Club Physical takeover by Jolt Fitness

[nate225]

http://www.nzherald.co.nz/business/news ... d=10867888

[Pseudonym]

Not sure that it constitutes grounds for breaking a franchise contract, but I do agree that Club Physical's adverts have long been cringingly terrible.

[Optimass]

Phillip Rice, lawyer for Richards, said Holder had cancelled the agreements at the same time as franchise fees - which had been waived for the first two years - suddenly became payable.

"The evidence shows there was clearly a predetermined plan here to acquire several franchises and at the opportune moment, terminate on some pretext.

"It's not mere coincidence that this times perfectly with the end of the two-year waiver of fees."

Assuming these clubs were making a loss at time of purchase with a promoted forecast under franchise ownership of growth which is how they are marketed, I guess when you look at your bottom line and add in the fee and your business model makes a loss all of a sudden then the agreement and franchise are flawed. With competition driving prices down you have to be able to meet the market - you cant always do this in a franchise. If you do everything the franchisor says to do and it doesn't make the money indicated - who is responsible?

There will be a lot more to it than just pricing.

[mr natural]

I can confirm at least 2 of the clubs around time of purchase were making profit. Like Iwilson said, you have to take the good with the bad when you sign into a working business model franchise agreement.

[Boom]

Mrnatural, how has this affected your business? Just curious, and I understand if you can't comment...

[tomsammce]

Paul Richards is always crying his eyes out.

[iwilson]

Assuming these clubs were making a loss at time of purchase with a promoted forecast under franchise ownership of growth which is how they are marketed, I guess when you look at your bottom line and add in the fee and your business model makes a loss all of a sudden then the agreement and franchise are flawed. With competition driving prices down you have to be able to meet the market - you cant always do this in a franchise. If you do everything the franchisor says to do and it doesn't make the money indicated - who is responsible?

There will be a lot more to it than just pricing.

But you can't have it both ways. Either you agree to the terms of the agreement and sign the line or don't sign.

A franchise is a restrictive agreement by nature. No doubt there are McDonalds owners around the world who would if they could change things to suit the local market (in my travels they actually do lol). But the whole idea of a franchise is to present a unified front, a level of service or product that customers can rely on to be the same where ever they may be. The fact of the matter is if franchisee's were perfect there would be no other business model, as there would be zero risk and everyone who took one on would be guaranteed success.

Fact of the matter is they go tits up just like any other business, despite opening in the right location with the right demographics etc as per the franchise handbook. Fact of the matter is there is no doubt you stand a better chance of success going with a proven franchise than going alone, down side is royalties and a one size fits all business model.

Holder got by the sounds of it a great deal with royalties being waived for two years, but it's a little to coincidental that when they came due he decided to bail. Ya make your bed and you have to lie in it.

But we don't know the full story, in due course we will with some very dirty laundry about to be made very public...

[I Declare War]

Breakaway gyms shut down by court order!

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10869572

[Android]

that's awesome news!!!!

2yrs free franchise fees and then ... ohh btw we weren't happy so we're screwing you LOL [MOD EDIT: No offensive comments, please.]

[holdenman]

that's awesome news!!!!

2yrs free franchise fees and then ... ohh btw we weren't happy so we're screwing you LOL [MOD EDIT: No offensive comments, please.]

Agree it's good news, but no need for the race card bro..

[Android]

that's awesome news!!!!

2yrs free franchise fees and then ... ohh btw we weren't happy so we're screwing you LOL [MOD EDIT: No offensive comments, please.]

Agree it's good news, but no need for the race card bro..

yeah sorry not meant to be a race card mate...no offense I just don't have much tolerance for immigrants who act this way, can't explain why but my tolerance for kiwis ripping off kiwis is less than if it's an immigrant.

dunno why, just a weakness of mine. I love and admire immigrants who make NZ a much richer place to live and even show us kiwis up by working harder and achieving more

[genetic freek]

See ya,

Idiots getting owned. Hope club physical cleans them right up.

[I Declare War]

See ya,

Idiots getting owned. Hope club physical cleans them right up.

And I hope it opens up again as a club physical. I was going to join up the day they re-branded... man am I glad that I didn't join up before all this mess.

Hopefully it opens up soon and not too many employees/instructors suffer financially because of it!

[Android]

that's awesome news!!!!

2yrs free franchise fees and then ... ohh btw we weren't happy so we're screwing you LOL [MOD EDIT: No offensive comments, please.]

really Mod Police....calling someone Sth African is racist these days :naughty:

or was it suggesting they return to their Mother land (the one they've already fucked up, hence why they're over here...)

geez :doh:

[tomsammce]

How is Stuart being from sth Africa in anyway relevant to the situation. Gee some ppl are complete morons. He owns the leases on all 3 gyms and all the equipment in them outright. He contributes to nz more than most New Zealanders so comments about his origin are pretty stupid and just reflects that persons level of intelligence.

The gym is still open, no one has been server any documents to close. An appeal is being lodged so I would say it will be open as normal for quite a while.

I'm not sure that it will just turn back to club physical, when Paul Richards has nothing to do with the building lease or any of the equipment. Offices and rooms are sub-leased off Stuart. As far as I'm aware someone could take over the lease and operate the building with the equipment inside as a gym. Damages would have to be paid obviously if the appeal is unsuccessful. I believe it's with the lawyer now.

My opinion is the Paul Richards doesn't uphold his side if the franchise agreement and hasn't for years, so why should other people. Stuart's not trying to rip Paul off. He is just not seeing the promises made on the franchise agreement delivered to him so is keen to break away as its not a two way street.

Ppls opinions need to be based on factual information not on ethnicity of people of what they think is facts from the media.

Some people look like fucking idiots on that FB page and on the forums like this. Embarrassing themselves lol. Talk of ripping off is rife, but if those pl knew Paul Richards or read his autobiography they would know he has ripped off his fair share of ppl. He is no saint.

Club physical westgate (currently jolt fitness westgate) was the top club physical franchise as far as member sign ups and member retention by a long way. Paul Richards can't accept westgate being better than his precious te atatu lol lotsa ego in this feud.

It's a good gym with good knowledgeable staff and since the re brand there has been about 100 people leave and about 50 people sign up. So the people that matter are still happy and enjoying their physical training which is the most important aspect.

Time will tell and what will be will be.

[tomsammce]

There are very few instances when you can break a franchise agreement and Stuart would have to prove that Paul has in some way breached/not lived up to his contractual obligations.

From the tone of the Herald article it seems as though this Stuart guy is a bit arrogant and possibly has a lot of money, he probably thinks he can lawyer his way out of it.

Do u believe everything u read in the herald and see on Campbell live, well yeah YOU probably would because your not the smartest cookie are you.

[tomsammce]

Used to go to the Botany one, Stuart as a person is a nice guy, but been told he is a bit stingy (from a few receptionist chicks, but if your contract was with head office then it's all good) had a chat to a mate of mine who still goes there, looks like they are going to be adding boxing classes/cross fit classes/boxfit classes/mma classes (no clue if it's done by proper instructors with black belts in their respective sport or just some PT who want to do some MMA fitness thing) as far as memebership goes my mate was told nothing happens and it will be carried over, guessing you still get access to the three Jolt gyms?

The mma classes at the gym are run by martial art instructors,

At west gate one is a black belt in contemporary ju jitsu the other unsure of rank but to instruct mma you don't need to have any rank or qualification. There is no belt/rank system in mma itself. Only in the arts which make it up.

There is no 'crossfit' training there, it's circuit training or cross training. No one calls it crossfit and it's not marketed as crossfit. The instructors aren't crossfit certified and don't need to be because it is not 'crossfit'.

Yes jolt members can use jolt gyms regardless of location.

Hope that clears your queries up.

[tomsammce]

So CP membership fees are paid to...CP.

Wonder how the new businesses are making money from CP members if the fees are going into the CP account....as someone said earlier contracts are with CP.

Will CP members be asked to cancel their memberships and re-sign or will the Jolt Fitness just wait out the contracts and re-sign them, in the meantime expect a strong recruitment drive for new members to pay the bills?

No it's a franchise, do you not know how a franchise works? the revenue goes to the franchisee and has nothing to do with the head office. Franchise fees/costs are paid out of the revenue. Weather it's a % or a set amount per Annum would vary with different kinds if franchises.

[tomsammce]

Actually gf you have no idea what u are talking about. I know that particular franchise agreement better than anyone. If you think everything is transparent in this business or any other based on what you read in the paper or on the net, just demonstates how very little you actually know. (Not just this but business in general)

Due dilligence is not full proof especially when the person you are purchasing the business from with holds information. The challenge on the other end of that is in order for you to prove it and get some compensation is a long expensive drawn out process. People lie ... or are you not familiar with this concept? :roll:

Unfortunately for you I know as I own a number of franchises. There probably is not a business purchased in NZ where the buyer is actually 100% aware of what the state of the business is in as its very easy to hide money etc. That's the risk we all take.

Going out and re branding is stupid - & shows to me by this act that they were already stupid when they purchased the business. A couple of PT's get together and think we can run a business & then find out its a bit harder than what they thought.

Just a correction bro, Stuart isn't a pt and owns multi million dollar companies in sth Africa. He's far from stupid.

Paul Richards doesn't honour his franchise obligations, i work there. iv seen it. that is Stuart's grounds for this case.

My personal views are that if something's not right you should do something about it. I support jolt fitness 100%

[Android]

CP for the win! \:D/

You'd have to b a muppet not to see how dodgy Stuart and Jolt looks in all of this.

I wonder what steps he took prior to remedy the so-called issues he was having with Paul., you know, business-like mediation to improve the agreement.....but he didn't like their advertising lol good grounds, good grounds.

:doh:

[I Declare War]

There are very few instances when you can break a franchise agreement and Stuart would have to prove that Paul has in some way breached/not lived up to his contractual obligations.

From the tone of the Herald article it seems as though this Stuart guy is a bit arrogant and possibly has a lot of money, he probably thinks he can lawyer his way out of it.

Do u believe everything u read in the herald and see on Campbell live, well yeah YOU probably would because your not the smartest cookie are you.

That's quite funny coming from you. ;-)

You obviously lack the comprehension skills required to understand my statement. If you could comprehend what I had said properly, you would see that I commented on the tone of the Herald article, and pulled implications from that viewpoint. I never said that I believed anything myself.

By the tone of your post it's evident that you're just an arrogant dimwit, probably (actually, almost certainly) just like Stuart is being portrayed as in that Herald article.

[trainlikeafreak]

Used to go to the Botany one, Stuart as a person is a nice guy, but been told he is a bit stingy (from a few receptionist chicks, but if your contract was with head office then it's all good) had a chat to a mate of mine who still goes there, looks like they are going to be adding boxing classes/cross fit classes/boxfit classes/mma classes (no clue if it's done by proper instructors with black belts in their respective sport or just some PT who want to do some MMA fitness thing) as far as memebership goes my mate was told nothing happens and it will be carried over, guessing you still get access to the three Jolt gyms?

The mma classes at the gym are run by martial art instructors,

At west gate one is a black belt in contemporary ju jitsu the other unsure of rank but to instruct mma you don't need to have any rank or qualification. There is no belt/rank system in mma itself. Only in the arts which make it up.

There is no 'crossfit' training there, it's circuit training or cross training. No one calls it crossfit and it's not marketed as crossfit. The instructors aren't crossfit certified and don't need to be because it is not 'crossfit'.

Yes jolt members can use jolt gyms regardless of location.

Hope that clears your queries up.

do those fkn MMA faggots still not clean their weights up bro?? lol

[tomsammce]

Well jolt fitness got an appeal so it'll be open as normal for quite sometime and hopefully permanently.

Ill sign u up tommorow IDW, give u a discount on the female only bootcamp that's kicking off soon.

Peace.

[Pseudonym]

Come on guys, leave the personal digs out of this. :naughty:

[tomsammce]

So update. Jolt fitness have 18 days given by the court to negotiate with Paul Richards and come to a solution if that's not solved the doors will be closed.

If negoiations fail I'd say jolt westgate would move to the old clip physical in Albany as its about the same size as the westgate gym still set up for a gym with all showers etc and the lease is still vacant. Unsure what will happen with botany gym. And three kings is doing pretty shit anyway so unsure about the future of that.