Disappointed SF Franchisee
Guest
|
Post by Disappointed SF Franchisee on Nov 3, 2016 16:21:29 GMT
Hi Guys,
This is the first time I posted to this group, but I am seeing a lot of frustrated franchisees on this site. How many members are there on this site? I am like you all...frustrated with the increasing fees and lack of support from corporate. The 10 year franchise agreements are vague and leaving corporate the right to add fees whenever they wish. Have any of you considered a "Class Action Suit" or a "Combined legal effort" against corporate? At least we were drawn in with the statement..."you can be a hands-off owner and make revenue off of Snap Fitness". That was a definite false statement, but by the time we all bought into the concept, we had thrown around $160-$200k into the franchise and were virtually forced to renew to protect our initial investment. I am interested in listening to how other franchisees feel about this and whether there would be interest in pursuing legal action versus closing our doors because we are being "Fee'd" out of business.
|
|
|
Post by determined1 on Nov 3, 2016 18:19:13 GMT
I'd be curious to know what was discussed at the convention about being a hands-on owner. The franchise agreement states that you can't file a class action suit, however, I'm wondering if that goes out the window if one party, lift brands, was not acting in good faith. Basically knowing that the business model doesn't work being a hands off owner. From what I can tell this was conveyed to attendees. To me it seems obvious that snap was out to swindle as many people as possible.
As you mention, most invested $200K+ to start the business and were then forced to make life altering changes to make the business work. Those who didn't make those life altering changes most likely failed. Once the renewal comes up then snap uses strong arm tactics to force owners not to leave. Personally, if a class action were possible that would be my first course of action.
Second is to form a franchisee association in order to use strength of the numbers and put a stop to the ridiculous fees they come up with.
|
|
|
Post by cheryl on Nov 4, 2016 1:07:40 GMT
Wish I had a juris doctorate (ie law) degree, but I'd think that being swindled into signing a contract, based on the model being represented as one of an absentee owner, when it's clearly not, would void the contract thereby throwing the inability to file a class-action right out the window. Everything I've read from this year's convention indicates that they're admitting active involvement by the owner is critical to success and that their claim that it's an absentee owner model is fraudulent.
|
|
|
Post by firecrackergirl on Nov 4, 2016 16:09:06 GMT
There is something in the FDD that basically relieves them of the liability. I took a pic of it awhile back, Ill have to dig it up on my phone.
Heres my question to you. If you don't like it so much, why not sell out? Also, where is the common sense? Anyone knows you can't just open a business and then disappear and it will run itself?
I'm younger than everyone here, I can just about bank on that, but I know the first step to running a business is being there!
I'm not trying to attack or tear you down; I am just confused about the lack of personal responsibility here for what happened. Who swindled you? Did someone physically force you to sign? Did you ever question the business model? Did you hire and train only the best staff who can effectively take your place?
- Sincerely, a manager of a profitable club with an ABSENTEE OWNER
|
|
|
Post by cheryl on Nov 4, 2016 18:32:18 GMT
The way the business is pitched by snap is that you staff it heavily when you have your grand opening. When you hit your desired number you greatly reduce your staffed hours and just worry about cleaning. THIS is THEIR idea of an absentee owner, and again this is what they pitch to potential franchisees. We followed their advice and it was a disaster. We were at breakeven within the first month and making a decent amount after just a couple months. I was shocked when someone told us they wanted to terminate just a few months in. When I joined a club I was a member for about 10 years. If they had done something that pissed me off I would have changed clubs, but everything was okay at every club I joined.
Of course we quickly threw away snap's playbook, increased our staffed hours and increased our staff
I am just confused about the lack of personal responsibility here for what happened. - What exactly are you assuming happened. I don't see anyone stating that anything happened other than the fact that snap knowingly misrepresented the business and the business opportunity. Your assumption is exactly the assumption that corporate makes over and over.
Who swindled you? I'm not trying to attack or tear you down, but duh, snap hq.
Did someone physically force you to sign? No but they knowingly misrepresented the business opportunity and the business operations.
Did you ever question the business model? Yes, we even spoke directly with the CFO who stated that he was going to open a bunch of them in New Orleans, because once they're up and running they just... wait for it... "run themselves"
Did you hire and train only the best staff who can effectively take your place? No we hired God awful people who would just run our business into the ground. Sorry, but a question like that doesn't get better than a sarcastic answer.
I think what you'll find is that the majority of the people on this site are successful. However, it's not because they follow snap's advice, but because they throw snap's absentee owner model out the window and run a model that works. Those that followed the snap model have closed their doors long ago.
|
|
|
Post by determined1 on Nov 5, 2016 1:48:33 GMT
There's also the fact that they call attention to the national marketing fee during the wooing phase as a way to "bring national attention to the brand", when all it really is is a slush fund. Once you're in they tell you it's called a national marketing fund because the posters they send out are marketing and they send them out nationally. Again, another example of fraud and swindling. And, yes I do have that email referring to the program that way. When one brings this up you're told "You can't expect to get national marketing for that small amount. Okay, fine, if you're not going to do actual "national marketing" then don't charge me for it.
Also, I also noted the semblance of the prior post to corporate's stance and yes I'm guessing we're also a top performing club and disregarding anything from snap hq, because they've demostrated they don't have a F'ing clue about what to do to improve the member experience. That is all left up to the franchisee.
|
|
|
Post by fishstyxx on Nov 5, 2016 17:06:51 GMT
I'm not sure what's considered a top performing club. I think I remember hearing of a club which was bringing in $10K/month in personal training alone. However, a top performer can't be based strictly on revenues. EBITDA may be a better measure, but only each owner knows what that is for them. There's also the cost of living in different areas to consider. $5 in San Francisco doesn't go as far in $5 in Bismark.
I do agree that the fees are really getting out of hand. We tend to try different things. Some work, some don't. Those things we find value in we'll pay for. Those that don't get scrapped. The things we've been charged with lately (eg excessive charges for substandard billing/management software, decline recovery, technology charge??) have no value to us. Our money could be spent more wisely on things which let us stand out from the competition.
Yes, I also noticed that the one comment reflected very closely to those left by corporate on other sites.
|
|
|
Post by snaplongtimer on Nov 5, 2016 18:55:51 GMT
It's a shame that we have to pay for "Peter's investments" as John V once mentioned to me. He didn't mention it's a shame, but that John mentions that Peter invests a lot of money in ideas he thinks will put us ahead of the competition. I'm sure he does, but doesn't have a clue about what will be beneficial, engaging and interesting to members. If he did it would help create better retention in our clubs. Peter buys into these ideas and gimmicky toys and sells them to us at a profit. I recognized that game plan of snap early on and stopped buying their crap. I knew better for I had spent more time in gyms than any of them have. I guess I am showing my age here. Then at one of the yearly seminars they used to do with the dog and pony show John V told us Peter is "The kind of guy that would give you the shirt off his back." BS...The most stressful period of my life was when Peter involved himself in my business as a favor to his friend. It cost me a lot of money and now he has disappeared without an apology for all the aggravation he has caused me. This was years ago. I had knots in my throat from the stress. It was so bad. My attorney at the time told me I could probably get my franchisee fee back, but I wanted to try and make it my life not knowing what was coming in the years ahead. Eventually, it cost me a franchise that they stole from me (from not opening a club soon enough) and disrupted my business plan overall that I had been in a tailspin for some time and now ready to lose another franchise. From this experience, I believe, Peter has learned from and will never leapfrog over his employees and involve himself on a personal level ever again. Even his employees (from years ago) rolled their eyes when I spoke of Peter as if they know already. Unfortunately, it cost me more money than I care to mention.
|
|
|
Post by firecrackergirl on Nov 7, 2016 2:55:46 GMT
The way the business is pitched by snap is that you staff it heavily when you have your grand opening. When you hit your desired number you greatly reduce your staffed hours and just worry about cleaning. THIS is THEIR idea of an absentee owner, and again this is what they pitch to potential franchisees. We followed their advice and it was a disaster. We were at breakeven within the first month and making a decent amount after just a couple months. I was shocked when someone told us they wanted to terminate just a few months in. When I joined a club I was a member for about 10 years. If they had done something that pissed me off I would have changed clubs, but everything was okay at every club I joined. I see. But it just doesn't sound like common sense to me, if the business is your passion, why would you not want to be there as much as possible. Of course we quickly threw away snap's playbook, increased our staffed hours and increased our staff Right, the more the better!! I agree with thatI am just confused about the lack of personal responsibility here for what happened. - What exactly are you assuming happened. I don't see anyone stating that anything happened other than the fact that snap knowingly misrepresented the business and the business opportunity. Your assumption is exactly the assumption that corporate makes over and over. From what you have said in your other posts, it sounds like you are upset and I'm wondering if part of the reason you are upset is because your club is not performing as well as you anticipated (?) Who swindled you? I'm not trying to attack or tear you down, but duh, snap hq. Did someone physically force you to sign? No but they knowingly misrepresented the business opportunity and the business operations. Maybe this opinion is just the way I was raised , but I still feel that you signed the line.Did you ever question the business model? Yes, we even spoke directly with the CFO who stated that he was going to open a bunch of them in New Orleans, because once they're up and running they just... wait for it... "run themselves" Well anyone who works for them is of course going to rehearse a marketing pitch. At the present time I always tell people go talk to current zees . But I noticed dependingwho you talk to you get a different story, some totally failing clubs, others making bank. from the patterns I observe, the ones doing well are-- of course-- staffed by the owner.
Did you hire and train only the best staff who can effectively take your place? No we hired God awful people who would just run our business into the ground. Sorry, but a question like that doesn't get better than a sarcastic answer. I'm not a fan of sarcasm , but I will say, if your staff is good enough to take your place and run the gym exactly as you would, then what is the problem? I think what you'll find is that the majority of the people on this site are successful. However, it's not because they follow snap's advice, but because they throw snap's absentee owner model out the window and run a model that works. Those that followed the snap model have closed their doors long ago. I agree, or they realized really quick you cant be absentee and decided to show up or sell out.
So what are we arguing over?
|
|
|
Post by firecrackergirl on Nov 7, 2016 2:59:41 GMT
fish--- I found this in FDD, this may be what they use to consider top clubs membership wise Average Members High 1895 members Top Third Average882 members Middle Third Average 544 members Bottom Third Average 345 members
|
|
|
Post by cheryl on Nov 7, 2016 13:34:46 GMT
The way the business is pitched by snap is that you staff it heavily when you have your grand opening. When you hit your desired number you greatly reduce your staffed hours and just worry about cleaning. THIS is THEIR idea of an absentee owner, and again this is what they pitch to potential franchisees. We followed their advice and it was a disaster. We were at breakeven within the first month and making a decent amount after just a couple months. I was shocked when someone told us they wanted to terminate just a few months in. When I joined a club I was a member for about 10 years. If they had done something that pissed me off I would have changed clubs, but everything was okay at every club I joined. I see. But it just doesn't sound like common sense to me, if the business is your passion, why would you not want to be there as much as possible. Never said it was my passion. It was misrepresented as an absentee owner model and an additional revenue stream.
Of course we quickly threw away snap's playbook, increased our staffed hours and increased our staff Right, the more the better!! I agree with that.
So then you agree that snap misrepresented the business model and opportunity
I am just confused about the lack of personal responsibility here for what happened. - What exactly are you assuming happened. I don't see anyone stating that anything happened other than the fact that snap knowingly misrepresented the business and the business opportunity. Your assumption is exactly the assumption that corporate makes over and over. From what you have said in your other posts, it sounds like you are upset and I'm wondering if part of the reason you are upset is because your club is not performing as well as you anticipated (?)
My biggest gripe is that the business model was knowingly misrepresented and that at every turn snap is stealing more and more money out of my pocket. Our monthly fees have nearly tripled and the quality of everything has decreased.
Who swindled you? I'm not trying to attack or tear you down, but duh, snap hq.
Did someone physically force you to sign? No but they knowingly misrepresented the business opportunity and the business operations. Maybe this opinion is just the way I was raised , but I still feel that you signed the line.
The business opportunity was knowingly misrepresented.
Did you ever question the business model? Yes, we even spoke directly with the CFO who stated that he was going to open a bunch of them in New Orleans, because once they're up and running they just... wait for it... "run themselves" Well anyone who works for them is of course going to rehearse a marketing pitch. At the present time I always tell people go talk to current zees . But I noticed dependingwho you talk to you get a different story, some totally failing clubs, others making bank. from the patterns I observe, the ones doing well are-- of course-- staffed by the owner.
In the early days most owners were just starting out and excited. There were no different stories. This isn't just talking with Sally in marketing or Bill in support. This was talking with the CFO, who should be an on the level player. Nothing he said wound up being true.
Did you hire and train only the best staff who can effectively take your place? No we hired God awful people who would just run our business into the ground. Sorry, but a question like that doesn't get better than a sarcastic answer. I'm not a fan of sarcasm , but I will say, if your staff is good enough to take your place and run the gym exactly as you would, then what is the problem?
The question itself is just a stupid question, hence it gets a sarcastic answer. If you don't like sarcastic answers don't ask stupid questions.
I think what you'll find is that the majority of the people on this site are successful. However, it's not because they follow snap's advice, but because they throw snap's absentee owner model out the window and run a model that works. Those that followed the snap model have closed their doors long ago. I agree, or they realized really quick you cant be absentee and decided to show up or sell out.
What they discovered is that they were swindled into putting out a crap load of cash for a false business model and then had to figure something out on their own in order to preserve that capital. Later, the company who has been no help, and more of a hindrance is coming in over and over again and stealing more money from their pocket.
So what are we arguing over? I'm simply pointing out why franchisees aren't happy and you're pointing out corporate's position.
Also, you list metrics in number of members. Those numbers aren't available unless you count them yourself. Corporate only provides membership numbers.
|
|
|
Post by determined1 on Nov 7, 2016 15:24:19 GMT
I'll add to that...
How does snap rip off their franchisees?
Let me count the ways:
1. Member Engager - $50 Absolutely useless. I believed originally launched because peter was pissed that some of the more successful clubs were complaining about snap's BS. He felt they were only successful because they had no competition and if polled members would give poor ratings. Sorry, petey. Guess that didn't pan out the way you planned.
2. Shitware - $155 (A bump of $100) for the WORST billing and member management system out there.
3. $8.95 program - $200 (We find that this program has cost us about $200 per month
4. SAPP program - $60 (This was the incremental bump we received when snap took it over)
5. Finder's fee - $10 (Paying for someone to use a service you've already paid for)
6. Lack of technology fee - $30
7. Decline recovery - $25 (on average) We still collect all of the updated info ourselves. Spam and automated phone calls are ignored.
That's almost $500/month or $6,000 per year that they've stolen out of my pocket, and provided nothing in return.
These are just a handful of the additional fees they've levied, and I'm sure I'm forgetting several. This also leaves out the frustration levels in having to deal with Snap's (lack of) support group.
I'll also chime in on the "quality" employees portion of the discussion. Our best employees are frustrated by shitware and have left simply due to the fact that they want nothing to do with it. I've even had an employee, who had 15 years of front desk experience which involved customer management and billing for a dental office, walk right out of the door because she got so frustrated with this shitty software. Again, showing that snap seldom helps in running your business, but just makes it more difficult.
|
|
|
Post by thatkidfromjersey on Nov 7, 2016 17:49:32 GMT
Firecracker girl - Since you are the self proclaimed youngest person on here, a certain degree of naivety in your responses is expected and excusable, but in an attempt to open up your mind a bit, I'll jump in and reply below to a few of your comments: The way the business is pitched by snap is that you staff it heavily when you have your grand opening. When you hit your desired number you greatly reduce your staffed hours and just worry about cleaning. THIS is THEIR idea of an absentee owner, and again this is what they pitch to potential franchisees. We followed their advice and it was a disaster. We were at breakeven within the first month and making a decent amount after just a couple months. I was shocked when someone told us they wanted to terminate just a few months in. When I joined a club I was a member for about 10 years. If they had done something that pissed me off I would have changed clubs, but everything was okay at every club I joined. I see. But it just doesn't sound like common sense to me, if the business is your passion, why would you not want to be there as much as possible. Passion notwithstanding, consider the possibility that people have other things going on in their lives and can't sit at their club all day, which is why Snap's "owner absentee" model would have appealed to them in the first place. Of course we quickly threw away snap's playbook, increased our staffed hours and increased our staff Right, the more the better!! I agree with thatI am just confused about the lack of personal responsibility here for what happened. - What exactly are you assuming happened. I don't see anyone stating that anything happened other than the fact that snap knowingly misrepresented the business and the business opportunity. Your assumption is exactly the assumption that corporate makes over and over. From what you have said in your other posts, it sounds like you are upset and I'm wondering if part of the reason you are upset is because your club is not performing as well as you anticipated (?) Possible, but my club performs extremely well, top 10% every month (despite being one of the smallest clubs company wide), and I am upset as well. So your statement doesn't fly.Who swindled you? I'm not trying to attack or tear you down, but duh, snap hq. Did someone physically force you to sign? No but they knowingly misrepresented the business opportunity and the business operations. Maybe this opinion is just the way I was raised , but I still feel that you signed the line. When you go to a pharmacy to buy a medication, do you take it to the lab for testing to ensure it contains what the label says before you ingest it? So if you take it and it kills you because something was in it that wasn't mentioned on the label, is it your fault for being ignorant? Hey no one forced the product down your throat right?
Did you ever question the business model? Yes, we even spoke directly with the CFO who stated that he was going to open a bunch of them in New Orleans, because once they're up and running they just... wait for it... "run themselves" Well anyone who works for them is of course going to rehearse a marketing pitch. At the present time I always tell people go talk to current zees . But I noticed dependingwho you talk to you get a different story, some totally failing clubs, others making bank. from the patterns I observe, the ones doing well are-- of course-- staffed by the owner. Total nonsense- There are clubs staffed by owner 60 hours a week doing poorly and clubs where the owner shows up once a month doing well.
Did you hire and train only the best staff who can effectively take your place? No we hired God awful people who would just run our business into the ground. Sorry, but a question like that doesn't get better than a sarcastic answer. I'm not a fan of sarcasm , but I will say, if your staff is good enough to take your place and run the gym exactly as you would, then what is the problem? Problem is a quality staff doesn't automatically overcome excessive fees, a flawed business model, and misrepresented information.I think what you'll find is that the majority of the people on this site are successful. However, it's not because they follow snap's advice, but because they throw snap's absentee owner model out the window and run a model that works. Those that followed the snap model have closed their doors long ago. I agree, or they realized really quick you cant be absentee and decided to show up or sell out.
So what are we arguing over?
|
|
|
Post by firecrackergirl on Nov 9, 2016 7:19:20 GMT
Makes sense. I appreciate your comments. So my next question, what are you all going to do about this?
|
|
|
Post by greenergrass on Nov 9, 2016 19:15:06 GMT
Here is what I would like to know because corporate is really vague about this - what is the monthly amount that I will need to pay corporate if I close before the end of my franchise term? Has anyone been through this? Are they following through? Because they do need to be consistent about this. If they don't charge some franchisees for closing early, how can they charge me anything, if I close before the expiration? Will it just be the franchise fee? Will they also bill for the insurance, and Superior Security fees, etc?
|
|