Arthur Murray Dance Studio Franchise

Financial Health Notes

Arthur Murray International, Inc. demonstrates a generally strong financial position. In the fiscal year ending June 30, 2024, the company's total revenue increased to over $16.8 million, and its net income also rose to over $3.1 million, reflecting healthy operational growth. The company maintains a solid working capital of over $5.7 million. A significant financial event in 2024 included a substantial dividend payment of over $4.3 million and the funding of a deferred compensation agreement by surrendering life insurance policies, which contributed to a decrease in the company's cash and cash equivalents compared to the previous year. The independent auditors have not identified any concerns regarding Arthur Murray International, Inc.'s ability to continue as a going concern.

Ongoing Support

After the Arthur Murray Dance Studio opens, Arthur Murray International, Inc. provides continuous support to its franchisees. This includes granting ongoing use of its Marks and the latest data on dance syllabuses and teaching methods. The franchisor offers suggested individual business advice and operational procedures via mail and telephone. Franchisees also receive updated operating and technical manuals and training aids, which may be modified over time. Arthur Murray International, Inc. periodically sponsors international, national, regional, or local marketing contests, promotions, and meetings that franchisees are obligated to participate in, with specific entry fees for dance competitions and conventions. For advertising, Arthur Murray Dance Studio franchisees are required to spend at least 12% of their annual gross receipts on advertising and public relations in approved media, which includes their share of national, regional, and local advertising efforts conducted or approved by the franchisor. While a National Advertising Fund can be established (up to 2% of weekly gross receipts), the franchisor has not consistently collected funds for it and may fund national advertising from its own resources. Franchisees must submit all non-prepared advertising materials for prior written approval and establish websites according to franchisor standards, potentially linking to or being part of the franchisor's main website. Regional and local advertising cooperatives exist, administered by franchisees, which require participation depending on the studio's location. Technologically, Arthur Murray Dance Studio franchisees are required to license and use the proprietary "Agenda Master Software" point-of-sale system for a monthly fee of $150, along with specified computer hardware. The franchisor retains independent access to data collected through this system. Although there are no mandatory refresher training programs, franchisees can attend other training programs offered periodically by the franchisor for free, though they must cover their own travel and living expenses. The franchisor also provides policies regarding traveling consultants and regulates social media use by franchisees and their employees.

Territory Size Requirements

The Arthur Murray Dance Studio defines Market Areas based on population density. Each area must be a city or a Census Bureau urbanized area with at least 50,000 people, and have a total drawing area population of at least 100,000. These Market Areas can also incorporate outlying counties that exhibit close economic and social relationships with the central county, meeting specific commuting levels and metropolitan characteristics like population density. The boundaries for these territories are typically delineated by city or county lines, streets, highways, or other relevant political subdivisions.