FDD Talk 2019: The Exercise Coach Franchise Review (Financial Performance Analysis, Costs, Fees, and More)

In this FDD Talk post, you’ll learn the following:

• Section I – Background information on The Exercise Coach franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for The Exercise Coach franchise, based on Item 7 of the company’s 2019 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for The Exercise Coach franchise, based on Items 5 and 6 of the company’s 2019 FDD

• Section IV – Number of franchised and company-owned The Exercise Coach outlets at the start of the year and the end of the year for 2016, 2017, and 2018, based on Item 20 of the company’s 2019 FDD

• Section V – Presentation and analysis of The Exercise Coach’s financial performance representations, based on Item 19 of the company’s 2019 FDD, including information on the:

• 2018 average, median, high, and low gross revenues, by quartile, for the 27 Exercise Coach personal training studios that were open and in operation for the entire 2018 calendar year

• 2018 average, median, high, and low gross revenues for the 2 Exercise Coach personal training suites that were open and in operation for the entire 2018 calendar year

• projected rent, marketing and promotion, required software, Exerbotics technology fee, insurance, utilities, phone, ISP, water filtration, lease, and payroll expense for Exercise Coach personal training studios and personal training suites, separately stated, based on data submitted by 21 franchised outlets that responded to a 2018 franchise-wide survey of operating expenses

Section I – Background Information

18 Things You Need to Know About The Exercise Coach Franchise

1.  The Exercise Coach opened one of its newest locations in early January 2019 in Germantown, Tennessee, a suburb of Memphis. This is the brand’s second Tennessee location. The studio includes customizable programs and bio-adaptive exercise technology to ensure better quality workouts.

2.  The Exercise Coach uses “revolutionary fitness science” and a “proprietary fitness data platform” to help users achieve results, according to the franchise’s website. At the time of the Germantown location’s opening, The Exercise Coach said that it had more than 50 computerized “smart gyms” across 14 states.

3.  Luke Eickmeier, owner of The Exercise Coach of Memphis, said, “This is something that I’m very excited about, and it definitely furthers my passion to help others achieve their fitness goals.” Eickmeier is a Navy reservist who spent the past two years at the University of Mississippi teaching Naval Reserve Officers Training Corps (NROTC) courses. He and his wife, Staci, wanted to offer more accessible fitness opportunities in their community.

4.  The Exercise Coach of Memphis charges $35 to $50 per session, and clients can enjoy personal sessions alongside certified trainers and cutting-edge technology. The 900-square-foot facility can have up to three clients at a time, and the small group work-out sessions focus on interval cardio and strength training customized for each user. The Exercise Coach also offers nutritional playbooks with select package sessions.

5.  Eickmeier added, “When I was introduced to the Exercise Coach, I’ll admit I was skeptical at first. Once I got an opportunity to learn about some of the science behind what we do and experience the workout for myself, I was thoroughly convinced at just how revolutionary it is and how much this needed to be shared with others.”

6.  Eickmeier and his wife, who are first time franchise owners, located their gym in Germantown to focus on older residents. The Eickmeiers plan to expand with additional locations in Collierville, Bartlett, and Midtown in the future.

Offers Personalized Workouts for Everyone

7.  The Exercise Coach provides optimized personal training for everyone across all fitness levels. All sessions at The Exercise Coach are about 20-minutes long and designed for a client’s specific needs. According to The Exercise Coach, personally-optimized strength training is the safest, most efficient path to realizing and retaining whatever results matter most to a client.

8.  The Exercise Coach’s unique and effective program is powered by Exerbotics, the premier strength training technology. Over the years, the brand’s coaches have cultivated deep learning and a wealth of data through the application of millions of Exerbotics-powered exercise sets for clients.

9.  Conventional fitness programs require a relatively high fitness level just to get started and may not be able to accommodate the full range of challenges that especially people over 50 can be experiencing. This is not the case with The Exercise Coach.

10.  The brand’s technology-enabled coaches use a personal training method that begins with the sensitive measurement of each client’s current fitness level. Based on this information, The Exercise Coach provides ability-based exercise guidance that is just right for the client’s fitness level. The individualized nature of The Exercise Coach’s personal training is such that more advanced trainees also enjoy the workouts.

11.  The Exercise Coach says that its Exerbotics resistance training technology is so intelligent that it accommodates everybody in just the right way. People new to exercise enjoy it and so do those who have tried everything and are looking for something new.

12.  One of the number one reasons that clients come into The Exercise Coach is for weight loss. Every Exercise Coach is specially trained to guide clients to reach their weight loss goal with just one or two 20-minute workouts per week. These sessions include innovative strength training and what the brand calls “concentrated cardio” for maximum benefits. Using Exerbotics technology, coaches customize workouts so clients can burn fat, get leaner, and feel better without beating themselves up with regular, sweaty cardio.

13.  In addition to smart exercise protocols for weight loss, coaches use The Exercise Coach nutrition playbook to empower and educate clients in whole-food nutrition. The Exercise Coach calls the combination of smart, whole-effort exercise and healthy, whole-food nutrition “The Metabolic Comeback.” In as little as 30 days of focused effort, The Metabolic Comeback can reset hormonal fitness and set the course for healthy and sustained weight loss success.

Company History

14.  The Exercise Coach was founded in 2000 by Brian Cygan and his wife Gerianne in Illinois. Cygan had studied kinesiology at Northern Illinois University and went on to become a personal trainer and strength and conditioning coach. Gerianne Cygan is a Certified Health Coach and well studied in the areas of health and nutrition. The Cygans wanted to create a more effective workout program and founded The Exercise Coach with that goal in mind.

15.  For about 10 years after founding The Exercise Coach, the Cygans personally operated only two studios before establishing an exclusive sales distribution partnership with Exerbotics. At the time, Exerbotics was a research and development company with a near-market-ready line of robotic strength training machines. Upon the successful negotiation of this arrangement, Brian Cygan began advising Exerbotics and working on the satisfaction of legal requirements for the operation and sale of The Exercise Coach as a franchised business opportunity.

16.  After launching its franchising program in 2011, The Exercise Coach was featured on CBS, NBC, FOX, HLN, and more. After a few years of growth, Cygan assembled a group of investors to acquire Exerbotics in 2015. In addition to his role leading The Exercise Coach, Cygan has since served as the CEO and chief innovator of Exerbotics.

17.  As The Exercise Coach continued to grow in the United States, the company opened its first international location in Japan in the summer of 2017. The Exercise Coach is currently seeking franchisees around the world.

Entrepreneur’s Franchise 500

18.  The Exercise Coach did not rank on Entrepreneur’s 2019 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of The Exercise Coach franchise costs, based on Item 7 of the company’s 2019 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on The Exercise Coach’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2019 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2016

• Outlets at the Start of the Year:  31
• Outlets at the End of the Year:  37
• Net Change:  +6

2017

• Outlets at the Start of the Year:  37
• Outlets at the End of the Year:  39
• Net Change:  +2

2018

• Outlets at the Start of the Year:  39
• Outlets at the End of the Year:  44
• Net Change:  +5

Company-Owned

2016

• Outlets at the Start of the Year:  2
• Outlets at the End of the Year:  2
• Net Change:  0

2017

• Outlets at the Start of the Year:  2
• Outlets at the End of the Year:  2
• Net Change:  0

2018

• Outlets at the Start of the Year:  2
• Outlets at the End of the Year:  2
• Net Change:  0

Section V – Financial Performance Representations (Item 19, 2019 FDD) and Analysis

• An Exercise Coach franchised business can either be: (1) a personal training studio, which is a retail location ranging from 1,400 to 2,000 square feet that is designed to have publicly-visible signage and fit into the retail landscape of a local market; or (2) a personal training suite, which is an office location ranging from 800 to 1,200 square feet.

• Both the studio and suite models are designed to reach into the local community and are publicly-accessible training locations. The suite model was designed to lower the franchisee’s total initial and ongoing operating expenses, although the business operated under each model is substantially similar.

• The following presents certain financial performance information for the 2018 calendar year for each franchised Exercise Coach personal training studio and personal training suite that was open and in operation for the entire 2018 calendar year (referred to as a “Qualifying Outlet”).

• The franchisor did not include data for its 2 affiliate-owned Exercise Coach outlets.

Part 1 – Historical Gross Revenues

• The table below identifies the total number of franchised Exercise Coach businesses (broken down between studios and suites) that were open as of December 31, 2018 and the total number of these outlets that were Qualifying Outlets.

Franchised Studios