INDUSTRY BENCHMARK · 41 SYSTEMS · FISCAL 2023–2025
Are fitness franchises a good investment?
Across 39 fitness franchise systems, the median system's exit rate in its latest fiscal year was 4.0%, and its opening rate 14.3%. Pooled across systems, with no system counting for more than 20% of the weight, the exit rate was 4.4%. JAZZERCISE alone is 31% of the sector's franchised base. Median franchise fee: $50K; median royalty: 7.0%; median total investment: $310K–$754K.
There is no official “fitness franchise failure rate.” What franchisors must disclose, in the Item 20 outlet tables of the FDD, is how many franchised outlets were terminated, not renewed, or “ceased operations — other reasons” each year. The exit rate here is that count divided by franchised outlets open at the start of a single fiscal year. It counts exits for any reason (some are retirements, sales, relocations or non-renewals) and misses struggling units that were sold as transfers.
4.0%
39 systems · latest fiscal year each
4.4%
JAZZERCISE alone is 31% of the sector's franchised base.
14.3%
1,311 outlets opened in total
41
FDD filed within 24 months
17,330
at latest fiscal year end
$50K
FDD Item 5
7.0%
FDD Item 6
$310K–$754K
FDD Item 7
32/41
systems disclosing an FPR
SOURCE: FDD ITEM 20 OUTLET TABLES FILED WITH STATE REGULATORS (MINNESOTA CARDS) · 41 SYSTEMS · 41 FILINGS · FISCAL 2023–2025
| Signal | Brand | Verdict |
|---|---|---|
| STRONGEST RECORD | HOTWORX | Strong |
| STRONGEST RECORD | Club Pilates | Strong |
| STRONGEST RECORD | Stretch Lab | Strong |
| WEAKEST FILED RECORD | 9ROUND | Weaker |
| WEAKEST FILED RECORD | I LOVE KICKBOXING | Weaker |
| WEAKEST FILED RECORD | UFC GYM | Weaker |
VERDICTS FROM EACH BRAND'S OWN FDD ITEM 20 FILING · METHODOLOGY
Fitness franchise questions, answered from the filings
How many fitness franchised outlets leave their systems each year?
There is no official failure rate. FDD Item 20 tables report how many franchised outlets were terminated, not renewed, or "ceased operations — other reasons" each year. Across 39 fitness systems, the median system's exit rate in its latest fiscal year (fiscal 2023–2025) was 4.0%; pooled across systems, with no system counting for more than 20% of the weight, it was 4.4%. JAZZERCISE alone is 31% of the sector's franchised base. Not every exit is a failure: some are retirements or sales.
How much does a fitness franchise cost?
Across the latest FDD filings of 41 fitness systems, the median initial franchise fee is $50K (Item 5) and the median total investment range is $310K–$754K (Item 7).
What royalty do fitness franchises charge?
The median ongoing royalty across 41 fitness franchise systems is 7.0% of gross sales, per Item 6 of their latest FDD filings.
Are fitness franchises growing or shrinking?
In each system's latest Item 20 fiscal year (fiscal 2023–2025), the median fitness system opened new franchised outlets at 14.3% of its starting base and lost 4.0% to exits. For the median system, openings outpaced exits.
What is the healthiest fitness franchise?
Of the fitness systems rated from their FDD Item 20 tables, HOTWORX has the strongest record (verdict: Strong). A verdict describes the filed record, not a recommendation to buy.
A broker is usually paid by the franchisor to place you. I'm paid only by you, never by a franchisor you're considering — and the job is pressure-testing the numbers, including talking you out of a bad deal.