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VOL. 36 | NO. 36 | Friday, September 07, 2012

24-hour gyms rewind empty video stores

By Colleen Creamer

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Callie and Brian Casey have two Workout Anytime facilities are are planning to open four more.

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Twenty-first century rat racers are looking for ways to stay fit without complications.

Exit video stores, enter all-night gyms.

Workout Anytime is a bourgeoning franchise that uses mainly shells of defunct video stores like Blockbuster and Hollywood Video, and could soon be competing with every gym in Nashville. Not only are they cheaper than regular fitness centers, they don’t require contracts. It’s no wonder they’re growing at the pace of kudzu.

Brian and Callie Casey own two Workout Anytime locations, one in Bellevue and one in Cool Springs, and say they have plans for four more locations, though they aren’t yet disclosing those locations.

The Bellevue gym has about 1,600 members, they say. With no contracts and rates of $15 or $25 a month, their business works on volume.

“It’s low overhead; it’s fixed costs. I mean we’ve got fixed costs and variable costs. You can’t do anything about the fixed, but the more I work and the more my wife Callie works, the lower our overhead is,” Brian Casey says.

Brian left the world of real estate, he says, for the obvious reasons, and his wife left behind her job as a nurse practitioner at Vanderbilt Medical Center.

“We opened out first gym in April of 2011, and then we opened the one in Cool Springs, so it was a year and a day later,” says Casey, adding that another franchisee recently opened a Workout Anytime in Lennox Village and one just opened in Smyrna.

“The traditional gym model that existed until about 10 years ago is outdated,” Casey says. “People are obviously working more, and they are busier and to be confined to a timeframe in which you need to work out doesn’t work for everyone. Our gym never closes, so we are never not open.”

Workout Anytime gyms offer the standard cardio machines such as treadmills and elliptical, as well as the weight machines and free weights most gyms have. However there are no steam rooms or tracks.

William Pratt joined the Bellevue gym right when it opened, and has since lost more than 200 pounds. He is now a personal trainer there.

“The price and the hours are what got me in the door,” Pratt says. “I had to be at work at 7 o’clock in the morning, and it worked best for me to work out before hand, so I would need to go down there like at 4:30 or 5 in the morning. The hours worked great for me, and if I wanted to work out late at night I could do that, too.”

With a nutritional program and, seemingly, his own personal gym, Pratt lost 223 pounds.

“I lost every bit of it at that gym with diet and exercise and the people who work there. That made all the difference,” Pratt says.

Randy Trotter, vice president of franchise development for Workout Anytime, says the business model is not as new as it seems.

“It’s been around for some time since 1999 when we opened our first Workout Anytime in Douglasville, Ga., and it’s pretty simple really,” Trotter says. “The no-contract, the value-priced model, but the big deal is not having a contract. People were just tired of paying for stuff they didn’t use like swimming pools or racquetball courts.”

Brian Casey works with a client at Workout Anytime in Bellevue, which has about 1,600 members.

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Trotter says people associate traditional franchising with being a restaurateur and the attendant complications.

“This has a lot less pieces,” Trotter says. “The real unique part of this is that if your manager doesn’t show up, you’re still open and you can look at the cameras and see what is happening, so there are a lot less headaches. Once you have people onboard on your reoccurring draft, after a couple of weeks you will already have money coming in.”

To open, Trotter says, a potential franchisee needs to have “around $90,000 liquid cash”

“We also have third-party lenders that will lend the money” Trotter says. “We negotiate with the landlord to get the Blockbuster turned into a Workout Anytime shell. The other thing we do is we get six months free rent, so that gives the franchise owner a great start, because what they do is they build their drafts up while they are not paying rent. We king of value ourselves at being really good at negotiating real estate.”

Trotter said that between the already-opened gyms and gyms under construction, there are about 50 total. The company has only concentrated so far on the southeast.

About the glut of video stores, Casey says “they’re everywhere.”

“Blockbusters are great shells because they are approximately the same size and they don’t put up walls in their spaces, or if they do they put offices along the edges,” Casey says. “They are easy conversions, and there are so many of them out there, and there aren’t too many tenants who can take over that kind of space.”

Casey isn’t divulging future locations.

“It’s top secret,” he muses. “I can’t tell you. Right now we are planning on opening four. I don’t know how we are going to feel in a year, whether we are going to go for more or start to have a life.”

Workout Anytime gyms are contract free, but members do sign up for a “rolling 30-day” membership. The member can stop the bank draft at any time.

“The old gym model was ‘let me sign you up for 6, 12, 24, 36 months,’” Casey says. “It lacks integrity. The more commitment you gave them the cheaper they would go. We totally would have done this anyway. We wanted to be able to offer a gym membership to someone who doesn’t make $50,000 a year. So, it’s affordable and you can come at any time. We want you to me a member of our gym. If you don’t, that’s fine.”

The two levels of memberships are minimal, but might be critical to some. There is a $15 monthly membership and a $25 membership.

“The only difference is that we have hydro massage and tanning beds and 30 minutes a month with our personal trainer with the $25 membership,” Casey says. “It’s a way for someone to get personal training advice without paying for personal individual training sessions.”

History tells Casey that it’s all about location. With fewer households in Cool Springs, numbers of memberships are not is not as high as he would like, so he is talking to the business community. Then again, he’s only been open at that location for four months.

“This market has proven challenging because there are not as many rooftops around, so we have been really beating the streets and talking to businesses and trying to get them to pitch in or pay for their employees memberships so people can work out before and after work.”

Casey said he is most proud that he’s been able to launch a successful business despite the tough economy.

“We are very excited that we’ve created jobs not just only for ourselves but nine other people,” Casey says.

Pratt says he couldn’t ask for better bosses.

“You couldn’t ask for better people,” he says. “It’s an awesome place and it changed my life.”

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