Planet Fitness Franchise Review (How Much Do Owners Make?)
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- Опубликовано: 4 окт 2024
- Is owning a planet fitness franchise a good investment? How much can I make and where is the fitness industry going in general - today on Franchise City.
Opening a planet fitness will set you back between $969,600 and $3,181,500 keep in mind the low number is not realistic and was likely a location that needed minimal work to transform to a Planet Fitness likely an existing gym conversion. If you need financing be aware that in the agreement Planet Fitness does not allow franchisees to borrow more than 80% of the total investment without prior consent.
Those numbers assume you will be leasing your gym equipment, if you choose to purchase the equipment the investment range increases to between $1,616,600 to $4,242,500. Now Planet Fitness also offers an area developer opportunity - which is essentially purchasing multiple licenses which you can either award to other operators, or open yourself. Certain area developer licenses do not require you to open a store while others, such as planet fitness, do require at least one store to be operated by the franchisee. But area development or master franchising can be very lucrative in that you are sharing in the franchise fees and ongoing royalties and building an empire in your territory.
Your royalty fees will be 7% of the gross monthly and annual membership fees, your National ad fee is 2% of gross monthly dues, and you local ad fee is the Greater of $15,000 or 7% of the total gross quarterly dues. So you are already at 16 points. In addition their FDD includes a "special marketing program" which is a maximum of 9% total gross. So technically we could be as high as 25 cents on every dollar for royalties and marketing. There are a few minor additional fees we wont mention here, but there are some other substantial costs including your re-equip costs if your old equipment gets ratty which will range between $314,000- $922,000. Now right in the contract you are required to replace cardio equipment every 5 years, and non cardio equipment every 7 years. So don't forget that number when you are forecasting. If you are wondering what happens if you don't comply - right in the contract you give Planet Fitness the right to come in and change the equipment and send you the bill. Wonder if that has ever happened. Also - remodeling costs will range between $70,000 to $600,000 as required by Planet Fitness and in the contract it states that remodeling could be as frequently as every 5 years. Same thing if you don't remodel they'll come in and do it for you and send you the bill. And this is a reasonable thing you do get bad franchisees who nickel and dime in any sector, like the dirty fast food restaurant bathrooms with leaky taps, or broken toilets. It's bad for business overall so I don't blame them. Estimated insurance costs will set you back $10,000 to $20,000 per year.
Average annual gross EFT Revenue represented by median high and low. So the average gross EFT revenue - including both corporate and franchised stores - for bottom 1/3rd was about 1.1 million, middle third about 1.6 million and upper third about 2.3 million. Sounds like a lot but this is gross before your expenses. Some stores were also excluded and please see the actual FDD for details as there are a lot of footnotes and differences in corporate vs franchisee locations.
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25% in fees? Who runs this? That is mafia level.
3.1 million for a planet fitness??? Might as well go buy a apartment building to rent and hold for eventually appreciation
Frfr
Way less pay out tho
that's much smarter than all the headec
Kinda agree, but apartment cap rates don’t appreciate as quickly as you could theoretically sign up new members. I feel like franchising/business in general is better for someone who wants to be more hands on, and real property investments make sense for completely passive investments. Plus commercial RE loans you’re generally looking at 25-30% down compared to only 20%. Still agree it sounds high as hell. I want to see a couple dozen P&L’s.
If your earnings dip below 8% of those figures, the lunk alarm goes off every time you walk in the door.
lmao
LOL RIGHT!!!! I hate that place. Did a tour and was horrified.
@@aurorajones8481
Looks like Barney & Tele Tubbies inspired the design. Blah
😭😭
😎
I f'ing love these franchise reviews
My new favorite, up and coming channel! Good on you!
I have been a member of planet fitness for two years know,no regrets.Its great for beginners and folks that want to be active in a gym without paying high membership fees.Thanks for the review franchise city,valuable information as always.
Thanks for the comment! Good you are making use of it where most are not :-)
what the average number of subscription per gym? just curious
wow fav channel now
I love the amount of content y’all putting out keep posting this much i love looking at this channel
YIKES. Planet fitness doesn't sound like a good investment
dude is probably the best investment in the fitness industry, dont let this guy decieve you, he just has a bias opinion
@@KIKEROMA1997 a hated company just growing because internet stuff stays forever also the 40 dollar hidden fee the grunting to loud all of this is facts in the video the money can be invested safer and better else were and also did you know that franchises can technically cancel when your franchising contract is up so millions gone so super risky and also how is he bias he has this whole team and at the filming did and with total of all them had according to what he says in other videos probably at least 10 million in franchises invested together so he is not bias unless you are saying a group of people with millions in franchises all hate this one company.
Thank you for doing such a great job. Your shows are incredible
we need a tech franchise review like hosting companies etc ,. would make this amazing channel complete
I may have just the thing........ :-)
With Summer coming up, how about a KOA (kamp ground of America) campground franchise?
Planet Fitness really is not at risk from the boutique fitness industry seeing as its monthly premium membership cost (black card membership) is about equal to the price of one workout at these studios. I wouldn't be surprised if some boutique fitness users had a secondary membership to a gym like PF for when their normal studio is closed, fully booked, etc. What really threatens them are the number of other low cost fitness franchises popping up such as Blink, Vasa, and Crunch which charge around the same prices and have been aggressively expanding in smaller metros where Planet Fitness hasn't yet gained a major foothold.
Good points! Thank you.
So it sounds to me, after all expenses you make about 10% return (assuming you don't get sued or mess the process up). Doesn't seem worth the hassle at all.
I would avoid a Planet Fitness. The growth is capped i.e. Once you hit capacity, that's it. How would you grow a business like this? The high fixed costs are not ideal, especially if you can't grow you way out of it.
Love to see the paperwork. @ 15 a head, that is a lot of heads to equate to 1.1 mill. let anum.
Per anum.
Gyms make more money selling Gatorade, supplements, clothing, etc.
Planet Fitness has an average of 7,300 members per location while more mature locations have upwards of ~10,000. (Seeking Alpha)
how about a Franchises City franchises?
I don't know if people dug enough but Planet Fitness revenue is completely dependent on people opening more locations and buying their equipment from them instead of fees
According to who?
@@HenryPaulThe3rd According to their income statement. check their p&L and majority of their money is made in selling gym equipments to franchises. Meaning the moment they stop opening new franchises their sale plummets and the glasswall shatters
Have you ever done a review on Chimney Sweep franchise? Thanks.
Can you do for profit prisons and evangelical churches ??
These gyms thrive here, and I'm dumbfounded how they do it. The Y's and muni rec centers offer much better facilities for a fraction of the price. (And no silly contracts/fees.) Most big companies and complexes offer their own gyms too. The highest end gym here (not planet fitness) has a freaking restaurant inside and a water slide at the pool. A family membership was $400/month. They had their own currency for use inside the facility. And the equipment isn't even that good.
Do trucking lease program reviews please. So many that are screwing over the owner operator.
Interested in hearing more! If you can provide the backstory we can put something together.
I'm a truck driver too. This is such an underreported story.
Very interesting. Thank you 🙏
Wow for 3 million you can get make your own gym,
Their auto renewal is bothering me ,but only because they don’t call u and ask u if it’s ok to process the charge and then it possibly overdraw your account and accumulate 5 x 35$ fees on the top of that ,whnen ask them to remove the charges they don’t want to do that ,I hate those kind of billing practices specially when not allowed to pay other then bank account draw the lawmakers should stop these companies to be able to take out money like that pushing you to sign contracts when they telling u in person there is no contract but it’s month to month .
I have a place called nnk burger they just started franchising. Can you inquire about that.
Can you do baskin robbins canada?
Please review Christian Brothers Automotive at your earliest convenience.
What does EFT stand for?
"Electronic Funds Transfer" or revenue generated by monthly ongoing membership fees. Thx for the question.
What about Blink fitness franchise? They are popular here in the North East area. I believe they are owned by Equinox gym.
Yep, owned by Equinox so a bit of baggage there especially in neighborhoods that are anti-Trump. Seems to be mostly company owned locations opening. Only 3 franchisee owned shops in 2018. The numbers look reasonable for a million $+ investment.
Planet fitness is not unlimited. In California, I can only go to locations owned by the same franchiser.i can go to other locations, but I am limited to just a few visits.
its 5 more to use all the clubs in the city here..anchorage Alaska
Thomas Sutherland I think that’s a problem with this franchise, it’s very inconsistent. That’s not a option made here. Also at the location in Daly City, California (which is a dump), I am not only limited for visits, but only 1 token at the massage chairs and they have to verify my membership in their system each time I visit for ask for a token.
@@jakp8777 seems they need to work on that. But different areas are going to have different costs so they may have to have some flexibility in prices. You can't expect Los Angeles or NY to be the same price as Kansas.
That seems to be a violation of corporate policy if you have a black card. I've been a member for a couple of years and have been to locations across the country (everywhere from ones in Kansas to San Francisco). None have ever stated that I'm not allowed to come in.
As a truck driver, I go to planet fitness all over the country. Never had a problem.
Nice video. What do you think about Rowhouse Fitness Franchise?
Thank you. It depends on the local demand, operator skills, operational preferences and business goals. There is no universally good or bad franchise. If you would like to compare Rowhouse to other brands our service is free www.franchise.city/our-services
Dell Taco & White Castle please!
Added!
How much does the owner of the Hyatt make??Video
I appreciate info
So.... with all that, is it worth it?
Can you do a review for the cleaning service Openworks?
Please dont rely on a general video to make a investing decision! 🙂 You can get custom reports and more (free) anytime: ruclips.net/video/HDrFegUMSZI/видео.html Thank you for watching.
@@FranchiseCityOnline Thanks but I'm still 1-2 years away from being financially ready to make the commitment. I can't view these reports unless my timeframe is 6 months out, correct?
@@DA_Karas we could get you reports, however in two years they are likely to obsolete. Given the high probability of a recession, the economic landscape and performance of many franchises (and industries) are likely to change considerably. I can tell you Openworks closed 80+ locations last year, and they do not provide a financial disclosure in their FDD which is generally not a positive sign. There are also multiple lawsuits that should be considered as well as a not great BBB rating www.bbb.org/us/az/phoenix/profile/commercial-cleaning-services/openworks-1126-8426/complaints . If/when the time comes we can walk you through the entire process including speaking with owners and determine which option makes the most sense for the local market and your business goals.
@@FranchiseCityOnline Thank you, I really appreciate this thoughtful response.
@@DA_Karas Anytime!
And now we have Corona killing gyms. Id hate to own one now. I feel bad for my gym that opens, and closes and opens and closes cause of the virus. Meh.
Can you do a review of GNC or send me a link to a review you already have done?
ruclips.net/video/L5mJVuoJnlY/видео.html - That was a couple of years ago - things have not gotten better since :-)
IF i wanted in the fitness biz I wouldnt need to"franchise"...you're spending $3mil for a "boss" PLUS royalties! I'd find a real pro and start out independent....I'd be way more PROFITABLE than any franchisee...
Alright!
Do the UFC GYM!
Added - thanks! We did Tapout no too long ago.
@@FranchiseCityOnline I'll check it out. Also, there's a channel called Company Man. You should watch his video on Planet Fitness. I know you will like it a lot.
@@marcusgaro995 love Company Man!
Their franchise rules will choke you out
They come in & just change 💩 & send u the bill 😂😂😂😂 Planet 🌎 is that one ☝️. Love ❤️ it 👍🏽 like delivered
Planet fitness is an awesome deal. Just the free showers alone pay for the membership.
IF I were to base it on my belief as a fitness place, I would not invest in this at all.
Planet Fitness provides pizza for the members... lol they are a joke.
Pizza is delicious
@@jaykayjay100 I love pizza but gyms shouldn't be providing members with pizza. Search "planet fitness pizza" on RUclips.
ruclips.net/video/VrYGw-lX2R0/видео.html
Why u hate‘ non the pizza😂😂😂
You don't like free pizza ?
ummm only one night per month, drama queen
Please do BurgerIM
DYEL: ruclips.net/video/s2XMhGSXtaI/видео.html
They dont know the expenses of the private store? BULLSHIT
I've been watching this channel for a while now and I'm certain the entire franchise market is a scam...prove me wrong w anything please
30 year quite successful entrepreneur here with a great sense of smell
Thanks for the comment - but most of us are /were franchise owners :-) ruclips.net/video/1yunaxZKyFE/видео.html Franchises have no reason to track net earnings as the royalties are paid on gross. It's rare to have net earnings in an FDD. The only way we can obtain an approximation for net is to contact 10-15 store owners - and the margins vary widely depending on operator capabilities. A lot of franchises are bad choices - but there is also good.
@@FranchiseCityOnline ok thank you...like which ones are good?