Risk Score
Pending analysis
Investment Range
$789,500 - $2,765,000
Franchise Fee
$12,500
Total US Locations
20
Business Summary
World Gym International, LLC offers franchises for fitness gyms that provide fitness training and equipment, along with related services and the sale of nutritional items, exercise apparel, and accessories. These gyms operate under the World Gym brand and system of business operations. The company also offers the right to develop multiple gyms within a designated geographical area.
Corporate History
World Gym International, LLC was organized in Delaware as a limited liability company on December 17, 2008. The company began offering franchises in June 2009. While World Gym International, LLC itself has never directly owned or operated the type of business it franchises, some of its management have previously owned and operated similar businesses. World Fitness Services, Limited, a Taiwan public company, is the parent company of World Gym International, LLC.
Financial Overview
Investment Range
$789,500 - $2,765,000
Franchise Fee (Low)
$12,500
Franchise Fee (High)
$25,000
Equipment Costs (Low)
$562,000
Equipment Costs (High)
$2,185,000
Working Capital
$162,500
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
The FDD's Special Risks section highlights that World Gym International, LLC's financial condition, as shown in its financial statements, raises questions about its ability to provide services and support to franchisees. The Maryland Securities Commissioner has also required financial assurance, deferring initial fee collection until pre-opening obligations are met. Historically, as of December 31, 2023, the company incurred losses from operations and negative operating cash flows, with negative working capital. Management has stated that existing cash, combined with ongoing funding from LLC members, is expected to cover anticipated cash requirements for at least one year. The December 31, 2022, financial statements similarly showed a loss from operations and negative operating cash flow, but positive working capital, with continued financial support from LLC members also cited.
Financing Details
World Gym International, LLC does not offer any direct or indirect financing to franchisees, nor does it guarantee their obligations. Franchisees are responsible for securing their own funding through external sources.
Performance Metrics
Total US Locations
20
Franchised Units
20
Corporate Units
0
Avg Square Footage
16,250
Franchising Since
2009
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
World Gym International, LLC has no litigation to disclose in this item.
Bankruptcy History
World Gym International, LLC has no bankruptcy history to disclose in this item.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their franchise agreement, World Gym International, LLC franchisees must meet several conditions: they must not have any uncorrected material defaults under their Franchise Agreement or other agreements with the franchisor or landlord, nor have received more than three written notices of material default in the 12 months before renewal. Franchisees must be in good financial standing and have continuous possession rights to their premises. They are required to complete necessary renovations and modernization of their gym, pay the then-current renewal fee, and sign the franchisor's current form of franchise agreement, which may have different terms. Franchisees and/or their designated manager must also complete a refresher training course and pay any associated tuition. Finally, they must sign a general release of claims in favor of the franchisor and commit to re-imaging, renovating, refurbishing, and modernizing the premises and gym within three months after the renewal date at their own expense.
Training & Support Program
Franchisor Assistance
World Gym International, LLC provides pre-opening assistance to franchisees, including designating development areas for multi-unit operators, offering site selection guidelines and approving premises, defining the designated territory, and providing access to confidential operating manuals. The franchisor also supplies lists of required items and approved suppliers, reviews and approves signage, layout, and equipment, and offers guidance for grand opening marketing and local advertising expenditures. An initial training program is provided for the franchisee and up to two additional individuals. After opening, World Gym International, LLC offers ongoing support through optional additional and refresher training courses, as well as continuing consultation and advice on management and operations via various communication channels. On-site assistance may be available upon request and payment of a fee. The franchisor directs and approves digital marketing activities, provides marketing templates, and reviews requests for non-approved products or alternative suppliers. They may also schedule annual franchise conferences, maintain a brand development fund, operate a system-associated website for updates and communication, conduct inspections and audits, update manuals, and research new fitness services and products.
Initial Training Hours
67
Training Location
Virtual, designated training gym or location, and on-site at the franchisee's gym.
Ongoing Support
After opening, World Gym International, LLC offers ongoing support services. This includes requiring franchisees and their management to attend up to five days of additional or refresher training each year, which may be at a designated location or virtual, along with up to 20 hours of online learning management system (LMS) training annually. The franchisor provides continuing consultation and advice on management and operations, delivered via phone, intranet, or online video. Additional on-site assistance may be provided upon request and payment of a training fee. The franchisor directs and approves certain digital marketing activities, provides marketing templates, and may schedule annual franchise conferences that franchisees may be required to attend. World Gym International, LLC also administers a brand development fund (if established), maintains a system-associated website for updates and communication, conducts inspections and audits, and researches new fitness services and products for the system.
Franchise Requirements
Ideal Candidate Profile
World Gym International, LLC seeks 'qualified individuals and entities' to become franchisees. While a specific detailed profile is not provided, the franchisor offers a 15% discount on the initial franchise fee to honorably discharged veterans of U.S. Armed Forces who meet their other requirements, indicating a preference for individuals who have served in the military and can meet general qualification standards.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
retail
Owner Participation
absentee-allowed
Territory Type
protected
Territory Size Requirements
World Gym International, LLC defines the Designated Territory for each franchised business once the premises are secured. The size of these territories can vary among franchisees, based on the specific location and demographics. The boundaries of the Designated Territory may be described using criteria such as population, a radius around the franchised business, zip codes, streets, natural or man-made landmarks, or county lines, or they may be delineated on a map attached to the Data Sheet.
Staffing Notes
World Gym International, LLC requires that each franchised business be managed and staffed at all times by at least one individual who has successfully completed the initial training program, unless otherwise agreed for 24-hour access gyms. If an owner chooses to hire a Designated Manager, that manager must complete the initial training before assuming management responsibilities. Furthermore, individuals providing Approved Services, such as fitness training, must have sufficient prior experience and complete specific instructor-related components of the franchisor's initial training program. If personal trainer certification is required by law for certain Approved Services, the franchisor expects these individuals to already hold such certification upon employment or engagement.