Health and Fitness Clubs
Nationwide research studies of fitness industries found that in 2007, revenues totaled $18.5 billion. In 2008, studies showed that 41.5 million people, in the United States alone, belonged to a health club. Health and sports was listed as the two fastest-growing franchises.
The purpose of this report is to present an analysis of franchise opportunities that we feel should be further explored. The franchises we explored were Bally Total Fitness, Curves, LA Boxing, and My Gym.
BALLY TOTAL FITNESS
In order to start up a Bally Total Fitness franchise, there is a requirement of $200,000-$400,000 of liquid assets. Bally has over 400 clubs in 70 cities holding strong name recognition with their national advertising campaign. Franchisees benefit from the Bally Supplier Program including technical support from the Bally Total Fitness National Service Center and training in all aspects of club management. On the other hand, Bally Total Fitness has faced bankruptcy and has closed several locations.
The startup cost for Curves franchise ranges from $19,900 to $24,900. The franchise royalty is 5% of gross revenues. Some of the benefits include profit with low overhead costs and low monthly membership rates to attract potential customers. One of the disadvantages is that franchisee has to pay for travel expenses for training in Texas.
The cost to start up a LA Boxing is $25,000 plus the costs of setting up a basic gym, which totals $174,000 to $185,750. Some benefits of this franchise include a solid business model, it is one of the world’s largest boxing, kickboxing and mixed martial arts gym franchises, it expanded 80% in 2006-2007, and it is ranked among the 25 fastest growing fitness companies. Although LA Boxing has solid business model, its fee structure requires high royalty fees that are taken directly from gross revenue.
The start-up cost for My-Gym starts from $55,000. Benefits consist of...