CURVES: Robert Lay’s Story
The American dream of owning your own successful business seems to be going up in smoke for a lot of the Curves Franchise owners. The story you are about to read may seem like a Steven King horror novel but it is a real story that has happened to my wife and I. To all of the past, present and future owners of a Curves franchise please take the time to read the whole story as at the end we explain what we plan to do and how you as an ex or present owner may want to get involved.
My wife and I had owned and operated our own business for over 20 years and had been very successful at doing so. While we were making a great income from our business there was something missing in our life. Neither us felt that we were contributing to society but just taking and we decided to make a major change in our life. That was when we heard about Curves for Women. It was a new franchise that only had 300 or so clubs and for the first time in years we both became excited at the prospect of actually helping people reach their goals. We bought our first club in 1997 located in a city of thirty thousand. From the first day it opened it was more successful than our wildest dreams. Not only were we making excellent money but the personal rewards helping people better their lives was a truly rewarding feeling. I can still remember as if it was yesterday the first time a Dr. of one of our members came in to check out what we were doing as he couldn’t believe the ch
anges his patient had gone through. She had gotten off her high blood medication and had lost over 40 pounds in 4 months. It was truly amazing and over the years we have seen it happen numerous times over and over.
We sold our first club in 2001 and bought two more franchises. My wife became a mentor for Curves International around this time and I was helping to sell franchise for Curves International as so many of are members wanted to own a club. It was at this time that we started to see problems arising with Curves International but we attributed it to the fast growth that Curves was going through. In 2002 we bought two more franchises but this time they were in what was called a metro-area instead of city under thirty thousand in population.
The first problem we encountered with Curves International was in early 2003. Curves sold a franchise that was a corridor of land between one of our franchise’s and the next city 8 miles from our southern boarder. It was obvious to us that the territory didn’t have the necessary population to support a facility and that Curves International was selling any location just out of greed and the fact that there were so many people who wanted a franchise. The people who bought that franchise tried to open up on our border but it had always been an unwritten but followed rule of Curves International that you open in the middle of your territory so that disputes between owners over stealing members from your territory didn’t arise. We immediately filed a complaint with Curves International and they stopped the new owner from opening at that location. Unfortunately for the new owners there were no other commercial locations between the two cities so they were forced into selling that franchise back to Curves International for a loss.
It was also at this time that Curves International started to change personnel. The employee’s who we had a personal relationship with that had started Curves International with Gary Heavin were leaving the company at an alarming rate. Seven employees that were the top management of Curves left or were forced out because of Gary Heavin’s greed. They ended up filling a law suit against Curves which was later settled out of court. It was at this time that Diane Heavin became involved with Curves and a whole new history was being written about how Curves was started. The original Curves member guide which was written by Gary Heavin and June Manley was taken off the market and the new Curves book authored by of course Gary Heavin was on the top 10 of the Times best seller list.. To make sure it was on the Times best seller list all the clubs had to order at least on case. That is when we as owners realized Heavin was a manipulator and not the born again Christian he portrayed to be. It was also at this time that the price to buy a franchise more than doubled in price. This came as quite a surprise as Heavin had always maintained that he would never ever increase his franchise price and he even swore on the bible in front of a group at club camp that he would never break his word on that. Well as we all know he didn’t keep that promise for long, which just shows his greed.
At this point my wife and I became quite concerned and even considered selling our business but other problems arose concerning Curves International that demanded our full attention. In 2004 another Curves location located on our boarder of one of our metro-areas hired two of our employees and stole around 15 members from our club. Both employees had signed the anti covenant not to compete and in our state those agreements are strictly enforced by the courts. We considered going to court but since it was another Curves facility we decided to file a complaint with Curves International. And to let them handle it. What a mistake that was as they did nothing. We transferred the members files but refused to transfer the money for the members dues until such time that Curves International responded to our complaint. We were told by the area director, which was a new position at Curves International, that we were trouble makers and he refused to send any of are clubs the members appreciation bags. Shortly thereafter Curves International resold the corridor of land that had been sold back to them at a loss from the previous owners and they allowed the new owners to open up in nearly the same location that they had refuse the previous owners only a year and a half before. The new owners advertised in our area and ended up getting 10 or 11 members to transfer to their club. Again we held their monthly dues but did transfer the members files. We immediately filed a complaint but again got the same response nothing. It didn’t take long for most of the members who transferred to come back to our club as the other location was small and in a very run down area and to this day that club has not shown a profit and has been sold numerous times over the years for little to nothing.
Then in 2005 the real problems with Curves International started that we are still contending with today. In one of our metro-areas a competitor by the name of Ladies Workout Express opened up right across the street from our location. Unknown to us they had hired our manager and one other employee from that location and when the employee’s left they had stolen off our computer our member files. They ended up stealing over two thirds of our membership with in a week. The employees had signed the covenant not to compete so we immediately hired a lawyer and prepared for a lawsuit. As I stated before in our state that agreement is strictly enforced but it took four months to get it into court. During this time that location was losing so much money that we decided to move the location next to our other territory so that both clubs could stay open. We sent in the required change of location form to Curves International but never heard anything back from them so we went ahead and relocated in late 05. The owners of the Ladies Workout Express eventually went broke because of the lawsuit and the fact that they would end up owing us monetary damages. They filed for bankruptcy to prevent us from collecting any monetary awards in Dec 05 but we did have the satisfaction knowing that we did what was right
In early 06 we were informed by Curves International that because we abandon that location they were terminating all of our franchise agreements. We immediately requested mediation for all of our clubs which is authorized by our franchise agreements with Curves International. We never heard back from them so we hired a lawyer in Waco, TX to represent us. He proceeded to send them a letter requesting the same mediation process and they did respond to him. They sent him letter stating that it was premature to go through the mediation process at that time as they were in the process of researching our reason for moving. Curves International continued to debit our account for the franchise and advertising fees for all the other clubs we owned but stopped talking the fees for the one territory that they stated we abandoned. The lawyer had us send Curves International a check for the fees and a new authorization form for them to deduct it from our account. Neither our lawyer or ourselves ever heard anything back from Curves International so we all assumed that things were back to normal.
In the spring of 07 we made the decision to start selling off all of our clubs and to completely retire. It didn’t take me long to sell the club we owned that wasn’t in a metro-area and I agreed to stay with the new owner’s to help train them how to run the business. We sent all the documentation into Curves International and the sale was completed by January 08. That freed my wife and I up to concentrate on our metro-area clubs and to get them ready for sale. In Feb of 08 we heard that a Curves club was opening in one of our territories within a mile of our current club. We could not understand how Curves International could do such a thing. We again filed a complaint by phone and e-mail to Curves International and several weeks later we were informed by e-mail that they didn’t know what we were talking about. We were told we didn’t own any franchises and hadn’t since we were terminated in 05. That came as quite a shock to my wife and I as our franchise and advertising fee’s had been deducted all along from our checking account and we had just recently sold a club that they were telling us we never owned. We had a local lawyer send a letter to the new owners explaining the situation and that we would be seeking legal recourse against Curves International and depending on the outcome they were opening themselves up to a potential lawsuit. During this time we had bought and paid in full for the Smart Equipment for Curves International and were waiting for the installation which was scheduled for the June 24th. On June 20th , a Friday we received a phone message telling us that the Curves Smart Installation was canceled and that we had to call Curves legal for an explanation. We left messages both e-mail and phone every 30 minutes on Monday June 23rd and finally late in the afternoon we received an e-mail stating that one of there lawyers would be in touch with us before the end of the day, They never sent an e-mail or a phone call as was promised but by mid day the next day they did respond by e-mail. It stated because of the problems with the members transfers, the fact that we abandoned a franchise, and that we had interfered with the opening of the new franchise located in our territory we weren’t approved for the Curves Smart. Yet in late May they had sent all the promotional ad material for the Curves Smart and of course we had gone to a considerable amount of expense for training the employees, advertising and promotion of the Curves Smart equipment. It was at this point that my wife and I decided that drastic action had to be taken against Heavin and Curves International.
While we still love the concept of Curves we feel that because of the deceptive and we believe fraudulent business practices that Heavin has allowed under his management Curves will eventually end up in the toilet so to speak. After spending many hours on the internet we have found that there are many lawsuits against this man and his company. Just read some of the post’s that are on franchisepick.com from owners concerning the new ten thousand fee if your club goes under and closes to the vitamins that were sold in Feb and March by Ideas in Action at a discount to owners without telling them that they would expire at the end of May. The lack of support and communication from Curves International that all of us owners are going through is intolerable. It is impossible for an owner to get through to them on the phone and good luck if you expect a call back in a timely manor. The fact that we as owners pay a lot of money for our advertising fees and have no accounting of where it is spent and a quite frankly we never see many ads in our area.
I have taken the time to do the necessary research to find several good lawyers who handle franchise law who are more than willing to help Curves owners who are having similar problems with Curves. I for one am going to go after Curves International and Gary Heavin in a court of law. These are not class action but group action lawsuit and if you don’t understand the difference contact me and I will explain it to you. There have been over 200 such lawsuit filed against Curves in the last several years and while some have been settled in mediation others are in the process of going to litigation. If you are a past or present Curves owner who has experienced these problems and want satisfaction whether it be monetary or revenge please contact me. We have several options that we can go and I for one am positive we will win as the other lawsuits have been successful so far and have set a precedent for ours. It is time for the owners of Curves franchises either past or present to stand up together and put a stop to Heavins’s ramped destruction of peoples lives just for monetary greed.
Thanks for reading our post and God Bless you all.
ARE YOU AN CURVES FRANCHISE OWNER OR FORMER CURVES FRANCHISEE?
ARE YOU FAMILIAR WITH THE CURVES FRANCHISE OPPORTUNITY?
PLEASE SHARE A COMMENT BELOW.
Last year in the WSJ they were “pruning the vine” now it is the economy and passive investors. What a crock. Heavin is a LIAR. Curves owners “made too much money” and they were “the victims of their own success”. HA.
Actually it would be easier to get rid of the club if Curves didn’t screen, she has had two interested parties willing to take it over and CI has said they could not take it over after running income/credit checks on the prospective buys. Again, by their actions they show that they would RATHER watch a club go down in flames and get a judgement against the failed owner than actually do anything to HELP.
@Christina
Yes, I received legal papers by mail, telling me the judgement was filed in default (I didn’t show up). I gave them to my lawyer. I also wound up filing Ch. 7 bankruptcy. Yes, I believe they do it just so they can have a write-off. It’s a shame isn’t it.
Curves has now lost more than 50 percent of its franchises, with more closing every day. I think we can agree they obviously oversaturated the market. They should never have offered more than 4,000 franchises.
Wow, I know of a club that is making about $200/mo that is being sold for .25.
You no longer list Curves? Why not?
is anybody familiar with the PA state law on franchises?
Can anyone in Florida suggest a lawyer half decient. I just got my letter from an attorney Avis in Illinois for collection of debt.
No attorney needed yet. You have 30 days to dispute the debt. Send a certified letter disputing the validity of the debt. You might Google fair debt collection act. Read it. Learn it. Did you buy directly from the seller?
Guest:
Yes, I bought from a seller.
ANYONE KNOW THE PENNSYLVANIA STATE LAW ON FRANCHISES????
@JUSTINE, I see that you mentioned above that your state law supecedes the franchise contract…what state do you reside? CI put a $40,000 mark on my credit report, and i am unaware of the state law in Pennsylvania.
Is that the state law that supercedes, State Law on Franchises? Or is there some other state law?
I closed almost a year ago in October of 2010….I moved on with my life. I got a job. My husband and I have worked very hard to try to get things back in order financially for us. We recently tried to finance some home improvement …. only to find out that just this month CI put two $10,700 marks on our credit report….where in the hell does this come from and how do they figure that? We only closed 6 months before our franchise agreement was done. Also, in response to the oversaturation of the market and the latest artcle being talked about. Our problem was not only the demands of CI but the fact that the people we bought our curves from that opened it from the beginning hay days and made enough to pay it off and buy and start many more….sold it to us for way more than it was ever worth. Yes we reserched, based on the information they provided to us, they told us the lowest they ever made in one year was 60,000 profit. I Never made a profit, ever! Was I a money hungry investor…uh, NO….I paid out alot and never made a profit period! We paid 150,000 for our club. I actually at one time offered 250,000 for a club the owner was asking 350,000 and she declined my offer. What are these resale sellers thinking….they too are the CROOKS in this scandal. That club sold in less that a year for less than 100,000, they are struggling too. I am at my wits end with this. It has caused so much trauma to our financial future, our happiness, our health. I really don’t know why I logged back on to see what was going on on this website, it all depresses me to no end! Good luck to everyone….at least we have each other to cry to!
Looks like we are not alone here in the US and Canada. Curves clubs are closing all over the world- here’s an article from Africa: http://www.iol.co.za/dailynews/consumer/be-wary-of-long-term-gym-deals-1.1144964
Drained,
You’re in my thoughts!
If you close your facility after your franchise agreement ends, what happens? Does Curves International have the right to anything within your facility if you are no longer under contract?
Interesting article on Curves on Club Industry.com; one of the fitness industry’s leading online news sites: http://blog.clubindustry.com/fitnessbusinessproblog/2011/09/28/examining-the-state-of-curves/?cid=nl_nb.
Curves President Mike Raymond is quoted as saying “While it’s true a number of clubs have closed in the U.S., many did so after enjoying a very successful return on their investment. We made it easy for them to decide to leave by announcing a policy that removed any penalties for closing.” This is news to me! Has anyone gotten out of their franchise penalty free??
Drained, please contact the credit bureau and demand that it be reomoved, tell them that you owe CI nothing and that you want the debt substantiated and that if you do not want to see another mark on your credit report until they have a judgement from CI to prove you.
curvesowner2: CI will make all sorts of outrageous requests that are not backed up by common or contract law. Read expiration claused of you contract, what do they say. That is all they can demand.
Fit Dude,
Thank you for sharing the story at clubindustry.com, “Examining the State of Curves”, Stuart Goldman September 28th, 2011.
My response is, “Blah, blah, blah, blah, blah, blah…”
Thank you Karen!!
I am thinking about buying a curves in a large metro area this is only one of two which has been in operation for 8 years. The club has 400 members. The area is perfect and the price may be around 78k
I have seen all of the returns and it seems viable. I also had my CPA review the documents. If the business makes money are there reasons I shouldn’t go forward?
I have reviewed the postings but the majority seem like revenue issues and fees to curves
Thanks
Please comment also if you can on the law suits
Also did anyone form an LLC or an s Corp to buy their franchise to personally protect themselves?
Thinking,
Ask the owner to meet with you, and have her call the members on the “Members Not Working Out Report”, so you can see why they are not working out and if they plan on continuing with their membership or cancelling. If the current owner will give you the names and phone numbers, then you should call these members.
This is our story…
http://www.franchisepublicity.com/curves-franchise-resale-buyer-cries-fraud/
Best Wishes!
We are considering offering an inexpensive ad service for franchisees interested in selling their locations. The ads would appear on this site and also several other sites.
While it may seem odd to advertise on a site with so many negative comments, there is a market for franchise resales perceived as priced to sell, and we generate a lot of traffic from those interested in fitness franchises. We are interested in helping those who want out to move on.
If you are interested in advertising or willing to provide feedback on the idea, please email unhappyfranchisee[at]gmail.com.
Admin,
Thank you for your offer, but how can we feel right about selling our facilities, knowing that whomever buys them will have to deal with what we are dealing with?
If we sell our clubs, whomever buys them is put in a bad situation, because if things do not get better and they have to close, then they have to pay Curves International all the fees for every month still left on the franchise agreement. I e-mailed someone at legal and asked them what would be owed if a franchisee was to close before they completed the franchise agreement, and they said, “They would owe the maximum for every month remaining on the franchise agreement.”
I said, “So Curves International is no longer making exceptions?” and I shared this article with them.
Examining the State of Curves, Stuart Goldman September 28th, 2011
http://blog.clubindustry.com/fitnessbusinessproblog/2011/09/28/examining-the-state-of-curves/
Curves President Mike Raymond responded to our request seeking comment about the closures in Lakeland. Raymond’s response from July also could apply to today.
“Curves has thousands of franchisees that do things the Curves way and are very successful—all around the world,” Raymond said in a statement. “While it’s true a number of clubs have closed in the U.S., many did so after enjoying a very successful return on their investment. We made it easy for them to decide to leave by announcing a policy that removed any penalties for closing. Even with the club closures, Curves is still the largest fitness franchise in the world.”
The response I received was, “There have always been penalties for closing before the franchise agreement has been completed. I do not know the source of that information but I would not consider it reliable.”
If we sell our facilities, knowing that we might be putting someone in a bad situation, then we are not any better then Gary Heavin and all his followers.
which is do much to support its franchises if anything at all. Just my opinion of course.
Ignore the bottom line! Typo
CurvesOwner2, thank you for sharing your response from Curves legal stating, “There have always been penalties for closing…I don’t know the source of that information, but I would not consider it reliable.”
I asked ClubIndustry.com to comment on that statement from Curves legal. Here is their response:
Stuart Goldman Says:
October 5th, 2011 at 5:44 pm
Curves provided us with a statement that included the following two sentences:
While it’s true a number of clubs have closed in the U.S., many did so after enjoying a very successful return on their investment. We made it easy for them to decide to leave by announcing a policy that removed any penalties for closing.
A spokesperson for Curves has seen this post and did not have an issue with this statement. –Stuart Goldman
CurvesOwner2, please inform Curves legal of this response and ask for clarification!
Admin is right. Someone may interested in priced to sell. but only if it’s true Curves will not require the royalty on a failed club.
Hello Former Franchisee,
Thank you for your response!
I would ask for clarification, but what difference would it make? They deny everything and you cannot argue with people that think they are right about everything. Stuart Goldman should clarify the statement and print an article about it again for all the clubs that want to close, but are unable because they will owe all this money. This is a huge story. I feel really bad for the new owners who are being manipulated into buying a facility, and Curves International is promising they will provide support but they do not. I read a post awhile back that said something about Curves International restructuring everything so they would not need the facilities anymore, and I am thinking this person may be right. Things are getting worse for franchisees and better for Curves International. We cannot get the products we need from Curves Products. If we want something we have to buy it at shopcurves.com, or have the member buy it there. It’s disgusting. Gary is worth millions because franchisees sacrifice everything for their clubs. They work other jobs to keep the facilities open, and Gary continues to make his Royalty and Advertising Fees which is why he is wealthy.
Just curious. Is there an active class action lawsuits against Curves International, or has everything been settled?
Hi, I live in northern n.s.w in Australia and I have a very close friend whos interested in buying a curves. She has been a member for almost a year and absolutely loves the whole concept. After reading through all your posts I’m scared that she’s going to make a big mistake and although it’s defintely causing her to start looking at things more closely she’s not being put off the whole idea due to most of your stories are from people who live in america. So I was wondering if there are any franchise owners that live in australia who are going through similar problems? She already has a fairly successful business in beauty therapy and would be looking to move that business into the curves building and though it will be classed as a seperate business would that be ok? This gym has been opened going on 7 years nowand has about 320 members in a city thats population is around 38,000 as well as offering it as a school sport to the local high schools (ones joined there are 5 more in the local area to approach). There is one other womens gym that offers a 30min workout, one thats about to open offering 24/7 hours and several other fitness and aquatic centre’s. Whats scareing me the most is that in the last 3 years profits have dropped about 40%. This woman is very motivated, willing to put in the hard work and has good friends who are also willing to put the time and effort into helping her succeed without any financial gain. She has lots of idea’s (offering a daycare for a few hours a day 3 times a week, improving the music, improving the morale and ambiance, adding a celulite treatment business to her own beauty shop, opening a juice bar, offering dance classes, etc) to turn it around and with her attitude and personality I do believe she can do it. Though the question is What are the restrictions on curves franchisee’s, are any of these things allowed? Because if not I don’t know how she would be able to. I do know a big problem with some members leaving was due to the old owner. I’ve read through some of your stories and I am so very sorry for what you’ve had to go through and I don’t want my best friend to have to go through that, but she needs more localised stories to see the proof. Is there a chance for this to work? This would be a dream come true for her I just don’t want it to become a nightmare. Any help you all could offer would be great. Thank You.
Jo;
You are a good friend to be concerned about your friend getting involved with Curves. First, she should insist on seeing the bank statements and members list to confirm that there are indeed 320 active members. (See http://www.franchisepublicity.com/curves-franchise-resale-buyer-cries-fraud/)
She will technically be in violation of her franchise agreement if she offers services and businesses such as daycare, beauty shop, juice bar, etc. within her club without getting approval first from the corporate office (good luck with that!). If she goes ahead and adds these services without approval and CI finds out, they will send her a demand letter to stop.
It sounds like there is going to be a lot of competition for her with an existing women’s club and a 24 hour club coming in. Some 24/7 clubs like Snap Fitness are adding women-only rooms with hydraulic equipment.
You will be doing your friend a huge favor if you discourage her from getting involved with Curves!
Just an update on our situation.
Zumba attendance has dropped off so much that it costs almost TWICE what she makes off the “$2 voluntary fee” just to get the instructor to show up, and that doesn’t cost the hour of “drive time” the instructor charges since there are none close enough to be convenient.
Her client list has continued to drop with a rare new member and she has even cut “unauthorized discounts” to get people in the door. There simply is not a customer demographic base in the area anymore to support the business.
She even found one lady that wanted to take it over, she was willing to pay for the new lady’s training fees and curves camp etc, and then CI turned her down because her husband was the only person working and they had no assets.
Her father and mother have both become ill and need lots of help so she is having to pay people to sit at the club and keep it open and so she is losing even more money every day.
At this point she is trying to determine if it is cheaper to just pay the fees and walk away, or hire a lawyer to fight it/draw it out long enough for curves to go under, it’s gotta happen eventually right??
A partner and I purchased a club almost 10 years ago (franchise agreement ends jan 2012). My husband has a disablitiy and we were counting on the business to support our family as our needs changed over time. I opened the club because I worked at one previously and loved the changes in the women and I new that I always wanted to make a difference in someone’s life and Curves seemed to be the perfect opportunity to do just that. I wasn’t looking to become a millionaire but I was looking for something that would provide for my family so that my husband would no longer have to work or could pursue other avenues of work that would be better suited to a person with his disability. The first 3 years were great but my husband did have to continue to work as my partner and I split the profits. It worked out that I was making a decent wage. It came time to move our facility as our lease was up so we moved to a larger location with a bigger lease, thinking that we would continue on with our large (600) member base for the duration of our 10 years with Curves. This was not meant to be. A year after our move, the membership started to drop off but we continued to have high hopes that we could make it work. This was not to be the case. The new owner of the building did not want to renegotiate the lease even after he knew that our membership was dropping so we were left paying a huge lease and continuing to cut our costs as much as possible. In the town that we are in, finding something suitable to move to is a challenge but something did come up and in January 2011 we moved to a higher profile location hoping that membership would increase but the opposite has happened. It was actually too little too late and by the time we got to our new location the debts were too high and by this time we have poured everything we had financially into the business. There is nothing left. We are behind in our rent, I had to do a personal proposal for all the debt that was racked up so my credit is crap, I had to take a full time job outside Curves to pay Curves bills and household bills as my husband lost his job. Our house is up for sale. The biggest disappointment is that we are only 3 months away from the end of our contract and we have no money left to carry us through to the end so we contacted our Area Director and she said that she would ‘fast track’ our case and seeing as how there are only a few months left on the contract, they ‘may’ approve the closing of the club. Apparently we will have to dismantle the original 8 pieces of equipment as we cannot sell it because it technically does not belong to us. I am wondering how 10 year old equipment is going to hurt any other Curves out there. My staff member would love to buy the equipment and this would certainly help with some debt. I would like to know if anyone else has done this. Also, I am in no position to pay closing fees as we have no where to get the money from. How can they charge closing fees when we are so close to the end of the contract? This has been the most difficult thing I have ever gone through. I have always had hope that things would turn around, I did things by the book and followed protocol but everytime you turned around there was more money going out and less and less coming in. It doesn’t take a rocket scientist to figure out where this is going. The hardest part of it all is no longer being able to help all of those women who are so faithful to Curves and to our business. I still believe in the concept of 30 minute fitness for women because it does work but there needs to be forward thinking and moving on with the times and there needs to be more focus on running a business and not just selling a membership. I am hoping for the best with our closure and because I am a hopeful person, I am hoping that there will be no extra fees associated with our closure. One can only hope.
Tamvo!
You indicate you signed your franchisee agreement in 2002. I bet you own your equipment. You must go thru your agreement with a sharp eye. I cannot remember the section, but there is one that pertains to the “disposition” of the equipment in case the agreement is ended before the time is up.It clearly states, that regardless of how the agreement is ended (and they use a different term instead of “ended”) Curves International has first right of refusal! And there is a schedule. In my franchise agreement (contract), it clearly stated that if it ended within the first year, they (CI) would have to pay me $17,999 for the equipment (or let me do whatever I wanted with it). If it ended in the second year, they’d have to pay me $15,999 (or let me do whatever I wanted with it), etc, etc. From year 5 to 10, if the agreement was interrrupted (ended, whatever), they could exercise their first right of refusal by paying me $2000. Since they opted not to do that, they can’t tell me what to do with my equipment… Except where in my choices could be limited by the Covenant not to Compete. Read it! And, or, get a paralegal to look at it with you. A paralegal is much cheaper than a lawyer and can help you decipher any legal terms that you are not familiar with.
BEST WISHES.
Thanks so much, Justine! Before finding this site I thought there was no hope but now I feel supported and feel stronger going forward knowing that I will not be strong armed. I am going over my agreement with a fine tooth comb. Thanks again for the support!
What does everyone think about the news that Mike Raymond is stepping down as President of CI? is that a good thing or not? is this a sign that Curves is folding?
Was thinking about buying a franchise but after finding this site and speaking to a friend who owns a club I have think I have had a lucky escape.
Something I just found out, that CAN protect club owners personal assets..
If you made the mistake of purchasing the club and signing the contract as a personal/private owner, this connects the club to your personal assets and credit etc. However, you go create a S-Corp or LLC, easily done for a few hundred $ and usually done all online.
Once you do that, CI has a process you can go through, and pay a fee (of COURSE), to change the club over to your new LLC/S-Corp ownership. Once that is done, if you start to go upside down, you can do what you have to do and legally they can only go after the LLC and any assets owned by THAT, NOT YOUR PERSONAL ASSETS.
If you then have to file bankruptcy as the LLC, it closes your club and ands teh LLC as an identity and you and your finances and credit rating are all left untouched. All this will still cost a few thousand $ but when CI is threatening to put a $20K entry on your credit report or sue you for $40k in franchise fees and ad dues, it is still cheaper and allows people that are in a bad spot to walk away and get on with their lives.
Of course laws in your area may vary but we discovered we can do this as a last resort if CI will not let her sell the club to someone that actually wants it.
wrong! Curves makes you sign a personal guaranty for the franchise agreement. The s corp or llc will only protect you against outside creditors not CI.
Well crap, so why will they let you pay a fee ($1000+) to change from a sole proprietor to a corporate holding? That blows if that is the case, I guess we need to hope that the right sucker comes along that ALSO has good credit.
I have read on here about some owners discovering that their local state’s business laws over rode the Curves “contract” and that allowed them to get out of it without getting sued for $$$.
I was wondering if anyone still monitoring this post knew what parts of the contract I should look into? Like what portion of the agreement is likely the [part that states differ on?
As in, requiring an owner to stay open 5 years regardless of viability or having no right to know where the3 advertising fees go to?
Don’t we have a right to know where the advertising dollars are going?
If Curves International isn’t advertising and presenting Curves in a positive light, all our efforts are worthless.
We owned 2 franchises. We closed 1,sold some of the equipment, used some if it in the other club and scrapped the rest. Our territory was expanded and includes the “closed area”, they were adjacent to each other. We have also rewritten our FA and changed our fees to the minimum. We are looking to sell because I have Non-Hodgkin’s Lymphoma and cannot work. Overall we have been disappointed but we do believe in helping our members. We know many of them would never have joined an exercise facility if not for Curves.
JM, re the laws of your state: it’s not what is written in the Curves Franchise Agreement (CFA), it’s what’s written in your state code. Either contact a lawyer, contact a paralegal, or go to your closest law library (for instance at a state university that has a law school) and ask them to direct you to the legal code about franchise agreements.
and that also pertains to the LLC and whether or not it is viable for your protection. visit a lawyer if you have any doubts.
when looking for a lawyer for this stuff, what type of “specialty” should I look for when browsing the yellow page ads?
that is really a good question. sometimes figuring out how to start doing something is challenging enough to really put one “off” the task!
basically you want someone who is familiar with franchise contracts. it might be someone who advertises that they help people set up new businesses? are there still yellow pages around?
also, depending on your state’s laws, a paralegal could get you the information… again that varies depending on state law.
best wishes!
Dear all,
I am an ex-curves owner. We bought a re-sale club in 2007. The Master Franchisor in my country told us that we do not need any licenses registerd as gym since it’s a health club. However the laws in my country are different. In 2010 we went to court because the Sports Organisation of my country accused as of illegal operation. When we told that to the Master Franchisor she told us that this is our problem and we had to sort it out. IN the end we got a fine and because we could get the license we had to close the club. We wanted to sue them but we need at least 4.000 euro. I was wondering if any of you who closed the clubs have sold the machines/equipment because we want to get rid of them…
Thanks and be strong..
I’m in the process of becoming an ex-owner. My 10 yr agreement will be fulfilled Jan.2 /12, and if Curves International thinks they’ll get one more penny out of me they are sadly mistaken!
Not only has CI allowed another club to open within my territory, it cost me over $7000 to have a lawyer do it. They(CI) would NOT do anything for me until we had to take legal action. They claimed that they never gave permission to the club moving into my area. How is that possible when you have to be approved for EVERYTHING!!!!
This franchise has completely ruined my life financially, and put me and my new husand in a tough financial position. It’s almost impossible for us to start a family now!
I can’t wait to have no involvementwith such a terrible company, and will voice my opinion to anyone who asks about Curves. I really hope that Gary Heavin hits rock bottom…again!