Jumping into four fitness franchises
The concept: Claiming to be America’s only mobile personal training concept of its type, GYMGUYZ finished 2016 with 100 open franchises in 18 states. It had just 20 franchised units in 2015. “We’ve grown quickly because of brand awareness and strong social media interaction with customers,’’ says founder and CEO Josh York. “GYMGUYZ comes where clients are for training.” The business uses vans wrapped in red with its logo, stocked with 365 pieces of equipment including weights, medicine balls, ropes and resistance bands for training. On-site expert coaches bring workouts to homes, offices, churches, hospitals, senior care centers, parks or other locations. Individual sessions can run from $10 to $110.
The stats: Total investment to launch a franchise runs from $75,000 to $102,450. That covers the van, marketing and other start-up costs. York hopes to sell another 120 franchises in the United States and projects these will open by late 2017. Based in Plainview, New York, the brand started in 2008 and began franchising in 2013.
The rivals: The health and fitness sector has added more than 100 brands since 2013, making it highly competitive. Some players include Fit Body Camp, Crunch Fitness and The MAX Challenge. But York says the brand differs from other fitness concepts because it has no brick-and-mortar locations, tending to make profit margins higher for operators than rival gyms with fixed real estate costs. Franchisees pay a 6 percent royalty fee based on weekly sales.
The challenge: York says the biggest hurdle is keeping up with its rapid expansion and providing technology and infrastructure to support franchisees.
The concept: Benefiting from a 9.2 percent annual growth rate in the nation’s Pilates and yoga industry for the last five years, Club Pilates expected to finish 2016 with 140 locations in 28 states. Now, the Costa Mesa, California-based franchisor is aspiring to grab a larger share of the nearly 8.6 million people doing Pilates. “We have the capacity to serve a lot of people,” says Kate Doyle-Kwon, Club Pilates’ franchise sales marketing manager. “Our growth strategy includes targeting more women and men professionals leading busy lifestyles seeking help to meet their fitness goals.”
The stats: The total investment to open a Club Pilates studio averaging 1,500 square feet ranges from $180,595 to $249,295. Studios include 12 Pilates Reformer machines, Spring Boards and other equipment. Club Pilates plans to open an additional 220 stores in 2017 owned by franchisees, Doyle-Kwon says. The franchise was started in 2007. It was acquired in 2015 by Anthony Geisler, former owner of LA Boxing and UFC Gyms.
The rivals: Club Pilates’ franchisees face competition for members from Pilates studios in local markets. Specialized health clubs like Equinox, Orangetheory as well as nationally recognized yoga brands like Yogaworks or CorePower Yoga are potential competitors. Doyle-Kwon says Club Pilates has the only network of studios with a national presence in its business. That allows it to offer 7 million classes a year to all fitness types and age groups. The nation’s Pilates and yoga industry is a $10-billion market.
The challenge: An immediate test for franchisees is finding real estate that matches demographic and layout requirements.
The concept: Aiming to distinguish itself from competitors, SPENGA offers spin (indoor cycling), strength and yoga training all at once in a 60-minute session. That means clients don’t have to go to three separate gyms to get each discipline. “This unique concept delivers cardiovascular, strength, and flexibility training in every session,” says Roger McGreal, SPENGA’S co-founder. The brand’s website features bold statements designed to catch the athlete’s eye, like these: “Spin. Ride it like you stole it,” and “Strength. No one ever drowned in sweat.” The final slogan, “Yoga. Leave it all on the mat,” just may be McGreal’s motto, too.
The stats: It runs from $425,000 to $450,000 to open a studio. The first franchise opened in July 2016 in Downers Grove, Illinois. SPENGA has six franchises under development in four Chicago suburbs, the Denver suburb of Broomfield and Virginia Beach, Virginia, set to open in 2017. The Mokena, Illinois-based franchise has one corporate-owned store.
The rivals: Adversaries in the $27 billion boutique fitness industry include Orangetheory, Pure Barre and CycleBar. SPENGA began franchising in November 2015 for many reasons, including making stores easier to operate and boosting the ability to open multiple stores faster.
The challenge: While SPENGA has sold 40 franchises in its first year, a hiccup has been achieving brand awareness in the competitive fitnness space. But McGreal says SPENGA’s combined workout model is catching on. The most popular package is $129 per month for unlimited sessions, he says.
The concept: More than 30 million people suffer from lower back pain daily. But Kevin Byrd is confident LumbarTrac Spinal Fitness Studio is their solution. It features decompression machines that provide people prevention or relief from spinal problems.
The stats: A studio is 1,200 square feet and runs roughly $35,000 to open. The spinal fitness clubs come with 10 self-operated decompression machines patients use for treatment. LumbarTrac has a pilot studio in New Bern, North Carolina, and Byrd has an intriguing approach to lead up to franchising. Plans call for opening 40 locations over the next five years, eight per year, backed by venture capitalists. The goal: Use the studios to show potential investors how they make money. “We then hope to begin selling units to franchisees within the next two years.”
The rivals: They include chiropractors, orthopedic doctors and physical therapists. Yet Byrd says his brand is more cost effective and convenient than rivals. LumbarTrac members pay $65 a month for unlimited use, he says. “That amount is much less than one trip to most chiropractors.”
The challenge: A big obstacle will be getting potential franchisees to buy into a concept that is unproven with no brand recognition. The little known and bulky decompression machines may also cause some to pause. LumbarTrac lacks the sophisticated marketing presence of some competitors, with grainy and odd-looking photos in some cases. On the other hand, back pain is a huge issue for many people, so a franchise to address it may catch on.