:
- Thoroughly review the Operations Manual and ensure a clear understanding of all requirements and procedures.
- Develop internal systems and processes to track and monitor compliance with the Operations Manual.
- Establish open communication with the franchisor to address any questions or concerns regarding compliance.
FDD Citations:
- Exhibit G, Operations Manual: The entire manual outlines operational requirements and standards.
Limited Working Capital Guidance
Low
Explanation:
- The provided FDD excerpt does not offer specific details on recommended working capital. Insufficient working capital can lead to cash flow problems and jeopardize the franchise's success, especially during the initial startup phase.
Potential Mitigations:
- Request detailed information from the franchisor regarding recommended working capital requirements.
- Develop a comprehensive financial projection that includes realistic estimates of startup costs, operating expenses, and revenue projections.
- Secure adequate financing to cover both the initial investment and ongoing working capital needs.
FDD Citations:
- No specific citation as the information is missing.
Legal & Contract Risks
3 risks identified
1
2
Superseding State Law
Medium
Explanation:
- Washington's Franchise Investment Protection Act (FIPA) and related court decisions may supersede provisions in the franchise agreement, potentially altering termination, renewal, dispute resolution, releases, waivers, statutes of limitations, and other key aspects of the franchise relationship.
- This creates uncertainty about the enforceability of certain contract provisions and could lead to disputes.
Potential Mitigations:
- Carefully review the franchise agreement and related documents with legal counsel specializing in Washington franchise law to understand the interplay between the contract and FIPA.
- Seek clarification from the franchisor on any discrepancies or potential conflicts between the agreement and state law.
- Be prepared for the possibility that certain provisions in the agreement may be unenforceable under Washington law.
FDD Citations:
- Item 1, Franchisee Bill of Rights: "RCW 19.100.180 may supersede provisions..."
- Item 2, Site of Arbitration: "In any arbitration...in Washington..."
- Items 3, 4, 6, 9, 10, 11, 12, 13, 14, 15, 16 (Multiple references to RCW and Washington specific regulations)
Void Release and Waiver Clauses
Medium
Explanation:
- Certain release or waiver of rights clauses in the franchise agreement, particularly those related to FIPA compliance or specific damages, may be void under Washington law unless executed under specific conditions (negotiated settlement with independent counsel).
- This limits the franchisor's ability to protect itself from certain claims and could expose the franchisee to unintended liabilities.
Potential Mitigations:
- Ensure any release or waiver is executed in strict compliance with RCW 19.100.220(2), including independent legal representation for both parties.
- Avoid signing any pre-agreement releases or waivers without thorough legal review.
FDD Citations:
- Item 3, General Release: "A release or waiver...is void except..."
- Item 9, Waiver of Exemplary & Punitive Damages: "...are void, except when executed..."
Unlawful Buy-Back Provisions
High
Explanation:
- The FDD states that buy-back provisions allowing the franchisor to repurchase the franchisee's business without consent are unlawful in Washington, except for terminations with good cause.
- This significantly restricts the franchisor's flexibility and could create disputes if they attempt to repurchase a franchise without adhering to these limitations.
Potential Mitigations:
- Carefully review the repurchase provisions in the franchise agreement to ensure they comply with RCW 19.100.180(2)(j).
- Seek legal counsel to understand the implications of "good cause" termination in Washington.
FDD Citations:
- Item 7, Certain Buy-Back Provisions: "Provisions...that permit the franchisor to repurchase...without consent are unlawful..."
Territory & Competition Risks
3 risks identified
1
2
No Exclusive Territory
High
Explanation:
- The FDD explicitly states that franchisees will not receive an exclusive territory. This means you could face competition from other Big Air franchisees, company-owned outlets, or other distribution channels controlled by the franchisor, even within your designated territory.
- This significantly increases the risk of market saturation and cannibalization, potentially impacting revenue and profitability.
Potential Mitigations:
- Carefully evaluate the existing competitive landscape in your proposed territory, including other trampoline parks, entertainment venues, and alternative children's activities.
- Thoroughly analyze the franchisor's expansion plans and the potential for future franchisees or company-owned locations to be established nearby.
- Develop a strong local marketing strategy to differentiate your business and build a loyal customer base.
FDD Citations:
- Item 12: "You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control."
- Item 12: "You will not receive rights of first refusal to acquire additional franchises within your area."
Territory Size Determination at Franchisor's Discretion
Medium
Explanation:
- The franchisor has sole discretion in determining the size and boundaries of your territory, based on factors like population density, income, competition, and other characteristics. This lack of control can lead to a smaller territory than anticipated, limiting your potential customer base.
- The FDD mentions the territory radius may be "considerably smaller" in densely populated areas, posing a risk for franchisees in urban locations.
Potential Mitigations:
- Clearly understand the franchisor's criteria for territory determination and negotiate for a territory size that aligns with your business goals.
- Request detailed demographic data and market analysis for the proposed territory to assess its potential.
- Consider the potential impact of future population growth or decline on the viability of your territory.
FDD Citations:
- Item 12: "We have the exclusive right to determine the boundaries of your Territory at our sole discretion."
- Item 12: "In certain densely populated metropolitan areas, this radius may be considerably smaller..."
Competition from Franchisor's Online and Alternative Channels
Medium
Explanation:
- The franchisor reserves the right to sell products and services through alternative channels like the internet, catalog sales, and direct marketing, potentially competing directly with franchisees.
- While the FDD mentions a potential credit for online sales within your territory, it's at the franchisor's sole discretion and not guaranteed.
Potential Mitigations:
- Clarify the franchisor's online sales strategy and its potential impact on your business.
- Negotiate for a fair compensation structure for online sales originating from your territory.
- Focus on building strong local relationships and providing personalized services that are difficult to replicate online.
FDD Citations:
- Item 12: "We reserve the right... to offer the Services or Products... through any alternate channels of distribution within or outside of the Territory."
- Item 12: "If we use the Marks to sell... over the Internet... we may... provide you with a credit in an amount solely determined by us."
Regulatory & Compliance Risks
3 risks identified
1
2
Data Privacy and Security Compliance (CCPA and other regulations)
High
Explanation:
- Item 1 highlights the responsibility of franchisees to comply with various data privacy laws, including the California Consumer Privacy Act (CCPA), which can be complex and require significant resources to implement effectively.
- Failure to comply can lead to substantial fines, legal action, and reputational damage, particularly given the sensitivity of customer data (potentially including children's information).
- The evolving nature of data privacy regulations adds to the complexity and requires ongoing monitoring and adaptation.
Potential Mitigations:
- Implement a robust data privacy and security program, including data encryption, access controls, and regular security audits.
- Engage legal counsel specializing in data privacy to ensure compliance with CCPA and other applicable regulations.
- Provide comprehensive training to employees on data privacy best practices and procedures.
- Establish clear data retention and disposal policies.
FDD Citations:
- Item 1: "Because you collect information from customers, it may contain personal information of individuals which is protected by law. You are also responsible for complying with all applicable current and future federal, state and local laws, regulations and requirements, including the California Consumer Privacy Act (as applicable)..."
Advertising Fund Management and Oversight
Medium
Explanation:
- The FDD mentions a National Marketing and Promotions Fund and Local Advertising Cooperatives, but lacks details on how these funds are managed, audited, and used.
- Lack of transparency and control over these funds can lead to potential misuse, disagreements, and inefficiencies in advertising spend.
Potential Mitigations:
- Request detailed information on the fund management structure, including financial reporting, audit procedures, and decision-making processes.
- Negotiate for greater franchisee representation and oversight in the management of advertising funds.
- Clearly define the criteria for advertising expenditures and ensure alignment with franchisee interests.
FDD Citations:
- Item 8: "Maintain the National Marketing and Promotions Fund and use these funds to develop promotional and advertising programs..."
- Item 11: "We also may designate any geographic area...as a region for establishing a local advertising cooperative..."
Dependence on Franchisor's Discretion
Medium
Explanation:
- The FDD grants the franchisor significant discretion in various areas, such as providing additional assistance, setting maximum resale prices, and approving advertising outside the territory.
- This dependence on the franchisor's decisions can limit franchisee autonomy and potentially create conflicts of interest.
Potential Mitigations:
- Negotiate for clearer guidelines and limitations on the franchisor's discretionary powers.
- Seek legal counsel to review the franchise agreement and ensure a balance of power between the franchisor and franchisee.
- Request specific performance metrics and benchmarks for services provided at the franchisor's discretion.
FDD Citations:
- Item 8: "...as required in our discretion...", "...we may set maximum resale prices...", "You may not advertise outside your Territory without our approval, which may be withheld at our sole discretion."
Franchisor Support Risks
3 risks identified
1
2
Limited Franchisor Support Beyond Initial Training
Medium
Explanation:
- The FDD mentions initial training and some ongoing support like marketing and operations manuals, but details about the extent and quality of ongoing support are limited. The phrase "Except as listed above, we do not provide any additional assistance to you" suggests potential gaps in support after the initial phase.
- This lack of clarity raises concerns about the level of assistance franchisees can expect in areas like troubleshooting operational issues, adapting to market changes, and receiving ongoing business development advice.
Potential Mitigations:
- Request a detailed schedule of ongoing support activities, including frequency, format (e.g., on-site visits, webinars), and topics covered.
- Speak with existing franchisees about their experiences with ongoing support and identify any recurring challenges.
- Negotiate for specific support provisions in the franchise agreement, such as guaranteed response times for support requests or access to dedicated support staff.
FDD Citations:
- Item 7, 8, 11: General descriptions of support provided, but lacking specifics on frequency and scope beyond initial training.
- Item 11: "Except as listed above, we do not provide any additional assistance to you."
Dependence on Area Directors/Designees for Support
Medium
Explanation:
- The franchisor reserves the right to delegate support responsibilities to Area Directors or other designees. This introduces a potential risk of inconsistent support quality and responsiveness depending on the individual Area Director's capabilities and workload.
- Franchisees have limited control over this delegation and may face challenges if their assigned Area Director is inexperienced or unresponsive.
Potential Mitigations:
- Inquire about the qualifications, experience, and support infrastructure provided to Area Directors.
- Request contact information for existing franchisees within the assigned Area Director's region to assess their experiences.
- Negotiate for a clear escalation process for support issues if the Area Director is unable to provide adequate assistance.
FDD Citations:
- Item 11: "We reserve the right, in our discretion, to delegate some or all of our pre-opening and continuing obligations under the Franchise Agreement to an Area Director…or other designee."
Limited Franchisor Obligation to Protect IP
High
Explanation:
- While the FDD outlines franchisee responsibilities regarding intellectual property (IP), the franchisor's obligation to protect IP is limited. The FDD states, "However, the Franchise Agreement does not require us to take affirmative action in response to any apparent infringement of or challenge to your use of any Copyrighted Works, Confidential Information or Trade Secrets."
- This lack of guaranteed protection could leave franchisees vulnerable to IP disputes and potentially impact their business operations.
Potential Mitigations:
- Seek legal counsel to review the IP provisions in the franchise agreement and assess the level of protection offered.
- Request clarification from the franchisor on their typical response to IP infringements and challenges.
- Consider purchasing additional IP insurance to mitigate potential financial losses from IP disputes.
FDD Citations:
- Item 11: "However, the Franchise Agreement does not require us to take affirmative action in response to any apparent infringement of or challenge to your use of any Copyrighted Works, Confidential Information or Trade Secrets."
Exit & Transfer Risks
5 risks identified
1
3
1
Restrictive Transfer Provisions Conflicting with State Law
Medium
Explanation:
- The FDD mentions potential conflicts between the franchise agreement and Washington state law regarding termination, renewal, and transfers (Item 1). This suggests the franchise agreement may contain restrictive provisions that could hinder a franchisee's ability to sell or transfer their franchise, potentially impacting exit strategies.
- Item 3 discusses the voiding of waivers related to the Washington Franchise Investment Protection Act, particularly concerning transfers. This further highlights the potential for conflict between the franchise agreement and state law, creating uncertainty for franchisees seeking to exit.
- Item 5 states transfer fees are limited to reasonable costs. While seemingly protective, ambiguity around "reasonable costs" could lead to disputes and complicate the transfer process.
Potential Mitigations:
- Carefully review the franchise agreement with legal counsel specializing in Washington franchise law to identify any restrictive transfer provisions and ensure compliance with RCW 19.100.
- Negotiate with the franchisor upfront for clearer and more favorable transfer terms, including a pre-agreed method for calculating reasonable transfer costs.
- Obtain written clarification from the franchisor regarding their interpretation of "reasonable costs" related to transfers, and document all transfer-related expenses meticulously.
FDD Citations:
- Item 1: "Franchise agreement provisions... are subject to state law."
- Item 3: "In addition, any such release or waiver executed in connection with a renewal or transfer of a franchise is likely void except as provided for in RCW 19.100.220(2)."
- Item 5: "Transfer fees are collectable only to the extent that they reflect the franchisor’s reasonable estimated or actual costs in effecting a transfer."
Limited Termination Rights & Buy-Back Provisions
Medium
Explanation:
- While Item 6 states franchisees can terminate under state law, the specific grounds and processes aren't detailed, creating uncertainty. Without clear termination rights, franchisees may face difficulties exiting under unfavorable circumstances.
- Item 7 highlights the illegality of franchisor buy-back provisions without franchisee consent or good cause. This suggests the franchisor may attempt to include such provisions, posing a risk to franchisee control and exit options.
Potential Mitigations:
- Consult with legal counsel to understand termination rights under Washington state law and ensure the franchise agreement aligns with these rights.
- Negotiate for clearer and more expansive termination rights within the franchise agreement, including specific scenarios and processes.
- Carefully review the franchise agreement for any buy-back clauses and ensure they comply with RCW 19.100.180(2)(j), requiring franchisee consent or good cause.
FDD Citations:
- Item 6: "The franchisee may terminate the franchise agreement under any grounds permitted under state law."
- Item 7: "Provisions... that permit the franchisor to repurchase the franchisee’s business for any reason... without the franchisee’s consent are unlawful."
Potential for Disputes Over 'Fair and Reasonable' Pricing
Medium
Explanation:
- Item 8 mentions unlawful pricing practices. The lack of specific pricing details and the subjective nature of "fair and reasonable" could lead to disputes with the franchisor, potentially impacting profitability and resale value, thus hindering a successful exit.
Potential Mitigations:
- Request detailed information on all required purchases and rental costs from the franchisor.
- Compare these costs with market rates and similar franchise systems to assess their fairness and reasonableness.
- Negotiate clear pricing terms and mechanisms within the franchise agreement to minimize potential for future disputes.
- Consult with an experienced franchise attorney to review the pricing terms and ensure they comply with Washington state law.
FDD Citations:
- Item 8: "Any provision... that requires the franchisee to purchase or rent any product or service for more than a fair and reasonable price is unlawful."
Potential for Misleading Information from Franchise Brokers
Low
Explanation:
- Item 17 advises caution regarding information from franchise brokers, who represent the franchisor. Relying on potentially biased information could lead to unrealistic expectations and hinder a successful exit strategy.
Potential Mitigations:
- Independently verify all information provided by franchise brokers with the franchisor and through independent research.
- Consult with a franchise attorney to review the FDD and franchise agreement before making any decisions.
- Seek advice from existing franchisees about their experiences with the franchisor and the broker.
FDD Citations:
- Item 17: "If a franchisee is working with a franchise broker, franchisees are advised to carefully evaluate any information provided by the franchise broker about a franchise."
Jurisdictional Challenges for Dispute Resolution
High
Explanation:
- Item 2 dictates dispute resolution location, potentially requiring proceedings in Washington state. This could create significant logistical and financial burdens for franchisees located outside of Washington, especially during exit negotiations or disputes, making it harder and more expensive to enforce their rights.
Potential Mitigations:
- Negotiate with the franchisor to establish a mutually agreeable and more convenient dispute resolution location in the franchise agreement.
- Consult with legal counsel specializing in interstate franchise disputes to understand the implications and potential costs associated with litigating in Washington.
- Consider mediation or other alternative dispute resolution methods to potentially avoid costly and time-consuming litigation in a distant jurisdiction.
FDD Citations:
- Item 2: "In any arbitration or mediation involving a franchise purchased in Washington, the arbitration or mediation site will be either in the state of Washington, or in a place mutually agreed upon..."
Operational & Brand Risks
3 risks identified
2
1
Inadequate Initial and Ongoing Training
High
Explanation:
- The FDD mentions a short initial training program (up to one week) which may not be sufficient to prepare franchisees for the complexities of running a trampoline park, including safety, operations, marketing, and financial management.
- The reliance on a single Operations Manual as the primary training material may limit practical experience and real-world application.
- While ongoing training is mentioned, it lacks specifics regarding frequency, content, and cost, potentially leaving franchisees unprepared for evolving industry trends and best practices.
- The trainers' experience, while noted, doesn't specifically mention trampoline park expertise, raising concerns about the depth and relevance of the training provided.
Potential Mitigations:
- Request a detailed training syllabus and schedule to assess the comprehensiveness of the program.
- Inquire about shadowing opportunities at existing successful franchise locations to gain practical experience.
- Negotiate for additional training sessions or mentorship programs to address specific areas of concern.
- Research industry-specific training and certifications to supplement the franchisor's program.
FDD Citations:
- Item 8, Training Section: Description of the initial training program.
- Item 22, Training Program Table: Breakdown of training hours by subject.
- Item 23: Discussion of training personnel and materials.
Dependence on Franchisor's Marketing Effectiveness
Medium
Explanation:
- While the franchisor manages a National Marketing and Promotions Fund, the FDD lacks details about the fund's budget, allocation strategy, and past performance, making it difficult to assess its effectiveness.
- The provided marketing plans and advertising materials may not be tailored to the specific needs and demographics of each franchisee's territory.
Potential Mitigations:
- Request detailed information about the National Marketing and Promotions Fund, including its budget, spending allocation, and performance metrics.
- Review the provided marketing materials and assess their suitability for the target market in the franchisee's territory.
- Propose local marketing initiatives and seek the franchisor's approval and support.
FDD Citations:
- Item 7: "Maintain the National Marketing and Promotions Fund…"
- Item 8: "Provide marketing plans and advertising materials…"
- Item 24: Discussion of advertising programs and expenses.
High Initial and Ongoing Advertising Costs
High
Explanation:
- The required $60,000 Start-Up Advertising and Promotions Expense and the ongoing monthly expense of the greater of 2% of Gross Revenues or $5,000 represent a significant financial burden, especially during the initial stages of operation.
- The mandatory spending may not be justifiable based on the local market conditions and could strain the franchisee's cash flow.
Potential Mitigations:
- Develop a detailed marketing budget and plan to ensure efficient use of advertising funds.
- Negotiate with the franchisor for flexibility in advertising spending based on market conditions and performance.
- Explore cost-effective local marketing strategies to maximize reach and impact.
FDD Citations:
- Item 24: Description of Start-Up Advertising and Promotions Expense and ongoing Individual Advertising Expense.
Performance & ROI Risks
3 risks identified
1
2
Limited Sample Size for Performance Data
Medium
Explanation:
- Item 19's performance data is based on a small sample size of only 13 franchised locations across all tiers. This limited sample may not accurately represent the potential range of outcomes for new franchisees.
- The small sample size increases the impact of outliers, potentially skewing the average and median figures and providing a misleading picture of typical performance.
Potential Mitigations:
- Request additional performance data from the franchisor, including data from previous years if available, to gain a broader understanding of historical performance.
- Conduct independent market research in your target area to assess local demand and competition, which can influence revenue potential.
- Consult with existing franchisees outside of the top performers to gain a more realistic perspective on the challenges and potential returns.
FDD Citations:
- Item 19, Tables 1-3: Small number of franchise locations included in each tier (4, 5, and 4 respectively).
- Item 19, Table 5: Data based on only 13 locations.
No Assurance of Similar Earnings
High
Explanation:
- The FDD explicitly states "There is no assurance that you will earn as much" as the presented figures. This disclaimer highlights the inherent risk in relying solely on the provided data.
- Numerous factors can influence a franchise's performance, including local market conditions, management effectiveness, and competition, which are not fully captured in the presented data.
Potential Mitigations:
- Develop a realistic business plan based on conservative revenue projections and thorough expense analysis.
- Seek professional financial advice to assess the feasibility of the investment and potential return on investment given the lack of earnings guarantees.
- Negotiate a strong franchise agreement that provides some level of protection or support in case of underperformance.
FDD Citations:
- Item 19, General Note 4: "Some franchised locations have earned these amounts. Your individual results may differ. There is no assurance that you will earn as much."
Dependence on Discretionary Spending
Medium
Explanation:
- Trampoline parks are a form of entertainment and rely on discretionary spending, which can be significantly impacted by economic downturns or changing consumer preferences.
- Families may reduce spending on leisure activities during times of economic hardship, potentially affecting revenue streams.
Potential Mitigations:
- Diversify revenue streams by offering a range of services and products, such as birthday parties, corporate events, and fitness classes.
- Implement dynamic pricing strategies to adjust to changing demand and market conditions.
- Develop strong marketing and promotional campaigns to attract customers and build brand loyalty.
FDD Citations:
- Item 19: Focus on revenue from entertainment services.
FDD Documents by Year
Download and view official Franchise Disclosure Documents
FDD Year: 2025
Uploaded: 8/9/2025
FDD Documents
Access and download Franchise Disclosure Documents by year