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Top 3 Franchising Tips from a former Executive at Club Pilates

Via Business Insider.
This as-told-to essay is based on a conversation with Shaun Grove, the 47-year-old president of the boutique boxing gym Rumble. It has been edited for length and clarity.

I'm an executive at a company that owns the boutique fitness brands Pure Barre, Club Pilates, and Rumble. Here are my 3 best tips for scaling up a franchise.

Shaun Grove, 47, is a former attorney and now the president of the boutique boxing gym Rumble. Before joining Rumble, Grove grew the Club Pilates chain to 700 studios from 25. Here's his story and best advice for building a franchise, as told to Claire Turrell.

I trained to be an FBI agent, but early on there were telltale signs it wouldn't be a lifelong career. It was very bureaucratic, which wasn't for me. When I finished my two-year training at Quantico, I was asked to move from California to Boston. Instead of making the move, I went back to my roots as an attorney and returned to law, and started working as a general counsel for the LA Boxing gym chain, owned by former internet entrepreneur Anthony Geisler.

As a former college footballer, I immediately felt at home in the fitness world.

Fast-forward two years, and I'd bought four LA Boxing franchises of my own. Then UFC Gym decided to acquire it. Anthony was then looking at new ventures and wanted to buy a boutique Pilates studio called Club Pilates. At that time Pilates was seen as a workout for the elite, and he wanted to roll it out to the masses. It had 25 studios but no consistency in any area, whether that was equipment or marketing.

By March 2015, Anthony had bought Club Pilates, I had become a partner, and we'd completely revamped the brand Within six years we'd launched 700 studios across the globe. We sold the brand to a private-equity firm in May 2017, but Anthony stayed on as CEO and I stayed on as Club Pilates' president.

Even though I was a franchisor, I never stopped being a franchisee.

I'd sold three of my UFC Gyms, but I remained the owner of one UFC franchise. I wanted to remember what it was like to be a franchise partner and need the support of the franchisor. We had a blueprint for boutique franchises and wanted to do the same for other fitness brands, so we created the umbrella company Xponential Fitness and started buying up other boutique fitness brands, including Club Pilates, CycleBar, Row House, and its latest venture, Rumble, which is backed by Sylvester Stallone and Justin Bieber.

In July 2021 we took Xponential public on the New York Stock Exchange. Here are my tips for building a successful franchise.

Our opening support program was a game changer for us. I think our biggest learning curve — which we acknowledge that we'd gathered over several years — was the importance of our opening support program, helping franchises move from presale to soft opening and grand opening. I equate it to an airplane taking off, getting that initial lift, and then reaching cruising altitude. Our opening support program is a very robust marketing and sales program that allows us to generate the number of prospective members that we need and then convert those into actual members so that we have a certain number before the studio even opens. Nine times out of 10 this puts a studio at a breakeven point even before they open their doors.

We choose our franchise partners carefully.

When we're choosing our franchise partners, we like to see some level of business experience and that they're well capitalized and passionate about what they're getting into. At the beginning, many of the Club Pilates franchisees were what I call corporate refugees, or people who'd been in corporate America for 20 years making money for someone else and wanted to go out and do it for themselves. Each potential franchisee goes through a three-month process where they're educated on what the concept is and what our expectations are of them. They need to take part in interviews, hold weekly calls with the presidents, and have conversations with existing franchise partners. This puts them through a funnel that takes them to "Confirmation Day," where they meet our corporate team, take a class at a local studio, and listen to presentations about the company. Once this is done, we'll decide who to award a territory to.

We overstaffed from the start to oversupport the franchise partners.

When we relaunched Club Pilates we were definitely overstaffed, but we've always taken the position that we want to oversupport our franchise partners. We created development departments for each line item in the business, from real estate and construction to sales and education. Even when we only had 25 locations, we still had all these people in place. We now have a team of 52 people at Club Pilates. When Club Pilates started to get larger, it became evident that we didn't just need to fill vertically underneath these departments, but we needed to create some new departments to help us continue to grow. We found really quickly that we needed someone who had a little bit more expertise in scaling the business, so we took on an SVP of operations when we reached 300 studios.

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