Snap Fitness
Date of Incorporation: 2003
Franchising Since: 2004
Headquarters: Chanhassen, Minnesota
Country: U.S.
Description: Snap Fitness Centers are accessible 24 hours a day and offer the sale of memberships that allow access to exercise equipment, including cardio, strength and selected equipment. Snap Fitness has developed a proprietary business format and system for operating a fitness and workout club featuring state-of-the-art exercise equipment; 24-hour personal keycard access for members (except as restricted by law); an online training page; personal fitness consultation, wellness plan and web page; automated member billing and collection procedures and services; web-accessible video surveillance; and proprietary and confidential information.
Franchise Offer: The franchise offered is a Snap Fitness Club featuring state-of-the-art exercise equipment and 24-hour keycard access for members. The franchisor grants the right to operate a Snap Fitness athletic and fitness center. The franchisee will be in the business of selling Memberships and operating their Center. A Membership entitles the individual to access and use the franchisor’s Center and any Affiliate-owned Centers.
Financial Assistance: Snap Fitness offers, directly or through a preferred financing vendor, the following financing programs: the Lease Servicing Center (LSC)/Matrix Vendor Program for new franchisees opening their first Club or existing franchisees opening an additional Club, the Snap Fitness In-House Program for existing Snap Fitness franchisees to finance equipment to open their next Snap Fitness location, and the Re-Snap Program for existing Snap Fitness franchisees renewing their agreement for a second term.
Training and Assistance: The franchisor provides an initial training to at least two people in the franchisee’s organization (including the General Manager), which the attendees must complete to the franchisor’s satisfaction. The program lasts approximately four days. The franchisor does not charge for this training, but the franchisee must pay the travel and living expenses and supply costs for themselves and their employees. Periodically, the franchisor may offer additional training programs and may charge a fee for attending these training programs. Training will occur at Snap Fitness headquarters in Chanhassen, Minnesota, or in the franchisee’s Club prior to opening.
Territory: The franchisee will not receive an exclusive territory. When the Franchise Agreement is signed, the franchisee will select a general geographic area in which he or she intends to operate their Club ("Preliminary Designated Area"). The franchisor will approve the franchisee’s selection unless they determine, in their sole judgment, that it may negatively affect the interest of another SNAP FITNESS® franchisee. A minimum Preliminary Designated Area will consist of one city block and, in suburban and rural areas, may be as large as a three-mile driving distance from the anticipated location.
Term of Agreement and Renewal: The term of the franchisee agreement is 10 years with the option to renew for unlimited additional 10-year terms.
Obligations and Restrictions: During the term of the Franchise Agreement, the franchisee or general manager must devote full time and best efforts to the management of the Club. The franchisee is expected to stay informed about the franchisor’s organizational plans, initiatives and direction by regular review of communications sent to the franchisee electronically or otherwise. The franchisee or general manager must provide direct on-premises supervision to the Club. The franchisee must offer at the Club all of the products, equipment and services that the franchisor periodically require and may not offer at the Club any unapproved products or use the premises for any purpose other than the operation of the Club.
Total Number of Units: Over 1,050 units.
Investment Tables:
Initial Investment:
| Name of Fee | Low | High |
|---|---|---|
| Initial Franchise Fee | $15,000 | $15,000 |
| GO FAST™ Kit | $17,560 | $17,560 |
| Equipment Package | $12,000 | $68,000 |
| Leasehold Improvements | $7,500 | $50,000 |
| Rent | $3,600 | $16,500 |
| Lease & Utility Security Deposits | $1,500 | $2,000 |
| Insurance | $768 | $768 |
| Training Expenses | $500 | $2,000 |
| Professional Fees | $1,000 | $4,000 |
| Additional Funds (3 month period) | $20,000 | $20,000 |
| Total | $79,428 | $195,828 |
Ongoing Fees:
| Type of Fee | Amount |
|---|---|
| Continuing Fee | 6% of total gross sales subject to the Royalty Incentive Program. |
| National Marketing Fund | $22,500 or then current fee. |
| Local Marketing Fund or Cooperative Advertising Contribution | $150 per month or then current fee |
| Member Service -Online Training Center subscription fee | $300 per year or then current fee |
| Member Service — Personal Wellness Plan subscription fee | $1 per month per address or then current fee |
| Internet Hosting Fee | $200 per month or then current fee |
| Membership Processing Fees | $1,500 |
| Audit | Cost of audit to $300 per day plus 10% interest on underpayment. |
| Transfer Fee | $2,500 fee if transferee is an existing Snap Fitness franchisee. If the transferee is new to the system, the transfer fee is equal to the then-current Initial Franchise Fee. |
| Costs and Attorneys' Fee | Will vary under circumstances |
| Modernization and Maintenance Costs | Will vary under circumstances |
| Insurance | $250 - $400 monthly |
| Interest/Late Fees | Will vary under circumstances |
| Indemnification | Will vary under circumstances |
| Supplier Review Fee | Our costs and expenses, which are currently expected to range between $1,000 and $3,000, although costs could exceed those amounts depending on the product. |
| Securities Offering Costs | Will vary under the circumstances. |
Date of FDD: 2010
The above information has been taken from the UFOC/FDD and online sources of Snap Fitness.
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