Planet Fitness

Planet Fitness (PFIP LLC) is an American franchisor and operator of fitness centers based in Hampton, New Hampshire.[4] The company reports that it has around 2,400 clubs,[5] making it one of the largest fitness club franchises by number of members and locations. The franchise has locations in the United States, Canada, Dominican Republic, Panama, Mexico, and Australia.[6] It markets itself as a "Judgement Free Zone" that caters to novice and casual gym users, and has faced both praise and criticism for its atmosphere.

Planet Fitness, Inc.
Planet Fitness
TypePublic company
IndustryFitness
Founded1992 (1992)
Founders
  • Michael Grondahl
  • Marc Grondahl
  • Rich Berks
[1]
HeadquartersHampton, New Hampshire, U.S.
Number of locations
2,039[2]
Area served
North America
Dominican Republic
Australia
Key people
Craig Benson (interim CEO)[3]
Number of employees
1,616 (2020)
Websiteplanetfitness.com

History

A Planet Fitness location in Waycross, Georgia in 2021
Planet Fitness locations in the United States as of 2015

In 1992, Planet Fitness founders, Michael and Marc Grondahl acquired a struggling Gold's Gym franchise in Dover, New Hampshire.[7] They eventually closed that original location, opened a gym called Coastal Fitness and brought on a third partner, former CEO Chris Rondeau.[8][9][7] In 2002, they purchased the rights to the name Planet Fitness from Rick Berks and renamed their franchise.[10][7]

Berks had started his own Planet Fitness gym in 1993 in Sunrise, Florida, and eventually expanded it to three clubs, along with a Gold's Gym franchise.[11][12] Berks had been catering to the bodybuilding culture in his Gold's Gym. "I decided I didn't want to deal with that crowd, so that's when I opened the original Planet Fitness club in Sunrise, Florida, in 1993." The name came from his daughter's school project, "Fitness Planet".[13] The new model was an effort to provide a fitness hub for everyday people.[14] Berks later went on to open the first Youfit Health Club in St. Petersburg, Florida.[15]

Rondeau and the Grondahls recognized that there was a greater opportunity to serve a much larger segment of the population if they changed the gym environment, both in attitude and format, by creating a non-intimidating, low-cost model.[16] Planet Fitness became known as the "Judgement Free Zone", aimed more at the average user than the bodybuilder type of fitness enthusiast.[17] They also dramatically reduced prices to compete against better-known brands.[18] This low-cost business model focuses on the needs of occasional or first-time health club members, rather than more experienced members,[19] and depends on many members rarely showing up.[20] According to a Planet Money episode from 2014, "half of the Planet Fitness members don't ever go to their gyms."[21] In 2003, Planet Fitness opened its first franchised location in Florida, with Eric Dore and Shane McGuiness.[17]

As part of their effort to create a non-intimidating environment, Planet Fitness has alienated many serious weight lifters. The gym utilizes a "lunk alarm", which is a loud siren and rotating light that is used when a gymgoer grunts too loudly or drops weights.[22] Some bodybuilders and weight lifters have found the way they are portrayed in Planet Fitness TV commercials to be offensive, and the way they are treated in Planet Fitness gyms to be "quite possibly discriminatory."[22] Planet Fitness has been criticized for prohibiting certain weightlifting exercises–such as deadlifts and clean-and-jerks–that many experts believe are highly effective.[23] In 2010, Men's Health magazine called Planet Fitness "the worst gym in America."[23]

As early as March 2015, the "Judgement Free Zone" policy was expanded to allow trans women to use the women's locker room. The policy states that "members and guests may use all gym facilities based on their sincere self-reported gender identity."[24]

In the fall of 2013, TSG Consumer Partners LLC became an equity partner in the Planet Fitness franchise.[25] Michael Grondahl, co-founder of Planet Fitness stepped down as CEO, and was succeeded by Chris Rondeau.[26][27] The company went public on August 6, 2015.[28]

In February 2016, the franchise was added to the Franchise Times' "Fast and Serious" list of top franchises (No. 1),[16] and in its 2016 ranking of franchises, Forbes magazine ranked Planet Fitness No. 4.[29] It ranked in the top 50 of Entrepreneur magazine's Franchise 500 in 2017.[30]

In 2020, the company received criticism for charging its customers for March dues "despite closing its facilities nationwide due to the novel coronavirus pandemic."[31] They stated that they were unable to stop the pre-scheduled payments on short notice, but would not charge future monthly dues until they reopen, and would also provide a credit for closed days previously paid for.[32]

While Planet Fitness closed many facilities during the onset of the COVID pandemic, during the Delta and Omicron variants there was not a decrease in gym attendance.[33][34]

Franchises

A row of Arc Trainers at a Planet Fitness in Spring Branch, Houston, Texas

Planet Fitness started franchising units in 2003. According to Franchise Direct, the initial franchise fee is $20,000, while the area development fee is $10,000.[35] The royalty fee for a Planet Fitness is 7% of the total gross monthly and annual membership fees.[36]

The net worth requirement for a Planet Fitness franchise is $3,000,000, while the liquid cash requirement is $1,500,000.[37]

Statistics and international expansion

The company reports that as of 2019, there are 80 corporate-owned gyms, the rest independently owned and operated.[38]

The club's two membership levels are $10 and $24.99 per month in the United states and in Canada they charge $15 and $25 per month. The $10 per month level includes access to cardio and strength equipment, unlimited group fitness instruction and pizza and bagels once a month; the $24.99 per month ("Black Card") level allows members to bring one guest per day at no charge, access to all Planet Fitness locations, and access to extra amenities, such as tanning booths, massage chairs, red light therapy and water massage beds.[39][30][40]

In December 2014, Planet Fitness opened its first international location in Toronto, Ontario, Canada. The second Toronto location opened in early 2015.[41][42] In October 2015 the company opened their second international location in Santo Domingo, Dominican Republic.[43]

With the addition of a Planet Fitness outlet in Hawaii in January 2018,[44] Planet Fitness had 1,500 locations with an estimated 10 million members across 50 states, the District of Columbia, the Dominican Republic, Mexico, and Panama[45] and Canada.[44][38] In 2016, over 90% of Planet Fitness locations were opened by existing franchise owners.[46]

Planet Fitness reported that it has around 2,400 gyms worldwide with a total membership of 17 million, generating an annual revenue of $936.8 million at the end of 2022.[5]

Sponsorships

In October 2011, Planet Fitness reached an agreement with NBC to sponsor the network's reality show The Biggest Loser beginning with the 2012 season.[47] The contestants on the show worked out on Planet Fitness equipment and then at Planet Fitness gyms near their homes, working with Planet Fitness instructors.[47]

In March 2013, Planet Fitness partnered with 50 Cent to sell his energy drink "Street King".[48]

Since December 2014, Planet Fitness has been the official fitness sponsor of Dick Clark's New Year's Rockin' Eve on ABC.[49][50]

Since 2015, Planet Fitness has been a personal sponsor of NASCAR driver and champion Joey Logano.[51] In April 2022, Planet Fitness appeared as a sponsor on a race truck for the first time in the 2022 Pinty's Truck Race on Dirt with Logano driving the truck.[52]

In March 2016, Planet Fitness partnered with STOMP Out Bullying,[53] a national organization dedicated to bullying prevention, and the Boys & Girls Clubs of America to launch the company's national philanthropic initiative to address bullying, The Judgement Free Generation.[54][55] Also in 2016, the company donated more than $1 million to the program.[56][57][58] Planet Fitness has also provided mini "Judgement Free Zone" gyms to Boys & Girls Clubs in Manchester, New Hampshire[59] and Pasadena, California.[60]

In October 2017, Planet Fitness and its members raised $1 million which it donated to the non-profit Boys and Girls Clubs of America.[61]

In January 2020, Planet Fitness partnered with The Biggest Loser to be the official sponsor of the show's 2020 reboot.[62]

References

  1. "At Youfit Health Clubs, patrons can feel the burn without bells, whistles".
  2. "SEC Form 10Q Report, Q1". bamSEC.com. U.S. Securities and Exchange Commission. Retrieved May 20, 2020.
  3. Fonrouge, Gabrielle; Richardson, Drew (September 15, 2023). "Planet Fitness shares sink after board ousts CEO in shocking move". CNBC.
  4. Sullivan, Max (November 10, 2016). "Planet Fitness headquarters moving to Hampton". Seacoast online.com. GateHouse Media. Retrieved May 31, 2017.
  5. "Planet Fitness Sets New Membership Records". Fitt Insider. February 28, 2023.
  6. Hall, Nick (December 16, 2019). "4 international franchises that landed Down Under in 2019". Inside Franchise Business. Retrieved December 23, 2019.
  7. Turner, Jeremiah. "Fit for franchising: From first gym in Dover, Planet Fitness building big brand". fosters.com. Retrieved July 1, 2020.
  8. "How Planet Fitness Became the Leader in Fitness Franchising - News".
  9. "How Planet Fitness Became the Leader in Fitness Franchising - News". www.franchise-info.ca. Retrieved July 2, 2020.
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  11. "YouFit Health Club expanding across South Florida, around nation | The Starting Gate". Miami Herald. Retrieved June 30, 2020.
  12. Brochu, Nicole. "No-frills gym offers fitness without flash". Sun-Sentinel.com. Retrieved June 30, 2020.
  13. "Meet Youfit's CEO Rick Berks". Youfit Youniverse. February 24, 2016. Retrieved June 29, 2020.
  14. Zabonick-Chonko, Rachel (November 11, 2013). "Youfit Health Clubs". Club Solutions Magazine. Retrieved June 28, 2020.
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  16. Ewen, Beth; Kaiser, Tom; Upton, Nicholas; Weingartner, Nancy (February 23, 2016). "Fast and Serious: FT ranks the smartest-growing brands". FranchiseTimes.com. Franchise Times.
  17. Taylor, Kate (July 25, 2014). "Franchise Players: We Were Planet Fitness's First Franchisees. Now, We Own 22 Locations". Entrepreneur.com. Entrepreneur Media. Retrieved May 31, 2017.
  18. Morrel, Katie (June 13, 2013). "Marc Grondahl of Planet Fitness: How a Lean Business Model Became a Franchise Heavyweight". Open Forum. American Express. Retrieved May 31, 2017.
  19. Schlossberg, Mallory (December 12, 2015). "The fastest-growing gym in America has $10 memberships and gives out free pizza, bagels, and candy". Business Insider. Retrieved May 31, 2017.
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  24. Grinberg, Emanuella (March 9, 2015). "Planet Fitness revokes woman's membership after transgender complaint". CNN.com. Cable News Network. Retrieved July 16, 2018.
  25. Lawrence, Kelli (August 15, 2013). "A World Of Their Own". Profile Magazine. Retrieved June 8, 2014.
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  31. Jakab, Spencer (March 23, 2020). "This Gym Chain Has Reason to Sweat". Wall Street Journal. ISSN 0099-9660. Retrieved April 30, 2020.
  32. McEnery, Thornton (March 19, 2020). "Planet Fitness members outraged over March bill amid coronavirus closures". New York Post. Retrieved April 30, 2020.
  33. Thomas, Lauren (January 3, 2022). "Planet Fitness CEO says gym visits are holding up against the omicron variant". CNBC. Retrieved January 28, 2022.
  34. Ryan, Thomas J. (January 14, 2022). "Planet Fitness Seeing Minimal Impact So Far From Omicron". sgbonline.com. Retrieved January 28, 2022.
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  39. Tom, Lauren (December 24, 2015). "17 January Gym Discounts That Are Too Cheap to Pass Up". cosmopolitan.com. Hearst Corp.
  40. Garcia, Tonya. "Planet Fitness is raising the price of its Black Card membership but still offers a $10 option". MarketWatch. Retrieved June 13, 2022.
  41. "American gym powerhouse chooses Brampton for first suburban Canadian location".
  42. Tucker, Rebecca (January 22, 2015). "Cheap 'n' cheerful chinups: Canada welcomes Planet Fitness, the $10 gym for those bad at gym". NationalPost.com. Postmedia Network Inc.
  43. Stromgren, Eric (October 15, 2015). "Planet Fitness Continues International Expansion in Dominican Republic". Club Industry Magazine. Retrieved June 2, 2017.
  44. Hrushka, Anna (January 4, 2018). "Planet Fitness opens first Hawaii location at Ala Moana Center". Pacific Business News. American City Business Journals. Retrieved March 12, 2018.
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  48. "50 Cent and Joan Rivers Kick It At The Gym [PHOTOS]". The Urban Daily. March 28, 2012. Retrieved June 8, 2014.
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  50. Briand, Paul. "Planet Fitness sponsors New Year's Eve celebration despite pandemic". Portsmouth Herald. Retrieved August 26, 2022.
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  52. Srigley, Joseph (April 6, 2022). "David Gilliland Racing Fielding Fourth Entry for Joey Logano in Bristol Dirt Race". TobyChristie.com. Retrieved April 12, 2022.
  53. STOMP Out Bullying
  54. Share, Susan (March 11, 2016). "The Judgement Free Zone: Judgement Free Generation Video Contest". www.myclubmylife.com. Boys and Girls Clubs of America.
  55. "Planet Fitness Opens In Fremont, Donates $1K To Boys & Girls Club". Fremont, CA Patch. January 10, 2022. Retrieved January 28, 2022.
  56. Friedman, John (November 9, 2016). "Planet Fitness 'Judgment Free Zones' a Model of Inclusion". Huffington Post.
  57. Cameron, Courtney (January 2017). "Planet Fitness Anti-Bullying Initiative $1M Success". athleticbusiness.com. Athletic Business LLC.
  58. "Planet Fitness Anti-Bullying Initiative $1M Success". thenewsandsentinel.com. The Parkersburg News & Sentinel. January 8, 2017.
  59. Feely, Paul (September 9, 2016). "Planet Fitness debuts fitness room for kids at Boys and Girls Club in Manchester". UnionLeader.com. New Hampshire Union Leader. Retrieved June 2, 2017.
  60. "Planet Fitness Opens Judgement Free Gym at Pasadena Boys and Girls Club". Pasadena Now. November 13, 2016. Retrieved June 2, 2017.
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