Plan calls for 350-plus franchise studios inside the big gyms by 2026
Boutique franchisor Xponential Fitness Inc. and Fitness International LLC, which operates LA Fitness and City Sports Club, have reached an agreement to add 350 franchise units inside more than 500 Fitness International locations over the next five years. Development of the franchised studios within the existing LA Fitness and City Sports Club sites is expected to start during the first quarter of next year.
Xponential Fitness will invite current franchisees who own an LA Fitness center or City Sports Club within their protected territories to open an Xponential studio inside those locations. Membership in an Xponential brand studio that resides inside an LA Fitness or City Sports Club facility will be available to their gym members for an additional cost.
The time and build-out funds needed to develop these new Xponential sites will be less than those of a traditional standalone studio, and “existing franchise partners will have an opportunity to drive additional revenues while operating these locations free of initial franchise fees and lower marketing fund fees,” according to a statement released by LA Fitness. The average unit volume at these new Xponential sites is projected to be less than those of standalone studio locations, but that should be offset to at least some extent by reduced operating costs.
In the LA Fitness statement, Xponential Fitness CEO Anthony Geisler said the agreement will “further our mission of making boutique fitness accessible to everyone, increasing our total addressable market, and providing expansion opportunities to our franchisees. This provides a unique opportunity for franchisees to increase their reach and overall revenue generation within their protected territories.”
Jill Grueling, who is Fitness International’s president for club operations, said, “Xponential will bring additional high-quality fitness experiences to our members. We are confident their boutique fitness brands will provide an excellent complement to our members’ existing workout routines.”
Irvine, Calif.-based Xponential Fitness was established in 2017. The company offers instructor-led Pilates, indoor cycling, barre, stretching, rowing, dancing, boxing, running, functional training and yoga within its studios. Xponential has locations across the continental United States and Canada, plus 10 additional countries (as of Oct. 13, 2021).
Fitness International, which also has headquarters in Irvine, has more than 700 sites across 27 states and Canada. It offers a wide range of workout amenities. LA Fitness was founded in 1984.