The Franchise Forecast
Franchising can be a lucrative business for both corporations and the owners that partner with them. We profiled some of the top franchisees of major businesses in the industry. Discover why they chose to open a franchise, what their successes are and what their next steps could be.
When Mike Singer first caught wind of Orangetheory Fitness, it blew his mind. Although he had owned a personal training studio in Miami since 1993, he had watched Ellen Latham, the founder of Orangetheory, and her work in fitness, for years. When the opportunity to franchise her concept came about, Singer and his wife couldn’t resist. “We had reached that point in our career where we were looking for something that we could duplicate, that we could have corporate support [in], that we could have corporate training and this was it,” he said.
Singer now owns two Orangetheory locations in Miami. “This was something I recognized was a big trend, a movement in fitness that I couldn’t resist getting involved [in],” he explained. “What I like to call this is, it’s group personal training that’s affordable to everyone.”
With his businesses growing, he plans to open four to six more in the Miami area. “The biggest success is our first location is so much busier and so much more successful than I even imagined it could be,” he said. “It drives me to continue on. It’s been absolutely amazing and it’s actually far exceeded my initial expectations.”
Andy Gundlach spent 13 years with Pizza Hut, working his way up to director of operations. However, Gundlach wanted to incorporate his passion for business with his love of exercise. In Illinois, he was scouting locations for Pizza Hut when he came across Anytime Fitness. Having noticed the franchise in his Internet searches for fitness business concepts, Gundlach pulled a U-turn and went inside. His first location opened in 2006, and he now owns 25 clubs in southern Wisconsin.
Gundlach said it was the people at Anytime Fitness that drew him in. “Meeting the corporate team and the founders, you could just tell they’re real, genuine people,” he said. “There was just something about them that I knew — you could just sense that they were the real deal and weren’t a fly-by-night operation, and they had a great vision.”
In 2011 and 2012, Gundlach won back-to-back Franchisee of the Year awards. And he is looking at developing seven to eight more locations in the coming years. “Each day me and my team, we strive to get better at what we do — providing an experience — and we’re not going to stop doing that,” he said.
Matt Rhodes and his wife wanted to lose weight. However, they weren’t happy with the gyms they went to, and they realized they weren’t alone. So, they began to look into owning their own gym.
On a business trip, Rhodes asked his hotel for the closest gym, which was a Snap Fitness. “I’d thought I’d try it out, and I walk in, and I was blown away by the experience,” he said. “It had everything that my wife and I had wanted in a gym: the size, the friendly staff, the amount of equipment. Everything we wanted was right there and it was like, ‘Hey this is our business plan.’”
Rhodes now owns two locations in Kansas and is in the process of looking for a third. “I’d like to think we haven’t had our biggest successes yet,” he said. “We’re still a growing company. I don’t think any business owner can survive the long haul relying on that one big moment. If you do, it’s tough. We try and find small successes every day. That’s what motivates us, and that’s the reason we wake up, and that’s why we love being in this industry, because you can get a success every single day. Just go talk to a member. You’re going to hear something successful.”
Iron Tribe Fitness
When Forrest Walden first started what would become Iron Tribe Fitness in his garage, Jamie Warren got a personal invitation to see what it was all about. “I went to this one workout and was blown away by how tough it was and it just leveled me,” he recalled. “I ended up in the fetal position in Forrest’s backyard trying to gasp for breath. I’d wondered what I’d gotten myself into.” Despite the rough start, Warren and his wife became two of the first members of Iron Tribe Fitness.
However, it was not until Warren and his business partner, Eli Martorana, were looking to open a stand-alone gym that he heard about the Iron Tribe franchise opportunity. “I knew from first-hand experience the power of the transformative program that Iron Tribe was creating,” said Warren. “So I didn’t need any education there.” The stand-alone gym idea transformed into a commitment of four Iron Tribe territories in Nashville, Tennessee, in July 2012.
With two locations open and two more to be opened by the end of 2015, Warren said the business has been enjoyable. “The impact on people, the caliber that’s surrounding Iron Tribe as we grow, and then just how enjoyable it is to just execute that model for various reasons is why I like it so much,” he said.
Vince Julien was 25 when he started his first fitness chain as a women’s-only facility. He opened a co-ed club chain shortly after, but sold it in 2005.
Five years later, Julien missed the day-to-day culture of his co-ed clubs. That’s when he chose to become a Crunch franchisee. “I started researching several brands, especially the low-price-point brands, because that’s where the industry was seeing it’s greatest gains in number of members and margins,” he said. “I was very familiar with the [Crunch] brand, and the model that was now attached to it was very appealing … because it takes years to build brand recognition, and without question, Crunch was a brand that was created with more than just fitness in mind.”
So far, Julien has opened five Crunch locations in the past two years throughout Florida. He attributed his success to not only the culture within the organization, but also Crunch’s brand and being able to constantly evolve. “Sure, fitness is the vehicle, but the brand revolves around fun, entertainment, excitement and has a great urban flare to it as well,” he said. “Add the ‘No Judgments’ philosophy and you have a brand that’s poised to be the best brand in the world.”
With more than 30 years of experience in the health and fitness industry, Victor Brick recognized that traditional clubs were continuing to struggle in reaching the 85 percent of Americans who weren’t members of health clubs. So, when he and his wife, Lynne Brick, began looking for opportunities to franchise, Planet Fitness stood out. “Planet Fitness is the only model that addresses the five fears of a typical consumer,” he said.
Those five fears include physical anxiety, not knowing anyone, being a klutz, feeling stupid and the hard sell. According to Mr. Brick, Planet Fitness and its “Judgement Free Zone” philosophy address all of those problems, removing barriers to purchasing a membership.
The Bricks’ passion for Planet Fitness shines through. In 2013, Planet Fitness corporate named the couple Franchisees of the Year. “We were very proud of that, because we strive to be the best,” said Mr. Brick.
Currently, the Bricks own 25 Planet Fitness locations and are looking to expand. “One of the reasons we chose Planet Fitness is because it’s simple and you can scale it,” said Mr. Brick. “We’re going to continue to find underserved areas where there’s a need for low-cost options [like Planet Fitness].”
Ever since opening their first UFC Gym just over a year ago in New York City, Jason Losco, Ramzey Prentiss and Dominick Rizzo have consistently operated the top-performing UFC-franchised gym. According to Prentiss, that is because they have believed in the UFC Gym brand from the get-go. “Promoting and getting behind UFC Gym was an incredibly easy decision and one we take pride in every day,” he said. “Not only do we believe in this brand, we live it.”
Together, the trio forms a dynamic team, each taking on their own individual roles of finance (Losco), marketing (Prentiss) and business management (Rizzo). That, and UFC Gym’s unique “Train Different” approach, are what the team attributes to their successes.
“Fitness options, especially in New York, are on every block and stacked several stories high,” said Losco. “In order to standout, we provide a superior product … our coaches help build such an amazing atmosphere in our clubs that the fitness experience at UFC Gym is like no other.”
And the trio doesn’t expect their success to waiver. “Our plan is to continue building the best-performing clubs throughout Manhattan over the next several years,” said Rizzo.
By Heather Hartmann and Rachel Zabonick