Are Anytime Fitness Franchises Profitable?

Vicki Morillo
9 min read
Some additional information in one line

Anytime Fitness, a 24-hour health and fitness club, stands out as a distinctive brand in the gym industry. Pioneering the concept of round-the-clock accessibility and a key-fob system for members, they offer flexibility and convenience unparalleled by typical 9-to-5 gyms. 

But the pressing question on the minds of potential investors and entrepreneurs is: Are they profitable? The short answer is yes. 

With over 4,700 gyms in the U.S. alone, the sheer growth of Anytime Fitness franchises across the nation suggests a compelling business model with potential return on investment.

Anytime Fitness stands out among fitness club franchises for its unique approach of charging a fixed royalty fee instead of a percentage of revenue. This distinctive feature has made it an enticing choice for aspiring franchisees looking to venture into the fitness industry.

Key stats about the Anytime Fitness franchise

Financial Metrics

Amount

Average Annual Turnover

$413,942 per year

Average Annual Revenue

$384,958 per year

Profit Potential

Promising with an average profit of 15%

Franchise Fees

$25,000 to $42,500

Growth and Success

"World's Fastest-Growing Fitness Club" for seven years in a row

Owner's Annual Salary

Approximately $114,000 annually

Number of Gyms in the US

Over 4,700 (2,500 franchise-owned)

EBITDA Margin

16.5%

Royalty Fee

An ongoing royalty fee is $449 to $699 per month. Ad royalty fee is $300 to $600 per month

Marketing Fee

$7,200/year

Investment (Mid-Point Estimate)

~ $309,127

Average Annual Sales

$339,000

Data Source: Anytime Fitness 2022 FDD

How much does an Anytime Fitness franchise cost?

The cost to open an Anytime Fitness franchise ranges from $73,259 to $693,917, with an average investment of $78,012 to $521,437. The franchise fee ranges from $25,000 to $42,500. 

Beyond the franchise fee, there is an ongoing monthly payment of $699. The liquid capital required is $160,000, and the net worth required is $350,000. The total investment needed for a franchisee is $94,430 to $523,824. 

What is the minimum cost to buy and own an Anytime Fitness franchise?

The initial investment required to own an Anytime Fitness franchise can vary based on several factors, including the location and size of the facility. However, the minimum cost to buy and own an Anytime Fitness franchise typically ranges from $107,524 to $722,796. This includes the franchise fee, which is $37,500 and covers essential expenses such as leasehold improvements, equipment, signage, and initial marketing efforts. It's important to note that additional costs may arise depending on your specific circumstances and location.

How much revenue do Anytime Fitness gyms make?Anytime-fitness1

According to various sources, the revenue generated by an Anytime Fitness gym can vary depending on location, membership fees, and operating costs. Here are some estimates of the revenue generated by Anytime Fitness gyms:

On average, an Anytime Fitness gym makes $413,942 in turnover annually. The average reported annual revenue for an Anytime Fitness gym is $384,958. The average revenue for an Anytime Fitness location is about $441,116 per year, with a predicted average profit of around $114,000.

It's important to note that these figures are estimates and can vary depending on various factors. Besides, the initial investment and ongoing costs associated with owning an Anytime Fitness franchise should also be considered when evaluating a gym's potential revenue and profit.

How profitable is an Anytime Fitness franchise?

Anytime Fitness franchises are profitable. On average, an Anytime Fitness franchise generates an annual profit of $69,516, boasting an impressive 16.5% profit margin. However, for those aiming for even greater financial success, a 20% profit margin could lead to estimated annual profits of $76,992.

Franchise owners have the potential to achieve an average revenue of $384,958 per year. After accounting for all expenses, this translates to an average profit of approximately $114,000. This reflects a predicted average profit margin of around 15%.

It's crucial to note that these figures can fluctuate significantly based on various factors. Location, membership fees, and operational costs all play pivotal roles in determining the profitability of an Anytime Fitness franchise. Thus, meticulous consideration of these elements is imperative for prospective owners.

While the profitability of an Anytime Fitness franchise can vary, with the right location, pricing strategy, and management, a substantial profit can be achieved. Prospective franchisees should carefully evaluate the initial investment and ongoing expenses associated with owning an Anytime Fitness gym to gauge its potential for financial success.

What is the failure rate of the Anytime Fitness franchise?

According to data from the Small Business Administration (SBA), the reported failure rate is approximately 7.83%, based on an analysis of 217 SBA loans totaling $39 million. However, this figure may need a comprehensive view of the franchise's overall performance.

In evaluating the performance of Anytime Fitness franchises, one must consider these varying perspectives and additional factors that may contribute to the success or challenges faced by individual locations. Potential franchisees should conduct thorough research and due diligence before making investment decisions.

What does the Anytime Fitness franchise agreement entail?

Anytime-fitness2

The Anytime Fitness franchise agreement is a comprehensive legal document outlining the franchisor's rights, responsibilities, and obligations (Anytime Fitness corporate) and the franchisee (the individual or entity purchasing the franchise). Understanding the contents of this agreement is crucial before entering into a franchise relationship. Here's a breakdown of what the franchise agreement typically covers:

1. Franchise Rights and Obligations:


The agreement specifies the franchisee's rights to use the Anytime Fitness brand, trademarks, and operating systems.

It outlines the franchisee's responsibilities in maintaining brand standards, including facility design, equipment, and customer service.

2. Territory and Location:

The franchise agreement may grant the franchisee an exclusive territory to operate their Anytime Fitness center.

Details regarding the size and specific location of the franchise are typically outlined in the agreement.

3. Initial Fees:


The agreement should detail the initial franchise fee and the upfront cost to acquire the franchise rights.

4. Ongoing Fees:


Franchisees are often required to pay ongoing fees, including royalty fees, based on a percentage of revenue and advertising or marketing fees.

5. Training and Support:


Any training and support provided by the franchisor, including initial training and ongoing assistance, are outlined in the agreement.

6. Duration of Agreement:


The franchise agreement specifies the initial term of the franchise relationship, typically ranging from 5 to 20 years.

7. Renewal Options:


It details franchise renewal options, renewal conditions, and associated costs.

8. Termination and Transfer:


The agreement covers conditions under which the franchisor or franchisee can terminate the agreement and any associated penalties.

It may also specify whether the franchisee can sell or transfer their franchise to another party.

9. Operations Manual:


The franchisee must usually adhere to the operations manual provided by the franchisor, which contains detailed procedures for running the business.

10. Advertising and Marketing:


The agreement may specify the franchisee's local advertising and marketing initiatives obligations.

11. Dispute Resolution:


The agreement typically includes provisions for resolving disputes between the franchisor and franchisee.

12. Financial Information:


The franchisor may provide financial information or projections, helping franchisees understand potential costs and revenue.

How do I start an Anytime Fitness franchise?Anytime-fitness3

Starting an Anytime Fitness franchise can be a rewarding venture in the fitness industry. To help you get started, we've outlined the key steps, from reaching out to Anytime Fitness for franchising opportunities to launching your gym successfully.

1. Contacting Anytime Fitness for Franchising Opportunities:


The first step in starting an Anytime Fitness franchise is to contact the franchisor. You can do this by visiting the official Anytime Fitness website (www.anytimefitness.com) and navigating to their franchise section. You'll find detailed information about the franchising process, including contact details for their franchise development team. Reach out to them to express your interest and initiate the conversation.

2. Negotiating and Agreeing on Contract Details:


Once you've expressed interest, Anytime Fitness will provide you with a Franchise Disclosure Document (FDD). This document contains essential information about the franchise opportunity, including fees, royalties, and terms. Carefully review the FDD and seek legal advice to understand the terms thoroughly. You will then negotiate with Anytime Fitness to agree on the contract details. Be prepared to discuss your territory, training, and support provided by the franchisor.

3. Costs and Considerations for Setting Up the Gym:


Setting up an Anytime Fitness franchise involves various costs and considerations:

  1. Franchise Fee: You must pay an initial franchise fee, which grants you the right to operate under the Anytime Fitness brand.
  2. Equipment and Build-Out: The cost of gym equipment, leasehold improvements, and interior design will vary depending on location and size. Anytime Fitness provides guidelines and approved vendors to help you make these decisions.
  3. Operating Capital: Ensure you have enough working capital to cover initial operating expenses, such as staff salaries, marketing, and utilities.
  4. Royalties and Marketing Fees: You must pay ongoing royalties and contribute to national and local marketing efforts.
  5. Insurance and Licensing: Factor in the cost of insurance coverage and any necessary permits or licenses.
  6. Real Estate: Finding a suitable location for your gym is crucial. Consider leasing or purchasing real estate based on your budget and target market.

4. Expenses and Preparations During the Launch Phase:


The launch phase is critical to the success of your Anytime Fitness franchise. Here are some key expenses and preparations to consider:

  1. Pre-Opening Marketing: Allocate resources for pre-opening marketing campaigns to create awareness and attract potential members.

  2. Staffing and Training: Hire and train staff members to ensure they provide exceptional service and adhere to Anytime Fitness standards.

  3. Equipment Setup: Install the gym equipment and ensure it is in working order before the grand opening.

  4. Member Onboarding: Develop a system for onboarding new members, including membership sign-ups and orientation sessions.

  5. Grand Opening Event: Plan a grand opening event to generate excitement and attract new members. Consider offering special promotions or discounts.

Starting an Anytime Fitness franchise requires careful planning, financial commitment, and dedication to the brand's principles. By following these steps and working closely with Anytime Fitness, you can embark on a successful journey in the fitness industry and help your community achieve their fitness goals.

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FAQs on starting an Anytime Fitness franchise

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