In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the GymGuyz franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a GymGuyz franchise, based on Item 7 of the company’s 2020 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a GymGuyz franchise, based on Items 5 and 6 of the company’s 2020 FDD
- Section IV – Number of franchised and company-owned GymGuyz outlets at the start of the year and the end of the year for 2017, 2018, and 2019, based on Item 20 of the company’s 2020 FDD
- Section V – Presentation and analysis of GymGuyz’ financial performance representations, based on Item 19 of the company’s 2020 FDD, including information on the:
- 2019 gross sales, operating expenses (advertising, auto truck, insurance, merchant processing, payroll wages, payroll taxes, payroll processing, repairs and maintenance, technology and POS, all other expenses), affiliate EBITDA, franchise costs (royalty, brand fund), and net operating income for the 1 affiliate-owned GymGuz location in Nassau County, NY
- 2019 average, median, high, and low gross sales for the 26 GymGuyz franchisees that operated units that were open 12 months or longer as of December 31, 2019, grouped according to population size (300,000 and above, 150,000 to 299,999, and 149,999 and below)
- 2019 average, median, high, and low gross sales for the 15 GymGuyz franchisees that operated units that were open 24 months or longer as of December 31, 2019, grouped according to population size (300,000 and above, 150,000 to 299,999, and 149,999 and below)
Section I – Background Information
29 Things You Need to Know About the GymGuyz Franchise
Hires New Vice President of Franchise Operations
1. In early August 2020, GymGuyz announced that it had hired Stacey Cooper as its new vice president of franchise operations. With over a decade of experience in the fitness industry, and significant experience in other industries, Cooper is poised to make an immediate impact on the fast-growing brand. She brings a history of exceptional leadership, vision, and strategic planning skills to the areas of sales, operations, and franchise compliance.
2. Cooper will lead the franchise operations team that is responsible for driving franchise unit revenue growth through best-in-class support systems and processes. She will also be instrumental in the brand’s expansion into new lines of business designed to increase overall market share.
3. Copper said, “GymGuyz offers a unique business model that is thriving in the post-COVID fitness industry. The brand’s upside potential is tremendous with the right operational systems in place. I am looking forward to contributing to the success and rapid ascent of GymGuyz, and helping to transform the lives of our current and future clients.”
4. Cooper comes to GymGuyz from Retro Fitness LLC, where she led business coaching activities for franchise owners located in the Long Island and Staten Island regions. Prior to Retro Fitness, Cooper served as a longtime general manager for New York Sports Clubs, learning the intricacies of operating a fitness business in a competitive market and industry.
5. Before entering the fitness industry, Cooper was in the music industry serving as a product manager at RCA Records. She was also a professor of music business at Nassau Community College.
6. According to Josh York, founder and CEO of GymGuyz, “We are incredibly excited to add Stacey to our senior leadership team. Her track record and past accomplishments speak for themselves. As a new and talented leader on the team, Stacey will help us provide more comprehensive support to our existing franchisees, while enabling our new franchisees to launch with more speed and success. Stacey’s addition gets us one step closer to preparing for our next growth spurt, which is well under way.”
7. With Cooper in place, York is nearing completion of his objective to bring additional, experienced leadership into the company as it enters its next phase of growth. GymGuyz hired a new chief marketing officer less than a year ago. This expanded leadership team is tasked with significantly strengthening GymGuyz’ franchise system, while also bringing new marketing plans, sales and operational processes, proprietary technologies, and business management tools to the table for new and existing franchisees.
8. York also sees this as an opportunity to not only increase overall franchise unit revenue, but to also implement new standards of operation for its locations worldwide. Aside from its growth in the UK, the fitness franchise also has its eye on opening locations in other European countries as well as in the Middle East. The company has already opened several locations in Canada.
Signed 17 New Deals and Opened 5 New Locations in First Half of 2020
9. Near the end of July 2020, GymGuyz said that it was keeping up its growth momentum amid the ongoing COVID-19 pandemic. “GymGuyz was founded at the height of the 2008 economic crisis with a goal to create the fitness industry’s solution for an ‘Amazon-style’ concept centered around convenience by bringing the gym to the consumer,” said Josh York, founder and CEO of GymGuyz. “Now, amid this pandemic, the brand has once again seen amazing growth despite facing the challenges of an unstable economy.”
10. In the first half of 2020, GymGuyz signed a total of 17 new franchise deals, five of which are already open even with COVID-19 restrictions. The mobile fitness franchise entered six new markets, including Greensboro, North Carolina; Charlotte, North Carolina; San Antonio, Texas; Chicago, Illinois; Dallas, Texas; and Naples, Florida.
11. In addition to expanding its international footprint, GymGuyz has confronted the consequences presented to the fitness industry by COVID-19 with a creative and strategic approach focused on supporting its franchise owners with what they need to remain successful. As the country grappled with the coronavirus outbreak and businesses across industries slowed and even halted operations, GymGuyz offered enhanced services to help new and existing customers cope with the crisis in a productive and healthy way.
12. GymGuyz is accommodating by offering services such as remote personal training, virtual fitness classes, loaner equipment options, and more. GymGuyz is also offering a workout migration program for new clients who are unable to go to their former gyms due to COVID-related closures and want to switch over to the in-home personal training brand.
13. York said, “No one is unaffected by the coronavirus, which is why GymGuyz is eager to continue giving back to the communities we serve and help current and new clients stay fit during this difficult time. GymGuyz remains committed to our mission of helping clients meet their fitness goals in a time when health and well-being are more important than ever.”
14. “Now, we expect to see growth continue post COVID-19 with the virtual strategies we’ve implemented to keep the business thriving. We’ve been able to go back to our roots and be the scrappy, proactive company that does what it takes to get through hard times. We quickly shifted our core business model to provide support to our franchise owners, and we feel confident that we’ll be stronger as a brand and as a franchise system on the other side of this,” added York.
15. This year also saw the brand receiving major industry recognition with its recent ranking in Entrepreneur magazine’s Fastest-Growing Franchises list for 2020. This highly competitive list recognizes the 150 companies with the greatest franchise unit growth in North America, based on data submitted for Entrepreneur’s Franchise 500 ranking.
16. In addition, thanks to its exceptional growth, GymGuyz ranked No. 2 in Franchise Gator’s annual list of the Top 100 Fastest-Growing Franchises and No. 83 on the Top 100 Franchises list.
17. On a final note, York said, “We are proud of our continued growth and success so far in 2020 and owe it to our owners, personal trainers and everyone involved for getting us to where we are today. If you surround yourself with the right people and create a culture that people are energized to be a part of, success and growth will follow. Moving forward, exercise is one of the best ways to boost your immune system and cope with stress, which means we’re not going anywhere.”
Continues to Support Communities During Coronavirus Outbreak
18. In late March 2020, as the country grappled with the early days of the coronavirus outbreak and businesses across industries slowed and even halted operations, GymGuyz announced that it was offering enhanced services to help new and existing customers cope with the crisis in a productive and healthy way. GymGuyz is offering services such as remote personal training, virtual fitness classes, loaner equipment options, and more.
19. The exercise franchise, founded in 2008, helps customers meet their fitness goals in the comfort and convenience of their own homes, providing state-of-the-art equipment and expert coaches right at the doors of their clients.
20. GymGuyz has a long history of giving back to local communities. The company has been deeply involved in many charitable causes from Hurricane Sandy initiatives to donating free training sessions to cancer survivors.
21. In reaction to the current concerns and restrictions related to coronavirus, GymGuyz is offering a variety of services across its entire network to support the well-being of local communities. For one, GymGuyz is offering a live, remote workout that is streamed on its Facebook page on a weekly basis. The free workout event is open to all, but meant to engage healthcare workers, those working or attending school from home, self-quarantined individuals, and others severely impacted by the coronavirus, in beneficial exercise. They are led by GymGuyz trainers from various markets across the nation.
22. The brand is also offering a Workout Migration Program to consumers who have gym and fitness program memberships they are temporarily unable to use due to business closures and other COVID-19 related restrictions. Participating GymGuyz locations are providing incentives to be used for in-home and remote personal training services while closures and restrictions are in place. Consumers can contact their local GymGuyz location for details and other incentives that may be available on a local basis.
23. Existing GymGuyz customers can also convert their in-person training sessions to remote sessions delivered through platforms such as FaceTime, WhatsApp, Zoom, and Skype. Remote sessions are designed to recreate the in-home personal training experience, with dedicated one-on-one instruction for a full hour. The sessions have been convenient and timely for clients.
24. Customers also have the added option of keeping loaner fitness equipment at their home, provided at no charge by GymGuyz for at least the next 30 days following the announcement. GymGuyz always disinfects equipment according to CDC standards prior to an in-person training session, or loaning equipment to a client.
25. Josh York, founder and CEO of GymGuyz, said, “No one is unaffected by the coronavirus, which is why GymGuyz is eager to continue giving back to the communities we serve and help current and new clients stay fit during this difficult time. Exercise is one of the best ways to boost your immune system and cope with stress. GymGuyz remains committed to our mission of helping clients meet their fitness goals at a time when health and well-being are more important than ever.”
26. GymGuyz was founded in 2008 by Josh York in Long Island, New York. York had worked briefly at a marketing firm after graduating from college, but felt that the environment was negative and he was not passionate about his job. Using his savings, York set out to establish a fitness business as he had always enjoyed fitness activities.
27. York bought a van and filled it with gym equipment and went directly to clients to train them. To drum up business, York drove the van up and down the Long Island Expressway and hung up GymGuyz fliers wherever he could. All of York’s legwork paid off and he quickly amassed numerous clients.
28. As demand for GymGuyz’ services grew, York hired certified personal trainers, support staff, and purchased additional vans. In 2014, York start franchising the GymGuyz concept. A few years later, GymGuyz opened its first international franchise in Canada. By 2018, the GymGuyz system had grown to over 184 locations. In addition to the U.S. and Canada, GymGuyz now has franchises in the United Kingdom.
Entrepreneur’s Franchise 500
29. GymGuyz ranked No. 274 on Entrepreneur’s 2020 Franchise 500 list.
Section II – Estimated Costs
- Please click here for detailed estimates of GymGuyz franchise costs, based on Item 7 of the company’s 2020 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on GymGuyz’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2020 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
- Outlets at the Start of the Year: 63
- Outlets at the End of the Year: 125
- Net Change: +62
- Outlets at the Start of the Year: 125
- Outlets at the End of the Year: 148
- Net Change: +21
- Outlets at the Start of the Year: 148
- Outlets at the End of the Year: 135
- Net Change: -13
- Outlets at the Start of the Year: 1
- Outlets at the End of the Year: 6
- Net Change: +5
- Outlets at the Start of the Year: 6
- Outlets at the End of the Year: 20
- Net Change: +14
- Outlets at the Start of the Year: 20
- Outlets at the End of the Year: 1
- Net Change: -19
Section V – Financial Performance Representations (Item 19, 2020 FDD) and Analysis
Part 1 – Financial Performance of Affiliate-Owned Locations
- As of December 31, 2019, GymGuyz’ Affiliate had one location in operation, servicing a core area in Nassau County, New York. This location has been in continuous operation since 2008. This territory is similar to the territory which will be granted to a Franchised Business.
- The financial results of GymGuyz’ Affiliate’s Nassau County, NY location for the year 2019 are summarized below.