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Xponential CEO Tells Operators: Prepare to Reopen Franchises


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The eight boutique concepts, with more than 1,500 locations, under the Xponential Fitness umbrella have a new set of marching orders: get ready to reopen.

"We have our reopening plan already put together and already deployed to the franchisees," said CEO Anthony Geisler, who added "99.5 percent" of the clubs are closed under government shutdown orders.

"We already began our re-launch," with operators pre-selling memberships over the phone "just like when we pre-sale a studio prior to construction." As economies open, most likely region by region, studios will be ready for a "re-grand opening."

Geisler formerly owned L.A. Boxing and went through the economic crash of 2008. "In the fight world, we always say there's a fight or flight reflex. You start punching at somebody, they literally get down in the fetal position, or they start punching back. We looked at it and we said, do we want to close the stores, stop billing everybody and sit idle, or do we want to fight our way through the storm," he said. 

"We said, Hey, let's go fight the fight. Let's get back to the market first. Let's switch people to virtual so we still engage them. We think that will allow us to be sustained during this time, but also get back into the market very quickly."

Like everyone else, he's unsure about exactly when governments will lift their orders, but that's no different than in a typical grand opening that could be delayed by construction or other problems.

"We guesstimate that early May we'll be having openings, so we're on a two-week presale. We don't know what those stores are," he said when reached earlier this week. "We're kind of watching and see what happens. This is a week of governors coming out and saying they have a plan to reopen."

Xponential bought a production studio last summer and began videotaping "thousands of hours" of content, with instructors from its concepts ranging from Club Pilates to Stride leading classes. The idea was to begin selling that content as an add-on for members.

"So when it hit, we said we're going to operate in the virtual world," he said. "Instead of launching that and charging the outside world for it…we launched it internally. We gave it to franchisees for free, across eight modalities, and they gave it to their members who were now consuming the products."

Although he doesn't yet have complete statistics, he said membership freezes reached a peak the week of March 22, but cancellations have been relatively few.

"Our mentality was to shift from the physical to virtual world, not close. It was, these stores are migrating from the physical to the virtual world, and then we'll be migrating back."

 

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The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
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