Buying an Orange Theory Franchise

Top 20 Most Popular Franchises: Orange Theory

Vetted Biz is the leading platform for accessible and analytical data on franchises and businesses available in the U.S. Our research team has reviewed over 1,500 franchises and knows the key facts and data that signal a successful franchiseA franchise is when a business (franchisor) allows a party (franchisee) to acquire its know-how, procedures, processes, trademarks, intellectual property, use of its business model, brand and rights to sell its products and services. The franchisee signs a contract (franchise agreement) with the franchisor to acquire the franchise and generally has a territory granted to operate.... system. Upon extensive review using a number of internet research tools, our team was able to compile a short list of the “Top 20 Most Popular Franchises in the United States.” In the article below, we review the business model proposed by one of these 20 franchises: Orange Theory, as well as the requirements that encompass its franchise application process.

About Orange Theory

Orange Theory began in Boca Raton, Florida in 2009 when one of its founders, Elle Latham, decided to open a gym to implement her personally designed workout, that eventually became the basis for Orange Theory’s system. After establishing a strong reputation across the fitness industry, Latham decided to seek a larger challenge and transitioned from the study of physiology to owning a gym that implemented a business model that remains in place across all studios to this day: offering trainer-led group workout sessions, which are broken into intervals of cardiovascular and strength training. Franchising began one year later, and today Orange Theory studios can be found in 18 countries, and across 49 states. The concept currently has over 1,000 franchises in the United States and another 150 international locations and is a subsidiary of Ultimate Fitness Holdings. Orange Theory is currently headquartered in Boca Raton, Florida and is run by its CEO Dave Long who previously served as main developer and owner of European Wax Center.

How Much Does an Orange Theory Franchise Cost?

The total investment amount to establish an Orange Theory franchise ranges from $575,422 to $1,497,732 including the company’s franchise fee of $59,950. Once the store has been built and operations begin, franchisees are then expected to pay Orange Theory’s corporate team a royalty fee of 8% on gross salesThe total amount in dollars made in the business before expenses are deducted. See also Gross Revenue...., and a marketing fee of 2% on gross sales in exchange for the marketing services provided by the franchisor. The franchisor is particularly looking for candidates who are enthusiastic about fitness, are willing to run the business on a daily basis, and have the required capital to fund a location. That said, the minimum net worthValue of all the non-financial and financial assets of a business buyer. There is usually a minimum net worth requirement to qualify as a franchisee and for bank financing.... required to own an Orange Theory franchise is $500,000 and the applicant must have liquid assets of at least $150,000.

Orange Theory Revenue

When evaluating an Orange Theory franchise’s potential for growth, one does not need to go beyond the fitness industry’s numbers to better understand the prospect for success of the opportunity at hand. The fitness industry generated $94 billion in revenues in 2018 and its global growth rate remains at a steady pace of 8.7% globally. Orange Theory itself was named the fastest-growing woman-owned company by Forbes in 2017 after having generated $451 million in revenue that year, and this year was ranked amongst the top 50 franchises in Entrepreneur’s Franchise 500 list. Looking at the franchise’s internal performance, the average gross revenueThe total amount in dollars made in the business before expenses are deducted. See also Sales.... for franchised studios in 2018 was of $1,142,442 and 45% of franchisees met or exceeded this number. Moving forward, due to Orange Theory’s rapid growth and strong demand from existing franchise owners, development opportunities are limited – although the concept is still looking to expand across new territories in the U.S.

Summary

Investing in an Orange Theory franchise is an interesting opportunity, especially for individuals looking to make their way into the Fitness industry.  The prospects for growth and success within the industry and the Orange Theory brand itself, are extensive and some markets continue to be available as they move forward with growing their presence across the country. If you are an individual with a passion for fitness and are willing to invest an amount ranging from $575,422 to $1,497,372 or more, Orange Theory is the right franchise for you!