Legal Terms To Include In Your Indoor Playground Customer Contract and Membership Agreement

Uncategorized Nov 13, 2023

Something I mentioned I love doing towards the end of the year in my business is doing some auditing and ensuring I have all the loose ends tied up in my processes.

Here in New York our busy indoor playground season starts in October but goes all the way through April– so this time before the holidays was crucial when it came to really setting ourselves up for success during this busy season.

And while marketing became a bit less important during this time because we were packed every single day with parents hoping to escape from the cold while still getting their little one out of the house, it was absolutely ESSENTIAL that all of our operating procedures were ON POINT during this time, so we could ensure each guest had an amazing experience. This helped ensure that they’d continue supporting us and attending open play and classes and keeping their memberships active even when the warmer weather came around.

Now this is another topic for another day but I definitely noticed that our success during a given month really had little to do with what we did in terms of action items THAT MONTH- but rather what we had done to set ourselves up for success and profitability 2-3 months prior. 

So let's sit down together today and tie up one more loose end to ensure you’re able to sustain your success long-term. 

Now this isn’t the sexiest OR the most fun topic but it’s one that is so critically important in helping you enforce your boundaries and protect your business, your assets, your staff, and your other customers– all things that WILL aid in doing just that– ensuring your business remains sustainable long-term.

In this article we are talking about membership agreements and customer CONTRACTS for your play cafe or indoor playground business. 

Now it has come to my attention recently that, for whatever reason, party or membership contracts are something some owners skip over, especially if these aren’t their main revenue streams.

And I have found that even those owners who ARE having customers sign contracts might not be utilizing this opportunity to it’s full advantage.

And this may sound like I am trying to pull one over on our customers or suggesting YOU do so, maybe by getting them to agree to some “gotcha” clause or hidden fee.

But honestly, the OPPOSITE is true,

Having a contract in place allows us to set CLEAR expectations well before our guests walk through the door as well as be extremely upfront about any boundaries, rules, or structures we will be enforcing when you arrive at our space.

Now back in episode 220 of my Profitable Play podcast I detailed clauses you should be sure to include in your PARTY contract. And while I touched on memberships a bit, there are some things I left out that really warranted it’s own episode. Because memberships are becoming increasingly crucial for indoor playgrounds to focus on. The economy is shifting and everyone is feeling it. We can NOT wish and hope and pray that a random 25-50 unique customers will wake up and decide to  walk through our door day in and day out anymore.

Many owners are finding it much more profitable and reliable to focus on a core group of 100-200 customers who value what we offer and prioritize their monthly membership spend each month with us. 

That is NOT going to be everyone in our local area. Not everyone will be able to afford it and not everyone will value what we offer enough to make SURE they can afford it.

And that's the beauty of memberships. Instead of needing to get 600-1000 unique customers to purchase an open play pass in  a given month, we can simply keep our current 100-200 members happy and see the same recurring revenue and profit come in month after month after month, and honestly probably find a lot more joy in our businesses.

I have dozens of episodes on memberships– detailing everything from how to create a membership offer to how to price it to how to integrate it with your other offerings such as packs of play passes to how to develop seasonal only memberships. But if you’re newer to this I would recommend episodes 64 and 115 to help decide if memberships are a good fit for YOUR business as well as how to get started with offering them.

But I digress.

Even though we have covered contracts before, in addition to getting more specific regarding membership agreements, I wanted to share this NEW episode with you because there have been some things I’ve helped indoor playground owners with over the past year that has forced me to really go back and add some stuff to the detailed membership agreement and contract I supply to all of my Play Cafe Academy and Play Maker Society members.

So yes, if you’d like a ready-to-go, plug-and-play contract you can tweak and add right into your business, you can get access to this template as well as hundreds of pages of other templates when you join Play Cafe Academy by going to playcafeacademy.com.

And real quick--contracts are NOT just to protect ourselves and our businesses as owners. A rock solid and comprehensive contract can also be an amazing tool to empower your staff with if an issue does arise. 

This goes beyond what’s included in your typical open play waiver. Because when someone signs up to be a member of our space, that signifies a need for a deeper level of trust and transparency on BOTH sides of the agreement. 

When there’s an issue with a member, whether it’s due to them not following a policy or due to them becoming overdue with their payment– the issue tends to become or at least SEEM more amplified since they are in your space so much and have formed relationships there.

So giving your staff this tool to point to that THEY agreed to and signed can be a great way to easily and quickly diffuse a situation or prevent it from happening in the first place. I know our staff really appreciated this– and taking care of our staff and retaining them as valuable team members was always a key component to our success.

Now let’s get into some clauses you NEED to be sure are in your membership agreement. This is not a comprehensive list and this is NOT legal advice– so be sure to consult with a local attorney to help adjust your membership agreement to your local area’s needs and laws.

 

1) Membership Terms and Duration

Clearly specify the term of the membership, including the start date and expiration date. Outline whether the membership is ongoing or for a fixed period.

 

2) Detailed Membership Fee Information

Detail the cost of membership, including initiation fees, recurring dues, and any additional charges.

 

3) Payment Terms

In addition to detailing how and when you will be charging a member's card as well as the amount, be sure to clarify consequences for late or non-payment. If you have a late payment fee, include that here as well.

 

4) Payment Authorization

Some states also require that someone signing up for a membership give explicit authorization for a business to charge them on a recurring basis– so cover your bases and include that.

I have noticed that some indoor playground owners ONLY have their members sign their waiver and a payment authorization form– and they do not have an additional membership agreement. And this can leave them open for liability and lost funds.

To summarize, a payment authorization in a membership agreement is a clause or provision that allows the organization or business to collect payments from the member's chosen payment method, typically on a recurring basis. This authorization is a formal agreement that specifies the terms and conditions under which payments will be processed, including the amount, frequency, and payment method (such as credit card or bank account).

But in an indoor playground environment, there’s typically much more to a membership than that. Especially if your membership includes things like affiliate commission, extra bonuses and discounts, and special member-only events. So while these are great to have, I have found it more effective to have these as one key PART of your membership agreement– and not the entire thing.

 

5) Termination and Cancellation

Explain the circumstances under which either party can terminate or cancel the membership, including notice requirements and any applicable penalties or refunds.

For some specific  examples of WHY and HOW this clause is so crucial, listen to the podcast episode that is related to this episode at the top of the page.

You can also reference some of my horror stories I went through with members here.

 

 6) Rights and Privileges

Outline the rights, privileges, and benefits associated with the membership, such as access to facilities, services, discounts, etc. This way, if there is any misunderstanding on behalf of either your staff or the member, it can be easily cleared up.

 

7) Code of Conduct and Behavior

Specify expected member behavior, including adherence to company policies, codes of conduct, and ethical guidelines. Describe any disciplinary actions for violations.

 

8) Liability and Waivers

Include clauses that address liability, disclaimers, and waivers of responsibility for accidents, injuries, or damages that may occur on the premises or during membership activities.

 

9) Photo Release

Including a photo release in the membership contract of an indoor playground is crucial as it allows the facility to obtain consent from members for using their images in promotional materials, such as marketing campaigns, websites, and social media. 

This transparency and consent not only build trust but also provide legal protection and ensure compliance with privacy regulations. By respecting members' image rights and privacy, the indoor playground can create a positive member experience and increase retention amongst their members– which as we know is key for a successful membership program.

 

10) Affiliate or Reward Program Details

Including details about affiliate or rewards programs in a membership agreement is essential to provide transparency and clarity to members. It helps members understand the benefits they can potentially receive through referrals or loyalty, promoting trust and satisfaction. By outlining program terms, eligibility criteria, and how rewards are earned, the agreement ensures that members have realistic expectations. 

 This proactive approach also establishes a clear contractual framework, minimizing disputes and enhancing the overall membership experience. Additionally, it serves as a valuable marketing tool, showcasing the organization's commitment to rewarding loyal members and incentivizing them to actively participate in the affiliate or rewards program, ultimately contributing to member retention and growth.

 

11) Intellectual Property Rights 

Clarify ownership and usage rights related to intellectual property, such as copyrights, trademarks, or proprietary information created or provided by the member.

 

12) Confidentiality and Non-Disclosure 

If applicable, require members to maintain the confidentiality of sensitive information, trade secrets, or proprietary data shared by the organization.

 

13) Privacy and Data Protection 

Address how the organization collects, stores, and uses member data, including compliance with data protection laws and the member's rights regarding their personal information.

 

14) Renewal and Auto-Renewal

Similar to a payment authorization, if the membership can be renewed automatically, specify the renewal process, including notice periods, fees, and the member's right to opt out. This is especially important if you offer annual memberships.

 

15) Dispute Resolution and Arbitration

 Outline the procedure for resolving disputes, whether through negotiation, mediation, arbitration, or litigation. Specify the governing law and jurisdiction.

 

16) Amendment and Modification 

Explain how and when the organization can make changes to the membership agreement. Include notice requirements for such changes.

 

Don’t forget– while I offer a lawyer-created template for a fully customizable membership agreement to all Play Cafe Academy and Play Maker Society members, you always want to be sure to consult a local attorney to be sure you are abiding by all local laws and regulations.

 

Did I miss anything? Did one of these give you a lightbulb moment? Comment below and let me know!

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