Reasons for the Success of Planet Fitness Franchise

Based in New Hampshire, Planet Fitness has rapidly grown over the years from a tiny chain to a leading fitness franchise. The franchise has an amazing 4.5 million members spread across 47 states in the US with a huge popularity among people from all walks of life. This growth does not look like it will be slowing down any time in the near future so this is the best time to invest in it. In terms of health club franchises in the country, this is one of the fastest growing. It also acclaimed popularity after sponsoring a popular NBC television program known as ‘The Biggest Loser‘. They also have hundreds of locations all over the country making them diverse in terms of geographical locations. This can be considered to be a huge success for a fitness franchise that started out as an experiment.planet fitness gym

The Birth of This Franchise

So, how did Planet Fitness grow to be this big? Well, it all begins in 1992 when Marc and Michael Grondahl took possession of a struggling Gold’s gym franchise in Dover. Given the inconvenient location and limited parking space in their original location, the brothers were forced to shut it down. However, this was not a deterrent enough for them. They went back to the planning table and in the next year started all over again with a new location known as Coastal Fitness. In order to offset the huge load of managing their operations, they had to bring on board a third partner who is also the current CEO Chris Rondeau. In 1994, they bought their current name from a Florida gym.

Dealing with Competition

The gym business even at the time was extremely competitive. The partners decided to adapt their approach and target a completely new demographic. The new target was the people who wanted a location for casual exercise without all the judgmental attitudes and serious body building types which was common in most other gyms and fitness clubs at the time.

In order to capture this new audience, they had to do away with all the serious weight equipment in their gym and focus more on cardio machines such as stationary bikes and treadmills. As time went by, this new setup got to be known as the ‘Judgment Free Zone’ in order to make the people who were still new to working out totally at ease in this environment.

Experiments on Pricing

The pricing model was also determined after quite a bit of experimentation. In order to compete with bigger, well-established brands, they reduced their membership prices to $10 per month after trying $99 per year and $35 per month. It is this low membership fee and a re-imagined gym environment that made them truly stand out in the fitness world with their amazing business model.

On top of the very low membership fee, the fitness franchise also has a number of other benefits such as being open 24 hours a day, no contracts, no commitments, free training and free pizza every first Monday of the month. In 2003, the company embarked on a national franchising plan. With the fitness industry seeing tremendous growth in the past 10 years, Planet Fitness franchise is at number 25 on the list of fastest growing franchises.

Investment at a Glance

planetfitnesslogoFor those who are looking to invest in the fitness industry, this is a great opportunity to be a part of the action. With a royalty fee of 5% over a 10-year duration and a franchise fee of $10,000, this is one of the most lucrative franchise options out there. The success looks like it is only going to keep on growing going with the current trends in the fitness industry. So, what made Planet Fitness this successful as a fitness franchise? Well, read on and find out for yourself.

1. Specialized Knowledge/ Proven System

The original owners of Planet Fitness were owners themselves and has the experience of running several gyms. This way, the founders were able to start a scalable system that saw tremendous growth over the years.

2. The Right Team

Planet Fitness had an experienced and seasoned team which made the transition into franchising much smoother than others with less experience. The team members also happened to have a system that could be rolled out successfully given the fact that they had been operating several gyms for more than 10 years.

3. Smart Marketing

With a keen sense for marketing, the partners were able to uncover a completely new market of casual fitness individuals who were intimidated by the body building attitude and had therefore lost all interests in gyms. By introducing a low membership fee and a conducive environment to work out without being judged, Planet Fitness was able to tap into the vast market hence attracting interest from new atypical gym members.

The fitness franchise dedicated themselves to this new audience and launched nationwide advertising campaigns which scoffed at judgmental gym members. This was hugely successful and won the hearts of many people who were interested in just casual exercise.

4. Business Model

By placing a low price tag on the recurring monthly memberships, the franchise made their gyms easily accessible to people from all walks of life. Even though most of the members would not work out frequently, they were still willing to maintain their membership since it was so affordable. They also went against expectations and focused on the bare minimum clients needed in terms of services and equipment. This way, they were able to streamline operations and purchase of equipment.

5. National Trends

With an aging population and increased rates of obesity, people are encouraged to get fit more than before. This trend has had a role to play in the success of Planet Fitness.

6. Support for Franchisees

The fitness franchise offers a number of support options such as training, ongoing support through meetings and newsletters, marketing support such as regional advertising, ad slicks and more.

7. Commitment to Success

It took tenacity and a lot of commitment from the original partners in order to bring Planet Fitness to where it is today. They were willing to stick with a new and unproven gym business model in order to discover a brand new market that was vastly untapped.


Images courtesy of Planet Fitness

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