Franchising Since: 2009
Headquarters: Irvine, California
Estimated Number of Units: 630
Franchise Description: PB Franchising SPV, LLC is the franchisor. The franchisor’s direct parent company is Xponential Fitness, LLC. The franchisor offers for sale a franchise to operate a studio at a specific location pursuant to the terms of its form of Franchise Agreement. Each studio offers fitness training classes using techniques and methods which are proprietary to the franchisor, and which provide a total body workout using elements of Pilates, weights and ballet, including using a ballet barre, to perform small isometric movements for a safe, low-impact workout that strengthens and sculpts the body without adding bulk and any other services that the franchisor authorizes.
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Territory Granted: Franchisees will operate the studio at an authorized location. Once franchisees have identified their authorized location, the franchisor will designate the designated territory around the authorized location within which franchisees will have certain protected rights. The designated territory will generally be an area with a population of at least 15,000 people, as published by the U.S. Census Bureau or other governmental agencies and commercial sources. However, the size and shape of the designated territory will vary from the territory granted to other franchisees based on the location and demographics surrounding the studio. The boundaries of the designated territory may be described in terms of zip codes, streets, landmarks (both natural and man-made) or county lines, or otherwise delineated on a map. As long as franchisees are in compliance with their Franchise Agreement, the franchisor will not operate, or grant a license to a third-party to operate, during the term of the Franchise Agreement, a studio located within the designated territory, subject to the franchisor’s reservation of rights.
Obligations and Restrictions: The franchisor recommends, but does not require, that franchisees (or, if they are an entity, the operating principal) personally supervise the studio. Franchisees may appoint a designated manager the franchisor approves to manage daily operations of the studio. Franchisees and their managers and employees must comply with the confidentiality provisions. Franchisees must offer for sale and sell only all those approved products and approved services and deal only with those approved suppliers that the franchisor authorizes or requires.
Term of Agreement and Renewal: The length of the initial franchise term is 10 years. Franchisees have the option to extend the term for one consecutive 10-year period if requirements are met.
Financial Assistance: While the franchisor does not offer direct or indirect financing or receive consideration from referrals or placement of financing with any third-party lender, certain third-party lenders, such as Amerifund and Navitas, have sponsored the franchisor’s convention in the past and may do so in the future, but the franchisor unaware of the terms of any financing franchisees may, if at all, obtain from these or other lenders. The franchisor does not guarantee a franchisee’s note, lease, or obligation.
Estimated Initial Investment
Name of Fee | Low | High |
Initial Franchise Fee | $60,000 | $60,000 |
Sourcing Fee | $0 | $28,000 |
Travel & Living Expenses While Training | $0 | $3,000 |
Real Estate/Lease and Professional Fees | $17,500 | $36,500 |
Net Leasehold Improvements | $103,500 | $279,500 |
Signage | $9,000 | $22,000 |
Insurance | $3,872 | $8,056 |
Fitness Equipment & Initial FF&E Package | $23,900 | $51,500 |
Pre-Sales and Soft Opening Retail Inventory Package | $14,000 | $18,000 |
Computer System, A/V Equipment, and Related Components | $19,500 | $22,500 |
Initial Grand Opening Marketing & Advertising Spend | $30,650 | $39,900 |
Instructor Training Fees | $8,850 | $13,750 |
Technology, Music, and Software Fees | $3,639 | $3,639 |
Additional Funds – 3 months | $20,000 | $43,000 |
ESTIMATED TOTAL | $314,411 | $629,345 |
Other Fees
Type of Fee | Amount |
Royalty Fee | 7% of gross sales. |
Contributions to Brand Development Fund | Currently, 2% of gross sales. |
Regional or Local Advertising Co-Op | As the Co-Op determines (not currently charged). |
Local Advertising Requirement | The greater of (a) $1,500 or (b) 2% of the prior month’s gross sales. |
Initial Instructor Training Fee | The then-current training fee for the kind of training being provided. The franchisor will not charge franchisees or their designated manager any tuition to attend the “owner/operator” and/or “designated manager” modules of the initial training program, as applicable, prior to opening. The franchisor may charge its general training fee in connection with (a) re-training or replacement training with regards to the portions of the initial training that are designed for the franchisee owner and/or designated manager, (b) any training the franchisor require franchisees to complete to cure a default under their Franchise Agreement with us (“remedial training”), (c) training the franchisee requests the franchisor provide (other than certain kinds of day-to-day assistance), or (d) training the franchisor provides on-site at their studio. |
Technology Fee | Then-current fee. Currently, $304/month per studio. |
Music Licensing (In-Studio) | Currently included in the Technology Fee – however, it may be a separately charged fee at the franchisor’s discretion. |
Instructor Subscription Fee | Then current subscription fee. Currently, not yet established. |
Renewal Fee | $10,000 |
Transfer Fee | $10,000 |
Relocation Fee | $5,000 |
Insurance Policies | Amount of unpaid premium. |
Mystery Shopper and Other Quality Control Programs | If charged, $500/year. |
Audit Fees | Costs incurred by the franchisor in connection with conducting audit. Currently, the franchisor estimates that such costs will typically be between $500 - $2,500 (plus costs of any travel). |
Late Fees | The greater of the highest applicable legal rate for open account business credit, or 1.5% per month. |
Non-Compliance Fee | Then-current fee charged by the franchisor. Currently, $100 for each day of non-compliance. |
Cost of Enforcement or Defense | All costs including attorneys’ fees. |
Indemnification | All costs including attorneys’ fees. |
Alternative Supplier Approval | $1,500 per day for personnel engaged in evaluating a supplier. |
Management Fee | The reasonable costs/expenses the franchisor incurs in connection with taking over operations, including manager’s salary, room and board, travel expenses, and all other related expenses. |
Lost Revenue Damages | The applicable amount of lost revenue damages. |
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