Franchising

Is the Anytime Fitness Franchise a Healthy Investment Choice?

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Anytime Fitness Franchise Propels Industry

The fitness industry was first put on the scene by the baby boomers from the late 1960s through the early 1970s.  During the ‘Golden Era of Health,’ many Americans found new ways to exercise by joining health clubs.

The fitness industry spiked in growth again beginning at the turn of the millennium. Now, 57.3 million people in the U.S. are participating in active health club membership. In the past 12 years, there has been over a 37% growth rate in U.S. gym membership.

Those looking to get a sweat going have over 36,550 different clubs to choose from. Yet the momentum has been felt the strongest in the one name that has been tattooed on over 800 gym employees and member’s biceps—Anytime Fitness Franchise.

That’s right.

Anytime Fitness franchise’s brand loyalty is so strong that employees and members alike have been known to tattoo the company logo on themselves. The company has over 3 million members. Anytime has over 2,255 U.S. owned franchises, while 1,240 locations operate internationally. 38 franchise locations are retained by corporate. The Anytime Fitness franchise, along with thousands of other thriving gym franchises have changed the landscape of the fitness industry.

  • Initial Investment: $114,950-$434,521
  • Net Worth Requirement: $300,00
  • Liquid Cash Requirement: $100,000
  • Initial Franchise Fee: $19,000-$37,500
  • Royalty Fee: $449-549/mo

What Makes Anytime Fitness so Competitive?

The fitness industry is far from monopolized. Any style of person with any varying styles of working out can find a gym franchise to their liking.

Gym franchises like Orangetheory, Snap Fitness, and Planet Fitness are all recognizable brands with cult-like followings. But the Anytime Fitness franchise dominates the market surpassing all other franchises by the pervasiveness of locations alone. The company’s revenue has arrived at $1 billion in sales revenue and claims to open a location every day with a member joining every 3 minutes. Hard to argue with figures like this when you can’t  drive through a Midwest strip mall without seeing Anytime’s  running-man purple logo.

Anytime Fitness is a 24 hour, seven days a week. 365-days-a-year exercise facility. All locations come equipped with aerobic and weight training equipment, changing areas, and showers. Members receive key-card access with a panic button. Advanced surveillance and security systems allow for members to workout literally whenever they want.

This was integral to the founder’s philosophy. Chuck Runyon and Dave Mortensen—the men who founded Anytime—both believe that membership retention stems from convenience. On Average, most members exercise between 6 a.m. and 9 p.m., with 11 members working out between 9pm and midnight, and five members that prefer the early morning between 1 a.m. and 5 a.m.

With every location equipped with security systems, there is no need for the gym to be staffed as constantly as competitors. Combined with massive support from regional offices, this is how the Anytime Fitness franchises have been able to reduce overhead.

Anytime has also been one of the leaders in engaging with customers outside of the gym. The launch of the Anytime Fitness App shifted the franchise from a ‘workout space’ to a dynamic brand. The app offers fitness guidance and tools. Goal setting, customized workouts, and a health feed are all available through the app. This digital platform maintains steady engagement with the Anytime Fitness franchise’s brand and helps customers achieve healthy results.

How Did it All Happen?

Anytime’s founders hail from the ‘Land of 10,000 Lakes.’ Chuck Runyon and Dave Mortensen were working for a fitness club in St. Paul when they decided to jointly purchase Southview Athletic Club. At the time, the club only had 500 members. 7-years-later the club swelled to 4,000 members thanks to work of Mortensen and Runyon. The two also worked in a consulting firm dedicated to under-performing athletic clubs which gave them the foundational knowledge behind the industry.

After watching their athletic club grow the two drew up the first franchise agreement with another employee Eric Keller and the first Anytime Fitness franchise location opened in Cambridge, Minnesota. (Keller is now Vice President of International Franchise Support for Anytime).

Shortly after, two more employees opened locations in different cities in Minnesota. The pattern continued until forty locations later the first corporate store opened. This lateral movement is pretty atypical for franchise beginnings. Usually, a few corporate locations are open and thriving before founders decide to franchise out. After the first international location opened in 2005 the brand was an undeniable juggernaut in the gym franchising world.

Many cite the Anytime Fitness company culture as the means of success for the franchise. The founders wanted a place where people could go workout without the grunts and machismo of average health clubs. Franchise owners seem to genuinely want to help their members. Runyon who is now CEO, describes franchisees who helped a 71-year-old grandmother loose her goal of 110 pounds and a location owner who donated a kidney to a member. The intimacy and personal connection encapsulated in the Anytime brand are big pushes for their success.

The contemporary economic climate—consumers wanting more experience and connection—combined with hard work and talented marketing, drove the Anytime Fitness franchise to carve the path for the rest of the gym franchising world. What other franchises should investors consider that followed this same model?

Gym Franchises:

  • Get In Shape for Women
  • GYMGUYZ
  • Charter Fitness
  • Planet Fitness
  • Pure Barre
  • Baby Boot Camp

Top Ranking Franchises:

  • 7-Eleven INC.
  • McDonald’s
  • Dunkin’ Donuts
  • The UPS Store
  • Jimmy John’s Gourmet Sandwiches
  • Splash and Dash for Dogs

Splash and Dash Groomerie & Boutique

  • Initial Investment: $152,000-$360,300
  • Net Worth Requirement: $500,000
  • Liquid Cash Requirement: $150,000
  • Franchise Fee: $25,000
  • Royalty Fee: 6%

When one boils down Anytime’s business model, at the Axiom, a prevailing concept that has nothing to do with marketing or rapid unit growth appears. The company is a family. Franchise owners care about their employees, members, and themselves.

There is no disingenuousness when Runyon tells media outlets, “In this industry, I’ve learned there are three types of people. There are people who care about lifting weights, people who care about lifting money, and people who care about lifting people.” Anytime Fitness is undeniably about “lifting people.”

Another franchise that shares this same outlook is Splash and Dash Groomerie & Boutique—the brick and mortar franchise segment of Splash and Dash for Dogs.

The company was founded on a principle of bettering the world around us. Of course, when individuals invest in a franchise they want to profit. But half the battle of acquiring those profits maintaining the focus to ensure one doesn’t burn out.

This takes fiery passion.

This is why Splash and Dash was built on core values that give shop owners the reins to be leaders in their community. Educating on sustainable and wholesome means of pet care, providing love for animals, and lifting the people in their community are a few ways owners can do their part to better this place.

Splash and Dash Groomerie & Boutique aims to bring all the love of familial mom-and-pop stores with all the advantages of big-box shops.

 

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How Much Can you Make Owning a Panera Bread Franchise?

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The Panera Bread franchise is synonymous with healthy living. Since originally opening as Au Bon Pain Co. INC, the authentic artisan bread bakery and cafe has become a ubiquitous international presence.

Panera Bread is most known for providing customers with healthy diet options. As a leader in the bakery-cafe franchise segment, the company pledges to serve food that is, “better for you, our associates, and the world we live in,” as boasted by their website.

  • Initial Investment: $942,000 to $1.6 million
  • Net Worth Requirement: $7.5 million
  • Liquid Cash Requirement: $3 million
  • Franchise Fee:35,000
  • Royalty Fee: 5%

The History of Panera Bread

The company first began as Au Bon Pain Co. Inc, in 1981 with its first location in Kirkwood, MO. The franchise was founded by Louis Kane and Ron Shaich. Shaich has remained at the center of business operations for Panera as the company’s Founder, Chairman, and CEO.

For the next two decades the company operating as Au Bon Pain opened sites along the east coast becoming the dominant operator of fast-casual restaurant segment serving fresh-baked artisan bread.

In 1993, Au Bon Pain Co purchased Saint Louis Bread Company–a chain of 20 bakery-cafes located out of the St. Louis area. At this point, the company began re-staging and managed an extensive overhaul. The average unit volumes increased by 75% during the years 1993 to 1997.

The founders’ vision was clear. What was soon-to-be-called Panera bread was rising to the ambition of becoming one of the leading brands in America.

Two years later, the company sold all AU Bon Pain., INC’s business units while retaining the Panera Bread franchise in 1999. The company officially renamed to Panera Bread and the transition was complete. Since the name change, the company’s stock has soared to a market capitalization of $4.5 billion, according to the company website.

The franchise made another huge business move in 2007 when Panera Bread purchased a majority stake in Paradise Bakery & Cafe assuming over 70 locations in 10 states centered in the west and southwest around the Phoenix-based concept.

Currently, there are 2,024 bakery-cafes operating within the Panera Bread franchise brand, Saint Louis Bread Co, and Paradise Bakery & Cafe names.

So, Why do People Love Eating Panera?

Panera Bread had the vantage point of being able to identify a market trend years before other quick-service restaurants. The idea that consumers wanted healthier food choices was just peaking on the horizon–when in 2004–Panera introduced chicken raised without antibiotics to their menus. This was unheard of at the time—before many restaurants jumped on the nutritional bandwagon.

The Panera Bread franchise was also the first restaurant to post calorie information on their menu boards exercising company values of transparency. They have also stayed ahead of the digital curve by including mobile ordering and kiosks within their business concepts.

In June 2014, Panera announced a plan-of-action to remove all ‘unclean’ ingredients from their menu.  The next year, in May, the company unveiled a ‘No No’ list that included every ingredient the franchise deemed unfit for their food. Chemical ingredients like Monosodium Glutamate (MSG) and  Potassium Bisulfate and any other ingredient that you ‘can’t pronounce’ made the list of chemicals that will never be in a Panera pantry. The company worked with distributors to find more holistic means of providing clean food.  

This was one of the first steps in Panera’s socio-political promise to serve food raised without artificial preservatives, sweeteners, flavors, trans fat, or colors. In January of 2017, the company made good on their promise. The entire menu of every Panera Bread franchise is 100% clean. The restaurants also value using animals raised in a humane environment—vegetarian fed and free of antibiotics. The company releases yearly progress reports so customers can track their initiatives.

A combination of healthy chemical-free food with protein sources that are raised ethically and a nutrient rich menu is why so many people crave Panera.

How much Do Panera Bread Franchise Owners Make?

With over 2,000 locations open, becoming part of the Panera Bread franchise team is not as simple as opening a single-unit bakery. The company has a development plan that sells market areas. This requires prospect franchisees to become a franchise developer.  All Panera Bread franchise developers open multiple units. On average, a Panera franchise owner opens 15 bakery-cafes within six years.

Franchisee applicants must meet the following criteria qualifications from the company’s website to be considered:

  • Experience as a multi-unit restaurant operator
  • Recognition as a top restaurant operator
  • Net worth of $7.5 million
  • Liquid assets of $3 million
  • Infrastructure and resources to meet our development schedule
  • Real estate experience in the market to be developed
  • Total commitment to the development of the Panera Bread brand
  • Cultural fit and a passion for fresh bread

Panera’s aggressive development plans calls for seasoned franchise owners with a hefty price tag. But the payout could make it all worth it. Forbes Business Magazine published an article stating that the average Panera bread makes $2.47 million annually. For a more accurate look at what a franchise owner takes home, you would have to obtain a franchise disclosure document (FDD) from Panera Bread. The details of the financial performance are documented under Item 19 of the FDD.

What are Other Franchises are following a Similar Path as Panera Bread?

Splash and Dash Groomerie & Boutique

  • Initial Investment: $110,750-$177,600
  • Net Worth Requirement: $350,000
  • Liquid Cash Requirement: $125,000
  • Franchise Fee: $48,500
  • Royalty Fee: 6.5%

A strong franchise brand begins with passion. Just like Panera Bread, passion is at the cultural roots of Splash and Dash Groomerie & Boutique—a pet salon and retail store. Instead of a passion for healthy fresh bread, Splash and Dash shop owners are passionate about pets. The company believes in a synergy between providing for animals and savvy business practices.

Around the time Panera Bread’s franchise starting taking off was when many Americans realized that the country’s food system needed to be fixed. The foods Americans were consuming were packed full of chemicals, animals being eaten were inhumanely slaughtered, and people were growing sick of it. An unhealthy food system also means more emissions and a heavier carbon footprint.

Companies like Panera and Splash and Dash wanted to be a step in the right direction; Providing consumers with healthier options both for themselves, and in the case of Splash and Dash, for their pets.

At the center of the company’s core values are healthy dietary options for pets, sustainability for the planet, and a culture that promotes contentiousness.

 

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