Rick Mayo, Alloy Founder/CEO, is interviewed by Wes Barefoot, Path to Freedom Podcast, about the Alloy Personal Training Fitness Franchise systems and why it’s a great investment opportunity.

In this episode, Rick explains why the Alloy concept is very different from everything else in the market. Most of the fitness concepts in the market are class-based. On the other end of the spectrum, there is one-on-one personal training, which is expensive.

What Makes Alloy Different From Other Fitness Concepts

Right now, there are many fitness franchise concepts. The great news for Alloy is we target an underserved market segment that has more discretionary income. We have more of a boutique fitness concept with a smaller footprint that generates more ROI per square foot. Our customer is 45 to 65 years old and 70% of the nation’s disposable income lives in this age bracket.

In the big box health clubs, you pay a base membership for one type of fitness access to all facilities, programs and equipment. Larger clubs have large group fitness classes for members and personal training options available for an extra cost. On one end of the spectrum, you’ve got a lot of large group fitness classes, with 15 to 30 people getting sweaty in a room that is included with the membership. On the other end of the spectrum, you have one-on- one personal training sessions that can be added on to memberships, which are typically pretty expensive, around $60- $80 per session.

Alloy has over 30 years’ experience in the fitness business and found the sweet spot by offering small group personal training classes by training with one coach training six people. We attract the same person who would normally buy the one-on-one training, but we can offer them a better value proposition and lower price threshold by training six people at once. We also have technology and other things included that deliver more with our brand promise.This makes Alloy a more scalable business model than one-on-one training, where the margins of that business are pretty small. The margins in a six-to-one personal training model are much more compelling.

The Value of Alloy’s 30 Years Of Experience

Wes wanted to make sure the audience understands that Alloy started franchising in 2020, but they have over 30 years of experience running a fitness business, consulting with other fitness businesses, and licensing the small group personal training concept to other facilities. The point is, there are definitely emerging franchises that are very risky, but on the flip side, there are emerging franchises that are not nearly as risky as it may seem at first glance. Those like Alloy can present phenomenal opportunities for the early adopters,

What Type of Franchise Owners Are You Looking For?

Who’s actually the right fit to own an alloy franchise? Rick shares you don’t have to be a fitness guru or be in the fitness industry to own an Alloy franchise. While we attract personal trainers that want to open their own fitness facility, but I will say that if we were going to build a model that only personal trainers could own and run, it might limit our growth. So we decided early on to make Alloy scalable and allow it to be run as a true owner absentee model. Many of our candidates are buying multiple units, and they’re buying them as investments.

We are also looking for investors who understand that fitness is a vehicle for doing good in their community and for changing lives for the better.

Many franchisees have been successful in other realms. They may like fitness, be a fitness consumer, or just understand what fitness does for the clients and the community. If you’re an investor and you’re hiring operators, not only do you want to know the numbers are right to deliver success, but you’re going to need to attract people that want to help people. It’s not just a transactional process, but it’s also relational. So if the franchise investor sees the financial opportunity, but also has a heart for service leadership and helping their community, that is who will be successful.

The Benefits Of The Alloy Model

The Alloy concept is brick and mortar, with a physical location. The facility is a small footprint around 1500 to 2000 square feet. That is a bay in most shopping centers and we’re putting them in well researched geographic and demographic areas.

The model is scalable. We help franchisees find talent, teach them the Alloy technology, programs, workouts, systems and algorithms. We tailor the workouts to the individual skill and fitness level. With our brand, we have members stay longer and deliver a higher customer lifetime value than other fitness concepts. If members stay for three years at $300. That’s a $10,000 plus lifetime value. In comparison, if you look at a class based concept like with some other boutique HIIT or bootcamp fitness concepts, the client stays around five months at around $129 a month with a lifetime value average maybe at $650 bucks. Also, customer acquisition costs for the $650 person are the same as the $10,000 person.

Alloy Pre-Sales Experience

Alloy has a strong client pre-sale program. Franchises will open, making money with a full client base of around 130 members. Then the Alloy attrition rate is only 3% a month. Which is very low compared to the fitness industry average of 28.6%. So if 3% of 130 members may leave because of moves or life changes, that is only three people a month. All you have to do is whisper to your membership that you might have an open spot, and it fills quickly. That eliminates a significant amount of marketing costs and manpower to chase down leads and mitigate churn like in big health clubs. So it’s unique because of the smaller footprint and a tribe feeling, which leads to an overall stickier fitness experience.

The main thing is Alloy is turnkey and you are in positive cash flow the day you open the doors.

The Alloy concept is based on attracting the customer avatar who wants the accountability of one-on-one personal training but gives them a better value proposition by training six people at once. From the customer perspective, this makes sense since they can have individualized personal training that is affordable. From a business perspective, it creates a scalable model that appeals to an underserved market.

Listen in to this interview to learn more about the Alloy Franchise Fitness concept and why it is a great investment opportunity!

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Podcast with: Rick Mayo and Wes Barefoot

Key Takeaways:

  • What makes the Alloy concept different (02:40)
  • Famous people Rick has trained in his career (17:58)
  • Who is the right fit for an Alloy Franchise (21:57)
  • What makes a franchisee successful? (27:53)
  • The Alloy customer avatar (30:14)
  • The marketing play that makes Alloy pre-sales strong (46:54)
  • How the franchising systems works (51:39)
  • Bullets before cannonballs (56:43)
  • What’s the vision of the Alloy brand (1:08:56)

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