Earnings Claims of Top Franchises Revealed

Earnings Claims of Top Franchises Revealed

  • Anytime Fitness
  • CruiseOne
  • Firehouse Subs
  • Jimmy John's
  • Massage Envy
  • Menchie's
  • Orange Leaf Frozen Yogurt
  • Planet Fitness
  • The UPS Store
  • Yogurt Land
  • And Hundreds More...

No, thanks. I'm not interested in uncovering the actual earnings of hundreds of franchises at this time.

FDD Talk 2013: Average Gross Sales, Payroll, Rent, and Operating Profit Information for RetroFitness Franchised Outlets (2013 FDD)

by Franchise Chatter on May 30, 2013

in Fitness Franchises, Franchise Earnings



Franchise Chatter Membership Information

Highlights of RetroFitness’ Item 19 Financial Performance Representations (2013 FDD)

Preliminary Notes

  • This is a historic financial performance representation relating to the performance of the Franchised Outlets in the RetroFitness system. The three corporate RetroFitness outlets operated by RetroFitness, LLC were not considered in this Item 19. All information in this Item reflects the membership, sales numbers, rent expenses, payroll expenses, and EBITDA reported by franchisees.
  • RetroFitness franchisees are required to provide the franchisor with a copy of their federal tax returns, which contains their payroll expenses, rent expenses, and EBITDA.
  • As such, the figures below are derived from reports generated from computer data reported to ABC Financial by all RetroFitness franchisees, maintained by ABC Financial, and reported to RetroFitness, and data as reported by franchisees to RetroFitness in the franchisees’ federal tax returns. RetroFitness has not undertaken any independent investigation to verify the amounts reported.

Average Gross Sales Information for RetroFitness Franchised Outlets

  • Retro Fitness Interior PhotoAs of December 31, 2012, 79 franchised RetroFitness Outlets were open and reporting to ABC Financial (each, a “Franchised Outlet”).
  • Of those 79 Franchised Outlets, 75 were open to the public and reporting to ABC Financial for at least 9 months as of February 28, 2013. All 75 of these Franchised Outlets were included in the results displayed in Tables A, B, and C of Item 19.
  • Table A provides information on the average gross sales RetroFitness franchisees reported to ABC Financial from March 1, 2012 to February 28, 2013.
  • Table B provides information on the average gross revenue per square foot RetroFitness franchisees reported to ABC Financial from March 1, 2012 to February 28, 2013.
  • Table C provides information on the average membership of RetroFitness franchises as of February 28, 2013.

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), Payroll, and Rent Information for RetroFitness Franchised Outlets

  • Of the 75 outlets included in Tables A, B, and C, only 48 outlets (a) were open for the thirteen-month period preceding December 31, 2011; and (b) provided RetroFitness with complete tax returns for their full 2011 fiscal year.
  • Of those 48 outlets, the following six outlets were excluded from the EBITDA results displayed in Tables D, E, F, and G: (a) five Franchised Outlets owned and operated by the same franchisee group were omitted due to ownership restructuring and implementation of atypical management and other internal fees; and (b) one outlet was omitted due to an extraordinary, atypical expense item for legal fees.
  • Information from the tax returns provided for the remaining 42 Franchised Outlets was used to determine the results presented in Tables D, E, F, and G, which reflect EBITDA, rent as a percentage of gross sales, and payroll as a percentage of gross sales.
  • Table D provides information on the average earnings before interest, taxes, depreciation, and amortization (EBITDA) of RetroFitness franchisees from 2011 Federal Tax Returns.
  • Table E provides information on the average earnings before interest, taxes, depreciation, and amortization (EBITDA) percentage for RetroFitness franchisees from 2011 Federal Tax Returns.
  • Table F provides information on average payroll expenses of RetroFitness franchisees from 2011 Federal Tax Returns.
  • Table G provides information on average rent expenses of RetroFitness franchisees from 2011 Federal Tax Returns.

Other Explanatory Notes

  • This study measured RetroFitness franchisees’ performance primarily in the State of New Jersey. Over 60% of the Franchised Outlets included in the results displayed in Tables A, B, and C, and over 70% of the Franchised Outlets included in the results displayed in Tables D, E, F, and G are located in the State of New Jersey.
  • Retro Fitness Franchise Photo by Big Ass FansThe market where your RetroFitness Outlet is located, however, may differ significantly from New Jersey. Accordingly, the results achieved by these franchisees may not be typical for those in your area.
  • Each of the franchisees studied has been in business for at least 13 months. Additionally, several of the franchisees studied have a 5 mile approved territory.
  • The sales volume attainable by each franchisee depends on many factors, including geographic differences, competition within the immediate market area, the quality and service provided to customers by the franchisee, and the size of the franchised location, as well as its own marketing and sales efforts.
  • There is no assurance that future sales and/or expenses will correspond to historical sales and expenses.

Table A – Average Gross Sales RetroFitness Franchisees Reported to ABC Financial from March 1, 2012 to February 28, 2013



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