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How much does Anytime Fitness cost?
Initial Investment Range
$458,826 to $907,607
Franchise Fee
$83,536 to $102,472
The franchise we offer is a fitness center offering convenient access and one-on-one, small and large group training, nutrition, coaching and recovery services.
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Anytime Fitness April 24, 2025 FDD Risk Analysis
Free FDD Library AI Analysis Date: August 21, 2025
DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.
Franchisor Stability Risks
Start HereDisclosure of Franchisor's Financial Instability
High Risk
Explanation
The franchisor explicitly notes its guarantor's financial condition as a “Special Risk.” The FDD includes financial statements for Anytime Fitness, LLC, which acts as the system manager. These statements show a significant negative member's deficit of over $949 million as of December 31, 2024. Such a large deficit may indicate financial instability, potentially affecting the manager's ability to provide long-term support and resources to the franchise system, despite a separate financial guarantee.
Potential Mitigations
- A franchise accountant should meticulously analyze the audited financial statements for the manager and guarantor, paying close attention to the notes and the significant member's deficit.
- Discuss the implications of the franchisor's complex securitization structure and negative equity with your financial advisor.
- It is vital that your attorney explains the specific terms and practical value of the performance guarantee provided by the affiliate.
High Franchisee Turnover
High Risk
Explanation
Item 20 text states that in the last year, 261 franchisees, representing 326 franchise locations, have ceased to do business under the agreement. With approximately 2,290 franchised outlets at the end of 2024, this represents a very high annual turnover rate of over 14%. This level of churn is a significant indicator of potential systemic issues, which could include franchisee unprofitability, dissatisfaction with the system, or other challenges that you may also face.
Potential Mitigations
- You should contact a significant number of the former franchisees listed in Exhibit C-3 to understand their reasons for leaving the system.
- With your accountant, analyze the turnover data over the past three years to identify any accelerating trends in terminations or cessations.
- Your attorney can help you formulate specific questions for the franchisor regarding the high rate of turnover and the support systems in place.
Rapid System Growth
Low Risk
Explanation
This risk was not identified in the FDD package. Rapid system growth can be a concern if it outpaces the franchisor's ability to provide adequate support to all franchisees. It is a positive sign that a brand is growing, but it's important to ensure the support infrastructure is scaling concurrently to maintain quality for every franchisee, including new ones like yourself. This FDD shows a mature system with slowing growth, not rapid expansion.
Potential Mitigations
- A review of the franchisor's support staff size relative to the number of franchisees with a business advisor can help gauge their capacity.
- Inquire with your attorney about any contractually guaranteed support levels or response times from the franchisor.
- Your accountant can review the financials to see if the franchisor is reinvesting in support infrastructure.
New/Unproven Franchise System
Low Risk
Explanation
This risk was not identified in the FDD package. Anytime Fitness is a large, mature franchise system that has been operating for many years. Its predecessor began franchising in 2002. An unproven system presents higher risks because its business model, brand recognition, and franchisee support structures have not been tested over time. A new franchisor may lack the experience and resources to effectively guide franchisees through the challenges of opening and operating a business.
Potential Mitigations
- A business advisor can help you assess the franchisor's track record and the system's long-term market viability.
- Have your accountant review the financial statements for evidence of sustained profitability and stability over several years.
- Even with a proven system, it is wise for your attorney to review the franchise agreement for any recent changes that could introduce new risks.
Possible Fad Business
Low Risk
Explanation
This risk was not identified in the FDD package. A fad business is one that experiences a sudden burst of popularity that quickly fades, which can leave franchisees with a worthless investment tied to a long-term agreement. The general fitness industry, while subject to trends, is a well-established sector with sustained consumer demand. Anytime Fitness has been operating for over two decades, indicating it is not a short-term fad but a business with a long history.
Potential Mitigations
- Your business advisor can help you research the long-term trends in the fitness industry and the specific market segment.
- It is useful to ask your financial advisor to help you assess the business model’s resilience to economic downturns.
- Discuss the franchisor's strategies for innovation and adaptation to evolving fitness trends with existing franchisees.
Inexperienced Management
Medium Risk
Explanation
Item 4 discloses that two key executives were officers of other companies that filed for bankruptcy approximately four months and four years, respectively, after their departures. While this does not involve the franchisor entity itself, it is a noteworthy part of the executives' business history. Inexperienced management can pose a risk by lacking the skills to navigate challenges, support franchisees effectively, or manage the system's finances and growth, which could negatively impact your investment.
Potential Mitigations
- In discussions with the franchisor, you could inquire about the circumstances surrounding the past bankruptcies mentioned in Item 4.
- Engaging a business advisor to evaluate the current management team's collective experience in franchising and the fitness industry is recommended.
- You should speak with current franchisees about their assessment of the management team's competence and the quality of support provided.
Private Equity Ownership
Medium Risk
Explanation
Item 1 discloses a complex corporate structure where the franchisor is indirectly owned by Purpose Brands Holdings, LLC, which is jointly owned by Anytime Worldwide, LLC and Ultimate Fitness Holdings, LLC. This type of ownership can present risks if the private equity owners prioritize short-term returns over the long-term health of the system. This could potentially lead to reduced franchisee support, increased fees, or pressure to use specific vendors to maximize profits for investors.
Potential Mitigations
- Researching the ownership group's track record with other franchise brands can provide valuable insight; a business advisor can assist with this.
- It is important to discuss with your attorney how the ownership structure might affect decisions about the brand's future direction or a potential sale of the system.
- Contacting franchisees to ask about any changes in support or fees since the current ownership structure was put in place is a crucial step.
Non-Disclosure of Parent Company
Medium Risk
Explanation
The franchisor entity, Anytime Fitness Franchisor LLC, is a subsidiary within a complex holding structure detailed in Item 1. The FDD provides financial statements for an affiliate manager (Anytime Fitness, LLC) and an affiliate guarantor (SEB Franchising Guarantor LLC) but not for the ultimate parent companies. While this may be compliant, it can obscure the complete financial picture of the entities that ultimately control the franchise system, making a full risk assessment more challenging for you.
Potential Mitigations
- Your accountant should carefully analyze the provided affiliate and guarantor financial statements and the guarantee agreement.
- It is advisable for your attorney to clarify the relationships between the various entities and their respective obligations to you.
- Understanding the limitations of the provided guarantee is crucial, and your financial advisor can help assess the true financial backing of the system.
Predecessor History Issues
Low Risk
Explanation
This risk was not identified in the FDD package. Anytime Fitness Franchisor LLC was formed in 2021 as part of a securitization transaction and acquired the assets from its predecessor, AFLLC. The FDD provides information on this predecessor. A failure to disclose predecessor history could hide past issues like high failure rates or litigation. This can prevent a prospective franchisee from understanding the true track record and potential inherited problems of the franchise system, leading to an incomplete risk assessment.
Potential Mitigations
- Reviewing the history of the predecessor in Items 1, 3, and 4 with your attorney is a key step in due diligence.
- A business advisor can help you research the predecessor's public reputation and history, if possible.
- Speaking with long-term franchisees who operated under the predecessor can provide valuable firsthand accounts of their experience.
Pattern of Litigation
Medium Risk
Explanation
Item 3 discloses several litigation cases involving an affiliate, Anytime Fitness Iberia, S.L., in Spain. These include lawsuits initiated by the affiliate against former franchisees and counterclaims from franchisees alleging issues like failure to provide support and unreasonable fees. While these are in a foreign jurisdiction and involve an affiliate, they suggest potential areas of conflict within the broader system. A pattern of litigation can be a red flag indicating underlying problems with the franchise relationship or business model.
Potential Mitigations
- It is important for your attorney to review the nature and frequency of the lawsuits disclosed in Item 3 to identify any recurring issues.
- Ask the franchisor about the disputes and how they might relate to the U.S. operations.
- You should contact current and former franchisees to ask about their experiences and whether similar issues exist in the domestic system.
Disclosure & Representation Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Financial & Fee Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Legal & Contract Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Territory & Competition Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Regulatory & Compliance Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
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Franchisor Support Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
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Operational Control Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Term & Exit Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Miscellaneous Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.