Risk Score
Pending analysis
Investment Range
$804,000 - $6,716,000
Franchise Fee
$35,000
Min Cash Required
$25,000
Total US Locations
422
Business Summary
Crunch Fitness operates health clubs under the CRUNCH® name, offering members basic health club services. These services include cardiovascular equipment, selectorized weight machines, free weights, group fitness classes, personal training, tanning, and online nutritional programs. Crunch Fitness provides three distinct club formats: Crunch Fitness, Crunch Select, and Crunch Signature, each with specific investment and operational requirements tailored to different markets.
Corporate History
Crunch Franchising, LLC was established as a Delaware limited liability company on August 18, 2009. The company began offering franchises for sale in April 2010. Its immediate parent company is Crunch Holdings, LLC, with Champion TopCo, LP serving as the ultimate parent since the acquisition of Crunch Holdings, LLC in June 2019. An affiliate, Crunch, LLC, operates 27 Signature health clubs under the CRUNCH trademark through subsidiary companies, some of which were acquired from the AGT Crunch bankruptcy in September 2009. Crunch Franchising, LLC has exclusively offered franchises in the health club business and has not ventured into other lines of business.
Financial Overview
Investment Range
$804,000 - $6,716,000
Franchise Fee (Low)
$35,000
Franchise Fee (High)
$50,000
Minimum Cash Required
$25,000
Royalty %
5%
Marketing %
2%
Equipment Costs (Low)
$630,000
Equipment Costs (High)
$5,250,000
Working Capital
$162,500
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Crunch Franchising, LLC's financial statements show healthy profitability, with net income of $46.9 million in 2024, $34.1 million in 2023, and $22.9 million in 2022. As of December 31, 2024, the company held $8.3 million in cash and $2.1 million in restricted cash. The auditors provided an unqualified opinion, indicating that the financial statements present fairly, in all material respects, Crunch Franchising, LLC's financial position and results of operations. However, Crunch Franchising, LLC is a guarantor for its Parent's Credit Agreement, which could obligate the company for up to approximately $290.0 million in future payments. Additionally, Crunch Franchising, LLC provides financial advances to its Parent to fund debt obligations and administrative costs, with such advances totaling $142.4 million as of December 31, 2024, recorded within member's equity. Despite these financial commitments to its Parent, Crunch Franchising, LLC continues to show strong growth in franchisee commitments.
Financing Details
Crunch Franchising, LLC does not offer any direct or indirect financing to its franchisees. The company also does not guarantee any franchisee's notes, leases, or other financial obligations.
Performance Metrics
Total US Locations
422
Franchised Units
415
Corporate Units
8
Avg Square Footage
35,000
Franchising Since
2010
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
2
Litigation Summary
Crunch Franchising, LLC has disclosed two concluded litigation cases. The first case, DBKW1, LLC v. Crunch Franchising, LLC, was filed in June 2016 by a franchisee. The franchisee alleged breach of contract and unfair competition, claiming Crunch Franchising, LLC allowed another franchisee to operate and advertise within DBKW1's exclusive territory. Crunch Franchising, LLC counter-claimed for breach of contract due to the franchisee's non-compliance with advertising standards, use of non-approved vendors, and refusal to allow reciprocity to other Crunch members. This case was settled out of court without admission of guilt in October 2017 and formally dismissed in February 2018. As part of the settlement, DBKW1's club was acquired by an affiliate, receiving a one-year royalty reduction from Crunch Franchising, LLC. The second case, Ronald J. Ciardiello v. Michael Blouin (our Senior Vice President), was filed in March 2020 by a former area developer and franchisee owner. The plaintiff alleged unlawful financial performance representations and failure to disclose market-specific information, claiming fraudulent and negligent misrepresentation. In September 2022, the court partially granted summary judgment, dismissing the fraudulent misrepresentation claim. The parties reached a settlement agreement in December 2024, without admission of guilt, which included a payment of $475,000 to the plaintiff. The action was dismissed with prejudice in January 2025. Crunch Franchising, LLC does not have any other litigation required to be disclosed.
Bankruptcy History
Crunch Franchising, LLC has no bankruptcy history required to be disclosed.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew with Crunch Franchising, LLC, franchisees must be in full compliance with all their agreements, provide 3 to 6 months' advance notice of their intent to renew, execute a general release of all claims against Crunch Franchising, LLC, upgrade their Crunch health club to meet the then-current standards for new franchised businesses of the same format, and sign Crunch Franchising, LLC's then-current franchise agreement, paying the applicable renewal fee, which is currently $15,000.
Training & Support Program
Franchisor Assistance
Crunch Franchising, LLC provides comprehensive assistance to its franchisees. Before opening, Crunch Franchising, LLC provides an Operations Manual with site and layout criteria and approves the proposed site. It may arrange for third-party site selection services (with franchisees covering travel expenses) and approves sites based on various factors within 20 business days of submission. Initial training for the franchisee or owner and manager is provided at no cost, with up to 5 days of on-site training at the new club. Crunch Franchising, LLC also provides standards for equipment, systems, and designates approved suppliers for opening inventory, selling fitness equipment, tanning beds, hydro massage beds, flooring, and lockers directly to franchisees. During operation, Crunch Franchising, LLC maintains System quality and brand image, offers additional training, provides sales, marketing, and technical assistance, consults on operating procedures, implements service improvements, maintains an Internet Website for franchisee services and promotions, designates approved suppliers for ongoing marketing materials, may conduct mystery shopping or inspections, and may suggest or establish product/service pricing. Franchises may also be required to renovate or replace equipment every five years.
Initial Training Hours
244
Training Location
Franchisor headquarters in New York, NY or Portsmouth, NH; national training center in Jacksonville, FL; and franchisee's location.
Ongoing Support
Crunch Franchising, LLC provides ongoing support to its franchisees by maintaining high quality standards for the System and public image. It offers additional and optional or mandatory training courses, usually 1 to 2 times annually for 1 to 3 days, covering operations, sales, and fitness areas, either at the franchisee's gym or the national training center (for a fee of $1,000-$3,000 plus expenses). The company also provides sales, marketing, and technical assistance, consultation on operating procedures, and makes available improvements and changes to services. Franchisees receive lists of approved suppliers, access to an Internet website for services and communications, and approved suppliers for ongoing marketing materials. Crunch Franchising, LLC may also conduct mystery shopping or inspections of the business and organizes annual franchise system meetings, which franchisees or owners must attend, covering their own expenses and a reasonable meeting fee.
Franchise Requirements
Ideal Candidate Profile
For candidates interested in developing a Crunch Signature club, Crunch Franchising, LLC requires the franchisee to currently operate a minimum of five Crunch Fitness model clubs or possess a significant level of experience in owning and operating a similar health club model. Generally, Crunch Franchising, LLC looks for individuals with strong business skills, financial capacity, and good personal character, particularly those with experience operating health clubs and managing other business commitments. Whether an individual or an entity, the franchisee or a designated manager must provide direct on-site supervision of the Franchised Business and successfully complete the initial training program.
Industry Experience Required
Yes
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Supervisory
Territory Type
Protected
Territory Size Requirements
Crunch Franchising, LLC defines its territories primarily based on population. For each Crunch Fitness or Crunch Select franchised business, the territory will encompass a population of approximately 75,000 people. The specific geographic size can vary and may be delineated using state or county boundaries, city limits, population, and drive time. Population determination is done using a demographic and geographic program from Buxton Company. For area developers, the development area will cover a minimum of 1,000,000 persons within a contiguous geographic area. For multi-unit developers, each individual trade area will contain at least 75,000 persons.
Staffing Notes
Crunch Franchising, LLC requires that all managers, multi-gym managers, and executive-level team members complete specific training based on their roles. Additionally, all team members, regardless of their position, must complete assigned eLearning courses through the Crunch Connected learning management system upon hire. Franchisees are required to use approved payroll vendors to ensure proper integration with Crunch Connected. Each Crunch health club must operate under the direct on-site supervision of the franchisee, an owner, or a manager who has successfully completed the initial training program. If a manager leaves, a new trained manager must be hired within 30 days. Franchisees are responsible for hiring all necessary employees, ensuring they hold required licenses, and conducting appropriate background checks as outlined in the Operations Manual.