Cons of Franchise and Chain Investment Exposed in Light of Enormous Lawsuit Against 24 Hour Fitness

After a $23 million dollar lawsuit against 24 Hour Fitness, Fitness Center Developers discusses why independent gym ownership may be more profitable regardless of size. DRSS report.

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The $23 million dollar law suit is just a drop in the bucket, and all of that money is being diverted away from making the gym better, away from new equipment and different things that will keep customers.

Las Vegas, NV (PRWEB) November 19, 2012

In a an article published by ClubIndustry.com, an online source for fitness business professionals, it was reported that Chris A. David, who served as chairman of the board of directors for 24 Hour Fitness until March of 2012, is now suing the club for $23.6 million, claiming a breach of contract concerning a phantom stock agreement. The lawsuit was filed by her lawyer on Monday, October 29, 2012 in United States District Court for the District of Delaware, Wilmington, DE. (Davis v. 24 Hour Fitness Worldwide Inc. Case Number: 1:2012cv01370)

24 Hour Fitness is the largest fitness chain in the United States, and is often used as the model for startup franchises and other fitness chains according to industry insider, Rob Copenhaver. Rob Copenhaver has extensive experience managing “Big Box” gyms and is now the General Manager of Fitness Center Developers, the largest independent, non-franchise developer of fitness centers in North America. “The 24 Hour Fitness business model has had a lot of success of course, however this is expected considering the intense boom the fitness industry is experiencing with the combined influx of Baby Boomers and the obesity epidemic and other factors.”

He believes that the sheer size of 24 Hour Fitness has created a false correlation between how the business is run and how a fitness center can be successful, “If you live in an urban location they are everywhere, so of course people are going. They are also closing all of the time though, and the turnaround is not ideal. They need to sign up a lot of new members every month to stay successful because people are always leaving. Then you have the incredible overhead that comes with such a huge corporate chain. The $23 million dollar law suit is just a drop in the bucket, and all of that money is being diverted away from making the gym better, away from new equipment and different things that will keep customers.”

Copenhaver believes that, as independent fitness centers pop up, these chains simply will not be able to compete because independent gyms are better equipped to cater to a specific local community, and because they aren’t burdened with the kind of overhead where a $23 million dollar lawsuit does not seem like such a huge deal.

Fitness Center Developers is a non-franchise independent developer of fitness centers specializing in all areas of fitness business development including financing assistance up to 100% plus operational costs, site location, lease negotiation, premium equipment from reputable and popular equipment manufacturers, wholesale merchandise such as supplements and clothing, member retention and signup training for owner and staff, business training, and support to the fitness center similar to a franchise for the life of the business, but without the franchise fees.

Fitness Center Developers is a branch of Discount Retail Store Services, an independent business development firm specializing in turn-key business setup for those who want to start a business. Get upcoming news on their Facebook Page.


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