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ASK THE EXPERTS Featured 2

PACE Express Circuit Training Equipment

An alternative to franchised fitness clubs, PACE provides equipment, training and support to individuals seeking to own and operate circuit training programs without the fees and restrictions of a franchise.

Rande LaDue is owner of Hydraulic Fitness Products, the worldwide exclusive distributor for the PACE and Kids PACE Express Circuit Training programs. PACE, originally called Hydra Fitness and dating back to the 1970’s, is the world’s first hydraulic exercise equipment. Some fitness franchises have used PACE equipment (the first Curves club in Harlingen, TX used PACE equipment) over the years, but PACE also provides equipment, training & support to those seeking to open or maintain independent, non-franchised clubs.

As the recession has created increased pressure on club owners,  Rande is seeing increased interest from people wanting to open independent fitness programs in markets that could not support franchised express fitness clubs like Curves.  For information and pricing on PACE and PACE for Kids, email paceequipment@gmail.com.

FranBest: Tell us about Hydraulic Fitness Products? How long have you been in business?

Rande: I’ve been in the fitness industry 30 years opening my first health club in Upstate New York in 1980. I started selling PACE equipment in the early 90’s when I was hired by Henley Healthcare (the medical company that bought Hydra Fitness) to head up its fitness division. I started distributing PACE myself about 10 years ago as Henley got out of the fitness business.

FranBest: What types of customers does Hydraulic Fitness Products serve? At what point do they begin working with you?

Rande: Over the years, we have sold PACE to thousands of facilities ranging from women’s clubs, coed clubs, weight loss centers, senior facilities, schools, colleges, physical therapy/rehab centers, community centers, the US military, and even professional sports teams. PACE was originally marketed to larger coed clubs as a means of attracting those people who were too intimidated to join (seniors, women, the overweight, etc.) and as a fun, new program for existing members.

The very first Curves club based in Harlingen, TX had our PACE equipment. As the Curves phenomena grew in the late 90’s, our market shifted to independent mom & pop startups who wanted to open a small studio but did not want to get locked into a franchise. There are many happy people out there who did their homework before jumping into a franchise and saw that not only did we offer superior quality adjustable equipment, but we provided the marketing and training tools necessary to be successful without any franchise fees. As Curves saturated the country, more coed clubs added our program as a means of competing against them. Since we are not a franchise, our customers were free to add additional profit centers, services or equipment to offer their members much more than the competition.

FranBest: Explain the nature of the Pace Fitness Equipment product line. How does hydraulic equipment differ from typical exercise machines?

Rande: Hydraulic resistance basically accommodates to the effort of the user; the faster/harder one pushes, the more resistance they encounter. PACE hydraulic machines provide concentric only resistance; there is no eccentric (or negative) resistance which allows each hydraulic machine to work opposing muscle groups in a “double-positive” fashion. The fact that there is no “fixed load” with hydraulic resistance allows for safe “fast anaerobic” exercising.

Note that every weight stack company recommends to use their equipment in a “smooth, controlled manner” while we recommend to use our machines as quickly as you can at your own “pace”. This type of fast exercising cannot be done safely with typical weight stack machines; you will either tear a muscle if the weight is too heavy or if it is too light, you will be throwing the weight in the air and catching it on the way down. Hydraulic resistance provides a combination of a safe muscle toning workout with a high calorie burn cardiovascular workout in a time efficient 30 minute program.

How does Pace Hydraulic Fitness Equipment differ from other hydraulic machines? What are the advantages to the fitness club member? How about to the owner?

Rande: What sets PACE equipment apart from its franchise competition is the fact that our hydraulic cylinders are adjustable and feature a dial that controls the amount of hydraulic fluid to be able to increase or decrease the resistance as needed. This allows our equipment to accommodate a wide range of fitness levels at the same time and also prevents members from hitting a plateau. These are huge advantages to the club owner as well as their members.

Member retention is one of the biggest problems club owners face. If a member hits a plateau and has stopped enjoying results, she will get frustrated, bored and eventually drop out. With PACE equipment, once a member has maxed out on setting #1, they just click the dial to #2 and it takes them to a whole new fitness level. Small clubs are successful long-term only if their members continue to get results and become walking testimonials- and bring in their friends.

Another huge advantage for the club owner of using adjustable PACE equipment is to be able to attract new members. Some of our customers offer a combination of women only hours during the day, then coed hours in the evening. Let’s face it, there are just as many out of shape men out there as women and many of them are just as intimidated to go into a hardcore club. It makes sense, especially in a small town, to try to appeal to as much of the population as possible. Again, since we are not a franchise, our customers are not locked into a cookie-cutter formula only; they have a huge advantage of being free to appeal to their unique markets by offering additional services, products, equipment, etc.

We provide a preferred vendor list as part of our marketing package to help customers find key suppliers (without getting any kick-backs).

FranBest: What are some of the fitness clubs that are using Pace Fitness Equipment products in their clubs?

Rande: One of our biggest areas of growth right now is selling into markets where a Curves club has just gone out of business. There may have been 50-60 loyal members who loved working out but have been left high and dry; maybe this was not enough members cover the high franchise fees, but usually more than enough to cover basic expenses.

One such customer, Kimberly Ellingsen, from New Image Fitness in WI had over 50 former Curves members signed up before she opened her PACE club, then recently had her grand opening and signed up dozens of new people. As a former Curves member, what she values most about our equipment is the superior quality over what she was used to. She told me “There is a difference of night and day in the quality of PACE equipment over Curves. Every one of my members who was a former Curves member loves it! Showing them how they can change the resistance quickly and easily is one of our best selling points”.

FranBest: Tell me about the service philosophy of Hydraulic Fitness Products. What kind of service and support do you provide? Do you provide value other than supplying equipment?

Rande: My philosophy in business is borrowed from Zig Zigler, who said “You can get anything you want in life if you help others achieve their goals”. If I help my customers become successful, then I will ultimately become successful. They will buy from me again when they open their 2nd and 3rd clubs and they will tell others about PACE.

I used this same philosophy in my own clubs- if I help a member achieve their fitness goals, then I will keep them as a member and they will bring their friends in. I encourage my customers to adapt the same philosophy in their clubs.

Another one of my favorite sayings is that “there is no monopoly on brains.” Running a successful club is not rocket science, but there are industry-proven tools and steps that should be taken to ensure success. My job is to provide these tools and training to my customers; their job is to utilize the tools that they feel will work best for their markets.

I also encourage my customers to network together on our PACE Facebook Group page to share ideas, success stories, etc. I can’t see paying a high franchise fee for years when we provide the same type of fitness industry tools. Kimberly from New Image Fitness also said “The marketing tools in the PACE package gave me everything I needed for a successful grand opening.”

She also appreciates the personal attention she received. “Being able to call the owner of the company if I have any questions is incredible customer service!”

FranBest: What differentiates your company from other equipment suppliers in the industry?

Rande: Quite frankly, there have been several knock-off companies who jumped on the hydraulic equipment bandwagon in the last few years to try to capture some of the Curves business; some of these companies did not even exist 2-3 years ago but they profess to be experts in this industry.

What separates PACE from these suppliers is our track record, knowledge, quality and personal-touch customer service. The personal touch is one of the key factors that separates small circuit clubs from large health clubs; I’ve tried to apply the same philosophy in my business. We may be a few hundred dollars more in cost, but there are no hidden surprises with PACE (no assembly needed on machines, cylinders that work, etc).  And whenever one of the club owners has a problem or a question, they can feel free to call me, the President, directly.  How many of the big franchise chains can make that claim?

FranBest:  How can club owners and prospective club owners find out more about Hydraulic Fitness Products and PACE equipment and support programs.

Rande: The best way is to email me, in confidence, at PaceEquipment@gmail.com.  Include your phone number and a little bit about your plans, such as whether you’re looking to start a new club or add on to an existing program.  I’ll email you information confidentially and with no obligation.

FranBest:  Thanks, Rande

Rande: Thank you.

To learn more about PACE and PACE For Kids exercise equipment, email Rande at PaceEquipment@gmail.com.  Also, visit the PACE website at http://www.pacegroupexercise.com/.

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BEST FRANCHISE SEARCH Legal Issues

FDD: The New Format for Franchise Disclosure


Guest Post by Joel Libava, My co-franchise blogger at Allbusiness.com

Hello FDD! Goodbye UFOC… Franchise Legal Documents

July 1st marked the day that the UFOC {Uniform Franchise Offering Circular} was officially retired. It was the legal document that the Federal Trade Commission {FTC} required franchise companies that were registered in the US to put together for distribution to interested franchise prospects, during the official sales process.

When the Federal Trade Commission overhauled its “Franchise Rule” last year, it came up with a new disclosure format. It was one which adopted the UFOC disclosure requirements, but added to them as well. And it gave a disclosure document prepared under these new requirements a new, easy to remember name: “Franchise Disclosure Document” (or “FDD” for short).

These are the items that are to be included in every FDD:

1. The Franchisor, its Predecessors and Affiliates

2. Business Experience

3. Litigation

4. Bankruptcy

5. Initial Franchise Fee

6. Other Fees

7. Initial Investment

8. Restrictions on Sources Of Products And Services

9. Franchisee’s Obligations

10. Financing

11. Franchisor’s Obligations

12. Territory

13. Trademarks

14. Patents, Copyrights and Proprietary Information

15. Obligation To Participate In The Actual Operation Of The Franchise Business

16. Restrictions On What The Franchisee May Sell

17. Renewal, Termination, Transfer And Dispute Resolution

18. Public Figures

19. Earnings Claims

20. List Of Outlets

21. Financial Statements

22. Contracts

23. Receipt

The major differences between the now old UFOC, and the new FDD are:

1. The new law encourages more disclosure about earnings. Information about business costs can be freely disclosed, and financial results can be given in the FDD for a subset of franchisees without having to compare them to the entire chain.

2. The FDD and other informational documents may be sent electronicallya change that will really save franchisors money and maybe even encourage them to send information to prospects sooner.{It is also pretty darn Green!}

3. Franchisors must disclose contact information for all of the franchisee associations in their system, including ones approved by the franchisor as well as independent associations. Before, prospects had to find independent associations on their own.

4. If a franchisor’s corporate parent guarantees the business or provides supplies to franchisees, its contact and financial information has to be disclosed. Previously, corporate parents did not have to be disclosed, at all.

5. More litigation disclosure is now required. Franchisors must list suits they’ve filed against franchisees over the previous year.

The FDD is a welcome change to the UFOC, which has been around for many years, and should provide a little more transparency for potential franchise buyers.

Let’s now move on to some serious stuff. I just launched yet another franchise website. Hopefully you have seen my 3 niche websites that were just launched a few weeks ago:

www.GreenFranchiseDirectory.com

www.MondayThruFridayFranchises.com

www.FranchiseFlavors.com

If you are a franchisor, or a supplier to the franchise industry, please let me help you spread your message with one of these niche franchise websites. I am doing some interesting things in conjunction with them.

Oh Yeah. Here is the newest one. I even have a helper- www.FranchiseFollies.com

Thanks, Joel! Great article.

WHAT DO YOU THINK? LEAVE A COMMENT.

_________________________

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Unhappy Franchisee: Franchising rumors, rants, controversies, issues, complaints & insider information you’re not supposed to know.

Unbiased franchise information, franchise interviews and detailed, searchable information on 400 franchise and business opportunities..

top new franchise opportunitiesFranchisees, customers & experts vote for their favorite new franchises at Top New Franchise: Who’s hot. Who’s not.

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TUESDAY'S TIPS

Ten Questions to Ask Before Buying a Franchise

(FranBest.Com)

You’ve got to be very careful if you don’t know where you’re going, or else you might not get there. – Yogi Berra

Related reading: 10 Criteria for Choosing a Franchise

Ten Questions to Ask Before Buying a Franchise by Sean Kelly, President, IdeaFarm

The probing question is the most important research tool in finding the perfect franchise opportunity for you. Here are ten questions to ask when considering any franchise opportunity:

1. What’s my motivation for owning a business?
Why do you want to own a business? What elements are important to you? What are your goals? Write them down and ask yourself if this given opportunity will get you there. While there are certainly both good and bad franchise opportunities, it is also important that you find the franchise opportunity that best meets your immediate and ongoing needs.

2. How does the franchised business concept work?
Who are its customers? How does it attract them? What’s the product line? How does it compare to its competition? Can it be easily copied? Is it the operation itself designed from both the customer’s and the operator’s viewpoint? Is it efficient? Is the product line sufficiently appealing in good economic times and bad? How is profit generated?

3. What’s the market for the franchises products and services?
What is the demand for the franchise business? What is the size of the market? Is its growth dramatic, flat or declining? What changes are taking place in the industry? Is the franchise concept well-positioned to benefit from social or industry trends? Is it positioned not only to meet the needs of today’s consumer, but tomorrow’s consumer as well? What is the demand in your intended geographical area? How many new competitors will the market support?

4. Has this company and concept stood the test of time?
How did the business start? Evolve? When was the company and concept founded? How has it changed? Did it thrive through a variety of economic times? Has it built a strong reputation and a loyal customer base? Does management show a commitment and/or talent for fine-tuning and improving the concept? For adapting to changes in the marketplace? Remember, a lot can happen over the course of your franchise contract

5. What’s the depth of experience of the franchise team?
You are paying for guidance, know-how and experience. Be sure its worth it. What is the company’s experience, both individually and collectively? Do they have resources that you will continue to benefit from? Who will provide your support? Do you respect their knowledge? Are you comfortable working with them? Do you get the sense that they truly have your best interest in mind?

6. How will the franchise company help me get started?
What initial services & training does the company provide? Do they help you find or select a location? Do they provide thorough training, both in the classroom and in the field? Do they provide design assistance, blueprints, equipment sourcing, etc. Getting up and running can be stressful. A good franchisor will provide strong assistance in this area, and have a well organized, well articulated start-up program.

IMPORTANT: Beware of any franchise that will not refund your franchise fee or downpayment if you fail to find a location within a specified time. This had been the subject of numerous recent lawsuits.

7. Will I derive ongoing benefits from the franchise relationship?
In short: will you continue to derive benefit from this relationship after you’re up and running? Are there proprietary products or processes you will continue to benefit from? How extensive is the field support? Will you get visits from company representatives at your location? How often? Will they provide refresher or ongoing training programs for you and your staff? What marketing programs and assistance will you receive? Will you benefit from their buying programs and vendor relationships?

8. Am I qualified to run this franchise?
How does the company describe their profile franchisee? Are you a match? Do you have the experience and/or the professional skills they say are necessary? Do you meet or exceed their stated financial requirements? Are you looking to locate in an area that is logical for the expansion of their brand? It is important that you are realistic about your ability to finance and support your chosen franchise, even if you get off to a slow start.

9. Is the franchisor selective about which franchisees they accept?
All franchisors SAY they are selective. All say they “award” rather than “sell” franchises. the good ones actually do. What are the steps you must follow to become a franchise owner? The franchise selection process should not be sales pitch, but rather a series of informational exchanges that help both sides determine whether the franchise is a good fit for you, and vice versa. Make sure the quality of franchisees is high, as the image they put forth will reflect on you

10. Does this franchisor have a great reputation?
What do their franchisees have to say about the company? Current franchise owners are a primary source of good information. What do their vendors say about them? How enthusiastic and loyal is their customer base? Have they been able to build and sustain a strong brand reputation on both the corporate and consumer levels? Be sure this is a company that you’ll be proud to be associated with.

Franchising is a great way to go into business, but only if you do so with your eyes wide open. Before you start any business, understand that if you plan to take the credit for success, you must also be prepared to accept responsibility for failure. The best way to ensure the former and avoid the latter is to ask lots and lots of questions upfront.

Best of luck!

copyright 2007, FranBest

This Tuesday’s Tip is sponsored FranchisePick.Com, the website for helping you pick the perfect franchise.

You could sponsor Tuesday’s Tips. Inquire to info[at]ideafarm.net

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ASK THE EXPERTS

10 Tips for Investing in a Franchise

10 tips for investing in a franchise

By Joel Libava

With 3,000+ different options in the world of franchising, the following tips are a good starting point for those starting the process. Remember, knowledge is power!

1. Start your exploratory process by looking at what your business skills are. Are you great at sales and marketing, or operations? Are you a manager of people, or would you prefer having no employees?

2. Are you comfortable using someone else’s systems and procedures? Remember that franchising is a license that you purchase to have the right to use the system. Don’t invest in a franchise, if you won’t use the system. Start an independent business instead.

3. Do you have family support? Starting any business is a family decision. Family members must understand that there will be demands on your time, and that they will need to be supportive of your decision.

4. Do a net worth statement. Subtract all your liabilities from your assets. The difference is your net worth. In addition to the down payment required by lenders, do not forget about your living expenses during the start up period. You should have funds set aside for 6-12 months, while your business ramps up.

5. When you find some franchises that interest you, visit and talk to as many franchise owners as possible in those systems. Are you like them? Are they happy with their decision? Would they do it again?

6. Don’t rush the research process. Be thorough, and talk to both happy and UNHAPPY franchise owners. Be willing to discuss what you are hearing with the franchise company’s representative. See how they react to your questions.

7. Read through the Uniform Franchise Offering Circular {UFOC}. This is the required legal document that will be sent to you by the franchise company. Write questions down as you go, and be prepared to ask them to the franchise company representative.

8. When you have narrowed your search down to one opportunity, visit the franchise company’s headquarters. Meet the executive and support teams in person. These are your business partners.

A good franchise company is also checking you out. They want the right people for their franchise.

9. When you get back from your visit, go back through your notes, and see if you have missed something. If not, now is the time to have an attorney familiar with franchise law look over the franchise documents. The attorney should point out things you may have missed, and explain both party’s legal obligations. You should also have a CPA help you decide on a business structure for your company, if you decide to move forward, and go over financial information.

10. Gut check time. You have done the data collecting. You have met franchise owners. You have visited company headquarters. Does the opportunity “feel” right? If so, move forward. If it does not feel right, don’t do it. There will be other opportunities. Really.

____________________________

ABOUT THE AUTHOR: Joel Libava, Franchise Selection Specialists Inc. 2nd generation President, brings real world franchise industry experience to his clients, coming from a franchise management background in the automobile and restaurant/hospitality industries.

Website www.Statefranchisecenters.com

Blog http://www.Thefranchiseking.com

© Copyright Joel Libava. Used by Permission.

Contact Joel at franpro@sbcglobal.net or by calling 216-831-2610

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ASK THE EXPERTS

Top 5 Franchisor Internet Marketing Mistakes: #1

CLICK HERE for “Justin Queen: Franchisors under-deliver on their franchise website” on Franchisor Marketing. 

Internet marketing plays a critical role in effective franchise marketing and franchisee recruitment.  As critical as it is, franchisors have traditionally been slow to adopt new technologies.  That’s created opportunities for franchise companies who can adopt New Media strategies for spreading awareness of their franchise program, generating inquiries, and turning those inquiries into leads and, eventually, sales.

To help franchisors identify areas where they can boost their effectiveness on the Internet, Franchisor Marketing asked Justin Queen, founder of BluZeus Technologies, for the Top 5 Mistakes Franchisors Make with Internet Marketing… And what they can do about it.