fit20 are one of the most exciting and inspiring high intensity training franchises in the world. fit20 only started in 2009 and already have 150 studios across 8 countries and 4 continents. They were awarded as best franchisor in the Netherlands in 2019.
CEO of fit20 Group, Walter Vendel, has been spearheading the franchise growth since the beginning. Walter is a voracious learner and humble entrepreneur who is always keen to help others achieve success and avoid mistakes. After all, a rising tide raises all ships.
[Note from Lawrence: Personally, I don’t think high intensity training is anywhere near as popular as we’d like it to be. Competition with other HIT brands should be the farthest thing from our minds.]
In the following blog post, Walter Vendel shares:
- 5 Valuable fit20 Franchisor Lessons
- 4 Important Factors Before You Start Franchising
A trip to New York first showed me how you can, with the help of high intensity training, achieve great results with training sessions lasting just 20 minutes a week. In 2009, I transformed our method with personal training into a concept for a larger audience in the Netherlands. When this pilot turned out to be successful, I was faced with the choice: open my own locations or franchise?
I chose the latter option because a franchise provides a lot of clarity in the various responsibilities and tasks. In short: the franchisee invests in getting his studio off the ground, whilst the franchisor invests strategically in innovation and growth of the formula. This way a franchisee gets a proven concept that can earn them money immediately after a flying start.
If you were to run your own studio locations, a lot of energy would be involved in managing your own studio managers. But with entrepreneur franchisees, I notice a difference in drive, and you can see that in the results. You really get a 1 + 1 = 3 effect.
5 Valuable fit20 Franchisor Lessons
- Be prepared to invest first
After three years, fit20 was only at 18 locations. During this time we invested heavily in formula look and feel. You have a close relationship with that first generation of franchisees, which is almost like family. Those early years were a hard learning experience, where fit20 had to invest a lot of money and work hard to develop the concept well. A franchisee who is willing to work hard, can now get to break even in 6 to 8 months, but that took years for the franchisor.
You, the franchisor, is a long way ahead of the music. At fit20, franchisees pay a franchise fee, with which the franchisor provides (national) branding, lead generation, and operational support. Additionally, the fit20 Academy runs its own training for franchise entrepreneurs and their personal trainers.
- Most business knowledge is cross-industry
As a prospective member, I joined the Dutch Franchise Association (NFV), which currently has around 200 members. There I found many tools in the financial and legal field, and how to create a franchise manual, etc. I then hired a consultant who had already supervised many other franchise formulas. About 80 percent of the activities of a franchisor are cross-industry, so you can gain a lot from the experience from others.
- ‘Copy and paste’ also works internationally
fit20 is now active in 8 countries and new countries are being added regularly. For example, recently we received people from the Philippines at the head office in Hattem, Netherlands. The Philippines looks like another powerful growth country for fit20.
You can grow internationally rapidly with a franchise. It is really a matter of ‘copy and paste’. Of course, you have cultural differences, but in essence everyone has the same body, so the training works everywhere. To be able to quickly roll out the concept across the border, fit20 makes all its instructions in English, after which everything is translated per country. Fit20 contracts a master franchiser for each country, who will be responsible for translations, the growth in that country, and for guiding franchisees.
- Collaboration is everything
One of the most important things about franchising is that you create a transparent model with which you offer franchisees a long-term perspective. Good cooperation is essential, so that everyone feels that the franchisor wants them to succeed. Of course everyone has to earn money, but you are there for each other. That is why franchising must really suit you as an entrepreneur.
There are plenty of entrepreneurs who prefer direct management and are not willing to wait for discussions to find solutions. If you prefer to only give instructions, you should not start with a franchise because you can’t say to a franchisee “that’s how you should do it”. After all, a franchisee is not an employee. You must be able to deal with that. Therefore you have “different conversations”.
This process sometimes takes longer, but the end product sometimes gets better, because franchisees think about how the product can be improved. They don’t ask questions to frustrate you, but they are aware of their wallets and their own interests. This way of working together fits well in a world in which a hierarchical management style disappears, and employees strive for more personal responsibility and freedom.
- Growth capital remains necessary
Franchising is ‘investment light’, but that does not mean that growth money is unnecessary. When fit20 crossed the border, extra capital was needed. Every country expansion incurs a lot of costs, such as registering your logo. We have already had a few court cases over branding. You could spend tens of thousands. If you want to add 3 countries, you should expect to pay about $100,000 USD, before you start earning internationally.
In short, for scaling up, you need to pre-invest. Fit20 raised €1 million from a private investor. We have figured out what works best in terms of earning models. Multi studios like 3 studios per franchisee for example, appear to ensure optimum scalability and an excellent earning model for franchisees (who hire their own trainers). Multiple studios per franchisee makes management easier for the franchisor.
fit20’s big-hairy-audacious-goal is to train 1 million people in 10 years, which requires a total of 5,000 studios. This requires exponential growth, with the number of studios doubling every year during the coming years. Next year we expect to open 80 new studios.
4 Important Factors Before You Start Franchising
- Less profit
With a franchise you share the investment costs with the franchisees. By reducing the risk you benefit less from the growth of your franchise. The only thing you earn are the franchise fees. In short, franchising is always a balance between risk and profit. Entrepreneurs sometimes forget that. You have to realise that the 2 different models (franchising vs owning locations) do not have the same earning capacity. New franchise law states that you must first have a concept properly tested before you sell the right to license your formula. But regardless of new laws, it is important that you are certain of your value proposition when you on-board a franchisee with the promise of a proven formula.
- Uniformity in representation
With a franchise you can quickly build brand awareness. You have many studio’s that look and work exactly the same way. The disadvantage is that you have to watch the brand experience carefully. The brand must be presented in the same way. You should have a clear idea of what the formula look (brand uniformity) of your company should be. If you know the core formula, then you know that it is important to make agreements to ensure consistency and compliance. The franchisee you engage must comply with that exactly.
If you provide freedom outside these set boundaries and preconditions, you will get a lot in return. If you select good franchisees, they will use the freedom to test things. This creativity will drive more results and the strategies and tactics can then be replicated to other franchisees.
Franchises that provide a good balance of freedom and working within agreed boundaries generate a network effect. More franchisees means more creative results means more value.
- It must fit with your way of doing business
Entrepreneurs who pay attention to the human dimension are the best franchisors. These are organisations that pay attention to the person behind the franchisee. If this is not your strength, you can also hire a manager for that. You have to work together towards a result.
Everyone naturally focuses first on their own business, making money for themselves and achieving success. But you also have a common goal, where you constantly have to take each other’s interests into account. As a franchisor you want the brand to grow and use the power of the formula. An independent entrepreneur also has an interest in the uniformity of the brand, but also that his own branch is running well.
Compare it to the owner of a property who wants to rent out a property, he must realize that he loses part of his control by putting the building into use. With a franchise, instead of a property, you have the name, the formula, and the know-how that you partially outsource. You must accept that.
- You are less agile
As a franchise company you are, on average, less agile than a conventional company. When being able to adapt quickly in your industry is important, you must bear in mind that as a franchisor you may be confronted with franchisees who can stall decisions. That can put a brake on innovation. Imagine you give 20 franchisees rights of use and a contract in which you promise to support them for five years. But after two years you realise the market has changed, and you have to adapt. Some franchisees may hold you to the original agreement. This can be a bottleneck in a sector that is changing. But if you have a good relationship, you can convince them that a change is important, and that they have to go along with it.
Occasionally, news surfaces about disagreements between franchisors and franchisees. This is often the result of a declining turnover. As long as you all make money, there is usually no serious disagreements. It’s important to look out for matching candidate franchise owners. Look for people who want to start for themselves, taking their future into their own hands, but who would like to work together within a proven formula with a good revenue model.
Learn more about Walter Vendel and fit20 on these podcast episodes:
- 219 – Walter Vendel – How to Build a Successful fit20 Franchise
- 225 – Kieran Igwe – Franchise vs. Start-up: Which One Works for You?
Dutch-based fit20 Franchise has offered thousands of people worldwide an effective way to increase their health and fitness levels significantly by training just once a week for 20 minutes. By adapting and innovating science-based High Intensity Resistance Training fit20 has become its world market leader. You can make this success story your business opportunity.
fit20 is expanding internationally rapidly and has licensed Master Franchisees in 8 countries on 4 continents. As a scalable franchise formula fit20 offers a highly profitable business model. fit20 combines human touch with cutting-edge technology in its boutique style studio’s. This is the fastest growing segment within the fitness industry today. The on-line and hands-on fit20 Academy guarantees a fast and successful launch. Contact [email protected] for a no-obligation introductory call or meeting.
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