Why Sports Based Franchises Need To Evolve

Posted in: Blog Started by

Why Sports Based Franchises Need To Evolve

franchise

 

With athletics being such a big part of the culture here in the United States there has been an incredible influx of sports based companies looking to capture market share.  For youth and adult athletes, there was a time it was unheard of taking private lessons indoors year round, learning proper ways to train your body with a professional, playing on private sponsored teams all over the country, or attending summer camps outside of what your town provided.

Today, that concept has been completely flipped on its head.  In “any town” USA you can attend baseball camp, soccer camp, attend speed/agility classes, compete on dance teams, train in martial arts, take private lessons and even have your birthday party fully outfitted with games, food, and cleanup….All for a price of course!  Check out Jungle Quest out in Colorado.  They do 1800 birthday parties a year! Pretty sure that didn’t exist when you were growing up!  Unique “sports” or “recreational” companies and franchises are coming down the pipeline everyday, competition is everywhere.

With so many sports facilities exploding onto the scene it has been increasingly difficult for sports facilities to scale and grow.  It seems that every where you look a new facility is opening or lately, closing.  Passionate entrepreneurs can now open their own niche sports facility or even buy into a recreation franchise company that will help them get set up.  The question remains however, if there is such a demand for these services why is there such a high turnover rate?  Why is it that sports facilities and franchisees have such a difficult time remaining in business?

Check out these stats:

 

122 Turnover in US Franchises-380x377

Out of the 135, 289 Franchises that opened from 2010-2013, only 16,644 of those locations were still open as of 2013.

Chart: BMM; Source: Franchise Disclosure Documents & FranchiseGrade.com

Obviously this set of data is for all U.S franchises, not exclusively for sports facility franchises. However, it’s clear there are some major hurdles to overcome in the world of franchising.  Opening them up isn’t the problem, it’s keeping them open and viable that seems to be the major issue.

To add a little more perspective in the sports facility world, here are some stats that help indicate the demand for these sports facility and sports franchise companies.

  • 35 Million kids ages 5-18 participate in some sort of organized sports
  • 60% of those kids play sports outside of school (Roughly 21 Million)
  • 85% of kids are coached by a father whose child is on the team

The following is from a study done by Michigan State on Youth Sports. 10,000 kids ages 5-14 nation-wide were surveyed:

  • 65% said they participate in sports to be with friends
  • 71 % said they wouldn’t care if there was no score kept in their games
  • 90% said they would prefer to play on a losing team then sit the bench on a winning team

Source: Minnesota Amateur Sports Commission, Athletic Footwear Association, USA TodaySurvey, Michigan StateDate Verified: 9.10.2013

What’s The Problem?

Here are the issues surrounding sports facilities and sports facility franchises.  All are fantastic opportunities for kids and adults to learn about something they are passionate about.  Today, you can find a sports facility or franchise that specializes in baseball, yoga, cross-fit, fitness, dance, golf, and strength/speed training.   The issues are the way these sports facilities and franchise scale and grow over time.

What so many sports facility franchise companies lose sight of is the reason why they were successful in their first location.  They forget that the reason they were successful was because of them!  They were marketing, branding, networking, operating, and driving sales for that location. It’s extremely difficult to find people with those same skills and entrepreneurial mind set.  This is the main reason why sports facility franchises fail.

darwin quote

Some additional reasons for stagnant sports facility franchise growth in the U.S. can be attributed to the ever changing world we live in.  A sports facility that started franchising a few years ago or a single unit that is entertaining the idea of entering the franchise market place needs to consider the following…It’s time to adapt!

Aside from your initial training to get them going, what is the ongoing training structure?  Is it simply training at the start with some occasional follow up or are you working with your franchisees on a weekly basis as if they are your sales force in the field?

For example, are you encouraging your franchisees to bring in professionals in other industries to help add to their customers experience?

If you’re a baseball and softball franchising company, are you advising, teaching, & role playing with your franchisees regularly on networking with local physical therapists, sports psychologists, nutritionists, and strength performance centers?  Have you given them the direction on how to best reach out, introduce, and negotiate those types of relationships so their units can be more profitable?

Are you keeping them up to date with best practices for networking, social media, web design, and blogging that a company in today’s market must be doing?  For example, are you providing your franchisees with a mobile friendly website, corporate social media that drives traffic and engages it’s audience across all platforms with a consistent message, and best practices for their blogs?

Are you leaving the social media up to the individual franchisees to worry about or are you using cutting edge technology to do it from a corporate stand point that will allow your franchisees to focus on the rest of the business?

Have you implemented a system that includes a scientific process through an accredited assessment test to best determine if your prospects will be the best fit for your company and its requirements to be successful?

Maybe most importantly, have you provided to your current franchisees an opportunity to learn where their strengths and inefficiencies lie through that same scientific process and assessment test?  Moreover, are you taking that data and applying it to what your company specifically needs?

For example, by taking a simple assessment test that produces data on how your franchisees handle pressure, interact with staff and customers, think strategically, & function as a leader you can drastically increase the productivity of your company as a whole.  By looking at the data and comparing against your best performing and worst performing units, you’ll be able to see a direct correlation on how those franchisees score with where their units perform.  This allows you to develop a specific training program to help with inefficiencies as well as encourage better performing units to add locations or continue growing internally.  Without this modern day analysis, it’s almost impossible to provide the support franchisees truly need.

Are you speaking with franchisees regularly to help them identify who their competition is?

For example, the baseball and softball franchisee needs to understand their competition is not the other private baseball and softball schools in the area.  Yes, they might be competing for the same kids, but that’s not the entire competition.

Who Will Survive?

The sports facility that will be the most successful and outlast the ups and downs is the one that understands that their competition is every sports facility or recreation franchise in that area. Parents only have so much disposable income.  They will choose to spend it on the place that they feel benefits themselves and their child the most.  They could care less if that means trying karate, swim lessons, travel baseball, or sleep away summer camp.  Those are all your competitors!  Too many sports facilities focus on the most tangible competitor, the one that does the exact same thing.

McDonald’s understands that if Taco Bell and Burger King open near them that they aren’t vying for the”fast food chain” market.  They are competing with the pizzeria, deli, and other small eateries in that area.  So they focus on providing the same product, with the same service, with the same speed that they always do.  They stick to what they are good at and stay focused on the overall market, not just their most obvious fast food competitors.  That’s why they are so successful and why you often see them right near each other.  They realize there is a bigger market to capture and there is plenty to go around.

Many franchising companies do a fantastic job with the set up of new units.  Their ability to prospect, close deals, assist in site development, aesthetics, banking, sales, grand opening, and annual conferences are without question the reason why they have been successful in what they do. However, to truly take franchisees to the next level so they can be wildly successful, there are some crucial aspects to growing the entire organization at the corporate level.

To truly have a profitable sports franchise company that is growing and viable, obviously the individual units need to be successful.  In this day in age with new technologies and competition popping up all the time, it’s the sports facilities and sports franchises that stay at the forefront that will end up being the most successful.

 

Did you find that helpful?  Did you get something from this article? If so….

Follow us on Twitter @ParkviewGroup to find plenty of great advice, information, and motivation…Tweet us questions or situations you need help with!

Want to see if Parkview Sports can lend a hand with the issues you’re facing with your sports business? Let us know your questions!

Email info@parkviewsports.com with your questions…

Tim Ziakas is a Sports Facility Consultant who specializes in helping sports facility owners run growing, viable, and profitable companies. He is one of the only Sports Facility Consultants who has real life experience purchasing, operating, growing, and selling sports facilities and sports training companies. His leadership and sales training stems from real life experiences both in the financial services industry and sports facility industry.

“WE ONLY WORK WITH ENTREPRENEURS WHO ARE PASSIONATE ABOUT RUNNING A SPORTS FACILITY BUSINESS, OPEN MINDED, AND UNDERSTAND THAT IN ORDER TO TAKE THEIR IDEAS AND PASSIONS TO THE NEXT LEVEL THEY’LL NEED HELP IN GETTING THERE.” — TIM ZIAKAS, CEO, PARKVIEW SPORTS GROUP

sports facility, sports facility help, sports facility advisory, sports management

Leave a Reply

Contact US

Would you like to schedule a consultation? Click here. All fields are required.

Your Name*
Your Email*
Are you human?*
2+3=? 
Your Message*