GoFaxer Blog

There are many issues facing new business owners. What kind of industry should they get into? Should they work from home or get office space? Should they buy a fax machine or use Internet fax? For many industries, the question of franchising comes up.

I just read a fascinating article at BusinessWeek.com about Snap Fitness, one of the nations fastest growing franchises. They found that there was really intense competition for new franchise owners. Their solution was to offer a flat franchise fee, regardless of the performance of the gym.

Many experts told owner, Peter Taunton, that this wouldn’t work. You have to make enough money in the initial startup to justify the expansion of infrastructure to support the growth. He said that although it was a risky move, they were able to grow so fast that it worked. They grew to 18 new stores in the first and 100 in the second.

This, according to BusinessWeek, “helped him realize what he calls a ‘tipping point,’ where he could comfortably provide infrastructure and support to new and existing franchisees. He now has some 1,350 franchise locations, says his company had revenues of $19 million in 2007 (nearly 100 times the $202,000 revenues of 2004), and he expects to have 2,000 locations by the end of 2008.”