John Gennaro is the founder of Cuts Fitness For Men, recently ranked by Entrepreneur Magazine as one of the world’s hottest franchises for 2005. He was in the process of launching his newest venture, Cuts Women, when ClubSolutions Magazine caught up with him.
Your company is getting much attention, both inside and outside of the fitness industry. Why is this?
Marketing is a priority for us. We recognize that we have terrific products and feel that we have a window of opportunity to create a very successful company. We were recently at IHRSA’s European Congress in Rome and I was approached by many industry leaders who were quite familiar with what we were doing and it was very flattering. We will continue to generate as much interest as possible both domestically and internationally through effective marketing channels.
You recently announced a vendor relationship with Technogym, a wellness company based in Italy. What is this relationship about?
It is about providing a unique product for our customers, both franchisees and gym members. Technogym approached us about six months ago regarding Kinesis and after meeting with the founder and their senior management team in Italy, we quickly realized that they were an ideal supplier. At the end of the day, it’s about quality.
The company is headquartered in Gambettola, Italy, near Bologna. It was founded by Nerio Alessandri about 20 years ago and has since evolved into an international company with 1,000 employees.
The Kinesis product that we are featuring is a new way of exercising. It features a resistance based training system that provides users the ability to move in hundreds of directions with consistent resistance. Kinesis enhances the movements of classic forms of exercise such as Pilates and Yoga and assist in sports training and rehabilitation therapy.
“This alliance between Cuts Fitness and Technogym could change the fitness franchising landscape for years to come.” -John McCarthy, President IHRSA
What response has Cuts Women generated thus far?
The feedback has been tremendous thus far. People are quickly realizing that our product is very strong compared to most others within the space. There is a definite need for this and women are providing terrific testimonials. What sort of growth do you expect to see? We feel that the growth of Cuts Women will be slightly faster than that of Cuts Fitness For Men given that it is more of an established market. We expect to sell 250 franchises by the end of 2006.
Why get into the women’s fitness space? Isn’t it already pretty crowded?
The space is extremely crowded at a certain level. There are 12,000 women’s only franchises right now-with Curves at about 9,000 as we speak followed by Lady of America, Contours, Slim and Tone etc. After much research, we determined that quality of the product package will determine who succeeds in the future and we are very confident about our direction in this regard.
Who will be your target market and how does that differ from other women’s-only facilities?
Our target market is women who are looking for a highquality, 30-minute workout in an upscale setting. It is a younger, more fit audience than the target of most existing women’s facilities. We expect to get a percentage of women who are currently members of a traditional, co-ed club who have not joined a women’s only facility due to the product offering. Of course, we expect to appeal to a percentage of the existing women-only members as well. Our research says that approximately 33% of these members feel that they need a better workout in a better setting.
What are the costs of the women’s franchise?
Our franchise fee is $69,950 and includes state of the art fi tness equipment, initial training, mentoring, initial media blitz, business ID package, ongoing support, and interior design book. The monthly royalty is a flat $400 and the monthly advertising fee is $250. Our pricing reflects a much higher quality product that sells memberships and retains customers on a long-term basis.
Will you position Cuts Fitness For Men & Cuts Fitness For Women side-by-side?
Yes, we feel that this product has great potential on a sideby- side basis. It’s a terrific opportunity that doesn’t currently exist in the marketplace. It’s an attractive package and they can feed one another from a marketing perspective as well.
What makes this club better than other women’s only facilities?
We have created a high quality environment that will motivate our members. We have partnered with interior designers to do our franchise design work. In addition to Kinesis, we feature high quality hydraulic equipment and intense cardio stations. And we are very focused on the experience factor. Sight and sound are critical elements.
“This is a significant development in the fitness and franchising industries, and we’re delighted to launch this alliance with Technogym to attract more people to lead a healthy lifestyle. ” -John Gennaro
When and where will you open the first Cuts Women’s locations?
The first locations will be opening by November 15, 2005 in Westfield, NJ (our corporate-owned franchise/showroom), Sayreville, NJ, Broadview Heights, OH (a Cleveland suburb) and Roswell, GA (an Atlanta suburb).
You seem determined to develop the domestic and international markets simultaneously?
We’re convinced that we have a chance to create a successful, high-profile, global brand. We’ve managed to acquire some real momentum, and targeting both domestic and international markets simultaneously will allow us to take advantage of it. Growth, for us, is going to be domestic and international, side-by-side.
How is Cuts Fitness For Men Progressing?
We have sold over 200 franchise locations with approximately 110 that have opened thus far in 32 states and five countries. Our members are very passionate about the product and as we move forward, I think the passion will increase as we add to the experience element.
What are the costs of the men’s franchise?
Our franchise fee is $39,950 and again, includes fitness equipment, initial training, mentoring, media blitz, business ID package, ongoing support, and interior design book. The monthly royalty is a flat $400 and the monthly advertising fee is $250.
Why do men like your product?
When I initially started Cuts Fitness For Men, I thought that the “men-only” aspect would be the driving factor for success. And although it has been one of the reasons, it’s certainly not the biggest reason. Time is what it’s all about today-or lack thereof. It’s been about the effective 30-minute workout through present. As we move forward, we’ll be incorporating other value-added components to the experience as well.
What is your franchising model?
We sell three types of franchises:
1. Individual franchises where we sell single units to franchisees.
2. Area Development agreements where franchisees own and operate multiple franchise locations and
3. Master Development agreements where our franchisee usually owns a single unit and resells/supports a minimum of 25 franchises in a given area. Master Development agreements are increasingly important to us in moving forward. We currently have these relationships in New Jersey, Virginia, Maryland, Mexico, and Ireland.
Why are you successful?
I know what I know and I know what I don’t know. We have a great team of people within our company and we also have terrific partners who have helped us as well. And at the end of the day, we are offering a product that works, a product that people are very passionate about.
What does the future hold for Cuts Fitness?
We will continue to drive much attention to our Cuts Men and Cuts Women brands and associated products. We will continue to create alliances with companies both inside and outside the fitness industry as we move toward mainstreaming what we do. The real key for us will be to continue to develop our product and make sure we focus on the customer education element.
John Gennaro is the Founder of Cuts Fitness for Men and Cuts Fitness for Women. He can be contacted at 732.381.9300, or by email at John.Gennaro@cutsfitness.com. For more information, visit www.cutsfitness.com or www.cutsfitnessforwomen.com.
