GOLD’S GYM Franchise Complaints
August 18, 2012
Gold’s Gym franchise claims to be the #1 Brand in Fitness.
No doubt, Gold’s Gym has been a powerful brand in health and fitness since Joe Gold opened the first location at Venice Beach in 1965.
The Gold’s Gym franchise website claims
“We are the most recognized brand in fitness because we have a proven business that offers franchisees instant competitive advantages:
“Over 45 years of experience and brand recognition
“Award-winning marketing programs
“State-of-the-art training systems to support operational and sales needs
“Industry-leading real estate and construction tools and models
“Significant group purchasing “
“Our franchisees benefit from proven systems and innovative resources that have been developed and improved over the last 45 years.
“We provide the structure, tools and resources to help you build and maintain a successful business…”
How well is fitness icon Gold’s Gym weathering the recession?
According to Entrepreneur, Gold’s Gym U.S. franchise locations fell from 465 in 2008 to 388, a net loss of 77 locations (17%)
According to data released by the Small Business Administration (SBA), Gold’s Gym franchise owners who qualified for SBA-backed franchise loans have a loan failure rate of 20%.
That just barely qualifies Gold’s Gym for inclusion in UnhappyFranchisee.com’s list of WORST FRANCHISES IN AMERICA (by SBA loan defaults)
Are you familiar with the Gold’s Gym franchise opportunity? If so, please share your experience, opinions or insights with a comment below.
If you are a Gold’s Gym franchise representative or employee, please leave a comment or email us at UnhappyFranchisee[at]gmail.com.
Gold’s Gym franchise owners have a 20% SBA loan default rate.
The inability to repay an SBA-backed loan (or any franchise loan, for that matter) indicates a serious situation for the franchisee.
It’s especially serious with a franchise investment as high as Gold’s Gym: between $898,500 – $3,890,000 according to Entrepreneur.
It’s likely that Gold’s Gym franchise owners who received SBA loans may have collateralized their franchise loan with their homes or other personal assets, and many were unable to repay those franchise loans… despite the serious incentive to do so.
Gold’s Gym
| SBA loans granted since 2001: | 116 |
| SBA loan failure rate: | 20% |
| Sources: Coleman report (SBA) |
Gold’s Gym franchise chain shrunk by 17% between 2008-2012 in the U.S.
The closure rate and loan defaults of Gold’s Gym could be seen as franchise due diligence red flags.
| Gold’s Gym Franchises 2008-2012 | |
| Franchises open 2008: | 465 |
| Franchises open 2012: | 388 |
| Franchise growth 2008-2012 (locations) | -77 |
| Franchise growth 2008-2012 (%) | 17% |
| Source: Entrepreneur |
What do you think of the Gold’s Gym franchise?
Are you familiar with the Gold’s Gym franchise opportunity?
What do you think accounts for the SBA loan failure rate of Gold’s Gym franchise owners?
What steps should Gold’s Gym be taking to stop further franchise failures?
Has Gold’s Gym and Gold’s Gym International (GGI) taken serious action to address the problems that led to these loan failures?
Please share a comment (anonymous is fine) or Contact UnhappyFranchisee.com.
ARE YOU FAMILIAR WITH THE GOLD’S GYM FRANCHISE OPPORTUNITY?
ARE YOU A CURRENT OR FORMER GOLD’S GYM FRANCHISE OWNER?
PLEASE SHARE A COMMENT BELOW.
Corporate responses, clarifications or rebuttals welcome:
Tags: Gold’s Gym, Gold’s Gym franchise, Gold’s Gym franchise complaints, Gold’s Gym failures, Gold’s Gym complaints, personal training franchise, fitness franchise, health club franchise, gym franchise, franchise failure rates, SBA franchise loans, worst franchises, unhappy franchisee, Gold’s Gym International (GGI)
FITNESS TOGETHER Franchise Complaints
August 18, 2012
The Fitness Together personal training franchise seems like an attractive opportunity.
After all, it ranked #100 in Entrepreneur’s Franchise 500, its fifth consecutive year to appear on the list.
“We are honored to be named among the industry’s best,” said Jeff Jervik, president and CEO of Fitness Together Holdings, Inc. “Despite the troubled economy, Fitness Together has continued to grow and establish itself as a leader in the fitness industry. And our annual ranking to the Franchise 500 is a true affirmation of our stability.”
The Fitness Together franchise website cites risk reduction as a key benefit it offers.
“Why all the excitement about franchising?” states the Fitness Together website.
“It’s simple. It’s because people want to reduce their risk.
“Entrepreneurs who choose to franchise are ahead of the curve with exclusive systems, branded services and a proven business model.”
Why is it that Fitness Together has such a high SBA loan failure rate?
However, once you dig a little deeper, the emphasis on risk reduction by Fitness Together seems a bit ironic.
According to the 2012 Fitness Together Franchise Disclosure Document (FDD) , 198 Fitness Together franchises ceased operation (31%) between 2008-2011.
According to data released by the Small Business Administration (SBA) indicates that Fitness Together franchise owners who qualified for SBA-backed franchise loans have a loan failure rate of 36%.
That qualifies Fitness Together for inclusion in UnhappyFranchisee.com’s list of WORST FRANCHISES IN AMERICA (by SBA loan defaults)
Are you familiar with the Fitness Together franchise opportunity? If so, please share your experience, opinions or insights with a comment below.
If you are a Fitness Together franchise representative or employee, please leave a comment or email us at UnhappyFranchisee[at]gmail.com.
Fitness Together franchise owners have a 36% SBA loan default rate.
The inability to repay an SBA-backed loan (or any franchise loan, for that matter) indicates a serious situation for the franchisee.
It’s especially serious with a franchise investment as high as Fitness Together: between $169,650 to $299,750, according to their website.
It’s likely that Fitness Together franchise owners who received SBA loans may have collateralized their franchise loan with their homes or other personal assets, and many were unable to repay those franchise loans… despite the serious incentive to do so.
Fitness Together
| SBA loans granted since 2001: | 107 |
| SBA loan failure rate: | 36% |
| Sources: Coleman report (SBA) |
198 Fitness Together franchises ceased operation (31%) between 2008-2011
The relatively high franchise closure rate of Fitness Together seems to be a franchise red flag.
| Fitness Together Franchises 2008-2011 | |
| Franchises open 2008: | 365 |
| Franchises added 2008-2011: | 272 |
| Franchises ceased operation 2008-2011 | 198 |
| Franchises ceased operation (%) | 31% |
| Sources: Fitness Together 2012 Franchise Disclosure Documents (FDDs) |
According to the 2012 FDD, Fitness Together started had 365 U.S. franchises open in 2008 and had 272 by the end of 2011… a net loss of 93 locations.
However, when you figure that Fitness Together opened 272 new franchises during that period, it’s apparent that the number of franchises that ceased operation is actually 198, or 31% of the 637 total Fitness Together franchises open sometime during that period.
Fitness Together Franchises 2008 – 2011
(Source: Fitness Together 2012 FDD)
| Year | Outlets at start of the year/period | Outlets added | Terminated / Ceased Operation* | Outlets at end of the year | |
| 2008 | 365 | 75 | 40 | ||
| 2009 | 400 | 18 | 72 | 247 | |
| 2010 | 346 | 8 | 44 | 218 | |
| 2011 | 310 | 6 | 42 | 207 | |
| 2008 -2011 | 365 | 107 | 198 | 272 |
* This column combines franchises that were either terminated by the franchisor or “ceased operation for other reasons.” During this period, 92 franchises were listed as terminated and 106 ceased operation for other reasons in the Fitness Together Franchise Disclosure Document (FDD).
What do you think of the Fitness Together franchise?
Are you familiar with the Fitness Together franchise opportunity?
What do you think accounts for the high SBA loan failure rate of Fitness Together franchise owners?
What steps should Fitness Together be taking to stop further franchise failures?
Has Fitness Together taken serious action to address the problems that led to these loan failures?
Please share a comment (anonymous is fine) or Contact UnhappyFranchisee.com.
ARE YOU FAMILIAR WITH THE FITNESS TOGETHERFRANCHISE OPPORTUNITY?
ARE YOU A CURRENT OR FORMER FITNESS TOGETHER FRANCHISE OWNER?
PLEASE SHARE A COMMENT BELOW.
Corporate responses, clarifications or rebuttals welcome:
MY GYM Franchise Complaints
August 17, 2012
My Gym franchise opportunity: Are you familiar with it?
If so, please share your experience, opinions or insights with a comment below.
The My Gym franchise information packet on the My Gym website claims “My Gym has grown by leaps and bounds in the last several years. We currently have over 200 locations and are in over 25 countries. We have been named as one of the top 300 franchises by Entrepreneur Magazine’s ‘Annual Top 500 Franchise List’ and also listed on their ‘Annual Top 200 International Franchise List’ for the past 5 years.”
My Gym claims that risk-reduction is a benefit of their franchise. Their info packet states:
“THE BENEFITS OF BUYING A FRANCHISE
…in purchasing a well-structured franchise, you greatly minimize the risks and strains of starting a new business….
“Our pre-opening, post opening and continuing support to our franchisees is unparalleled in the field of franchising.
“My Gym Children’s Fitness Center is a proven, productive business with locations across the country.
“Comprehensive financial, marketing and administrative systems help you avoid the mistakes and perils independent business owners must combat alone.”
However, according to Entrepreneur, My Gym locations declined from 179 US franchises in 2008 to 152 in 2011
According to data released by the Small Business Administration (SBA), My Gym franchise owners who qualified for SBA-backed franchise loans have an outrageously high loan failure rate of 51%.
That earns My Gym a spot in UnhappyFranchisee.com’s list of WORST FRANCHISES IN AMERICA (by SBA loan defaults)
My Gym franchise owners have an outrageous 51% SBA default rate.
The apparent drop in My Gym franchises in recent years and the high loan default rates are franchise due diligence red flags.
| My Gym Franchise | |
| My Gym U.S. franchises in 2008: | 179 |
| My Gym U.S. franchises in 2011: | 152 |
| Growth in franchise units 2008 – 2011 (#) | -27 |
| Growth in franchise units 2008 – 2011 (%): | -15% |
| SBA loans granted since 2001: | 68 |
| SBA loan failure rate: | 51% |
| Sources: Entrepreneur (growth), Coleman report (SBA) |
The inability to repay an SBA-backed loan (or any franchise loan, for that matter) indicates a serious situation for the franchisee.
It’s likely that My Gym franchise owners who received SBA loans may have collateralized their franchise loan with their homes or other personal assets, and many were unable to repay those franchise loans… despite the serious incentive to do so.
Are you familiar with the My Gym franchise opportunity?
What do you think accounts for the SBA loan failure rate of My Gym franchise owners?
What steps should My Gym be taking to stop further franchise failures?
Has My Gym taken serious action to address the problems that led to these loan failures?
Please share a comment (anonymous is fine) or Contact UnhappyFranchisee.com.
If you are a My Gym franchise representative or employee, please feel free to leave a comment or email us at UnhappyFranchisee[at]gmail.com.
ARE YOU FAMILIAR WITH THE MY GYM FRANCHISE OPPORTUNITY?
ARE YOU A CURRENT OR FORMER MY GYM FRANCHISE OWNER?
PLEASE SHARE A COMMENT BELOW.
My Gym, My Gym franchise, My Gym franchise complaints, My Gym complaints, My Gym Enterprises, MGE, children’s franchise, Kid’s franchise, fitness franchise, gym franchise, children’s gym franchise, franchise failure rates, SBA franchise loans, worst franchises, Cory Bertisch, Jamie Bertisch, Mike Chalovich, Monique Vranesh, Randy Bertisch, Susi Sherman, Yacov Sherman
CURVES Sold? Gary Heavin Out?
July 27, 2012
CURVES Sold? Gary Heavin Out?
Curves franchise owners and UnhappyFranchisee.com long for the day when we publish that headline with exclamation points instead of question marks.
According to a report by Stuart Goldman on the Club Industry website, Curves International is close to an equity deal with North Castle Partners.
According to the Curves franchise owners and former franchise owners who have posted more than 1000 Curves franchise complaints on UnhappyFranchisee.com, a deal can’t close fast enough.
Speaking of closing fast, more than half of the franchisee-owned Curves U.S. locations have closed in the last few years. (Read: CURVES: The Rise & Painful Fall of the Curves Franchise Chain)
Curves franchisees complain that they have suffered brutal and callous treatment at the hands of Curves International. Rather than lending assistance or even compassion, devastated Curves franchise owners complain, the supposedly Christian Curves International turned loose law firm/collection agency attack dogs to demand final payments from failed franchisees. Curves franchisees were not allowed to sell their equipment, but were forced to return, donate or destroy it by CI.
It’s been alleged that Curves management repeatedly rubbed salt in the wounds of their many failed franchise owners.
As franchisees fought for survival, past-President Mike Raymond told the Wall Street Journal the widespread failures were part of a strategy to “prune” the Curves system. (Read: CURVES Franchise Owners React to Comments That They’re Being “Pruned”)
When confronted with the high SBA loan default rate from Curves franchise investments, founder and CEO Gary Heavin blamed greedy franchisees and “the overpriced resales of franchises between third parties.”
As their franchisees struggled to save their homes and savings and fight off bankruptcy, Gary and Diane Heavin publicized their Christian philanthropy by appearing on the national tv show Secret Millionaire (Gary Heavin on ABC Secret Millionaire: What do CURVES Franchisees Think?)
Curves Sale Negotiations in the “Final Stages.”
According to Club Industry:
Curves International, Waco, TX, says it is close to an equity deal agreement with private-equity firm North Castle Partners.
Curves CEO Gary Heavin says negotiations surrounding the transaction are in the final stages.
“North Castle and Curves are working closely together as the investment becomes finalized,” Heavin said in a statement released to Club Industry. “We will send out a notice to inform everyone when the transaction is official and follow up with details about upcoming changes shortly after that.”
Terms of the pending transaction were not disclosed.
North Castle Partners, Greenwich, CT, is a firm focused on the health, wellness and active living sector. Its investments range from $10 million to $200 million. Included in its portfolio are equipment manufacturer Octane Fitness, Brooklyn Park, MN, and Canadian clubs World Health and Spa Lady.
How the deal would affect the company roles of Heavin and his wife, Diane, who co-founded Curves in 1992, is unknown. Full details regarding any changes in the corporate structure will be released when the deal is finalized, according to the company.
Read all about Curves International here: CURVES: Curves Posts on Unhappy Franchisee
ARE YOU FAMILIAR WITH THE CURVES FRANCHISE OR CURVES INTERNATIONAL? SHARE A COMMENT BELOW.
SNAP FITNESS Franchise Complaints
April 26, 2012
SNAP Fitness Franchise Complaints are plentiful on the Internet.
Do you have a SNAP Fitness Franchise Complaint? Please share it below.
Do you love Snap Fitness? Please tell us why in a comment below!
Also read: ANYTIME FITNESS Franchise Complaints
Snap Fitness franchise marketing claims that “The Snap Fitness franchise concept is the wave of the future. Regardless of the condition of our Nation’s economy, people always appreciate good value. With single memberships as low as US$22.50 per month, your Snap Fitness franchise provides a great alternative to the big box health club concepts available today
Snap Fitness promises world-class support, including:
- Site Selection
- Lease Negotiations
- Location Build-out
- Ordering Initial Materials & Supplies
- Hands on training at our Minneapolis corporate offices
- On-site sales staff the entire 1st week of your store opening
- Ongoing monthly training and sales seminars
Snap Fitness Franchise Complaints
However, unhappy Snap Fitness franchise owners, former owners and employees tell a different story.
On Blue Mau Mau, a failed Snap Fitness franchisee wrote:
Don’t believe the sales pitch that you can run a successful snap while also working full time somewhere else. This would only work if you are able to pay a full time, sales oriented manager.
Also, you most likely will NOT breakeven within the first 6 months. It could take 12-18 months or more. Make sure you have the financial resources to subsidize your business for the long haul.
These were my two biggest mistakes. I didn’t have the time, energy or finances to keep my business going.
Guest wrote:
My experience in the fitness industry cost me over $200,000. These franchisors are theives at best…
Snap Fitness Crap wrote:
If you choose to sign with Snap Fitness…..Beware
If you become dissatisfied with them and don’t want to renew your agreement, they have a clause in the agreement that prevents you from doing business on your own for two years. Peter Taunton is no better then a mob boss forcing franchisees to stay with him. And the sad part is that they really don’t do anything to help you succeed, except have their name, which I have found no one is familiar with the name anyway unless they have actually driven by a Snap in their area. Biggest mistake I have ever made in my life.
Guest wrote:
Why do Snap Fitness franchises fail?
1. Inaccurate representation of potential financial success by corporate
2. Factual statistics about financial health of current franchisees “not available”
3. Weak business model
4. Inadequate support provided to franchisees by corporate
5. “No contract” memberships become a liability in time
6. Billing, software and technical equipment continually have issues
7. Requires turnover of staff to keep costs low. Revolving door employees.
8. Return on investment, if any, is scant and unjustified for the amount of risk
9. CORPORATE IS MAKING HUGE PROFITS WHILE FRANCHISEES ARE WIPING OUT
PETER TAUNTON = Case # 24040055, Court File # K598001371, Disposition Date 3/18/1999, Minnesota Attorney General’s Office St. Paul, Kaniyohi District Court, Theft-by Swindle-Artifice/Trick/Device or Other, Statute # 609.52.2.4., CONVICTED, Probation Sentence – 2 Years
ARE YOU A SNAP FITNESS FRANCHISE OWNER, SNAP FITNESS FRANCHISEE OR EMPLOYEE? ARE YOU FAMILIAR WITH THE SNAP FITNESS FRANCHISE OPPORTUNITY? SHARE A COMMENT BELOW.
ANYTIME FITNESS Franchise Complaints
April 26, 2012
Anytime Fitness Franchise Complaints: Add yours as a comment below! Love the Anytime Fitness franchise? Tell us why!
Are you familiar with the Anytime Fitness franchise opportunity? Please share a comment below.
Also read: SNAP FITNESS Franchise Complaints
If you are searching for the right franchise opportunity, we hope you brought a shovel.
Even the absolute worst franchise disasters seem to receive high rankings in Entrepreneur and accolades in the mainstream business media.
Do some digging to find out the truth – then post it on UnhappyFranchisee.com for others to see.
Is Anytime Fitness A Great Franchise Bet?
In 2011, CNN.com named Anytime Fitness one of its “10 Great Franchise Bets.”
CNN made this pronouncement based almost solely on Anytime Fitness’ relatively low SBA loan default rate of 2.7%.
CNN wrote: “Anytime Fitness, a chain of gyms, offers customers workouts at their convenience. The clubs are open 24 hours a day. Members can exercise even when a club is not staffed, thanks to proprietary access software, security and surveillance technology.
“Co-founders Dave Mortensen, Chuck Runyon and Jeff Klinger — who has since left the company — opened the first club in 2002 in Cambridge, Minn. Less than 10 years later, there are nearly 1,600 clubs nationwide with more than 1.1 million members.
“More than half of the club owners have more than one location. Running an Anytime Fitness gym involves relatively low overhead, because large numbers of employees are not required. “
“…Of 147 SBA-backed loans between 2005 and 2010, there were just four defaults.
Reports of Anytime Fitness Closings & Franchise Failures
Despite the CNN’s implication that only four Anytime Fitness franchises have failed, a quick Google search reveals a different story.
Anonymous writes Maplewood, MN Anytime Fitness closed yesterday ( 5/25/11 ) and I showed up to exercise since management did not have the courtesy to notify any of the members.
Yelp reports Anytime Fitness – CLOSED 2501 7th St W St Paul, MN 55116
ABC57 reports SOUTH BEND, Ind.– Anytime Fitness is closing its doors at Eddy Street Commons.
Rasmus Auctioneers wrote: Anytime Fitness at Broadlands Center. Rasmus will make a complete liquidation of cardio, excess circuit, plated, strength and excercise equipment, office & business assets by internet only auction
Union County Weekly wrote: Stallings Anytime Fitness on Idlewild Road closed its doors on the last day of the year
Anytime Fitness franchise owners Chad and Jenni Riegel wrote: Dear Anytime Fitness Member, We regret to inform that we are forced to close anytime fitness – New Haven on August 31, 2011.
bcintron wrote: I was a member of the E. Sahara Ave., Las Vegas, NV gym for three months, the gym was only open for about 5 months.
We could go on…
Anytime Fitness Franchise Complaints
Anonymous writes:
All is not what it seems. A great concept except ATF wants all the control by making it mandatory to us ABC Financial. ATF owns ABC and this to me is a conflict of interest to the gym owner. As long as they have their hands on your money the only people that make money is them… this is not a easy business and far more difficult than what they try to make it out to be.Plus on average I would say that between the two of them you will be paying about 10-12% of your gross income to them which doesn’t leave much for you.
Bend Over Chuck writes:
BE PREPARED FOR THE MASS CLOSINGS OF BOTH FRANCHISES IN THE NEAR FUTURE. Besides a weak business model and crappy customer service most 24/7 clubs throughout the country are performing business contrary to the current state, county and city laws and regulations. BUYER BEWARE!
ANYTIMEASSHOLES writes
The owner of the anytime fitness in Ortley Beach New Jersey had the franchise for about 5 years. He was diagnosed with multiple sclerosis, a debilitating incurable disease. The franchise could not turn a profit so he had to close down when the franchise license and the lease on the property expired.
How did ANYTIME respond? By harassing the owner, sending threating letters from their scumbag ambulance chasing attorneys and threatening to sue the owner. They sent a private investigator to New Jersey to look for ways to screw the owner further. For what? Instead of letting him close the franchise and move forward with his life, made complicated by multiple sclerosis, these scumbags from anytime and their lowlife lawyers had to harass him and make his life difficult….
Anyone who wants to do business with these lowlife scumbags deserves all the bad experiences they will bring . They are the lowest of the low and don’t deserve to be a part of the American franchise field. They and their lawyers are the lowest form of life on the planet. They are all greedy un-caring scum.
NO HEART, ANYTIME wrote:
This company’s leader is Chuck Runyon CEO. The company is all about one thing and one thing only, MAKING $$$. The owners and management have signed contracts with their franchisees and they are going to enforce the letter of the law! Franchisees are getting screwed and passing this behavior onto their members. It is a vicious cycle. Corporate is making BANK while franchisees are wiping out. It is tragic for all of the franchisees who bought into this business model based on the information AF corporate sales provided. Does anyone really know how many AF’s are even making money?
ARE YOU AN ANYTIME FITNESS FRANCHISE OWNER OR FORMER FRANCHISEE? ARE YOU FAMILIAR WITH THE ANYTIME FITNESS FRANCHISE OPPORTUNITY? SHARE A COMMENT BELOW.
CURVES AUSTRALIA Franchise Complaints
February 22, 2012
Are you familiar with the Curves franchise program in Australia?
Please share what you know with a comment below.
In the past, UnhappyFranchisee.com has focused its reporting on the troubles of U.S. Curves franchisees.
(Read CURVES: Robert Lay’s Story – 1000+ comments – Or CURVES: Curves Posts on Unhappy Franchisee for a complete list of posts)
Frankly, we don’t know how exactly the Curves franchise operates in Australia.
We have heard that more than 52 Curves franchises have closed since 2010.
We do know that more than 60 Curves in Australia are for sale on the BuyCurves.com resale website.
And we know one more thing: We get lots of emails from Curves franchisees in Australia that mirror the complaints of Curves everywhere else:
- Complete lack of support.
- Corporate indifference to the plight of franchisees struggling to survive.
- Cold calculated legal demands forcing clubs to close and pay damages and future royalties, even from franchisees who have lost everything.
Aussie Z wrote:
I wish I never heard of Curves and Gary Heavin… Things were going great for the first 18 months then things started going down hill, repeatedly emailed CI for some sort of help got nothing. Then Curves Smart came and I borrowed more money as Curves said this would really make my club profitable. What a crock. Just meant I am in more debt.
Cornered Gary at Convention and he promised that when he got back to America he would get in touch with me to see what he could do to help. LIAR he never did. I am now on the verge of having to bankrupt myself so I hope Gary and CI are proud of themselves. So much for the god fearing person he portrays himself to be. Made me sick to see him on “Secret Millionaire” giving away thousands of dollars to strangers and wont do anything to help the people who made him rich in the first place.
When I started my curves up there was over 400 in Australia now there are 273 clubs left. One regional club couldn’t even give her club away for $1 so she just closed down as well. Very very sad.
Dont get sucked in by the hype. Certainly don’t help Gary get any richer.
A rural Australian Curves owner complains of the lack of support and threat of termination:
I bought a Curves resale in rural Australia. it wasn’t doing well mainly due to the owner at the time, she did a lot of damage and I’ve been trying to rebuild it. I have continually asked Curves for support during this time but NOTHING. So my issue is mainly with the royalty / ad fee repayments. Some months go through others don’t from lack of members (financials). So they now issued me with a pay $8000 you owe us on 10 days or your agreement will be terminated.
Another Australian Curves owner emailed us:
… I am in the same situation as everyone else who has purchased Curves, and has encountered their unprofessionalism…
I live in Australia, and I have been forced to terminate my franchisees, and havebeen sent a letter from a Law Firm in Melbourne, Australia.
Last year we were forced to be closed for some time due to a natural disaster, and since then we have fallen behind in royalty fees etc….
I have just received a letterlast Friday (27th August) from a Law firm in Melbourne, Victoria, stating that I need to close my clubs ASAP, and also pay then a huge amount of money, including future royalty fees.
I cannot offer any money as I am broke..
“A Desperate Aussie” wrote:
I am from Australia and things are not good here.
Tried to get assistance from CI to consolidate 2 clubs into a single club that may have a chance of surviving. 2 clubs will certainly both fail and very soon, so we are closing one immediately.
We have paid royalties for 3 years from the closing club and 2 years for the one that may survive BUT CI (Jim J and Gary H have both said that population is large enough to support 2 clubs and will not allow us to consolidate. They just say sell one and concentrate on the other. If the closed club were to be resold then the 2 clubs would fail quickly.
We need support and asked for their help and had the door slammed in our face. The population figures they use to justify a viable club is so out of date and does not in any way reflect the environment clubs operate in these days.
We are frightened that CI will access all our funds and force us into Bankruptsy.
I know of several other clubs that are in big trouble also and will have to close sooner that later. CI just does not care. When you no longer supply funds to them they just want you to sell your franchise. It is all about keeping the cash rolling in and to hell with the damaged lives that lay in the wake of the failed businesses.
ARE YOU FAMILIAR WITH THE CURVES FRANCHISE IN AUSTRALIA? PLEASE SHARE YOUR INSIGHTS, OPINIONS OR INFORMATION BELOW.
Contact UnhappyFranchisee.com.
Did CURVES President Mike Raymond Get Pruned?
February 16, 2012
Did CURVES President Mike Raymond Get “Pruned”?
If so, many franchisees who lost their Curves clubs, retirement savings, positive credit scores and investments as part of a process Raymond called “pruning” might call that “poetic justice.”
In a 2010 interview with the Wall Street Journal, Curves President Mike Raymond stated that the failure of more than 1000 Curves clubs, and the closing of 1/3 of all domestic franchises, was simply a healthy “pruning” of the system.
He also blamed the closures on Curves franchise owners, who had an “investor” mentalities (Read: CURVES Franchise Owners React to Comments That They’re Being “Pruned”)
CURVES President Mike Raymond Steps Down With No Fanfare
In the brief February 14th story Curves President Steps Down on ClubIndustry.com, Stuart Goldman wrote:
Mike Raymond, who had been the president of Curves International, Waco, TX, since 2005, resigned in December.
Raymond is now a senior advisor to the company and continues to serve on the Curves board of directors. He has been with Curves since 2002 and had served as its senior vice president of marketing prior to his promotion to president. He succeeded Gary Findley, who is now the chief operating officer for Snap Fitness, Chanhassen, MN.
“I wanted to do some other things,” Raymond says. “I’m still very actively involved with the company, and I still have an office there and do a lot of work there.”
Raymond says he is teaching at Baylor University, which is in Waco.
A company spokesperson says Curves has no immediate plans to fill its president’s role.
If A Tree Is Pruned and No One is There to Hear It…
Anyone find it odd that the President of a large company like Curves International steps down and no one notices?
There were no press releases or announcements that Mike Raymond stepped down.
The industry’s own trade magazines didn’t report it for 2 months.
The brief ClubIndustry.com mention raises many questions:
Was Mike Raymond “pruned” as being unnecessary, like the pesky Curves franchisees he referenced in the Wall Street Journal article?
(Also read: CURVES: 1000 Franchise Clubs Failed Last Year)
What are the “other things” Mike Raymond wanted to do?
Will he parlay his pruning skills into an entrepreneurial venture, like raising bonsai trees?
If Mike Raymond still has an office at Curves, what does he do in it?
If Mike Raymond is gone and is not being replaced, does that mean that Gary Heavin was just calling all the shots anyway?
Well, if Mike is feeling low about stepping down after 8 years, he can always commiserate with the thousands of Curves franchisees who know what it’s like to get “Pruned.”
You can talk to them here, Mike: 1000+ Comments from Curves franchise owners.
Just don’t mention that when you left, you got a golden parachute instead of threatening letters and a collection agency hounding you.
WHAT DO YOU THINK? SHARE A COMMENT BELOW.
CURVES: Why Did the Curves Franchisee Association Fail? (Part 1)
February 2, 2012
If ever a group of franchisees needed a strong independent franchisee association, that group would be the embattled franchise owners of Curves International.
Once touted as the fastest-growing franchise in history, Curves has now achieved the distinction of also being the one of the fastest-failing franchises in history.
According to an article last summer in the Wall Street Journal, “Curves now has about 4,000 U.S. locations—half the number at its zenith in 2005.”
WSJ reporter Richard Gibson stated “Last year 833 clubs, or 16% of the chain’s domestic presence, closed across the U.S., turning what many franchisees thought would be comfortable incomes and retirement nest eggs into money pits.
On the UnhappyFranchisee.com website, unhappy Curves franchisees have outspokenly detailed and protested their alleged mistreatment, bullying and harrassment at the hands of Curves International.
Thousands of franchisee comments, ranging from sad to scathing, have been posted at CURVES: Robert Lay’s Story, on the CURVES: Curves Posts on Unhappy Franchisee and on other Curves franchise articles.
Curves Franchisee Association (CFA) 2006-2011. RIP.
The Curves Franchisee Association held its first meeting in October, 2006 and was laid to rest Sept 30th 2011.
Just 2 years earlier before being pronounced dead, Curves International’s funding and support of the CFA prompted the American Association of Franchisees and Dealers to name Curves International, Inc., its Franchisor of the Year for 2009.
According to the AAFD news release: “Notwithstanding the challenges of rapid growth, and dynamic involvement in multiple channels of distribution, [Curves International, Inc.] has embraced a collaborative culture with its franchise network and has enjoyed a very positive relationship with its members as a result.
“AAFD Chairman Robert Purvin cited Curves’ exemplary franchise culture as the primary focus of the AAFD’s recognition. ‘Curves management has encouraged and supported the organization of an independent franchisee association, including a willingness to engage the association’s elected leadership.’”
CFA Autopsy by Attorney Ron Gardner
What killed the much-needed Curves Franchisee Association?
According to CFA attorney Ron Gardner, the fatal wounds were self-inflicted. It was the distractions of franchisee infighting, bickering, and petty politics that rendered the Curves Franchisee Association ineffective. Ultimately, the death blow was that Curves franchisees were unwilling (or unable) to fund their own association.
According to CFA attorney Ron Gardner, a number of contributing factors led to the demise of the CFA, including franchisee infighting, bickering, petty politics and Curves franchisees’ unwillingness (or inability) to fund its franchisee association. In the end, the Curves Franchisee Association simply ran out of steam.
In his final letter (and autopsy report – posted below), Ron Gardner had nothing but praise for Gary Heavin and Curves International management. Not only was CI open to hearing the ideas of the CFA, Gardner praised Curves for “so generously funded the organization through its infancy.”
Do you agree with Ron Gardner that Curves franchisees killed their own organization? Share a comment below.
Here is Ron Gardner’s post-mortem and farewell letter, originally posted on the CFA website:
So Long … For Now
As someone who has practiced franchise law for almost two decades, I could have predicted that this day was coming several years ago.
The reality is that most franchise associations go through a lifecycle quite similar to that experienced by the most recent iteration of the Curves Franchise Association:
(1) lots of excitement by lots of people to get an association formed and to move forward;
(2) a lot of time, effort and hard work in setting the association up by a smaller number of people;
(3) continued hard work as the association tries to find its feet, both in terms of its goal and purposes, and its independent voice – by a smaller number still;
(4) a longer period of time in which a few people continue the work of the association, working hard to make the system better for all franchisees, but increasingly feeling unappreciated by the “membership”; and
(5) resignation by the few remaining members that, given the volunteer nature of the work, it is no longer worth the effort.
Let me be clear – none of the current CFA Board members have expressed to me a “resignation” that their service was not worth the effort. But, to be fair, I could see it in their eyes, hear it in their voices.
On a brighter note, however, it has also been my observation over the last two decades that an association like the CFA has laid too much groundwork for a franchisee voice to simply be ignored by the franchisor. Whether that voice is in the form of the CFA or some successor organization that is most certainly sure to spring up (if it has not already) is something that we will all have to wait and see about. However, during this “lull” in activity by an official independent franchisee association, it probably behooves all of us to take stock of the lessons that we have learned through the lifecycle of the CFA, as well as providing our sincere thanks to those who worked so hard, and quite frankly, accomplished so much, in pioneering this effort.
Among the lessons we have learned: while Curves certainly prefers to do things its way, it is willing to listen to reasoned and rationale viewpoints that are divergent from their own. Look, we all know that franchising is different than most people think it is when they first start – but, having a franchisor that is willing to listen to the concerns of the franchisee, and consider them, is a significant step in the right direction. I am not suggesting that you should not be dissatisfied with your franchisor at times, and maybe even most of the time depending on your situation. But, we know that screaming, yelling and suing each other rarely brings the parties closer to together to gets things moving in a more cooperative direction. One of the most refreshing things that I observed during my work for the CFA was the willingness of Curves senior management, including Gary Heavin, Mike Raymond, Roger Schmidt, and a host of others, to listen when we had something to say. Often times, Curves would agree with our observations, and change their approach, or at least consider serious modifications. We did not win all of our battles, but we most certainly had a lot to say, and Curves is a better system for it.
We learned that, not surprisingly, a collective voice is much louder than an individual one. As you know, Curves has thousands of franchisees, and is broken into several subparts. Just getting the attention of your franchisor can be difficult if you do not have a collective voice to go through. The franchisee association, in its heyday, was a loud voice for franchisee rights, and helped many individual franchisees find solutions to problems that they were not able to find on their own.
Of course, not all the lessons that we learned were positives. We learned that franchisee associations cannot function productively if they have to spend a significant portion of their time battling the viewpoints of other franchisees – rather than executing strategies aimed at changing the behavior of the franchisor. To my great dismay, the CFA and the people who committed so much of their time and effort to making the CFA a better organization, spent far too much of their time being victims of unjustified rumors, accusations, and other frivolous distractions. It is my sincere hope that the next time an independent association rises in this system, that those members who choose to disagree or not participate with those who are doing the work, choose to merely sit on the sidelines and/or voice their displeasure at the ballot box, rather than undertaking a campaign of personal attacks that make it certain that nothing productive can ever get done.
Another lesson that is not surprising that an association cannot survive, long term, no matter how much value it is adding to its member, if those members are not willing to fund the organization. Among one of the most remarkable things I will remember about the CFA was the way in which Curves so generously funded the organization through its infancy – never demanding in return that we take their particular viewpoint, or refrain from challenging them on any of their initiatives. Unfortunately, that was an unappreciated gesture by the vast majority of Curves franchisees, and when that money ran out, the value that the CFA was delivering to the members was either unappreciated, or unknown, and members were not willing to step up and contribute even a small amount to keep the organization vibrant. Again, my hope for the future is that Curves franchisees remember this the next time around, and that they might give generously to those who worked so hard to protect their rights.
Of course, the end of the CFA does not mean the end of issues between Curves and its franchisees. Therefore, if you find yourself in a situation in the future where you either have business disputes and/or legal disputes with Curves, it is my sincere hope that you realize that resources were developed over the years that will exist into the future – even if the CFA does not. I am virtually certain that most CFA Board members would be happy to share with you their experiences on particular business issues if you were to reach out to them in a time of need. Likewise, to the extent that you need legal help in your dealings with Curves, my contact information has not changed. You can still contact me at rkgardner@dadygardner.com, and I will be happy to share my knowledge and information with you about my insights into the Curves culture, contracts, and likely responses to particular situations.
In closing, I want to take one moment to extend a personal thanks to the Board members who I have worked with over the years (many of whom became very good friends), and most importantly to the four women who chaired the organization over the last several years, Melanie Schaengold, Mary Ella Young, Teri Bertrand, and Carole Keyes. Their wisdom, insight, leadership, and enormous commitment of time on your behalf can likely never be repaid. Thanks as well to those Board members who participated year after year after year, against difficult odds, giving of their time and sacrificing their businesses and their families, to try and make things better for the system. While I am sure I will forget some, I particularly want to thank Sandie Maddux, Shelly Ronfeldt, Angie Wisler, Darlene Bayer, Brad Steinberg, Don Marshall, and Cheryl Hdarecky. While these Board members did not always see eye-to-eye with each other, I firmly believe they all always had the best interests of the Curves franchisee members in mind as they went about their work.
So, at this point, it is not goodbye. It is so long – for now. I look forward to the day our paths cross again.
- Ron Gardner
In reacting to this post, Mr. Gardner added this clarification:
“While I do think it is likely that WITHOUT committed leadership AND adequate funding (one or the other is not enough), most franchisee associations will ultimately fail, such associations can be widely successful (and there are many examples) when the Association finds a way to groom and foster effective leaders for the future AND finds a reliable and on-going source of funding.”
Are you familiar with the Curves Franchisee Association (CFA)? What do you think? Share a comment below.
Contact the author or site ADMIN at UnhappyFranchisee[at]gmail.com
Related reading: CURVES: Robert Lay’s Story (1000+ comments)
CURVES: Curves Posts on Unhappy Franchisee (Curves story links)
ANY LAB TEST NOW Franchise Complaints
June 23, 2011
Any Lab Test Now, a chain of walk-in labs, has 130 franchised stores in 26 states. It is managed by Joe Neely, Chief Executive Officer; Clarissa Bradstock, Chief Operating Officer; and Terri McCulloch, Vice President Sales and Marketing. Bradstock is married to prominent Olympic athlete Roald Bradstock, who is seeking a final appearance in 2012 Olympics under the British flag.
Seven present and former franchisees of “Any Lab Test Now,” a walk-in lab facility franchise owned by Atlanta-based Any Test Franchising, have sued David Lageschulte, the founder and owner of the franchise, in Miami Circuit Court for unfair trade practices in the sale of their franchises. They seek over $10 million for fraudulent conduct in the sale of the franchise. Lageschulte, reportedly a billionaire, is the owner of LTP Management and numerous franchised restaurants.
According to franchise attorney Michael Garner, who is representing the franchise owners, “Any Lab Test Now selectively presented the best information and hid what was most relevant — how their actual franchisees were doing. The law doesn’t allow you to start talking about profitability, and then be one-sided about it.”
“They started their sales presentation with an endorsement from Lags,” said Jason Baumann, one of the plaintiffs, referring to Lageschulte’s nickname. “He said that franchising was the way to get rich.” Exhibits to the complaint show Lageschulte’s quote, surrounded by logos from prominent franchisors such as Hooters, Ugly Tuna, and Dan Marino’s. The written presentations go on to extol the success of the franchise’s stores in Atlanta.
Referring to the allegedly blatant earnings claims in the presentation Garner said “That’s plainly a violation of franchise sales laws. Lageschulte knows that Any Lab Test Now can’t sell franchises by hawking it this way. They have to put it in a disclosure document.”
The case seeks the value of the business that Lageschulte’s endorsement held out to them. “Based on the information in the written sales pitches,” Baumann explained, “we should be entitled to damages of at least $10 million before any punitive damages or attorneys’ fees.” The franchisees’ case is similar to an action brought by investors in the Trump International Hotel and Tower in Ft. Lauderdale. Although Donald Trump was not the developer of that project, and was lending his name to it for a fee, the court held he could be held liable under the Unfair Trade Practices Act.
“I would never have bought this Any Lab Test Now franchise if I had known the actual performance of the franchisees,” said Baumann. “We were shown several sets of figures and told they were representative. In fact, the franchisor, Any Lab Test Now, was sitting on data from its existing franchisees that showed much worse performance.”
ARE YOU FAMILIAR WITH THE ANY LAB TEST NOW FRANCHISE OPPORTUNITY? WHAT DO YOU THINK? SHARE A COMMENT BELOW.
