FRANCHISE INFORMATION PACK - EMS Training | Electro Muscle Stimulation · Electro Muscle...

FRANCHISEINFORMATION PACK

2018

2BODY20INFORMATION PACK

FRANCHISE INFORMATION PACK 2018

BODY20 FRANCHISE

Body20 is leading the EMS fitness revolution and offering franchise opportunities to entrepreneurs in one of the fastest growing industries within the franchising sector.

EMS stands for Electro Muscle Stimulation and with Body20 powered by Body20 EMS Technology we help you capitalise on one of the fastest growing fitness movements globally. Your very own Body20 Franchise will cost you from as little as R670k including all of your equipment, aesthetic fit-out, signage, marketing, training and franchisee support.

The Body20 Studio franchise model offers:

Low staffing

Fast break-evens

Impressive returns

Body20 prides itself on offering its franchisees high levels of accessible support from its team of in-house support specialists who are on hand to make sure you are getting the most out of your

Body20 Franchise.

We invite you to take a look further, I’m sure you will be impressed!

Bertus AlbertseManaging DirectorBody20 Franchise



Why a BODY20 Studio? WHY A BODY20 STUDIO?

Earn Subscription Revenue

Fastest Growing Fitness Device Globally

Low Overheads

High Returns

Automated Client Management Systems

Lifestyle Orientated Oppurtunity

BODY20 STUDIO CONCEPT

Body20 is a rapidly growing franchise model within the fitness industry that provides a high return on investment thanks to strong-unit economics and streamlined operations. The combination of state of the art EMS Technology, modern personal training and rapid fitness results makes Body20 the most exciting franchise opportunity in fitness this decade.

Electro Muscle Stimulation (EMS) gets you fit and healthy in a short amount of time and keeps your body in shape. This exclusive beauty and sports technology is made in Germany and leverages the effect of your workout to another level. Muscle structure gets strengthened, fat cells get burnt effectively and the joints are spared.

Body20 helps franchisees set up their own turn-key Body20 EMS Studios to capture huge customer demand and also supplies systems and support to ensure ongoing success.

The appeal of a stronger, fitter you in only 20 minutes per week attracts potential members, while the expertly designed layout of each club appeals to investors by utilising space and resources efficiently, so that owners are not paying for space and utilities that go unused.

Along with the strategic membership price, Body20 retains members through additional offerings, which provides owners with multiple revenue streams.



BODY20 EMS TECHNOLOGY IS A GAME CHANGER

EMS stands for “Electro Muscular Stimulation”. Technically it is a full body training exercise using impulse current. In everyday life our central nervous system constantly sends electrical impulses to control our muscle action. EMS uses this natural principle and is able to intensify this process to reach deeper muscle layers, which are hard to activate through conventional training. This is achieved by applying EMS electrodes to the skin directly above the muscle.

All in all you can call EMS simply a selective intensification of electrical stimuli from the outside. You gain the best results if you work out actively while using our EMS device. Muscles are additionally stimulated through the electrodes while doing a series of low-impact exercises. This combined training leads to an additional increase of tension producing highly effective training results.

Your personal trainer can control each muscle group by adjusting the training intensity according to your individual goals. With EMS you achieve visible and tangible success in a very short time.

Body20 EMS utilizes advanced technology from Miha and Xbody. Designed in Germany and Hungary respectively, the Miha and Xbody system is regarded as the world leaders in EMS devices serving the following markets.

Sports + Training

Health + Medical

Beauty + Wellness

CONSUMER OFFERING

Customers looking to reduce cellulite, build muscle, lose weight or just improve their overall health will benefit from Body20 EMS.

Training with Body20 EMS is growing due to the following facts:

Rapid results can be achieved in just 20 minutes a week

Specific muscle groups can be targeted

The technology is safe

Body20’s personal training approach

Active results tracking & assessments



INBODY20 ASSESSMENTS

Body20 is about results and accountability. The InBody20 is an express body assessment tool that is used to establish a baseline for each of your client’s body compositions that includes results on their body fat % and lean mass content amongst other valuable information.

InBody20 active progress evaluations enable customers to accurately track results and monitor progress throughout their Body20 training regime. Studio owners can now monitor their customer’s muscle imbalances and identify body fat areas to strategically target critical areas with EMS training to achieve maximum results.

Package Name Package Type Once-Off Cost Monthly Cost Credits per Month Redemption Period

Body20 Membership - R1000 4 (30 min) 12 Months

Body20 6 Month Membership - R1200 4 (30 min) 6 Months

Body20+ Membership - R1500 6 (30 min) 12 Months

InBody Membership - R2000 8 (30 min) 12 Months

InBody+ Membership - R2700 12 (30 min) 12 Months

Body20 Voucher R4000 - 10 (30 min) 12 Months

MakeOver Voucher R4950 - 20 (30 min) 10 Weeks

MEMBERSHIPS & VOUCHERS

Body20 customers benefit from a fixed term membership to the studio for a duration that suits them. New clients have the option to purchase a training Lycra suit directly from the studio when they sign up. Vouchers are also exclusively available through Body20 Studios and make the perfect gift for upcoming weddings, dances and photo-shoots or just for anybody that wants to EMS train on their own terms. Voucher customers almost always upgrade to a membership option once they have seen the positive effects of Body20 EMS.

Customers also benefit from:

World class equipment

Convenient locations

Affordable memberships

Well trained staff

Free leisure time

Progress & performance monitoring

*VAT INCLUSIVE

*Please note that pricing is subject to change and excludes value added services like pro rata vouchers.



FRANCHISE OFFERING

Something that is very important to us at Body20 Studio is ensuring the right level of support is provided to our Franchisees. To achieve this, all Franchisees are provided with the following:

FULL STAFF TRAINING AT BODY20 UNIVERSITY

Full initial training and ongoing training through champ boot camp. Modules covered include top performer recruiting tactics, compensation & commission structures, sales, marketing and Body20 systems and procedures.

LOCATION SERVICES

Detailed demographic profiles, nationwide real estate/lease/purchase negotiating.

InBody20 is able to monitor the following values amongst others:

Total Body Weight

Skeletal Muscle Mass

Body Fat Mass

Total Body Water

Percentage Body Fat

Waist Hip Ratio

BMI

Basal Metabolic Rate

South African working population by income:

> R50 000

R50 000 - R99 999

R100 000 - R299 000

R300 000 - R499 999

R500 000 - R749 000

R750 000 - R999 000

> +R1 million

Source: BMR, MMz Analytics



EXCLUSIVE STUDIO LICENCE

Capture the market with your very own Express, Standard or Flagship Studio within the Body20 Framework.

The rights granted are attached to the location of the studio.

AESTHETIC FIT OUT INCLUDING PAINTING FLOORING AND FINISHING’S

A professional environment ensures an unparralleled training experience

WEBSITE AND WEB MARKETING

We generate a considerable amount of leads nationally via online mechanisms, which are delivered to our franchises in real time, these in turn become memberships for your Body20 franchise.

EXTERNAL & INTERNAL SIGNAGE

Our signage experts will make sure you are visible to your clients.



ONGOING OPERATIONAL SUPPORT & SYSTEMS

Body20 Centralised Customer Billing & Collections: We use the latest electronic banking and debit recovery systems to ensure memberships are collected accurately. Reduced admin means our franchisees can focus on sales growth and customer experience.

Body20 Customer Relationship Management Software (CRM):Give great customer service and improve your sales cycle. Body20 CRM helps you manage your leads, opportunities and customers ensuring maximum customer retention with full reporting functionality.

Body20 Online Purchasing Portal:Body20 franchisees have access to the Body20 Portal to order equipment, training suits, consumables, and marketing material at group discounted pricing.

Body20 Online Video Training:Online training videos are available to ensuring your staff receive adequate training to deliver the Body20 EMS experience.

USE OF THE BODY20 BRAND AND CORPORATE IDENTITY (CI)

Leverage off the Body20 brand and benefit from overall network growth.

FULL OPERATIONAL EQUIPMENT SUPPORT & SUPPLY CHAIN MANAGEMENT

Body20 offers full operational equipment support (Miha Bodytec & Inbody20 Devices) covered within the operational royalty. We also provide the supply chain back-end with online ordering for everything you will need from lycra suits to merchandising, chip cards and consumables.



BUSINESS INVESTMENT REQUIRED

An investment in a Body20 franchise is an investment in lifestyle. Our current franchise owners come from diverse industries and backgrounds, but they have one thing in common: they were looking for an outstanding investment opportunity that would benefit themselves and their families as well as a balance between lifestyle and business investment and they found it.

Body20 has 3 different studio options available:

BODY20 EXPRESS

Ideally suited to an owner operator

Single person per time-slot

120 Member capacity

30-60 Sqm premises

BODY20 STANDARD

Ideally suited to an owner operator or

skilled networker with multiple business’s

2 People per time-slot

240 Member capacity

60-90 Sqm premises

BODY20 FLAGSHIP

Ideally suited to an investor or

skilled business owner

2 - 4 People per time-slot

Multi studio strategy

Network growth incentives

Marketing leadership

Huge membership capacity

90-120 Sqm premises

Build +/- 170k

Licence 200k

Equipment +/- 100k

Cash Flow +/- 200k

Investment Required 670k

Build +/- 315k

Licence 300k

Equipment +/- 150k

Cash Flow +/- 350k

Investment Required 1.095M

Build +/- 480k

Licence 400k

Equipment +/- 145k

Cash Flow +/- 400k

Investment Required 1.425M

*VAT EXCLUSIVE



STUDIO MANAGEMENT SERVICES

APPLICATION 5K (excl. VAT) Non-Refundable Fee

Assessment of Application (qualifications, financial standing, etc.)

Deal making (risk assessment, security, contract, etc.)

STRATEGIC MANAGEMENT & BUSINESS PLANNING (once-off) 15K (excl. VAT) Non-Refundable Fee

Structure & Set-up of Business (consultation, risk management - specific to owners)

Venue Selection (landlord negotiation, approval and space planning)

Marketing Plan (specific to location & venue)

Financial Planning (financial model/projections, budget, etc.)

VARIABLES FOR EXPENSES Affecting working capital required to cover expenses and future profitability

Owner’s Drawings (What does the owner need to earn prior to or in addition to dividends)

Studio Rental (Various venues differ in size and rentals per square meter)

Trainer Employment (Staggering the employment of trainers may help reduce salary expenses but reduce marketing capacity)

Sales (Projections assume growth of Sales at R8,000 - 10,000 per month)

OPERATIONAL MANAGEMENT (monthly expense)

Bookkeeping

Payroll - Salaries / Wages / Commissions (incl. PAYE & UIF)

Financial Management (incl. monthly & annual financial reporting, VAT, Income Tax, Advisory)

Marketing Services (promotions, advertising, etc.)

1. Sage One

All network partners will use this package for invoicing and inventory control (a big problem at the moment to manage and will be worse now that we have supplements to sell) 2. Bookkeeping

We have bookkeepers who will ensure that network partners books are up to date at all times. They will have access to the respective Sage One accounts and will ensure that the studios have all their financial transactions properly recorded. Studios will send through their bank statements (CVV files) and stock counts for reconciliations to be performed to ensure proper financial discipline and pick up any operational problems. VAT calculations and submissions will be performed.



3. HR Services

We will provide each studio with an Employee Handbook that will spell out the Body20 policies and procedures. As the policies and procedures might change from time-to-time, we will ensure that studios and the staff are adequately informed. We will also ensure that each employee signs theirstandard Body20 legally binding employment contract. We have HR specialist consultants who will consult with owners and employees in times of “difficulty” and who will ensure that owners are informed to deal with problem HR situations. These consultations will be for the cost of the owner and we will be negotiating a group rate for network partners. We will ensure that staff salaries, wages, commissions are documented for employee and employer records and payment. We will ensure that PAYE and UIF payments to SARS are posted on studio Internet bank sites for payment by owners. In addition, employee vacation and sick leave will be recorded according to the HR policies. 4. Financial Management

Our accounting team (CAs) will provide financial reporting on a monthly basis according to the annual monthly budget (prepared each year in consultation with the studio owner and based on the projections as laid out in the business planning process). Reporting will inform owners of any discrepancies highlighted through the bookkeeping function or other possible financial or legal contraventions. This service will include the drafting of monthly and annual Financial Statements, Income Tax calculations and submissions, etc. For owners who require it, advisory services such as (Tax Consulting) will be available through this service but will come at an additional cost – quoted up front. Please note that we will not be performing any reviews or audits. Should studios require such services then Body20 can refer auditors. 5. Marketing Services

Body20 will be making fully equipped activation trailers and equipment available for network partners to utilise for promotional activities. In addition, we have activation personnel available to assist owners at their activations or to perform flyer drops. Activation Managers are responsible for activation schedules and activities as well as high-level corporate and sport marketing. Much of this fee goes towards regional advertising and promotions in addition to standard (non-studio specific) flyers and other printed media.



INCOME SCHEDULE

Membership Sales:

Memberships bring in recurring monthly revenue (subscription revenue) into your business which helps you plan and grow. This predictable income stream forms the nervous system of the Body20 operation as only with predictable and recurring income can you strategically grow your business.

Memberships are taken mostly via debit order via Body20’s systems. Invoicing, collections, and unpaids are all handled centrally by the Body20 franchisor. Payments are then made to the franchisee on a monthly basis.

Membership monthly income is split between the Body20 Franchisor and the Body20 Franchisee in weight of the Franchisee (see above table). Once-off income derived from joining fees, demo fees or lycra sales is taken 100% by the franchisee.

ONCE OFF COMMISION MONTHLY COMMISION

Package Name

Package Type

Once-Off Cost

Franchise Comm

Franchisee Comm

Monthly Cost

Franchise Comm

Franchisee Comm

Body20 Membership R0 R0 R0 R1000 R150 R850

Body206 Months Membership R0 R0 R0 R1200 R200 R1000

Body20+ Membership R0 R0 R0 R1500 R225 R1275

InBody Membership R0 R0 R0 R2000 R300 R1700

InBody+ Membership R0 R0 R0 R2700 R405 R2295

Body20 Voucher R4000 R0 R4000 R0 N/A N/A

MakeOver Voucher R4950 R0 R4950 R0 N/A N/A

*VAT INCLUSIVE

Your Once-Off Investment: Depends on the studio licence type you purchase.

Your Ongoing Operational Royalty Cost: Depends on the studio licence type you purchase. * The Operational Royalty is payable to Body20 Global for the ongoing operational support as well as for the Body20 EMS Devices if you wish to lease the EMS devices. The operational royalty

is an operational expense for the studio with the advantage of reducing your capital outlay and minimising your device investment risk. The amount payable monthly is R12.5k for an Express studio and R20k for a Standard and Flagship studio. As a Flagship studio reaches its initial capacity (200 members) an additional EMS Device will be provided at the monthly expense of

R7,5k. A Flagship studio may grow to a maximum of 2 additional EMS Devices. An operational deposit is also required on start-up equal to 3 X the monthly operational royalty cost. This cost

has already been factored into the ‘Cash Flow’ breakdown amount on page 8.



Studio Type Express Standard FlagshipPremises Size Required Estimate 30-60sqm 60-90sqm 90-120sqm

Number of Memberships Approaching Capacity 100 200 400

Type of Package Subscribed - 1 Year Package (R1000) R850.00 R850.00 R900.00*

Total Subscription Revenue per Month R85 000.00 R170 000.00 R360 000.00

15 x New Subscription Sales Per Month (Lycra Fee) R7 500.00 R7 500.00 R7 500.00

5 x Voucher Sales Per Month R20 000.00 R20 000.00 R20 000.00

Total Once-Off Revenue Per Month R27 500.00 R27 500.00 R27 500.00

Income Monthly R112 500.00 R197 500.00 R387 500.00

Expenses Monthly R-43 450.00 R-79 950.00 R-105 050.00

Gross Profit R69 050.00 R117 550.00 R282 450.00

Voucher Sales:

Body20 franchisees have the opportunity to sell vouchers to customers as well. These suit customers who want to attend in their own time or have a specific need.

Body20 Voucher: 10 EMS Credits of choice, strength, cardio or relax programs to use over 12 months.

Makeover Voucher: 10 week transformation package with 10 strength sessions and 10 cardio

sessions and also includes Inbody Express Assessments to monitor your progress.

Once-off income derived from voucher sales made directly via the franchisee is taken 100% by the franchisee. A healthy combination of rolling existing memberships and signing up new members and vouchers is key to Body20 success.

PROFIT PROJECTIONS

The profit projection below is based on the following conservative assumptions:

15 new membership sales are achieved per month

5 new voucher sales are achieved per month

Subscription churn is maximum 15 customers per month

A studio with a single Body20 EMS device can handle 100 active sessions per week

While it is possible to accommodate an active membership base with 100 active members per machine the calculations do not take into account inactive members, those customers who pay on a subscription but never come in for training. This inactive base can be as large as 40% of your active base which means more revenue for little work.

The projections provided above in no way represent any form of guarantee or undertaking by Body20 to the prospective franchisee or any third party that any figures set out therein will be achieved.



ARE YOU THE RIGHT BODY20 FIT?

Body20 is currently assembling an elite team of franchise partners who have the ability to run successful studios, to think strategically and to execute on a daily basis.

Do you possess the following?

Sales and marketing abilities

A passion for business and fitness

A high standard of people management and communication skills

The willingness to learn and acquire new skills

An entrepreneurial, enthusiastic, positive attitude

Expenses Breakdown Express Standard Flagship

Studio Rental R9 000.00 R15 000.00 R25 000.00

Insurance R600.00 R800.00 R800.00

Wages (excluding owners) R5 000.00 R25 000.00 R35 000.00

Sales Commission R2 500.00 R3 000.00 R5 000.00

Electricity R1 000.00 R1 500.00 R2 000.00

Washing of Items and Cleaning Studio R800.00 R1 000.00 R1 000.00

Technical Training Garment R5 250.00 R5 250.00 R5 250.00

Session Consumables (Wear & Tear, Water etc) R1 500.00 R2 500.00 R3 000.00

Telephone Bill R350.00 R350.00 R350.00

High Speed Internet R700.00 R700.00 R700.00

Accounting Software R250.00 R250.00 R250.00

Bookkeeping R1 000.00 R1 000.00 R1 000.00

Payroll - Salaries/Wages/Commissions (incl. PAYE & UIF) R500.00 R600.00 R700.00

Local Marketing Budget R2 500.00 R3 000.00 R5 000.00

Operational Royalty (includes EMS devices and BMF) R12 500.00 R20 000.00 R20 000.00



BODY20 FRANCHISE TRAINING DATES

Included in the once-off franchise fee is the initial 4 day training held in Cape Town or Guateng. We cover 3 days of business management training and we finish off with a hands on practical on day 4 in a studio environment.

2018: Training dates will be provided on request.Space is limited so please book early. The training is only for fully incorporated Body20 Franchisees.

HOW TO GET STARTED

Contact the Body20 Head Office on [email protected] or call us on 087 231 0359

Preliminary application to approval

1. Request an application form and complete in full.

2. A non-refundable preliminary application fee of R5000 ex vat is then payable by the applicant. The applicant will then receive the welcome pack that includes the disclosure document, franchise agreement, letter of approval & LSM information amongst other items.

3. Upon preliminary approval you will be contacted by a Body20 Global development manager for a personal or telephonic interview. We will discuss your preferred studio license and answer any questions you may have. We then will enter assessment of application (qualifications, financial standing, etc.) and deal making (risk assessment, security, contract, etc.) stages.

4. Once you are in receipt of our welcome pack, please ensure that you take any relevant legal and financial advice on the business opportunity that Body20 Global offer. Should you have any questions regarding either the documents provided or the opportunity offered, please address these to us in writing, so that we can properly address any concerns before taking any further steps.

Approval to Business Planning

5. A once off, non-refundable fee of 15k (excl. VAT) is required to start the Financial Application & Business Planning Service. Services include but are not limited to: Business Structure & Setup, Venue Selection, Marketing Plan, Financial Planning.

NOTE: The application fee and the business planning fee do not form part of the Franchise Fees, do not constitute a deposit, and shall be considered as fully earned by Body20 Global upon receipt of payment from the applicant.

Full license fee payable to completion of franchise training

6. No less than 14 days after receipt of the welcome pack, more particularly the disclosure document and upon our mutual consent, you will enter into a Body20 Franchise Agreement



with the Franchisor. Payment of the full license fee must be paid 30 days before your induction training. You will be afforded 10 business days after signature of the Franchise Agreement to exercise your rights in terms of s7(2) of the Consumer Protection Act to cancel the agreement, and upon receipt of your written notice to cancel, Body20 Global shall refund the license fee paid without costs or penalties. Accordingly, no training will be provided or further steps taken by Body20 Global until the lapse of this period, whereafter, the license fee paid will be deemed to have been fully earned, and wlll no longer be refundable. In the event that any further steps are taken at your instance, Body20 Global shall be reasonably entitled to retain the portion of the initial franchise fee, as set out in the Disclosure Document, paid in respect thereof from any refund due to you upon cancellation.

7. Book yourself into and complete your 4 day business management, sales, technical and hands on practical training at the Body20 Headquarters in Cape Town or at the Gauteng regional office. (Don’t forget your workout clothes on day 4.)

Join the fastest growing fitness movement globally

8. In the background, the site selection process will be underway and once a suitable site has been approved, and lease signed your Body20 development manager will co-ordinate your studio construction. At this point your second and final payment is due.9. Body20 Global will then provide Global Champs that assist with pre & post operational training.

These champs can be booked to ensure the highest level of operational training & assist with creating a great customer experience.

10. Your Body20 turn-key studio is handed over to you for the grand opening!

For more information please go to www.body20.co.za, all the necessary application forms are also available for download on the website.

Thank you for your interest and we look forward to welcoming you to Body20!Bertus Albertse



COMPANY REGISTRATION

Company registered as: Body20 Global (Pty) Ltd

Company registration number: 2014/139840/07

Nature of operation: Franchising of fitness studios specialising in EMS technology and peripheral services.

National contact number: 087 231 0359

Website: www.body20.co.za

Address: 5 High Street (4th Floor), Rosenpark, Bellville 7530

Bank details: Body20 Global (Pty) Ltd FNB Cheque 62507566662 Branch Code 200912

VAT Number: 4210270858

Full FASA Member Number: F16/0745

Publication date: 01 January 2018

FRANCHISE INFORMATION PACK - EMS Training | Electro Muscle Stimulation · Electro Muscle...

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