Opening a sports academy franchise location can offer powerful benefits that you can’t get when you start from scratch or even purchase an existing business, and franchise opportunities have grown quite a bit in recent years.
However, not all franchisers are created equal, and owning a franchise never guarantees success – or even guarantees that you won’t have to work just as hard as if you’d opened on your own.
If you’re considering opening a sports facility franchise location, here are a few things to keep in mind.
Some franchises charge a set amount each month, and others collect a percentage of your total monthly revenue.
The flat rate can be difficult to cover when you’re just starting out, but costs less than a percentage would over time, assuming you’re successful. The percentage amount has the opposite benefits; it’s very affordable when you’re just getting started, but generally costs more than a flat fee as you start to make more money.
DNA Sports Center is home to a Parisi Speed School franchise location, and we pay a monthly flat fee. While the dollar amount was high for us when we first opened, I started by doing the math of how many memberships we’d have to sell in order to cover the fee, and then made sure we had the resources to hit that minimum number each month – which, of course, was easier because of all the help their team gave us. The fee ended up being manageable very quickly.
The type of structure that will work best for you will depend on which services are included in your fee, how important those services are to you, and whether your demand for those services will increase as your business grows.
Here are some examples of services your franchise fee might cover:
- general support and consulting (you’ll want to know how often it’s available, whether you’ll have a dedicated rep or team, and how you can reach them)
- advice or specific guidelines on site selection and design (build-out)
- instructions on which equipment to buy and access to special vendor relationships, which may even include discounts
- help with planning a grand opening and other opening tasks
- local advertising plans and materials
- insurance (or guidance on how to get it)
- legal documents (incorporation, waivers, etc.)
- help with securing business licenses and permits
- instructor training/certification and educational resources, including conferences
- logos, branding materials and signage
- access to professional designers and tech staff that are shared by the franchisees
- regular consultations on the latest tools and trends for marketing and promotions
- a scheduling system and/or customer database management tools
- a web site or help with getting started with a web site
In addition to the types of services listed above, one of the biggest benefits of owning a franchise location is the name recognition you may get with the brand. The franchiser has likely already spent plenty of time and money getting the word out about their services, so depending on how well-known the brand is in your area, taking advantage of those efforts can make attracting new customers easier.
If getting your doors open quickly is a high priority, opening a franchise location should be especially appealing.
When you open a franchise, you can skip a thousand decisions about branding, operations, services, and pricing that you’d have to spend a lot of time on if you were starting from scratch.
You’re also likely to get lots of help with issues that can be big time drains for beginners, such as site selection, market research, insurance and legal issues. And if their fees are based on your revenue, your franchise team will have an extra incentive to start helping you make money as soon as possible.
Remember: Franchises Aren’t Foolproof
When you look at the list of all the services included with joining a franchise, the franchise route might seem like a no-brainer.
But any franchiser should make clear that while they can certainly improve your odds of success and make it easier for you to get up and running, you’re still going to have to work extremely hard to stay open for the long term.
These franchises may be particularly appealing to part-time owners, which I was myself, because they almost give the impression they’re foolproof. That’s why I advise caution.
As I said in my post about selling DNA Sports Center, I started out with some unrealistic expectations about my ability to run it mostly hands-off and entrust it to a general manager. I ended up spending most of my evenings and weekends there.
Tim Ziakas at Parkview Sports Advisory notes in his blog that some of the main things any new sports academy needs to succeed is entrepreneurial zeal and the ability to close sales. Those are things that successful franchisers are already great at themselves, but that they can’t truly impart to you or your staff.
Evaluate and Control
As you evaluate various franchise opportunities, ask about their success rates and make sure that they have a plan to keep their franchisees at the forefront of all the new technology and competition in our constantly changing industry landscape.
If you like the idea of skipping some of the upfront work in opening a facility but want to control more of your academy’s look, feel and services, I’d also encourage you to look into buying an existing facility. Depending on the deal you reach, you may be able to purchase things like logos, branding, web sites and equipment.
You can also do what I did – offer a combination of franchise and non-franchise services at your sports facility. I was able to have more control over the look, feel, and decisions for my main brand, but I still had the backing of a franchise for one of our primary services.
If you have any other questions or feedback on purchasing a franchise, please contact me or leave a comment below.