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

• Section I – Estimated initial investment (franchise costs) for a Play It Again Sports franchise, based on Item 7 of the company’s 2022 FDD

• Section II – Initial franchise fee, royalty fee, and marketing fee for a Play It Again Sports franchise, based on Items 5 and 6 of the company’s 2022 FDD

• Section III – Number of franchised and company-owned Play It Again Sports outlets at the start of the year and the end of the year for 2019, 2020, and 2021, based on Item 20 of the company’s 2022 FDD

• Section IV – Background information on the Play It Again Sports franchise opportunity, including relevant news updates

• Section V – Presentation and analysis of Play It Again Sports’ financial performance representations (average revenues and/or profits), based on Item 19 of the company’s 2022 FDD, including information on the:

• 2021 average, median, high, and low gross sales and average and median gross profit for the 254 franchised Play It Again Sports Stores in the United States and Canada that had been in operation by the same franchisee or owners for the 12-month period ended December 25, 2021, grouped by year opened (2020, 2019, 2018, 2017, 2016, and 2015 and prior)

• 2021 average, median, high, and low gross sales and average and median gross profit for the first, second, third, and fourth quartiles of the 254 franchised Play It Again Sports Stores in the United States and Canada that had been in operation by the same franchisee or owners for the 12-month period ended December 25, 2021

• number and percentage of franchised Play It Again Sports Stores in the United States and Canada that had been in operation by the same franchisee or owners for the 12-month period ended December 25, 2021, grouped by range of gross sales ($0 to $250,000; $250,001 to $500,000; $500,001 to $1,000,000; $1,000,001 to $2,000,000; $2,000,001 to $3,000,000; and greater than $3,000,000)

• Section VI – Key ratios, comparables, computations, and analyses for the Play It Again Sports franchise opportunity (exclusive content for Platinum subscribers)

Section I – Play It Again Sports Franchise Costs

• Play It Again Sports franchise costs, based on Item 7 of the company’s 2022 FDD:

• Initial Franchise Fee:  $25,000
• Fixtures and Supplies:  $26,000 to $38,000
• Signs:  $8,000 to $12,000
• Security System and/or Cameras:  $1,000 to $4,000
• Point-of-Sale System:  $20,000 to $23,300
• Leasehold Improvements:  $5,000 to $9,000
• Build-Out:  $35,000 to $50,000
• Deposits and Business Licenses:  $5,000 to $10,000
• Letter of Credit:  $0 to $5,000
• Opening Inventory:  $90,000 to $120,000
• Miscellaneous Pre-Opening Expenses:  $35,000 to $50,000
• Rent for First 3 Months:  $12,500 to $20,000
• Additional Funds for 3 Months:  $30,000 to $35,000
• Estimated Total Franchise Costs:  $292,500 to $401,300

Section II – Play It Again Sports’ Initial Franchise Fee, Royalty Fee, and Marketing Fee

• Play It Again Sports’ initial franchise fee, royalty fee, and marketing fee, based on Items 5 and 6 of the company’s 2022 FDD:

• Initial Franchise Fee:  $25,000
• Continuing Fee:  5% of Gross Sales
• Marketing Fee:  $1,500 per year
• Cooperative Advertising:  maximum amount is 5% of Gross Sales
• Local Marketing Expenses:  minimum amount, when combined with cooperative advertising expenses, is 5% of Gross Sales
• Advertising Fee:  if Winmark imposes this fee, you will pay up to 2% of Gross Sales

Section III – Number of Franchised and Company-Owned Play It Again Sports Outlets

Franchised

2019

• Outlets at the Start of the Year:  281
• Outlets at the End of the Year:  280
• Net Change:  -1

2020

• Outlets at the Start of the Year:  280
• Outlets at the End of the Year:  274
• Net Change:  -6

2021

• Outlets at the Start of the Year:  274
• Outlets at the End of the Year:  273
• Net Change:  -1

Company-Owned

2019

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

2020

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

2021

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

Section IV – Background Information on the Play It Again Sports Franchise

19 Things You Need to Know About the Play It Again Sports Franchise

Teams Up with National Women’s Hockey Star for Youth Hockey Mentorship Program

1.  At the beginning of July 2021, Play It Again Sports announced a formal partnership with Blake Bolden, a trailblazer in women’s hockey who competed in the NWHL and is a current Pro Scout for the Los Angeles Kings, to sponsor her inspiring girl’s mentorship program – emBolden her. The free six-month mentorship program welcomed 25 female hockey participants, ages 13-16, from across North America – supporting and empowering them as they navigate and become trailblazers in the world of ice hockey.

2.  The application period was open through August 31, 2021. Lucky winners were selected by Bolden and Winmark and announced via email on September 10, 2021. The program met virtually once per month for 90 minutes and ran from October 2021 to March 2022. Discussions included a variety of topics from mental preparation and goal setting to self-motivation and time management as well as a special guest speaker.

3.  Bolden’s hockey journey began at age six when she got her first set of hockey gear at her local Play It Again Sports. Since then, Bolden has gone on to make history as the first Black women’s hockey player to compete in the NWHL and the second woman to ever scout in the NHL, working for the Los Angeles Kings. She also just joined ESPN’s NHL Coverage Team as an NHL reporter this past fall.

4.  Bolden said, “This isn’t just about me. I decided to do more and be more for those young girls who waited for me after the game. I get energy speaking to young girls and would always come away feeling inspired simply by being vulnerable with them – it changed my entire persona. This was so important to me; I dedicated my life to it. Play It Again Sports, where I got my first set of gear, allowed me the opportunity to play this sport at a time when I wouldn’t have been able to afford new gear. I am so excited to be partnering with them on this initiative. I have one message for kids coming up in hockey today: Be true, be you, be bold.”

5.  Women’s hockey is one of the world’s fastest-growing sports with female participation growing 34% over the last ten years. This program will support girls and young women by empowering them as they navigate the world of ice hockey, together.

6.  Renae Gaudette, president of franchising at Winmark Corporation, added, “We are thrilled to partner with Blake Bolden for her inspiring mentorship program and allow the opportunity for our young customers to learn from such a role model in this sport. Play It Again Sports and Winmark are proud sponsors of this initiative and look forward to making an impact on young players’ lives.”

Achieved Record Sales in 2020

7.  In mid-May 2021, Play It Again Sports reported that its growth in 2020 remained strong and that it was continuing to grow throughout 2021. Across the network of Play It Again Sports stores, the 2020 average unit volume (AUV) grew by 13 percent over 2019’s figures to $921,510. Additionally, franchisees within the top quartile of owners saw their average gross sales increase by 18 percent in 2020, reaching $1,701,930.

8.  Winmark said that Play It Again Sports’ success was due to several key factors, including adapting quickly to the circumstances of the COVID-19 pandemic. For instance, Winmark launched its ecommerce platform in 2013 with Music Go Round. Play It Again Sports joined the established platform in May 2019, which offers tens of thousands of quality used items to customers.

9.  The platform allows customers to research and purchase items while providing flexibility in how they receive them. Winmark’s multi-channel business model allows customers to have the option of picking up their products in-store, curbside delivery, or having them shipped to their home. The ecommerce platform played a substantial role in ensuring sales growth throughout 2020.

10.  Play It Again Sports also adapted its strategy based on the increased number of consumers exercising at home. As many gyms and fitness centers shut their doors to the public, consumers adapted to remain active wherever and whenever they could. In many cases, they spent the past year and a half recreating the gym environment in the comfort of their own homes.

11.  According to NPD, a market research company, home workout equipment in Q3 of 2020 doubled its sales compared to Q3 of 2019. According to the report, every category showed a significant uptick in sales, and cardio equipment, like treadmills, led the way.

12.  For example, Oregon-based Play It Again Sports owner Jay DeKalb took phone orders and requests through social media during the initial wave of the pandemic and offered curbside pickup and delivery. DeKalb sold nearly 90 percent of his free weight inventory by the end of March 2020.

13.  Similarly, John Acheson, an owner in Bozeman, Montana, also saw demand for fitness equipment – free weights and exercise machines – increase as stay-at-home orders and social distancing took effect. In fact, the at-home workout trend is expected to stay for good, especially with the rapid emergence of virtual fitness classes and the variety of equipment accessories available.

14.  At the time of the press release, Play It Again Sports had 274 stores in the U.S. and Canada. The brand added three new franchise agreements in 2020 and already opened one store and added two signed agreements in 2021. As the COVID-19 vaccine rollout continued, Winmark said it had high expectations for 2021. An increasing number of kids will be resuming their team sports, and many are also looking forward to resuming individual sports, like golf and biking.

15.  Play It Again Sports plays a crucial role in the lives of families across the country. Typically, the average American family spends about $700 annually on their child’s sports activities, but some parents are willing to shell out the hefty total of $35,000 annually for everything from extra lessons to higher-end equipment. Play It Again Sports allows children from lower income families to also participate in sports.

Company History

16.  Play It Again Sports was founded in 1983 by Martha Morris in Uptown, Minneapolis. Morris decided to start a gently-used sports resale business after noticing that most sports equipment lasted much longer than its participant’s desire to continue on in their sports. This was especially true in youth sports. The business was a success and over the next few years, Morris opened more locations in the area.

17.  When Morris expressed interest in turning Play It Again Sports into a franchise, she consulted with Ron Olson and Jeffrey Dahlberg, the founders of Winmark Corporation. After helping Morris set up a franchising system, Olson and Dahlberg realized that they wanted to own the company instead of working as consultants. Morris then sold the franchising rights to Play It Again Sports to Olson and Dahlberg in 1988. Two years later, she sold them the stores and the entire company.

18.  Play It Again Sports became the first brand in Winmark’s portfolio, which now includes other resale franchises Once Upon A Child, Plato’s Closet, Music Go Round, and Style Encore.

Entrepreneur’s Franchise 500

19.  Play It Again Sports ranked No. 461 on Entrepreneur’s 2022 Franchise 500 list.

Section V – Financial Performance Representations (Average Revenues and/or Profits) for the Play It Again Sports Franchise (Item 19, 2022 FDD)

• The following is a financial performance representation titled “Play It Again Sports Unaudited Statement of Average Annual Sales and Gross Profit.” The gross profit figures do reflect the cost of sales but do not reflect the operating expenses that must be deducted from the gross profit figures to obtain your net income or profit.

• The following statement of average annual gross sales and gross profit includes average gross sales and gross profit during the 12-month period ended December 25, 2021 (Winmark’s fiscal year) as reported by the 254 franchised Play It Again Sports Stores in the United States and Canada that commenced operations during the years 1988 through 2020.

• This statement includes information from only those Play It Again Sports Stores located in the United States and Canada that had been in operation by the same franchisee or owners for the 12-month period ended December 25, 2021, with the understanding that some of the Stores had temporary closures as a result of COVID-19, as further described below.

• There are no material financial and operational characteristics of the U S. Stores that differ materially from the Canadian Stores included in this financial performance representation.

• No other Play It Again Sports Stores are included in this statement due to insufficient history of operations (not in operation for the 12-month period ended December 25, 2021 or transferred during this period).

• The financial statements Winmark receives from franchisees for these stores are unaudited, and Winmark does not audit or independently verify, or express an opinion regarding, these statements.

• There were 254 franchised Play It Again Sports Stores which had been in operation by the same franchisee or owners for the 12-month period ended December 25, 2021. All 254 Stores are reflected in the average.

• This financial performance representation does not include information for the 19 Play It Again Sports Stores that opened or transferred in 2021. No Stores closed in 2021 after being open less than 12 months.

• Due to governmental regulations and other restrictions related to COVID-19 in many jurisdictions during 2021, some of the Play It Again Sports Stores were forced to temporarily close for extended periods of time during the year. The temporary closures and COVID-19 regulations and restrictions impacted the Stores’ sales.

• During the temporary in-store closures, some Stores continued to operate by offering curbside and/or online sales.

• Despite these temporary closures, as of the date of the current Disclosure Document, Play It Again Sports does not anticipate that COVID-19 has or will significantly change its business model or the way its Business System operates.

• For purposes of clarification, the 254 Stores includes all Stores that were temporarily closed as a result of COVID-19.

Part 1 – Statement of Average Gross Sales and Gross Profit of 254 Franchised Play It Again Sports Stores for the Fiscal Year Ended December 25, 2021

Year Opened – 2020

• Number of Stores Reported:  8
• Number and Percentage of Stores Attaining or Exceeding Average Gross Sales:  1/13%
• Number and Percentage of Stores Attaining or Exceeding Average Gross Profit:  1/13%
• 2021 Average Gross Sales:  $762,452
• 2021 Median Gross Sales:  $660,118
• 2021 Average Gross Profit:  $423,556
• 2021 Median Gross Profit:  $364,906
• Average Gross Profit Percentage:  55.55%
• Sales Range:  $487,630 to $1,371,530

Year Opened – 2019

• Number of Stores Reported:  22
• Number and Percentage of Stores Attaining or Exceeding Average Gross Sales:  7/32%
• Number and Percentage of Stores Attaining or Exceeding Average Gross Profit:  8/36%
• 2021 Average Gross Sales:  $1,194,906
• 2021 Median Gross Sales:  $1,038,719
• 2021 Average Gross Profit:  $646,359
• 2021 Median Gross Profit:  $581,741
• Average Gross Profit Percentage:  54.09%
• Sales Range:  $222,408 to $4,907,381

Year Opened – 2018

• Number of Stores Reported:  28
• Number and Percentage of Stores Attaining or Exceeding Average Gross Sales:  8/29%
• Number and Percentage of Stores Attaining or Exceeding Average Gross Profit:  8/29%
• 2021 Average Gross Sales:  $988,568
• 2021 Median Gross Sales:  $937,004
• 2021 Average Gross Profit:  $522,063
• 2021 Median Gross Profit:  $514,545
• Average Gross Profit Percentage:  52.81%
• Sales Range:  $333,422 to $2,056,640

Year Opened – 2017

• Number of Stores Reported:  12
• Number and Percentage of Stores Attaining or Exceeding Average Gross Sales:  3/25%
• Number and Percentage of Stores Attaining or Exceeding Average Gross Profit:  3/25%
• 2021 Average Gross Sales:  $907,796
• 2021 Median Gross Sales:  $963,535
• 2021 Average Gross Profit:  $500,813
• 2021 Median Gross Profit:  $528,991
• Average Gross Profit Percentage:  55.17%
• Sales Range:  $407,786 to $1,435,354

Year Opened – 2016

• Number of Stores Reported:  7
• Number and Percentage of Stores Attaining or Exceeding Average Gross Sales:  1/14%
• Number and Percentage of Stores Attaining or Exceeding Average Gross Profit:  1/14%
• 2021 Average Gross Sales:  $800,685
• 2021 Median Gross Sales:  $728,606
• 2021 Average Gross Profit:  $423,177
• 2021 Median Gross Profit:  $395,925
• Average Gross Profit Percentage:  52.85%
• Sales Range:  $355,557 to $1,212,894

Year Opened – 2015 and Prior

• Number of Stores Reported:  177
• Number and Percentage of Stores Attaining or Exceeding Average Gross Sales:  76/43%
• Number and Percentage of Stores Attaining or Exceeding Average Gross Profit:  75/42%
• 2021 Average Gross Sales:  $1,189,325
• 2021 Median Gross Sales:  $1,015,192
• 2021 Average Gross Profit:  $624,278
• 2021 Median Gross Profit:  $525,852
• Average Gross Profit Percentage:  52.49%
• Sales Range:  $212,131 to $5,351,338

Total

• Number of Stores Reported:  254
• Number and Percentage of Stores Attaining or Exceeding Average Gross Sales:  96/38%
• Number and Percentage of Stores Attaining or Exceeding Average Gross Profit:  96/38%
• 2021 Average Gross Sales:  $1,130,222
• 2021 Median Gross Sales:  $976,384
• 2021 Average Gross Profit:  $597,226
• 2021 Median Gross Profit:  $523,306
• Average Gross Profit Percentage:  52.84%

• “Gross Sales” means all revenues the franchisee receives from the sale of goods and services, whether by cash or by check, credit card or trade, in connection with the Store, less sales tax and customer refunds and returns.

• Average Gross Profit equals Gross Sales less Cost of Goods Sold. Average Gross Profit does not reflect any expenses related to the operation of a Play It Again Sports Store other than Cost of Goods Sold.

Part 2 – Statement of Sales Ranges by Quartile for the 254 Franchised Play It Again Sports Stores Open on December 25, 2021 That Had Been in Operation for at Least 12 Months by the Same Franchisee or Owners for the 12-Month Period Ended December 25, 2021

• Quartile refers to that portion of the total number of Stores open that represents 25%. For example, the first quartile identifies those Stores that were in the top 25% of all Stores in gross sales.

• These results relate to specific Play It Again Sports Stores located in the United States and Canada. Your individual results may differ.

1st Quartile

• Number of Stores:  63
• 2021 Gross Sales Range by Quartile:  $1,366,207 to $5,351,338
• 2021 Quartile Average Gross Sales:  $1,977,747
• 2021 Quartile Median Gross Sales:  $1,706,256
• Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Sales:  20/32%
• 2021 Quartile Average Gross Profit:  $1,043,012
• 2021 Quartile Median Gross Profit:  $920,065
• Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Profit:  21/33%
• Quartile Average Gross Profit Percentage:  52.21%

2nd Quartile

• Number of Stores:  63
• 2021 Gross Sales Range by Quartile:  $978,679 to $1,356,867
• 2021 Quartile Average Gross Sales:  $1,156,666
• 2021 Quartile Median Gross Sales:  $1,143,997
• Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Sales:  30/48%
• 2021 Quartile Average Gross Profit:  $610,729
• 2021 Quartile Median Gross Profit:  $601,504
• Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Profit:  30/48%
• Quartile Average Gross Profit Percentage:  52.80%

3rd Quartile

• Number of Stores:  64
• 2021 Gross Sales Range by Quartile:  $710,613 to $977,036
• 2021 Quartile Average Gross Sales:  $849,731
• 2021 Quartile Median Gross Sales:  $851,515
• Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Sales:  32/50%
• 2021 Quartile Average Gross Profit:  $452,342
• 2021 Quartile Median Gross Profit:  $444,961
• Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Profit:  26/41%
• Quartile Average Gross Profit Percentage:  53.23%

4th Quartile

• Number of Stores:  64
• 2021 Gross Sales Range by Quartile:  $212,131 to $705,476
• 2021 Quartile Average Gross Sales:  $530,710
• 2021 Quartile Median Gross Sales:  $574,004
• Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Sales:  40/63%
• 2021 Quartile Average Gross Profit:  $289,996
• 2021 Quartile Median Gross Profit:  $309,366
• Number and Percentage of Stores Attaining or Exceeding Quartile Average Gross Profit:  38/59%
• Quartile Average Gross Profit Percentage:  54.64%

Part 3 – Number of Stores, Average and Median Gross Sales, Lowest and Highest Gross Sales Amount in Each Range, and Percentage of Total Number of Stores That Fell Within Certain Ranges of Gross Sales for 2021

• Based on information reported by the 254 Play It Again Sports Stores which had been in operation by the same franchisee or owner for the 12-month period ended December 25, 2021, the following chart sets forth the number of Stores, average and median Gross Sales, the lowest and highest Gross Sales amount in each range, and the percentage of total number of Stores that fell within certain ranges of Gross Sales for 2021:

2021 Range of Gross Sales:  $0 to $250,000

• Number of Stores Falling Within Range:  6
• Average Gross Sales for Stores Within Range:  $226,978
• Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range:  3/50%
• Gross Sales for Lowest Store Within Range:  $212,131
• Gross Sales for Highest Store Within Range:  $249,350
• Median Gross Sales for Stores Within Range:  $225,356
• Percent of Total Number of Stores (254) Within Range:  2.36%

2021 Range of Gross Sales:  $250,001 to $500,000

• Number of Stores Falling Within Range:  15
• Average Gross Sales for Stores Within Range:  $414,533
• Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range:  9/60%
• Gross Sales for Lowest Store Within Range:  $272,185
• Gross Sales for Highest Store Within Range:  $489,730
• Median Gross Sales for Stores Within Range:  $444,650
• Percent of Total Number of Stores (254) Within Range:  5.91%

2021 Range of Gross Sales:  $500,001 to $1,000,000

• Number of Stores Falling Within Range:  108
• Average Gross Sales for Stores Within Range:  $756,917
• Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range:  55/51%
• Gross Sales for Lowest Store Within Range:  $508,790
• Gross Sales for Highest Store Within Range:  $978,679
• Median Gross Sales for Stores Within Range:  $767,060
• Percent of Total Number of Stores (254) Within Range:  42.52%

2021 Range of Gross Sales:  $1,000,001 to $2,000,000

• Number of Stores Falling Within Range:  105
• Average Gross Sales for Stores Within Range:  $1,335,039
• Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range:  48/46%
• Gross Sales for Lowest Store Within Range:  $1,004,916
• Gross Sales for Highest Store Within Range:  $1,983,581
• Median Gross Sales for Stores Within Range:  $1,289,215
• Percent of Total Number of Stores (254) Within Range:  41.34%

2021 Range of Gross Sales:  $2,000,001 to $3,000,000

• Number of Stores Falling Within Range:  16
• Average Gross Sales for Stores Within Range:  $2,383,002
• Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range:  6/38%
• Gross Sales for Lowest Store Within Range:  $2,056,640
• Gross Sales for Highest Store Within Range:  $2,929,781
• Median Gross Sales for Stores Within Range:  $2,274,151
• Percent of Total Number of Stores (254) Within Range:  6.30%

2021 Range of Gross Sales:  Greater Than $3,000,000

• Number of Stores Falling Within Range:  4
• Average Gross Sales for Stores Within Range:  $3,860,547
• Number and Percent of Stores Attaining or Exceeding Average Gross Sales for Stores Within Range:  3/75%
• Gross Sales for Lowest Store Within Range:  $3,924,858
• Gross Sales for Highest Store Within Range:  $5,351,338
• Median Gross Sales for Stores Within Range:  $5,082,996
• Percent of Total Number of Stores (254) Within Range:  1.57%

Section VI – Play It Again Sports Franchise Ratios, Comparables, Computations, and Analyses (Exclusive Content for Platinum Subscribers) ⬇️