“Understanding who you are” – The secret to 12RND Fitness’ rapid growth
Ask any franchisor and they’ll tell you, the number one thing that all business owners value is network growth. But in an economic climate where the talent pool is hampered by household debt and access to finance, how can franchise businesses capture the market?
“It comes down to understanding who you are,” Tim West, managing director and co-founder of 12RND Fitness told Inside Franchise Business.
“If you focus on one thing and do it really well, you’re going to have a much better chance of creating an excellent product, rather than just adding another string.”
Franchisors would be wise to heed his advice. The former personal trainer turned executive launched 12RND in partnership with Australian boxing legend Danny Green in Brisbane in 2016, into a market already heavily saturated, and has since opened 60 locations nationwide.
Now classified as the second largest boxing franchise worldwide, 12RND is preparing to launch internationally, targeting the major US and UK fitness markets. So, amid various economic factors and market saturation, how did the franchisor create a culture of network growth and scalability?
West reveals the four key pillars that form the foundation for 12RND’s impressive expansion.
1. Identify markets
In an industry such as fitness, where consumers have a seemingly unrestricted flow of new models on offer, it can be easy to fall in the trap of replication.
West said identifying a key market and demographic better allows franchise brands to establish the key wants and needs of its consumer profile.
While competitors such as F45 and big box gyms still hold majority market share, West believes there are certain advantages to being a fresh voice in a crowded space.
“12RND was all about identifying pain points and finding ways to address those, but also looking at those models in existence and adapting the elements that we liked,” he said.
“That’s the advantage of a second mover, to achieve growth in a mature market, it can’t just be blue ocean, there has to be an element of red.”
Understanding how consumers interact with fitness chains currently has allowed West and 12RND to continually refine and evolve as a training platform.
2. Refine your offering
“Everybody loves the look of a boxer, but not everybody wants to get hit in the face,’ West revealed. It’s the premise that has for years drawn a barrier between boxing fitness and combat training.
For 12RND, creating an environment that was accessible to the core market was one challenge, but consumer education was another.
The franchisor revealed that for sustained network growth , years of testing and market segmentation was be carried out.
“At the end of 2014 we started testing, beginning with two pilot sites that ran for six months, before we started franchising in March 2016,” West said.
The corporately owned period allowed West to slowly refine the brand’s core competencies, making sure the model not only had merit but also scalability.
“Differentiation and identity go hand in hand,” West said. “Simply adopting superficial elements of models that appear to be working but not quite understanding why they work isn’t a recipe for creating an excellent product.”
3. Promote authenticity
For brands to succeed in any market, West said consumers must be confident the model is authentic. For 12RND, it was about creating a boxing program that was not only effective but credible.
“The last thing I wanted to do was say we were authentic boxing conditioning when we really weren’t.”
In order to do this, West set about boosting the authenticity of the training program by testing it in ring with a professional boxer
Top of his list was Danny Green, former world light-heavyweight champion and iconic Australian sporting personality.
“Meeting him and seeing his enthusiasm for the product was great, his excitement came from the similarities between our product and the training he had done throughout his career”
Green was more than just enthusiastic with the 12RND model. The professional boxer signed on as a major investor, which West said was another categoric boost to the brand’s authenticity.
“He invested his cold, hard cash because he believed in bringing a form of boxing conditioning to the market that didn’t involve contact,” West said.
“When you think about his whole post-boxing career, with the “Stop the Coward Punch” campaign, it made sense.”
4. Align values
Once a brand has clearly identified its market and refined its offering; West said the next challenge is finding partners that buy into the brand’s value set.
Many franchisors will note that the days of a cheque book and pulse have long gone, and in light of recent media attention, it’s more important than ever that brands recruit franchisees who are committed to company culture.
West said the secret to 12RND’s booming growth has been the establishment of a stringent franchisee identification protocol, focusing on what he calls the ‘Four Cs’; competency, capital, character and capacity.
“This was something that was really hard to work out originally,” West said. “The elements all play against each in a sense, but essentially it all starts with capital. Starting a new business is stressful enough but being under financial stress from the start is just not helpful.”
West revealed that while franchisee capital provides the operation with an added safety net, particularly within the early stages of business, but this can be exchanged for competency.
“If you have less fitness experience but you have more capital, than you are able to recruit those skills,” he said.
The next key factor in franchisee identification is character, which West says can’t be measured through an applicants c.v. It is an alignment of personality and the sense that you can work productively with this person for the foreseeable future.
“Danny likes to say if we wouldn’t have a beer with them, we wouldn’t sign them up as franchisees,” he joked.
“In reality, it’s work ethic. Their character in terms of resilience, their ability to build rapport. If we can look at their previous history and see that they’ve achieved a high level in corporate life, or high level in sports, then we know their character is there for hard work.
The final and overarching aspect of 12RND’s recruitment process is capacity; how much time and effort the prospective applicant can expect to commit to the business.
West said while the other elements are crucial to an operator’s success, capacity is the hallmark for continued growth.
“You might have the capital, the competency and the character, but of you don’t have any time, none of that matters,” he said.
12RND growth opportunities
The latest growth for 12RND sees the brand enter a global market for the first time, West revealed.
With 60 locations across Australia, and other 25 to open in the next six to nine months, the franchisor said now was the perfect time to expand internationally.
“We have always recognised the opportunity to bring 12RND to the global market, but only seriously committed to the expansion upon increasing inquiries internationally for franchise opportunities,” he said.
“With the maturity of our internal systems and key staff recruitment, we are now able to facilitate the international growth.”
West said for all franchise brands moving forward, the biggest challenge was consumer education about what the product is and how it can help them achieve their goals. The franchisor reiterated that growth should continue to be driven by advocacy.
“If a potential franchisee can see themselves as a member, they will have the confidence to invest as a business owner.”
“If you are 100 per cent focused on providing value to customers, you will be successful.”