Highlights of Bar Method’s Item 19 Financial Performance Representations (2012 FDD) – Part 2

Preliminary Notes (for High, Medium, and Low Volume Bar Method Exercise Studios)

These sales figures represent revenue only from Bar Method classes. They assume average revenue per client visit of $20 based on a price point that varies from $16 per class (i.e. discounted cost for prepaying for 30 classes) to $35 per class for a single class.

These pricing assumptions are valid for most North American urban markets. There are some suburban markets and rural markets where prices would have to be lower and a few markets where prices could be higher.

These statements assume 15,000 client visits in the first year, rising to about 37,500 client visits in the 8th year.

A studio “matures” in about 8 to 10 years. At that time, profits tend to flatten out unless prices can be increased. However, spending on exercise tends to be discretionary so there may be resistance to price increases.

Pro Forma Operating Statement for Medium Volume Studio

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