All-Star Major Multi-location Gyms Discussion

[NJ Coach]

ACX just announced a New Jersey location now. (South Jersey)


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It's a merge with Diamond Athletics. I think they're close to SJS and NJSE

 

[stuntjumptumble]

It's a merge with Diamond Athletics. I think they're close to SJS and NJSE

Woah this is interesting

 

[Beans100]

Having many locations seems to be a recent development in cheerleading. Does this reflect the growth of cheer as a sport? Or does this show that cheer is an profitable business that involves a sport?

Or, have I just been blind to all these locations...

 

[BlueCat]

Having many locations seems to be a recent development in cheerleading. Does this reflect the growth of cheer as a sport? Or does this show that cheer is an profitable business that involves a sport?

Or, have I just been blind to all these locations...

I don't believe those things are mutually exclusive. It is growing sport that involves several different types of profitable businesses. (Nearly every sport involves multiple profitable businesses.)

 

[BlueCat]

I'm curious what these various franchise models look like. How much money is flowing from these (I'm assuming) mostly independent satellites to "rent" the name and logo? How much help/oversight comes from the "home" gyms?

I can certainly understand the appeal of the franchising. The local gym gets the name recognition (to a point) and the main facility gets revenue without the risk/commitment of actually owning the business.

 

[RockstarCheer]

I'm not that familiar with how other gym models are. Our model is not renting the name and logo. We take pride in our name and reputation as a program. We have many quality control measures in place with our expansion model. I have sent my veteran coaches to many new expansion gyms. They're Allstar directors and run those new rockstar gyms.

We certainly would be open to renting the name and logo to a quality gym that is in line with what rockstar is as a product. If a program as good Cheer Athletics came to us and wanted that option of course we would say yes because that program is amazing. I'm not going to dive into the details because this is proprietary to Rockstar and our partners.


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[MomMomMamaMom]

I'm also really curious about the models that these various expansion gyms use. I appreciate the insights from those in the know. I am not privy to many insider business details in the industry in general. I do know that two local gyms attempted to franchise this year. I believe both gyms maintained their own ownership and paid nominal fees to their parent gym that was to include choreography, music, minimal training of coaches, and management.

I believe in both cases the parent gym scheduled competitions, handled parent complaints, and required adherence to overall gym policies ( i.e. team placements, class structures etc.) I believe that in both cases the parents/athletes paid their comp and uniform and choreography and camp fees to the parent gym and their tuition to the satellite gym. I think that for at least one of them, the satellite gym paid a per student fee to the parent gym, so the revenue had to be based on the enrollments.

Interestingly enough neither expansion worked out. One announced mid season that they weren't happy with the philosophical differences and we're going back to their original program. The other one just disappeared.

 

[Cody Z.]

I'm also really curious about the models that these various expansion gyms use. I appreciate the insights from those in the know. I am not privy to many insider business details in the industry in general. I do know that two local gyms attempted to franchise this year. I believe both gyms maintained their own ownership and paid nominal fees to their parent gym that was to include choreography, music, minimal training of coaches, and management.

I believe in both cases the parent gym scheduled competitions, handled parent complaints, and required adherence to overall gym policies ( i.e. team placements, class structures etc.) I believe that in both cases the parents/athletes paid their comp and uniform and choreography and camp fees to the parent gym and their tuition to the satellite gym. I think that for at least one of them, the satellite gym paid a per student fee to the parent gym, so the revenue had to be based on the enrollments.

Interestingly enough neither expansion worked out. One announced mid season that they weren't happy with the philosophical differences and we're going back to their original program. The other one just disappeared.

Which gyms are you referring to ?

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[BlueCat]

I'm not that familiar with how other gym models are. Our model is not renting the name and logo. We take pride in our name and reputation as a program. We have many quality control measures in place with our expansion model. I have sent my veteran coaches to many new expansion gyms. They're Allstar directors and run those new rockstar gyms.

We certainly would be open to renting the name and logo to a quality gym that is in line with what rockstar is as a product. If a program as good Cheer Athletics came to us and wanted that option of course we would say yes because that program is amazing. I'm not going to dive into the details because this is proprietary to Rockstar and our partners.

Fair enough. I would assume there is a "spectrum" of support that gets offered in these cases, which almost certainly varies from program to program and perhaps from gym to gym within a program. On one end would be just money in exchange for use of imagery/name/etc, while the other end would be getting extensive support from the franchiser. I wouldn't expect anyone to share the details, but I am certainly curious. I'm not putting a value judgement on it at all, as I can see advantages and disadvantages to nearly any way of doing it.

 

[catlady]

@BlueCat based on the last few comments, it sounds like some gym owners are doing "limited liability partnerships". An example would be, a current owner willing to give up X% of their business to the better known brand in exchange for things such as an experienced director, name rights, equipment, etc. However, the original owner could still hold the majority of the financial risk such as, if the business goes under, the better known brand just pulls the name, director and equipment, and the original owner deals with the bankruptcy. "Aha moment", limited liability partnerships actually make a lot of sense with what you had said in the past about small gyms coming to bigger gyms for help.

 

[BlueCat]

@BlueCat based on the last few comments, it sounds like some gym owners are doing "limited liability partnerships". An example would be, a current owner willing to give up X% of their business to the better known brand in exchange for things such as an experienced director, name rights, equipment, etc. However, the original owner could still hold the majority of the financial risk such as, if the business goes under, the better known brand just pulls the name, director and equipment, and the original owner deals with the bankruptcy. "Aha moment", limited liability partnerships actually make a lot of sense with what you had said in the past about small gyms coming to bigger gyms for help.

LLPs could be used this way, although you could do the arrangements with nearly any type of corporate structure, or even just a contract without changing either side's setup.

 

[catlady]

LLPs could be used this way, although you could do the arrangements with nearly any type of corporate structure, or even just a contract without changing either side's setup.

True. I was trying to figure out if they weren't franchising or doing a completely new start up, how the agreement would make sense from a limited capital standpoint. We live fairly close to a gym that is getting a new name, it's a good gym but, small with quite a bit of competition surrounding it. I was kind of perplexed as to why an established gym owner would want to take it over but, it makes more sense they aren't, they're probably partnering. While a general or limited partnership could be established, IMO it makes more sense that they are taking the limited liability approach since they have the upper business hand. For a small gym that is hurting, giving a portion of your gym in exchange for an established name, director, etc. may be their only option to keep the doors open. The gym close to us is in a great AS area, it will be interesting to see how the AS population responds.

 

[tumbleyoda]

According to Twitter new location for Rockstar. Evansville, Indiana. (Cheer Zone)

 

[cheerKT]

According to Twitter new location for Rockstar. Evansville, Indiana. (Cheer Zone)

Jeez.

 

[FaithOverFear!]

According to Twitter new location for Rockstar. Evansville, Indiana. (Cheer Zone)

Probably going to end up competing against Rockstar this next season lol, kinda cool