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Description
Investment Icon

What Are the Initial Investment Requirements for a Snap Fitness Franchise?

To open a Snap Fitness franchise, you should be prepared for an initial investment ranging from $430,800 to $1,118,100. This includes a franchise fee of $39,500, which is a one-time payment to join the franchise system. Additionally, you will need to have a minimum net worth of $150,000 to $400,000 and sufficient cash reserves to cover the initial setup costs. Understanding these financial commitments is crucial for aspiring franchisees to ensure they are financially equipped to start their business journey.

Fees Icon

What Are the Ongoing Fees Associated with a Snap Fitness Franchise?

As a Snap Fitness franchisee, you will be responsible for ongoing fees that include a royalty fee of 6% of your unit's gross revenue and a marketing fee of 2%. These fees are essential for maintaining the brand's marketing efforts and providing ongoing support to franchisees. It's important to factor these ongoing costs into your financial planning to ensure your business remains profitable in the long run.

Revenue Icon

What Is the Average Revenue Potential for a Snap Fitness Franchise?

The average annual revenue for a Snap Fitness franchise unit is approximately $365,206, with a median annual revenue of $207,265. However, revenue can vary significantly, with the lowest recorded revenue at $30,106 and the highest reaching $1,289,044. This variability highlights the importance of location, management, and market demand in determining your franchise's financial success.

Breakeven Icon

What Is the Breakeven and Payback Period for a Snap Fitness Franchise?

Snap Fitness franchisees can expect a breakeven time of around 10 months, indicating that you could potentially recover your initial investment within this period. Furthermore, the investment payback period is estimated at 18 months, suggesting that after the breakeven point, you could start seeing a return on your investment. These timelines are essential for potential franchisees to understand the financial dynamics of running a Snap Fitness location.

Snap Fitness Franchise Financial Requirements

Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.

Net Worth Required icon The minimum total assets (minus liabilities) you must possess.

i Net Worth Required:

$150,000 - $400,000
Investment Payback icon The estimated period to recoup your total investment.

i Investment Payback:

18 Months
Franchise Fee icon The initial fee paid to join the franchise system.

i Franchise Fee:

$39,500
Royalty Fee icon Ongoing percentage of revenue paid to the franchisor.

i Royalty Fee:

6%
Marketing Fee icon Regular contribution toward the franchise’s advertising fund.

i Marketing Fee:

2%
Breakeven Time icon The estimated timeframe to recover your initial costs.

i Breakeven Time:

10 Months
Initial Investment icon The total amount required to launch the franchise.

i Initial Investment:

$430,800 - $1,118,100
Cash Required icon The minimum liquid capital you must have on hand.

i Cash Required:

$430,800 - $1,118,100
Average Revenue icon The typical yearly revenue generated per franchise location.

i Average Revenue:

$365,206
Median Revenue icon The middle value of yearly revenue among franchise locations.

i Median Revenue:

$207,265
Highest Revenue icon The largest reported annual revenue among franchisees.

i Highest Revenue:

$1,289,044
Lowest Revenue icon The smallest reported annual revenue among franchisees.

i Lowest Revenue:

$30,106
Industry icon A broad sector defining similar types of franchise businesses.

i Industry:

Fitness Franchises
Category icon A more specific division within the broader industry.

i Category:

Gyms
Leadership icon The key individuals guiding the franchise’s strategy and growth.

i Leadership:

Peter Taunton
Corporate Address icon The official business address of the franchisor’s headquarters.

i Corporate Address:

2411 Galpin Court, Suite 110, Chanhassen, Minnesota 55317
Funding Year icon Available financing options to help start the franchise.

i Funding Year:

2003
Parent Company icon The main organization that owns the franchise brand.

i Parent Company:

Lift Brands Inc.

Snap Fitness Franchise Unit Growth Summary

A breakdown of corporate, franchised, and total units, with yearly net changes.

The overall number of operating franchise locations.

Total Units i

520
The number of locations owned by independent franchisees.

Franchised Units i

510
The number of locations owned and run by the franchisor.

Corporate Units i

10
Units 2021 2022 2023
Total Units 607 559 520
Net Change YoY -48 -39
Franchised Units 585 547 510
Net Change YoY -38 -37
Corporate Units 22 12 10
Net Change YoY -10 -2
Investment About

Investment Overview

The Snap Fitness franchise offers a low to high initial investment range, from $430,800 to $1,118,100. The initial franchise fee is set at $39,500, with ongoing royalty and marketing fees of 6% and 2% respectively. Potential franchisees should be prepared with a cash requirement that falls within the same investment range, alongside a net worth requirement between $150,000 and $400,000.

Potential About

Revenue Potential

Franchisees can expect an average annual revenue per unit of $365,206, with a median of $207,265. The revenue can vary significantly, with the lowest annual revenue reported at $30,106 and the highest reaching $1,289,044. This variance highlights the potential for profitability depending on location and management.

Metrics About

Breakeven and Payback

The Snap Fitness franchise has a breakeven time of approximately 10 months, allowing franchisees to recoup their initial investments relatively quickly. The investment payback period is estimated at 18 months, making it an appealing option for those looking to achieve a return on their investment in a short timeframe.

Fees About

Franchise Growth

Snap Fitness has seen a decline in the number of franchised units over the past few years, with 585 units in 2021, decreasing to 510 in 2023. This trend may indicate market saturation or increased competition, which potential franchisees should consider when evaluating the brand's growth trajectory.

Breakeven About

Financial Performance

The average profit and loss statement for Snap Fitness shows a gross profit margin of 91.3%, with operating expenses accounting for 48% of revenue. This results in an EBITDA of $158,356, or 43.3% of revenue, indicating a strong financial performance and potential for profitability for franchise owners.

Units About

Operational Expenses

Franchisees should anticipate average annual running expenses totaling around $105,100. This includes costs such as occupancy, insurance, marketing for grand openings, professional fees, and miscellaneous expenses. Understanding these costs is crucial for effective financial planning and management within the franchise.

Frequently Asked Questions

The initial investment for a Snap Fitness franchise ranges from $430,800 to $1,118,100, which includes the franchise fee and other startup costs.