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Log In / Register | Jan 19, 2017

A Snap Fitness Owner's Story

For potential franchisees: Consider carefully your available resources in terms of time and money.

Don't believe the sales pitch that you can run a successful snap while also working full time somewhere else. This would only work if you are able to pay a full time, sales oriented manager.
Also, you most likely will NOT breakeven within the first 6 months. It could take 12-18 months or more. Make sure you have the financial resources to subsidize your business for the long haul.
These were my two biggest mistakes. I didn't have the time, energy or finances to keep my business going.

I don't know if I failed or not because I was never able to give it my full, undivided attention. I was torn between my commitments to my family, full time employer and my snap, never fully engaged in any of the three. We took out a home equity line of credit to subsidize our business each month. After 18 months I saw the writing on the wall and decided to sell. The new owners are making a go of it as far as I can tell so I'm glad about that for our members.

I don't have a huge problem with corporate. I signed the FDD so don't really have any right to complain about any of the terms. They are in business to make money so let them to the extent that the law, the market and their conscience will allow. My biggest complaint is the way the business was pitched to me. The time and money required were vastly understated in my opinion.
Bottom line is that for some, this is a good business opportunity, for others (like me) it is not right

In my opinion:

-You cannot run a successful Snap franchise while working full time at another job
-Your breakeven will be substantially higher than 250 members
-Do not plan on turning a profit in your first 12-18 months.
-Make sure you have enough in personal savings or liquid capital to subsidize your business until you turn a profit (if you ever do)
-Franchising is extremely risky at best. You must be 100% committed in terms of all of your time, energy, and financial resources
-Take EVERYTHING the corporate sales team tells you with a grain of salt. If it sounds too good to be true IT IS!!

Here is my story
It was a couple years ago and I've tried to forget most of my experience but as best I can remember, based on an average membership of $40 (might be a little high), our break even was probably around 320 memberships (475-500 members).
We also never got personal training off the ground. #1 I couldn't find a good trainer in our area and #2 our members just weren't interested it seems. Of course if I could have found a good trainer, maybe my members WOULD have been more interested. However, it seems like the area I live in (Midwest) just doesn't see the demand for personal trainers. After all, they are joining snap for the low fees and convenience, why should they pay more and have someone hound them with training sales pitches while they are working out?
I tried the best I could to provide a clean club and friendly competent staff since I couldn't be there myself due to my regular job. When I opened I had a gung ho, energetic manager hired, who was also a personal trainer (newly certified). He was paid $10 per hour, plus incentives for signing up new members. He worked about 20-25 hours per week (all of our staffed hours except for about 5 which I covered myself, one night per week and some weekends). After a few months I bumped his pay to $11 per hour then $11.50. He was not able to get the PT going and quickly became disenchanted with the marketing, sales, and cleaning duties he was required to do. He quit after about 6 months and then it became an endless string of part time staff, usually 2 or 3 at a time who each worked 5-10 hours per week. No one stayed more than a few months so I was always recruiting, interviewing and training new staff.

I would stop in at the store in the morning on my way to work 2-3 times each week to check on the club. After a heavy thunderstorm, the satellite and TVs would go out so I was on the phone with DishNetwork. I had to meet the Pepsi guy to restock the vending machine, or the water guy for the water delivery, or the equipment repair guy. It was never ending. I could monitor the club via the cameras from my work computer (I cheated my boss out of many hours by working on Snap stuff). When my employees didn't show up I was leaving work early, using up my vacation to staff the club. I was maintaining our club website and monitoring our club email account and responding to inquiries about memberships. I was on the phone with members regarding club questions, issues, dues payments etc. On the phone with Corporate over Checkfree, door access, membership issues. all on company time. I spent my lunch hours and company time on the mostly useless to me marketing and sales webinars. All the programs sounded great, but I didn't have the time or the money to implement them.

At night I would try to keep up with the accounting, pay the bills and do the payroll. Luckily my good friend is a CPA and helped me out a lot. There were quarterly payroll taxes, quarterly income taxes etc. One of my staff had a child support order against him so that was more work for me.

Meanwhile my wife and kids suffered because I was always gone or busy.
You can either do all this yourself, or pay someone to do it for you. I couldn't afford to pay someone so I was doing it all myself.

Make sure you can afford either the time or the money necessary.
Eventually I couldn't (refused to) keep up. My wife suggested we seek a buyer and I agreed, two months later my club was sold. We lost about 65K in the deal but I was glad to only lose that much. The weight of the world was off my shoulders and I felt FANTASTIC!

I'm sure this sounds like whining and it probably is. I'm just mad at myself for falling for the sales pitch, overestimating my capabilities and putting my family finances at risk.

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