Earn More Money, InvestingDecember 28, 2020January 25, 2021

How Much Can You Earn From A Planet Fitness Franchise?

It should come as no surprise that one of our go-to topics to speak on is fitness. Fitness is one of the building blocks of health and wellness. Furthermore, those who are successful and are within the upper echelons of society say that having some sort of fitness routine is crucial. However, this article is not about how important fitness is, in a sense. One of the industries that are growing at a rapid pace is fitness. For example, creating your own fitness products such as protein and creatine powder.

Another popular choice, albeit slightly less, is opening your own gym. We wrote an article on how much you can earn from opening a gym. I won’t spoil how much it is. However, if you want to see how much you can earn, check out that article here. Moreover, what about opening a gym franchise? This a less talked about option. However, it can be quite lucrative. Although, the amount of money you make and invest can both depend on what type of franchise you’re looking for. By this, I mean the company. Therefore, we will take a look into how much money you can possibly earn from opening and operating a Planet Fitness gym franchise.

What Is Planet Fitness?

Planet Fitness is a franchised gym that spreads across both Canada and The United States. With their headquarters in New Hampshire and a current stock price of $77, Planet Fitness is huge. However, it’s not enough to say that Planet Fitness is just a gym. There are a few things that make Planet Fitness different from the competition. These differences may make or break whether or not you’ll want to open a franchise with them. Planet Fitness likes to call their gyms a “Judgement free zone”. By this, they tend to have policies and procedures in place that would deter a certain demographic of people. In my, this is fairly ironic but that is neither here nor there.

Regardless, these policies ultimately try to help foster a gym atmosphere that is family-friendly and less intimidating. For example, Planet Fitness has what they like to call a “Lunk Alarm”. This is an alarm that’ll sound if you do something that is otherwise disturbing or obnoxious to the people around you. For example, if you’re working out, grunting extremely loud, and dropping weights, you’ll fit into the category of a link. If you do fall into this category, they sound the alarm and do one of two things. First, they can give you a warning and tell you to stop working out how you currently are. Second, they’ll just kick you out of the gym.

The second notable aspect of Plant Fitness is their low membership fees. Planet Fitness has two types of membership, Regular and black card. The Regular has basic gym features at $15 a month with a $40 annual fee. However, the black card membership is slightly more expensive at $25 per month with the same annual fee. Some of the benefits that the black card membership includes but are not limited to are nationwide usage of any Planet Fitness and the ability to bring a guest at any time. Therefore, it is easy to see what makes Planet Fitness an attractive place to workout and owns as a business.

What Are The Requirements To Owning A Planet Fitness?

Unfortunately, Planet Fitness is not accepting any new franchisees at the moment. This is most likely due to COVID-19. Therefore, much of the information on how to go about owning and operating a Planet Fitness franchise has been removed from their site. Fortunately, there are external sources that can give us relatively accurate information.

First, is the territory requirements. Planet Fitness franchising is becoming increasingly competitive. Therefore, you may have to reallocate to a different area in order to run your franchise. This means you need to be extremely flexible.

Next is the training aspect. Training can take a relatively long time. Anywhere from 6 months to 2 years. However, the training is intensive and covers a wide array of aspects pertaining to the business. In a nutshell, the training you and the managers will undergo is meant to make you proficient in every aspect of the business. Furthermore, if the franchise decides it for any reason, franchisees may have to attend additional training. However, the reasons for the franchise to decide if you need additional training can vary.

Lastly for this section, we will talk about the investment fees.

Above is a list of investment fees that you’ll have to pay on both the low and high end. This list outlines an amalgamation of fees ranging from the additional investment fee to out-of-pocket initial training expenses. As you could imagine, there are a lot of expenses. However, the amount you pay depends on a few factors such as area and how big the restaurant is. However, some fees stay the same. For example, the franchise fee is $20,000 across the board regardless of size. However, it can be completely possible that this amount will vary as well.

Regardless, the amount range you may have to pay is quite large. Ranging from 1 – 4 million dollars.

Above is another picture that includes the additional fees (feel free to zoom in as the text is a little small). However, a few of the fees that are included as *additional* are royalties and interest. Both of which are a set percentage amount. For the royalties, you will be paying 7% based on your gross monthly sales and membership fees. Next is the interest fees. This is approximately 18% annualized. There are other fees such as vendor costs. However, the amount you spend on that can vary depending on circumstances. However, those two pictures depicted above will give you a good estimation of how much you may be looking to spend when opening a Planet Fitness franchise.

How Much Money Can A Planet Fitness Make?

Onto the last part of the article. How much money can Planet Fitness make? Luckily for us, the official website displays how much money the average Planet Fitness earns in revenue.

According to Planet Fitness, they have a median membership revenue of almost 2 million dollars. Furthermore, they have a median annual operating income of approximately $570,000. While there is no exact number of how much you as a franchisee will earn, there are a few things that we can consider in order to get a good estimation. First is what we mentioned above, the amount the establishment will make in memberships and operating income. The second is the return on investment.

Of course, your first couple of years will be the ones where you make the least amount of money. This is due to the fact that you’ll be using a chunk of your earnings to pay off the investment. However, according to Planet Fitness, this can be as low as 4 years. That being said, if we take the 1 – 4 million dollar investment range and divide that by 4, we can assume that your franchise has the potential to earn $250,000 – 1,000,000 per year. However, these numbers can be very unlikely. This is due to a few factors such as inflation, commissions, bonuses, repairs, and the other fees we’ve spoked. Therefore, it’s fair to say that, on average, you’ll most likely be looking at $150,000 per year.

Shameed Chris Khan

Shameed is just a man on a mission to help those around him gain financial success. Obsessed with writing about all things finance, this GTA native is constantly learning and sharing his experiences with others.