Business Tips
When you sign an exercise club franchise agreement, you could be signing for a duration a lot longer than your contract actually calls for if you don’t know what to look out for. So be aware of these and other little tricks, compliments of Muscle Beach®, that some exercise club franchises will use to lock you into their system.
Some exercise club franchises will place a clause in their contract stipulating that a prescribed amount of your equipment MUST be painted with their corporate colors and decaled with their logos. Be aware of this, and as you’re negotiating, DEMAND that such a clause be stricken from your agreement. If the exercise club franchise won’t remove it, then simply walk away and come and talk to us. If your contract is coming up for renewal, demand that the clause be deleted from your agreement, otherwise you’ll opt out of your contract. Another key point to remember; NEVER sign a contract that DOES NOT have an escape clause.
Although an exercise club franchise might tell you that their corporate-colored policy is there to create consistency among their clubs, the real reason they use it is to extend the duration of your contract well beyond the agreed upon amount of time.
They know that if they can get you to paint the interior and exterior of your club, plus a large chunk of your equipment, with their corporate colors, then have you decal your equipment with their logo, they’ll have you locked in to their system for a lot longer than just the 5 years, or whatever the duration of your agreement. They know that it will take at least 10 years, maybe even longer, for your equipment to pay for itself.
So, just by using this one little tactic; using it to convince you that it’s necessary in order to give all of their exercise club franchises the same look and feel, they’ve, in essence, converted your 5-year agreement into a 10-year contract without you even knowing it!
What if you become dissatisfied with their exercise club franchise and decide that you want out after the 5th year? You won’t be able to get out, and they know it! They’ve got you right where they want you; locked in to their exercise club franchise, with no way out, and nowhere to go!
If you wanted to opt out of your contract, your only immediate option would be to become an independent brand. That’s because, in all likelihood, no other exercise club franchise would take you on. Why would they, when your building and equipment are painted with someone else’s corporate colors?
You’ll be left with only three choices. One, renew your contract for another 5 years, or for however long it will take for your corporate-colored equipment to pay for itself. Two, become independent. Or three, pray that you’ll get an opportunity to sign on with another exercise club franchise.