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5 Fitness Franchises Getting Buff

Stocks in this article: TOWN LTM

2. Retro Fitness

Corporate locations: 4

Franchise fee: $69,000 per store

Investment: capped at $1.3 million per store

Monthly customer fee: $19.99

Retro movie buffs, this one's for you.

Founded in 2004, Retro Fitness boasts its low cost, yet high value concept offering members a full-service gym experience for just $19.99 a month.

"There's a lot of great things they can still do that they don't have to sacrifice if they went to a traditional low cost provider," founder Eric Casaburi says.

How is that possible? Casaburi says it's all in maximizing square footage, buying equipment in bulk, offering group classes on demand through touch-screen kiosks and adding additional "revenue centers" like a juice bar, personal training, tanning and onsite chiropractic services.

"I found a more efficient way to build a higher-end fitness center and pass the savings along to my customers," Casaburi says. "I was able to buy in bulk. We're able to negotiate better lease agreements."

"Most of the people that were offering fitness license or systems really weren't giving you the real total package. No one was doing that. I felt that alone would be a really big niche," he says.

RetroFitness currently has 85 locations in operation, with an additional 15 locations slated to open by the end of the year. The company projects 155 locations to be open or in the development pipeline by the end of 2013.

RetroFitness is already in 10 states, mainly New York and New Jersey, and Casaburi has a longer-term goal of opening more than 300 units by moving into markets such as Chicago, Dallas, Washington, D.C. and North Carolina, and continuing to ramp up in California.

Each RetroFitness location is equipped with a full service fitness center including 60 to 100 pieces of equipment supplied by leading manufacturers such as Life Fitness and Iron Grip. The gyms also have individualized LCD television monitors. And of course, each gym also offers members a "RetroTheatre," where members can work out in a darkened room on cardio machines while watching classic '80s movies (and current ones too).

Casaburi, who also founded Lets Yo! Yogurt last year, and plans to have 30 locations open by the end of 2013, says the fact that multiunit developers are expressing interest in the gym is a good sign.

"We know how to make money inside four walls and our serious investors see that," he says.

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