L.A.-Based Vert Franchises to Pump You Up All Over

0

The Vert Worldwide Inc. health club chain is getting pumped up.


The L.A.-based company, fueled by a raft of high-profile sports clients, is embarking on an aggressive franchising initiative that will see five locations open by the end of the year and 15 more in 2008.


The company decided to go the franchise route because it believes that approach will allow the brand to grow quickly and more economically than simple expansion. Additionally, the branding provided by franchising offers potential buyers a higher success rate on average than startups of independent shops.


“Franchisees have close to a 90 percent success rate, as compared to 25 percent for start-ups,” according to Chad Emerson, director of franchise sales.


The company will offer franchisees two different sized facilities. The smaller studio is simply a fitness facility while larger franchises will offer rehabilitation services, an increasingly popular option as health-conscious boomers age.


Franchise fees will range from $12,500 to $30,000, plus a 6 percent royalty fee. Franchisees are also expected to secure real estate, which can of course run into hundreds of thousands of dollars. The larger size studios can handle up to 300 members per location.


The gym’s original Santa Monica location has already been supplemented by franchises opened during the past 12 months in Hermosa Beach and New York. Future locations include West Hollywood, Long Beach, Irvine, Chicago and two more locations in New York.


Vert’s approach to training has drawn an impressive client list. Miami Heat center Shaquille O’Neal, volleyball champion Holly McPeak, gold medalist swimmer Lenny Krayzelburg and former Cubs shortstop Ernie Banks work out at the club.


The Hermosa Beach location has quickly become the training center for athletes on the professional beach volleyball circuit. Approximately 40 percent of current clients are athletes from the high school level up.


“Clients train at the same speeds at which they play,” said Emerson. “Certain muscles used in sprinting and jumping do not strengthen simply by lifting weights.”


Clients pay a $30-$45 fee per one hour session. All workouts are organized and supervised by a personal trainer; trainers supervise four to six individuals concurrently using a computer system that monitors progress. The computer also stores workout information for clients, which allows them to track their progress.



Betting the Card

One local businessman is betting big that pre-paid cards will be a big hit with casual sports fans looking to get an edge in their fantasy football leagues.


“The value comes when we help people win in casual gaming,” said James Hart, president of Priflex Systems Inc. While the company offers information about games, it does not for gambling. “We are not a gambling site, we are an information site,” said Hart.


With offices in Pasadena and Huntington Beach, Priflex offers pre-paid cards and live point of sale transactions for credits used to receive the picks of top rated Las Vegas handicapper Jimmy Spats. The two-year-old company signed distribution deals last month to get their cards onto shelves in 750,000 convenience stores worldwide. They will start by rolling out in 33,000 locations this week across the country. Advertisements have started running locally during Dodgers games on radio station KFWB-AM (980).


“Hopefully we’ll be in all 750,000 stores by football season,” said Hart. He worked in the mortgage industry for 13 years, including five and a half years at Calabasas-based Countrywide Financial Corp., before leaving to start this venture.


The pre-paid cards cost $20. Card users can then go online or call a toll-free number to redeem the card for picks on games in virtually every professional sport on a game-by-game basis.


The business model clearly has potential. If just one card is sold per location monthly, revenues could reach $18 million monthly.



Carriage Deal

Santa Monica-based World Championship Sports Network has reached an agreement to provide content to IPTV provider Optical Entertainment Network. The deal will allow WCSN to broadcast in Houston and other markets served by the Internet television provider as part of its basic cable package. It is the first deal for the sports and lifestyle network with this type of service.


“IPTV does not have the longstanding history of cable or satellite so they are hungry for content,” said Bo LaMotte, WCSN senior vice president for distribution.


Other Internet television competitors like AT & T; are starting to roll out similar technology across the country. The technology can support nearly unlimited numbers of channels because it does not send all channels directly to the set-top box. Instead, signals are stored on a main server and only the channel selected is sent into the home.


The company’s content is available to 45 million subscribers via television and Internet. The station has agreements with international federations that govern Olympic sports, which also gives it rights to all of the archival footage. Subscribers have access to more than 2,000 hours of live Olympics-style sporting events annually.



Staff reporter David Nusbaum can be reached at (323) 549-5225, ext. 236, or at [email protected].

No posts to display