Franchise Costs: Detailed Estimates of Anytime Fitness Franchise Costs (2020 FDD)

Updated June 29, 2020.

Detailed Estimates of Anytime Fitness Franchise Costs Based on Item 7 (Estimated Initial Investment) of Anytime Fitness’s 2020 Franchise Disclosure Document

• This table relates to the estimated initial investment for a start-up fitness center.

• None of these payments are refundable.

• These figures are estimates based on Anytime Fitness’s experience in establishing and operating Anytime Fitness centers in the last 3 years and reflect the anticipated initial costs based on a lease for a “vanilla shell” or “as is” space for the operation of a 5,289 square foot Anytime Fitness center.

• The low end of the ranges provided all assume that you are financing these costs with a loan from the Small Business Administration (“SBA loan”) which generally requires a 15% cash injection from you.

• You may not qualify for an SBA loan and even if you do, you may be required to make a cash injection that is higher than 15%.

• Except where noted, the high estimate assumes you will pay cash.

1.  Initial Franchise/Development Fee:  $6,375 to $42,500

• The Initial Franchise Fee is generally $42,500 for an Anytime Fitness center franchise. However, Anytime Fitness charges other Initial Franchise Fees in certain specific circumstances.

• The low end of the range assumes you finance the $42,500 initial franchise fee with an SBA loan. The high end of the range assumes you pay cash.

2.  Travel and Living Expenses While Training:  $413 to $2,750

• The person you designate as the “Principal Operator” of your business must attend mandatory initial training in Woodbury, Minnesota or such other place Anytime Fitness may designate. In addition, if your Principal Operator is not a Principal Owner, then a Principal Owner must also attend and complete this training to the company’s satisfaction before you open your Anytime Fitness center.

• While Anytime Fitness does not charge for this training, you do have to pay your travel and living expenses while you attend the training.

3.  Real Estate and Improvements:  $49,319 to $189,267

• This estimate assumes you will lease space for your Anytime Fitness center.

• The above estimates anticipate costs equal to $59 per square foot for the buildout, and assume that you will receive tenant improvement allowances of $26.38 per square foot from your landlord.

• Anytime Fitness’s estimate assumes you must pay only the first month’s rent and a security deposit equal to another month’s rent.

• The Anytime Fitness franchise model is based on minimizing overhead expenses, including real estate costs.

• A lower cost center is one that would require fewer leasehold improvements and fewer equipment expenditures. The lower estimate assumes the landlord will cover many of the leasehold improvement costs.

• Moderate and higher cost fitness centers may require extensive interior renovations and additional equipment. The above figures do not include extensive renovations.

• Anytime Fitness assumes the general contractor will include permitting fees in the construction costs.

• You may be required to participate in Anytime Fitness’s “Construction Management Services” program offered through its approved vendor to oversee the construction of your Anytime Fitness center. Anytime Fitness anticipates that the cost of the Construction Management Services will be $6,500 to $8,500.

• At this time, participation in the Construction Management Services program is optional, and the $8,500 cost is included in the high range estimates.

4.  Architect/Design Fees:  $1,275 to $8,500

5.  Fitness Equipment:  $21,152 to $141,012

• The total cost of equipment will vary depending on various factors, including the size of your fitness center and the type of equipment you obtain. Some costs will vary in relation to the physical size of the fitness center and whether you purchase from Anytime Fitness’s recommended sources or from others.

6.  Technology Solutions Equipment Package:  $5,034 to $34,718

• The Base Technology fee includes ProVision’s ongoing support of the technology purchased through ProVision, technology services, proprietary and club management software, any applicable development updates and release updates, networking equipment and support, door reader technology, security and surveillance system, fitness scanning and/or monitoring equipment, sound system, and email hosting.

• In addition, the Base Technology Fee includes access to Anytime Health’s suite of products.

7.  First Aid Equipment:  $150 to $1,000

• Anytime Fitness requires you to have an automated external defibrillator. This equipment will generally cost $1,000.

8.  Interior Signs:  $429 to $2,857

9.  Outside Signs:  $1,050 to $7,000

• The above amounts reflect Anytime Fitness’s recommended package.

• The total cost of the signage will vary depending on various factors, including the size of your location and local zoning requirements.

10.  Miscellaneous Opening Costs:  $939 to $6,263

• This amount includes utility set-up and first month costs, permitting, and licensing fees.

11.  Pre-Sale/Grand Opening Advertising:  $2,400 to $16,000

• If you are a new franchisee in the Anytime Fitness system and you open a new Anytime Fitness center, you will need to spend a minimum of between $11,000 and $23,000 (depending on your market Tier) for a Grand Opening and Ramp Up program.

• Some franchisees, particularly people who sign Area Development Agreements to control an entire market, may spend more than $23,000 per center for grand opening advertising because they believe they will receive a return on that investment.

12.  Insurance:  $413 to $2,750

• You will need to purchase and maintain in effect at all times during the term of the Franchise Agreement a bond for your business, which you are required to purchase from the franchisor’s designated surety bond vendor to secure your obligations to pre-paid members for membership fees and for pre-paid personal training revenue.

• The franchisor has negotiated a base rate of $250 per year for bonds through its designated vendor, however your actual cost may vary based on your individual circumstances.

• Further, you will need to purchase and maintain in effect at all times during the term of the Franchise Agreement a policy or policies of insurance, naming Anytime Fitness and its affiliates as additional insureds on the face of each policy.

• You must have and maintain general liability insurance with complete operations coverage, broad form contractual liability coverage, and property damage, all with current minimum limits of $1,000,000 per person, $1,000,000 per occurrence, and $3,000,000 in the aggregate, and other insurance in the types and amounts as Anytime Fitness may require or as required by law.

• The insurance estimate assumes that you will personally operate your Anytime Fitness center and have no employees. Therefore, the estimates do not include premiums for workers’ compensation insurance, employer’s liability insurance, or automobile liability insurance.

• Before you make a decision to purchase the franchise, you should confirm that insurance is available for a fitness center of the type you intend to operate, given that you will not staff the premises all of the time.

13.  Supplies and Furniture:  $675 to $9,000

14.  Legal and Accounting Expenses:  $450 to $4,500

15.  Additional Funds – 3 Months:  $8,356 to $55,707

• These figures estimate your initial startup expenses during the initial 3 months.

• These figures are estimates and Anytime Fitness cannot guarantee that you will not have additional expenses starting the business.

• These costs include payroll expenses for a full-time personal trainer and two full-time employees. These costs do not include any owners’ draw amounts.

16.  Total Costs:  $98,430 to $523,824

• These figures are estimates based on the experience of Anytime Fitness in establishing and operating Anytime Fitness centers last year. Your actual expenses of establishing and operating this business could vary significantly from these estimates.

• Some states have laws that require staffing or operational requirements that will significantly increase the amounts you will have to spend to open and operate your Anytime Fitness center.

• If your state requires you to have someone on the premises full-time or additional equipment on the premises, these costs may increase by $5,000 or more a month.