In this FDD Talk 2016 post, you’ll learn the following:
- Section I – Background information on the 9Round franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a 9Round franchise, based on Item 7 of the company’s 2016 FDD
- Section III – Presentation and analysis of 9Round’s financial performance representations, based on Item 19 of the company’s 2016 FDD, including information on the:
- number of 9Round Centers with over 300 members, 200 to 300 members, and less than 200 members, respectively, as of December 31, 2015
- average number of members for 9Round Centers with over 300 members, 200 to 300 members, and less than 200 members, respectively, as of December 31, 2015
Section I – Background Information
Heather met Shannon at the karate studio he owned when she landed a job there. In what she describes as a “whirlwind,” they fell in love, got married, and started a kickboxing franchise together, making Shannon and Heather Hudson co-founders of 9Round 30 Min Kickbox Fitness. He serves as CEO and she serves as COO.
Heather was already a black belt in Shotokan Karate, but after having two children she was looking for something more to get back in shape and stay that way. When she discovered kickboxing for fitness, the wheels started turning.
Shannon, for his part, has held the IKF Light Middleweight Kickboxing Champion of the World title since his 6th round TKO victory on October 1, 2011. He’s been training in martial arts since he was seven years old, holding a 5th degree Black Belt in Japanese Shotokan Karate and a 4th Degree Black Belt in the Joe Lewis’s Fighting System (JLFS).
Founded in 2008, 9Round started franchising in 2009. The number of locations has grown rapidly during the past five years and currently stands at 380, four of which are company-owned and 41 of which are located outside the U.S. Shannon has written a book about making it all happen called Zero to 100.
Here’s how 9Round 30 Min Kickbox Fitness keeps customers kicking their way towards their fitness and health goals:
A Unique Approach
Shannon had enjoyed some of the best training possible and wondered why it wasn’t made more widely available to the public for fitness purposes. Seeing an opportunity, he and his wife Heather took his in-ring workouts and modified them into a 30-minute, 9-station circuit workout supervised by personal trainers.
The idea is to allow anyone to get the health benefits of boxing and kickboxing without getting beat up in the process.
Nine Value Propositions
9Round takes pride in its unique approach, highlighting nine different key sources of value that distinguish the chain from the rest of the fitness gym industry as highlighted on the company’s website: “1.) A fast, effective full-body workout in 30 minutes; 2.) Works every muscle, every time; 3.) A new station every 3 minutes to Get In Get Fit; 4.) No class times, equals no waiting; 5.) High-energy, motivating trainers included; 6.) Measurable results with heart rate technology; 7.) Workout changes every day, never boring; 8.) Burn up to 500 calories in 30 minutes; 9.) Virtual nutrition coach included.
Nine Workout Stations
Customers begin with stations 1-2 for strength building with dumbbells, kettle bells, medicine balls, jump ropes, and other equipment. Stations 3-8 is where you strike 100-pound bags to build power, double-end bags for timing and hand-eye coordination, and speed bags for conditioning shoulders and developing speed. The last part of the 30-minute workout focuses on building core strength.
9Round wants to have 1,000 locations open by 2018. Given that all the stories out there in the news are about new locations popping up everywhere, there’s every reason to think the chain will achieve that goal. Some of this expansion is happening internationally, with one recently inked deal for 100 clubs in Japan.
Section II – Estimated Costs
- Please click here for detailed estimates of 9Round franchise costs, based on Item 7 of the company’s 2016 FDD.
Section III – Financial Performance Representations (Item 19, 2016 FDD) and Analysis
- As of December 31, 2015, there were 296 9Round Centers operating in 38 states and 7 countries. Of these 296 Centers, 274 were in the United States. In the United States, 4 Centers are operated by the franchisor’s affiliates and 270 are franchised locations.
- Of these 274 U.S. Centers, 174 (170 franchised and 4 affiliate-owned) were in operation for the full 12-month period ending December 31, 2015.
- The chart below reflects historical membership information concerning these 174 Centers that were open and operating for at least the full 12-month period ending December 31, 2015.
Historic Membership Numbers as of December 31, 2015 for the 174 9Round Centers in Operation for the Full 12 Months of 2015
Centers with Over 300 Members (29 Centers)
- Average Number of Members as of December 31, 2015: 383
- Percentage of Total Centers That Attained or Surpassed the Average Member Amount: 31%
Centers with 200-300 Members (71 Centers)
- Average Number of Members as of December 31, 2015: 240
- Percentage of Total Centers That Attained or Surpassed the Average Member Amount: 48%
Centers with Less Than 200 Members (74 Centers)
- Average Number of Members as of December 31, 2015: 150
- Percentage of Total Centers That Attained or Surpassed the Average Member Amount: 50%
- As of December 31, 2015, the 9Round Center in Dilworth, North Carolina has 645 members, which is currently the highest in the System. The Center is 1,000 square feet in size and is located in a strip mall of a suburban area that contains numerous competitive businesses including fitness centers and other kickboxing and boxing clubs.
- The 9Round Centers reflected in the above chart are located in Arkansas, California, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Kansas, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Virginia, Washington, and Wisconsin.
- The figures reflected in the chart were compiled from unaudited information reported to the franchisor by its franchisees and, with respect to locations operated or managed by its affiliates, from unaudited information provided to it by its affiliates.
- The franchisor has not independently verified any of the sales information upon which this financial performance representation is based.
- The figures reflect the average number of members as of December 31, 2015.