Anytime Fitness Franchise Review and Cost

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. What a great business - you just invest and sit back as the money

rolls in. But is that really the case? Today, lets take a critical look at the Anytime Fitness


So let me start by saying that there are owners that have done very well with their Anytime

Fitness Franchise. When the model works, it works well and you can have a relatively passive

business that provides predictable income.

Now that's the side you will hear from the franchise, but as always we like to give you

the other side of the story so you can make an educated decision.

Taken from their brand new 2018 FDD the cost to open an Anytime Fitness center will range

between $131,002 and $722,796. Keep in mind that number includes your operating capital

for the first 3 months, and assumes you will be leasing your gym equipment. If you buy

your equipment count on about $140,000 on top of that number. There is also the option

for an Anytime Fitness Express location which we won't cover today. You will pay a $549

monthly fee to Anytime Fitness, a general advertising fee of $300 monthly and you will

be required to invest between $8,000-$18,000 on a Grand Opening and Ramp up Program when

you first open up. You will pay a fee of 50 cents for each member of your club monthly

for the Anytime Health membership, to a maximum of $225 for a single location or $675 a month

if you have multiple locations. There is a global access fee of $249 per month. Training

suite fees are $149 per center.

So those are the fees, but how much can you make with an Anytime Fitness Franchise? The

2018 Item 19 financials in Anytime Fitness FDD provide suggested earnings for 500, 865

and 1150 member scenarios. The earnings BEFORE debt expense, depreciation, interest and taxes

are $9,900 for a 500 member location, and if you read the fine print that number assumes

you are working at the center yourself. If you have installed a manager from when you

opened you will not be making that amount. Next level is $99,800 for an 865 member location,

and these following numbers do assume you now have a a manager and $192,000 for an 1150

member location. Keep in mind that representation assumes that all members stay for a full year

with zero attrition or zero new ,members, which is not realistic. These numbers were

based on an estimated value of $371.90 per year per member, and a club size and approximate

cost related to 5000 sf But how many members will an average club have? Well if we look

again at the item 19 in the FDD we see Anytime Fitness gives the average of 697 monthly paying

members, and a median of 646. Pay per visit members average count was was 168 and median

was 101. The lowest membership in their system was 177 the highest was 3316. So essentially

these numbers paint the picture in your mind that the 697 paying members plus pay per visit

of 168 gives us the average of 865 members so we can expect $99,800. Pretty good right?

And if you are emotionally driven through the FDD thats the only number you will see.

But read the fine print more closely and there are other considerations you need to understand

such as paragraph 6 in the Item 19 relating to training income. This is important as certain

clubs who did not report personal training income of at least $1500 monthly were just

not included in the numbers. So underperforming PT locations were removed from the figures,

and remember franchisors have the ability to present these numbers to you any way they

like. Also remember this number is before debt expense, depreciation, interest and taxes.

As always make sure you have read and understand all the points in the FDD and have a competent

franchise lawyer advise you.

Now the growth of Anytime Fitness has been strong with almost 400 new locations opening

in the past 3 years. Litigation is almost zero which is really amazing for a franchise

of this size. But hold on 400 locations opening that sounds

like no locations have closed doesnt it? A quick Google of the words Anytime Fitness

Closed will prove otherwise Now one of the initiatives we conduct with our clients is

to contact people who closed their locations, their names will be listed in the FDD, and

ask them what happened. You dont just want to speak to franchisees who are doing well.

This is how we make an educated and balanced franchise buying decision, not by fixating

on only the positives. All franchises have some obstacles or negatives you need to be

aware of those and be confident you can overcome them.

Now if you are seriously considering buying a gym franchise I want to bring your attention

to the operational model for a second. Now the goal if you are seeking a truly passive

franchise which most people are with Anytime Fitness, is to hire someone to run your business

while you focus on other things. Now a gym franchise, keep in mind, is completely dependent

on the person you hire, much more so than say a hair salon by virtue of the client acquisition

process. So a hair Salon manager welcomes people and runs the store, and is a relatively

easy hire and even if you have to replace this person your customers still will walk

in and have their haircut. Your store success is not tied to any one individual and people

don't need to be sold a haircut.

With fitness however that manager will need to be very adept at client acquisition, at

selling. And if you can't find someone in the fitness industry, that is also good at

selling, your club is going to suffer. So if you are running passively, and you have

ongoing problems finding the right hire your store is going to suffer, and your passive

business just became a hands on headache.

We also found some negative feedback on, and I'll post the link to that page down below

in the description box if you want to visit the page. Now keep in mind there are many

more happy franchisees than unhappy, but these comments provide us with some red flags that

can help direct our future research. Some complaints speak to the fact that actual ownership

may not be as easy as claimed, that corporate may be taking more than they should be, that

their real estate team are unqualified that Anytime Fitness did not properly disclose

earnings of other clubs and support is poor this owner suggests they are being forced

to pay $60,000 after only 5 years to remodel their club and are drowning in debt, and this

prospective franchisee suggesting Anytime Fitness did not allow them to speak to other

owners, and that the fees are ridiculous. There are over 81 comments both good and bad

and will certainly be of interest to anyone considering buying an Anytime Fitness franchise.

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