CONTENTS€¦ · Examples: Equinox, Life Time Fitness, 24 Hour Fitness, LA Fitness Space needed:...

BUSINESS MODEL EBOOKBUSINESS MODEL EBOOK

CONTENTS

Introduction .....................................................................................................3

Industry Overview ..........................................................................................5

The Competitive Landscape ..........................................................................6

How Retro Fitness Stands Out to Customers .............................................9

How Retro Fitness Stands Out for Franchisees .......................................10

The Revenue Model ......................................................................................12

Meet the Leadership Team ..........................................................................16

Next Steps .....................................................................................................18

INTRODUCTION

Retro Fitness is a hometown gym dedicated to building a strong community for our members while providing exceptional return on investment for our owners. Our fitness franchise has been recognized as one of the nation’s top franchise opportunities by numerous publications, earning write-ups in Forbes, Entrepreneur Magazine, Rolling Stone, and The Wall Street Journal as well as appearances on CNN, CBS, and MTV.

For consumers, Retro Fitness is an attractive fitness destination because of its inclusive community, state-of-the-art equipment, group fitness classes and personal training, a welcoming atmosphere, and amenities like massage chairs and tanning. It is a one-stop-shop for anyone looking to improve their health in a nurturing environment.

For franchisees, Retro Fitness provides an opportunity to make their community healthier and happier while also generating a significant return on investment. Thanks to memberships that start at $19.99 per month, owners enjoy recurring revenue.

Personalized training, the Retro Blends Smoothie Bar, and merchandise sales create additional revenue streams.

The business model is also simple: Keep everything clean and in good working condition, market your business, and build a community culture within your gym. If you and your team can master these basics, you can thrive. Franchisees fall into two categories — owner-operators who spend a lot of time in their gyms, and investors who hire general managers to handle day-to-day operations. Regardless of which category they fall into, top-performing franchisees regularly drop in to ensure the gym is in great shape and the culture is friendly.

On the following pages, we provide an overview of the booming fitness industry as well as the challenges and opportunities that exist as the industry evolves. We also examine Retro’s recent financial performance and how our business model has franchisees well-positioned for continued growth.

Retro Fitness Business Model3

For consumers, Retro Fitness is an attractive fitness destination because of its inclusive community, state-of-the-art equipment, group fitness classes and personal training, a welcoming atmosphere, and amenities like massage chairs and tanning.


$32 BILLIONSpending at U.S. health clubs in 2018.

SOURCE: INTERNATIONAL HEALTH, RACQUET AND SPORTSCLUB ASSOCIATION

INDUSTRY OVERVIEW

GROWING DEMAND FOR HEALTH AND WELLNESS OPTIONS DRIVING GROWTH OF THE FITNESS INDUSTRY

The fitness industry in the United States has enjoyed robust growth for two decades, with a 6.4% compound annual growth rate from 1996 and 2016, according to Piper Jaffray’s January 2018 Fitness Industry Update.

Strong growth is expected to continue in the $32 billion space thanks to America’s growing embrace of health and wellness. Millennials and Gen Z, in particular, are expected to drive long-term growth including a projected 20% increase over the next five years. Among younger generations, America’s obesity epidemic has driven much higher awareness of the importance of healthy lifestyles. At the same time, the growth of social media and “selfie” culture has enhanced people’s motivations to look their very best, and provided tools that make it easier for people to track and share their fitness progress.

According to data collected by The Halo Group, 65% of people born after 1975 regularly consult either a nutritionist, dietitian (58%), or a personal trainer (54%) about their food choices. According to the Physical Activity Council, nearly 64% of Millennials and 71% of Gen Z are regularly involved in high calorie-burning activities. That compares to 41.6% of Baby Boomers.

Notably, overall gym membership growth has been consistent — even during recessions. At the same time that the S&P 500 was declining during the depths of the Great Recession, total gym membership grew from 45.6 million Americans to 52.2 million from 2008 to 2012, according to data from the International Health, Racquet and Sportsclub Association (IHRSA).


THE COMPETITIVE LANDSCAPE

HIGH-VALUE, LOW-PRICE GYMS AND BOUTIQUE FITNESS CLUBS ARE POWERING THE INDUSTRY’S GROWTH

The health club industry’s membership growth has been primarily driven by two segments:

1. High-value, low-price (HVLP) gyms (of which Retro Fitness was a pioneer and continues to be a leader)

2. Boutique fitness studios (Club Pilates, Orangetheory Fitness, and SoulCycle are examples)

According to the IHRSA’s 2018 Health Club Consumer Report, about 40% of health club members now belong to a HVLP fitness center. The HVLP business model provides low-cost membership options that make fitness centers attractive to people eager to establish and maintain healthy habits.

Boutique fitness clubs tend to market themselves as an elite business and are priced accordingly ($150/mo for classes, for instance). They have gained popularity by focusing on specific fitness trends and providing personalized instruction in a group training environment that often doubles as a place to form friendships (and for courtship). On the following pages, we share an overview of the major industry segments and their strengths and potential weaknesses as an investment.

+7.7% The increase in year-over-year health club spending from 2017 to 2018.

SOURCE: INTERNATIONAL HEALTH, RACQUET AND SPORTSCLUB ASSOCIATION


QUICK GLANCE AT THE COMPETITIVE LANDSCAPE

LIFESTYLE CENTERS

Examples: Equinox, Life Time Fitness, 24 Hour Fitness, LA Fitness

Space needed: 30,000-120,000 square feet (on the high end, this is the size of a Home Depot)

Offer to customers: Full assortment of equipment, athletic courts, pools, classes, personal training

Pros: Maximum variety for customers. Higher membership rates.

Cons: Very high investment. Membership rates face pressure from HVLP competitors, hurting margins. Reliance on big boxes means less real estate flexibility, which can make it harder to secure convenient locations.

HVLP 1.0

Examples: Planet Fitness, Blink Fitness

Space needed: 10,000-20,000 square feet (roughly the size of a Staples store)

Offer to customers: Full assortment of equipment

Pros: Low-cost memberships that drive high enrollment. Lower investment thanks to smaller facilities (by cutting out amenities like pools and courts).

Cons: These spaces essentially function as equipment rental. No-frills customer experience means price and convenience are the main points of differentiation. Market shows significant signs of saturation, which could decrease avg. enrollments and hurt unit-level profitability. (Club Intel, “U.S. Budget Clubs: A Value Proposition Becoming Commoditized and Where It goes Next?”)

+6.4% The compound annual growth rate for the fitness industry between 1996 and 2016.

SOURCE: PIPER JAFFRAY, “FITNESS INDUSTRY UPDATE,” JANUARY 2018


HVLP 2.0

Examples: Retro Fitness

Space needed: 15,000-17,000 square feet

Offer to customers: Full assortment of equipment, classes, personal training, on-site amenities

Pros: Low cost memberships paired with tiered options that add extra value as members become more engaged. Multiple upsell opportunities to increase average revenue generated by each member. Brings together the best of HVLP 1.0 model with personalized options such as specialized group classes and personal training designed to appeal to people currently frequenting boutiques.

Cons: To differentiate from HVLP 1.0 competitors, it’s imperative to build a sense of community within the gym. Members — particularly younger members — will pay more for individualized experiences and a strong sense of community. Large and small classes are two of the key ways to deliver this experience.

BOUTIQUE CLUBS

Examples: 9Round, Barry’s Bootcamp, Pure Barre, Club Pilates, CorePower Yoga, Orangetheory, SoulCycle

Space needed: 1,000-2,000 square feet

Offer to customers: Full assortment of equipment, classes, personal training, on-site amenities

Pros: Small spaces reduce overhead and allow clubs to locate very close to customers. Customers tend to be younger and spend more. Strong sense of community among members.

Cons: Prices typically range from $150 to $300/month. Services revolve around group fitness classes and limited space means customers are restricted to set times and must clear out for the next group. Less variety at any individual boutique means customers frequently try different concepts, hurting customer retention. This is exacerbated by emerging Web-based intermediaries like ClassPass, which offer unbooked fitness classroom space to its members at a wide variety of clubs. While these platforms do fill open slots for club operators, they also encourage sampling and threaten to reduce customer loyalty. The intermediaries also pay lower rates to fill the unbooked slots, which has the potential to erode margins. Many of their customers are also members at a gym. While boutique customers currently outspend gym members — $66/mo vs $35/mo according to a 2018 report by Piper Jaffray) — the same report says “53% of boutique members note they would leave their boutique if a similar class were offered at a gym for a lower price.” Club Intel, in its report “U.S. Budget Clubs: A Value Proposition Becoming Commoditized and Where It goes Next?”, reports signs of market saturation due to a growing backlog of unopened locations.


HOW RETRO FITNESS STANDS OUT TO CUSTOMERS

Retro Fitness helped transform the gym industry as a pioneer of the High-Value, Low-Price (HVLP) movement, which gave millions of Americans access to state-of-the-art fitness equipment at low monthly membership rates. Retro is now a pioneer of HVLP 2.0, which combines the benefits of access to state-of-the-art equipment with membership tiers that provide access to group instruction and personal trainers.

A FIT FOR EVERYONE

By offering two membership tiers, we are able to meet the needs of people just starting their fitness journey and enthusiasts who are looking to achieve and maintain peak fitness. Additional services are available to all members and provide ancillary revenue for owners.

Core Memberships ($19.99) include:• The same top-tier equipment as luxury

gyms like Equinox• Reciprocity to visit any Retro Fitness

facility

Ultimate Memberships ($29.99) also include: • Group fitness classes. Classes vary by

location, but include:• Group Programs

‐ Yoga ‐ Spin ‐ Zumba

• Small Group Training ‐ Team HIIT

• Amenities including tanning, and hydromassage.

• Child sitting to make it easier for parents to maintain their workout routines (and set a great example for their kids)

Quality and variety are only part of what makes Retro Fitness stand out. The biggest ingredient is community. The strongest locations are run by managers or owners who welcome guests, learn about their families, and foster a sense of community and teamwork among members. This will be even more true in the future, since younger people tend to treat fitness activities as a social opportunity. By providing quality, variety and community, Retro Fitness is positioned to take advantage of the next evolution of the fitness industry.

Add-on services available to all members include:• Personal training• The Retro Blends® Smoothie Bar• A pro shop that offers nutritional

supplements and athleisure wear


HOW RETRO FITNESS STANDS OUT FOR FRANCHISEES

OUR BUSINESS MODEL OFFERS SEVERAL ADVANTAGES FOR INVESTORS

Join an industry with high, sustainable demand. The fitness industry has been growing for decades, and Millennials and younger generations are even more avid fitness consumers than those who preceded them. A 2018 survey projected that, based on current spending, today’s young people will spend more on health and fitness than on college tuition over the course of their lifetime. Moreover, they report making fitness a high spending priority. Fitness memberships have also been embraced by employers and health insurers as a way to reduce overall healthcare costs. Many employers and insurers now offers discounts and rebates to encourage people to improve or maintain their fitness.

Retro is a service leader. Retro Fitness provides a full-service gym experience to members while maintaining High-Value, Low-Price (HVLP) positioning. We’re not the cheapest HVLP gym, but we believe we offer the best value by providing access to state-of-the-art equipment and amenities as well as group classes and personal training. Quality and variety are two major points of differentiation that help us command a premium over discount gyms, while sales opportunities help owners generate more revenue per member. This gives Retro Fitness broad appeal.

Broad appeal. By combining the best of HVLP gyms and group classes offered by boutique fitness clubs, Retro Fitness is able to draw a broad swath of customers without sacrificing profit margins.

Make lives better. We’re not just in business to make money. We also relish seeing the difference we make in customers’ lives. We and our employees get to watch and encourage people to become stronger, slimmer and more confident.

A business that works for you. While our current franchise owners come from diverse industries and backgrounds, they are united by a common objective. Each wanted an outstanding investment opportunity that would benefit themselves and their families, while providing a balance between lifestyle and business investment. That is one of the primary reasons that only about a third of Retro Fitness owners are owner/operators. The rest leave their trusted General Manager to oversee the day-to-day operations of the club, along with staff and the ongoing assistance of the Retro Fitness support team.

Simple business model. The ingredients to a successful gym: Keep it clean, keep the equipment maintained, hire and train friendly people, and listen and respond to your members.

Recurring revenue and multiple revenue streams. Memberships provide recurring revenue. The Ultimate membership allows


https://www.marketwatch.com/story/this-is-the-insane-amount-millennials-are-spending-on-fitness-2018-01-21

TRAILBLAZERS. Retro Fitness helped transform the gym industry, giving millions of Americans access to state-of-the-art fitness equipment at low monthly membership rates.

you to maximize the profitability of memberships and deliver incredible value to customers by providing group classes. Personal training options provide upsell opportunities that deliver tremendous value to customers. The smoothie bar generates additional high-margin revenue from members seeking healthy nutrition before and after workouts. And the pro shop provides supplements and athleisure gear. There are many ways to serve your customers and make money.

Strong financial results. Retro Fitness clubs have a strong history of providing solid ROI for franchisees, especially relative to other franchising categories like restaurants. See the next section for details.


THE REVENUE MODEL

Retro Fitness generates recurring revenue through tier-priced memberships, and through ancillary sales from a smoothie bar, a pro shop and personal training.

The tiered membership model maximizes your membership rolls — and your profitability — by appealing to a wider variety of potential customers. Those who are looking to establish a fitness routine are often attracted to our $19.99/mo Core membership tier, which provides access to state-of-the-art treadmills, ellipticals, stationary bikes, free weights, machines, and more. The lowest price is a great way to get people into your gym, where they can start to work out and discover other options you have available. At $29.99/mo, Ultimate members gain access to all gym equipment at the club in addition to unlimited Group exercise classes such as Spin, Yoga, Barre, and Body Sculpt, plus tanning, massage chairs, and other amenities. Group training with Retro Fitness is like being a member at a wide variety of Boutique Fitness Clubs, but at a lower price and without being chased out the door once your class is over.

While members are at the gym, franchisees enjoy additional sales opportunities. The Retro Blends® Smoothie Bar provides smoothies and juices, which offer members a convenient, nutritious and refreshing way to recharge. A $19.99 member who purchases four smoothies in a month has doubled the amount they spend with you. Likewise, the pro shop offers nutritional supplements members can buy to use at home, as well as athleisure wear. Members can also purchase personal training sessions to work 1-on-1 with fitness experts.

PURPOSE. We’re not just in business to make money. We also relish seeing the difference we make in customers’ lives.

These strategies have helped produce strong financial results. Here’s a look at the financial performance of Retro Fitness locations, as reported in Item 19 of our 2019 Franchise Disclosure Document. We have divided the following charts into two sections based on the data used to calculate the results.


AVERAGE GROSS SALES, REVENUE PER SQUARE FOOT, AND MEMBERSHIP

As of December 31, 2018, there were 147 franchised Retro Fitness outlets open and in operation. Of those 147 Franchised Outlets, 138 were open the entirety of January 1, 2018 through December 31, 2018. All 138 of these Franchised Outlets were included in the results displayed in Tables A, B and C following.

TABLE A: AVERAGE GROSS REVENUE*

Based on data reported from March 1, 2018 to Feb. 28, 2019.

Average Gross Sales

Percentile Number of Clubs in the Stated Percentile

Number of Clubs in the Percentile that Attained or Exceeded the Average Gross Sales

Percentage of Clubs in Percentile that Attained or Exceeded the Average Gross Sales

$2.2 million Top 10% 14 6 43%

$1.7 million Top 25% 35 14 41%

$1.4 million Top 50% 69 24 35%

TABLE B: AVERAGE REVENUE PER SQUARE FOOT*

Based on data reported from March 1, 2018 to Feb. 28, 2019

Revenue Per Square Foot

Percentile Number of Clubs in the Stated Percentile

Number of Clubs in the Percentile that Attained or Exceeded the Average Gross Sales

Percentage of Clubs in Percentile that Attained or Exceeded the Average Gross Sales

$142 Top 10% 14 7 51%

$115 Top 25% 35 13 38%

$95 Top 50% 69 25 36%

PROFITABILITY. Retro Fitness clubs have a strong history of providing solid ROI for franchisees, especially relative to other franchising categories like restaurants.

* Numbers as published in Item 19 of the Retro Fitness 2019 Franchise Disclosure Document. Read Item 19 in its entirety for important defined terms, assumptions and qualifiers relating to these figures.Retro Fitness Business Model13

REVENUE STREAMS. Retro Fitness generates recurring revenue through tier-priced memberships, and through ancillary sales from a smoothie bar and pro shop.

TABLE C: AVERAGE MEMBERSHIP*As of Feb. 28, 2019

Average Number of Members

Top Percentile

Number of Clubs in the Stated Percentile

Number of Clubs in the Percentile that Attained or Exceeded the Average Number of Members

Percentage of Clubs in the Percentile that Attained or Exceeded the Average Number of Members

5,605 Top 10% 14 5 36%

4,564 Top 25% 35 12 35%

3,785 Top 50% 69 25 36%

AVERAGE EBITDA, RENT AND LABOR EXPENSE

There were 133 Franchised Outlets that were officially open to the public and in operation for the entire 2017 calendar year (not including Outlets in pre-sales during this period). Of these 133 Franchised Outlets, 35 were excluded from the results displayed in Tables D, E, F & G for the following reasons: (a) 9 were excluded because they combined locations onto one tax return; (b) 4 were excluded because they did not send in their 2017 tax returns; (c) 21 were excluded because they were sold or closed prior to the date on which we required submission of the 2017 tax returns and the former owners did not submit copies of their 2017 tax returns; and (d) 1 was excluded because their tax return wasn’t on a calendar year basis.

Information from the tax returns provided for the remaining 98 Franchised Outlets was used to determine the results presented in Tables D, E, F, and G, which reflect EBITDA.


RENT AS A PERCENTAGE OF EBITDA, AND PAYROLL AS A PERCENTAGE OF EBITDA.

TABLE D: AVERAGE EBITDA*

Average EBITDA*(in dollars)Reported by theDEFG Clubs in 2017 Federal TaxReturns

Percentile Number of DEFGOutlets inPercentile

Number of DEFG Outlets that Achieved or Exceeded the Stated Average EBITDA

Percentage ofDEFG Outlets in Percentile that Achieved or Exceeded the Stated Average EBITDA

$527,426 Top 10% 10 2 20%

$401,062 Top 25% 25 11 45%

$307,936 Top 50% 49 19 39%

TABLE E: EBITDA AS A PERCENTAGE OF REVENUE*

Average EBITDA* (as a percentage of total earnings) Reported by DEFG Outlets in 2017 Federal Tax Returns

Percentile Number of Outlets in Percentile

Number of Outlets in Percentile that Achieved or Exceeded the Average EBITDA (as a percentage of total yearnings)

Percentage of Outlets in Percentile that Achieved or Exceeded the Average EBITDA (as a percentage of total yearnings)

31% Top 10% 10 3 31%

27% Top 25% 25 8 33%

24% Top 50% 49 20 41%

TABLE F: AVERAGE PAYROLL EXPENSES*

Total Number of Outlets

Average Payroll Expense

Number & Percentage of Outlets whose Payroll Expenses Equaled or Exceeded the Results Stated in Column 2

Average Payroll as a Percentage of Gross Sales

Number & Percentage of Outlets whose Payroll Expenses Equaled or Exceeded the Results Stated in Column 4

98 $263,713 44 (45% of outlets) 23% 49 (50% of outlets)

TABLE G: AVERAGE RENT EXPENSES*

Total Number of Outlets

Average Rent Expense

Number & Percentage of Outlets whose Rent Expenses Equaled or Exceeded the Results Stated in Column 2

Average Rent as a Percentage of Gross Sales

Number & Percentage of Outlets whose Rent Expenses Equaled or Exceeded the Results Stated in Column 4

98 $256,115 38 (39% of outlets)

22.6% 51 (52% of outlets)

* Numbers as published in Item 19 of the Retro Fitness 2019 Franchise Disclosure Document. Read Item 19 in its entirety for important defined terms, assumptions and qualifiers relating to these figures.Retro Fitness Business Model15

MEET THE LEADERSHIP TEAM

ANDREW ALFANO

CEO

Retro Fitness is led by Andrew Alfano, a former Senior Vice President for Starbucks who joined Retro after serving as President and COO of an early education franchise company. Prior to that, Andrew enjoyed an impressive 16 year career with Starbucks Coffee. Having joined in the late 90’s, he helped grow

the brand while working his way up to Senior Vice President, U.S. Business. Andrew was one of the key leaders that helped architect the company’s strategic growth in some of the more high profile, complex urban markets, specifically Starbucks flagship market of New York. He was ultimately accountable for over $3.5B in revenue across both company operated and licensed stores.

He then joined his most recent company in 2015, when they were of similar size as Retro Fitness. He leveraged existing strengths of the brand to fuel growth, reorganized and matured the business. A few short years later, the brand now boasts of over 400 units open or in development in both the United States and Europe.

“I love to build brands. Retro Fitness has all the characteristics I love — a compelling value proposition, a strong franchisee base and a brand following with consumers ripe for growth and expansion. By offering members everything they love about a big-box gym and bundling it with personalized group classes, niche workout experiences and personal training, Retro Fitness has great potential for its next phase of growth.”

TODD SCARTOZZI

SENIOR VP OF OPERATIONS

Todd Scartozzi joined Retro Fitness in 2019 and brings vast executive leadership experience in the gym industry.

He oversaw the growth of one of Planet Fitness’ largest multi-unit operations,

helping private equity group Exaltare Capital grow their portfolio from 10 gyms to 161 locations.

He also served as COO of Gold’s Gym International, where he directed sales, marketing, fitness, real estate and construction, IT, a call center, and capital improvement programs. His tenure there saw growth in customer retention, same-store sales, and EBITDA.

In addition to his fitness industry experience, he has also served as a leader in the hospitality field, overseeing a private equity firm’s investment in Chase Suites Hotels, and acting as Senior Vice President of Operations at Omni Hotel Corporation.

He joined Retro Fitness because, “Andrew is a proven executive who has built great companies, and Retro Fitness has a huge amount of white space in which it can grow.”


ROBBIE SPRECHMAN

CFO

Robbie Sprechman has been CFO for Retro Fitness since 2008 and has helped oversee the growth of the brand while crafting win-win solutions to drive revenue growth and EBITDA.

“The fitness industry is a great industry. It’s outpacing the S&P. It’s one of the best industries to be in right now. And it’s Amazon proof.” Describing how the management team prioritizes efforts, he said, “We care insanely about increasing franchisees’ profitability and revenue streams and we care about increasing their engagement. Everything we do goes through those filters. If we are talking to a new company, talking to a new vendor, coming up with a new process, if it doesn’t meet any of those three goals, we don’t do it.”

Before joining Retro Fitness, he spent 22 years as CFO/COO for Noamex Inc., an international clothing wholesaler. He has served as CFO for a diverse set of companies: HFS Realty Associates, where he oversaw four commercial properties in New York City; Dynamic Changes Hypnosis Centers, which assisted clients with weight loss and smoking cessation; The Antique Boutique, a New York City vintage store that attracted a celebrity clientele; and Let’s Yo frozen yogurt.

VICTOR BAO

SENIOR VP OF MARKETING

Victor Bao has a broad range of marketing, brand, PR and innovation experience, both domestic and internationally, most recently serving as Chief Marketing Officer of Global Shopper. Victor worked closely with the franchisees and led and developed digital and

mobile applications that supported all B2C and B2B efforts for the company.

Victor started his career with UPS as the International Marketing Manager, and later was the architect of loyalty programs for the automotive industry at Maritz. He worked in London, Paris and Madrid returning to Miami after 11 years abroad.

Upon his return to the U.S., Victor led the marketing function at Club Med where he played a critical role during that brand’s transformation. He led the marketing charge for over 70 franchised InterContinental Hotels, and was Head of Marketing at Yamaha Motor Company for its distributors and across multi-brand retail stores. Victor was also Head of Marketing and Digital Marketing at Louis Vuitton Moet-Hennessey (LVMH) in a new ecommerce and technology endeavor, the first of its kind for that brand.

MEET THE LEADERSHIP TEAM


NEXT STEPS

OUTLINE OF THE PROCESS FOR BECOMING A RETRO FITNESS OWNER

I hope you have found this eBook helpful as you evaluate Retro Fitness as a business opportunity. Here’s a look at our process:

STEP 1: INITIAL CALL

We’ll make a brief introduction and ask some initial questions to determine if your desired territory is available and if you are likely to be financially able to make the investment. Assuming the answer is “yes,” we will schedule a webinar with you and share our Franchise Disclosure Document (FDD).

STEP 2: FDD REVIEW

The FDD is a document regulated by the Federal Trade Commission. It is not a contract. Instead, it serves as a summary of key information about the franchise system and the legal relationship between the franchisor and franchisee. If it’s your first time reading an FDD, you are likely to have many questions. Take note of anything that is unclear or that gives you concerns. We’ll discuss these questions during our next conversation.

STEP 3: WEBINAR AND Q&A

This is a 45- to 60-minute meeting that provides a detailed look into the brand and what makes it work, including an overview of what is offered to consumers and the support the brand provides to franchisees. We will also answer your questions about the webinar and about the FDD.

RIGHT PERSON. RIGHT OPPORTUNITY. We look forward to learning about you and your goals, and determining if Retro Fitness is a good fit for what you’re looking to accomplish. We’ll work with you to make sure you receive the information needed to make an informed decision.


STEP 4: APPLICATION

Before we begin booking meetings with the rest of the support team, you’ll need to submit a Franchise Application and Personal Financial Statement. Neither document creates any obligations for you. Instead, they allow us to perform due diligence by completing a background check and credit check on candidates. This is an important step we take to protect the brand and the investment of existing franchisees.

STEP 5: REAL ESTATE REVIEW

This webinar with the real estate team focuses on your preferred area(s). We will discuss the real estate requirements, site selection process, and answer your questions about securing a great location.

STEP 6: DISCOVERY DAY

You will be invited to meet the corporate team at the home office in West Palm Beach. The half-day meeting includes presentations from department heads and a mutual interview process. You will get a deep dive into our vision for where the brand is headed and how we will get there.

STEP 7: FINAL QUALIFICATION

If the executive team agrees that you are likely to thrive as a Retro Fitness owner, you will be offered a Franchise Agreement.

STEP 8: FRANCHISE AGREEMENT SIGNED

You are now officially a Retro Fitness franchisee! A call with the Franchise Concierge will help set the next steps. It is typically 8-12 months from the day you sign to the day you open your gym. Much of that time is devoted to scouting the best location and negotiating the lease. Actual construction takes about 3-4 months. As construction is going on, you will begin pre-sales, which allows you to open your doors with an existing membership base.


QUESTIONS? YOU CAN REACH US AT 732-431-0062.

WE LOOK FORWARD TO SPEAKING WITH YOU!

Revenue numbers in this document are also published in Item 19 of the Retro Fitness 2019 Franchise Disclosure Document. Read Item 19 in its entirety for important defined terms, assumptions and qualifiers relating to these

figures. Franchise offering made by prospectus only, view our Franchise Disclosure Document for details.

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