In this FDD Talk 2017 post, you’ll learn the following:
- Section I – Background information on the TITLE Boxing Club franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a TITLE Boxing Club franchise, based on Item 7 of the company’s 2017 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a TITLE Boxing Club franchise, based on Items 5 and 6 of the company’s 2017 FDD
- Section IV – Presentation and analysis of TITLE Boxing Club’s financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:
- 2016 actual and average monthly pricing (annual/monthly membership), gross revenue, and EBITDA for the 7 TITLE Boxing Club facilities that were utilizing Premium Pricing prior to December 31, 2016 and responded to the franchisor’s information request prior to the issuance of the 2017 disclosure document (as of April 28, 2017, TITLE Boxing Club has mandated minimum monthly membership pricing in the amount of $109 per month for all new Fitness Facilities (“Premium Pricing”))
- 2016 average, high, and low monthly pricing (annual/monthly membership) and gross revenue for the 132 TITLE Boxing Club facilities that were in operation for the entire calendar year ending December 31, 2016, by quartile
Section I – Background Information
11 Things You Need to Know About the TITLE Boxing Club Franchise
Partnership with Oscar De La Hoya to Produce New Boxing Gear
1. At the start of August, TITLE Boxing Club announced that it had partnered with boxing legend Oscar De La Hoya and Golden Boy Productions to produce gear designed by boxers for boxers. One of the first items that TITLE and De La Hoya will be releasing are boxing gloves commemorating the 25th anniversary of De La Hoya’s gold medal winning bout at the 1992 Olympics.
2. The rest of the Oscar De La Hoya Signature line, featuring training gloves, punch mitts, and novelty items; and the Golden Boy line, featuring professional fight gloves, protective gear, and apparel will be released throughout the fall and winter of 2017.
New Vice President of Franchise Development
3. In mid-July, TITLE Boxing Club announced that it had expanded its senior leadership team to further aid in the nationwide expansion of the brand by hiring Marty Mazer as the new Vice President of Franchise Development for TITLE Boxing Club.
4. Prior to joining TITLE, Mazer served as the President of Opportunity Tax and Service. Mazer has also been responsible for identifying and developing franchise sales and lead generation channels for multiple high-level organizations.
5. In his new role at TITLE Boxing Club, Mazer will be tasked with providing strategic leadership and direction for the franchise sales division in addition to putting systems in place that will improve the overall franchise sales process. Mazer wants to improve the prospecting process for franchisees and streamline the company’s lead generation strategy.
6. Mazer also hopes to bring in successful franchisees to the brand in an effort to expand to 500 to 700 clubs within the next three years.
Plans for Expansion Into Portland and Las Vegas
7. Following its success in 2016, TITLE Boxing Club announced that it was seeking qualified multi-unit franchisees to add five to seven new clubs in the Portland, Oregon market over the next three years. TITLE is also looking for franchisees to open five to six new locations in the Las Vegas, Nevada market.
8. TITLE has already opened 18 new boxing clubs so far in 2017, but has plans to open at least 40 to 50 locations by the end of the year. In addition to Portland and Las Vegas, TITLE Boxing Club is targeting New York City; Long Island, New York; Philadelphia, Pennsylvania; Baltimore, Maryland; Washington, D.C.; Houston and Austin, Texas; Denver, Colorado; Atlanta, Georgia; and Chicago, Illinois for development within the next three years.
9. TITLE Boxing Club was founded in 2008 by former boxer Danny Campbell, together with Tom Lyons, David Hanson, and Tony Carbajo, in Overland Park, Kansas, a suburb of Kansas City. The fitness club franchise was named after Title Boxing LLC, the boxing, kickboxing, and mixed martial arts (MMA) equipment company, which is owned by Hanson and Carbajo and which is also headquartered in the Kansas City area.
10. The group opened a second location later in 2008 and a third in 2009. After seeing the success of the first three clubs, the business partners started franchising TITLE Boxing Club. Today, there are over 150 TITLE Boxing Club locations across the U.S. and one in Canada.
Entrepreneur’s Franchise 500
11. Since it began franchising in 2008, TITLE Boxing Club has appeared just a few times on Entrepreneur’s annual Franchise 500 list. The company’s highest rank was No. 230 in 2015, while its lowest rank was No. 363 in 2017.
Section II – Estimated Costs
- Please click here for detailed estimates of TITLE Boxing Club franchise costs, based on Item 7 of the company’s 2017 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on TITLE Boxing Club’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.
Section IV – Financial Performance Representations (Item 19, 2017 FDD) and Analysis
- The tables below provide historical information about pricing, Gross Revenue, and EBITDA for Fitness Facilities operated by TITLE Boxing Club’s franchisees and affiliates as explained in greater detail below.
- As of April 28, 2017, TITLE Boxing Club has mandated minimum monthly membership pricing in the amount of $109 per month for all new Fitness Facilities (“Premium Pricing”). Premium Pricing will apply to all Franchisees entering into a franchise agreement pursuant to the 2017 disclosure document.
- As of December 31, 2016, there were 149 franchised locations and 3 affiliate-owned locations. Of these, 18 franchised locations were utilizing Premium Pricing prior to December 31, 2016. TITLE Boxing Club surveyed these 18 franchisees and seven locations responded to its information request prior to the issuance of the 2017 disclosure document.
Part 1 – 2016 Pricing, Revenue, and EBITDA for Locations with Premium Pricing
- The first table includes information that TITLE Boxing Club received from those seven franchised locations and displays the current annual and monthly membership prices (shown in monthly amounts) as well as Gross Revenue and earnings before interest, taxes, depreciation, and amortization (“EBITDA”), as reported by each of those seven franchised locations for the calendar year ending December 31, 2016 (the “Measurement Period”).
Franchised Location #1