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Is It Time for a Toaster In the Express Market?

DENVER — Even though a new express club franchise seems to be announced every month, people took notice in February when Quiznos Sub CEO Rick Schaden announced that he and Brooksy Smith, former executive vice president of Quiznos, would open a franchise of residential-based express clubs. Perhaps that's because Schaden and Smith bring with them franchising experience unlike most others entering this market. After all, Quiznos is the number three franchise in the latest Entrepreneur 500 ranking. Or perhaps it's because they are working with Ray Wilson, who purchased the rights to the Life Cycle and founded several health club chains including Family Fitness.

But how does Smith, who is now CEO and president of the new franchise called 123 Fit, plan to set the new franchise apart from the crowd? He is taking a page from his Quiznos experience. When Quiznos launched, Subway was — and still is — the largest sandwich shop. Quiznos differentiated itself by toasting its sandwiches and soon surpassed the other sandwich shops to stand at number two in the industry. Smith plans to do the same in the express market by setting the franchise apart from the others with a toaster — or at least the fitness industry's version of Quiznos' toaster.

That toaster is the Simbio System, which Smith calls “revolutionary” resistance equipment. The equipment uses resistance cords, cams and pulleys to provide positive and negative resistance without a weight stack. The system offers constant force during the workout but also allows the user to have control of the weight throughout the movements. The system has three zones to choose from depending on the user's fitness level, and each zone allows for small increments to reduce soreness, said Smith.

Beyond the new technology, the clubs will be co-ed, results-focused, rooted in a 30-minute exercise routine that involves a circuit environment, and will be set up with several pre-defined beginning and end stations, eliminating intrusive interruptions or others working in and sharing equipment. Each club will be between 1,800 square feet and 2,200 square feet.

“In the fitness business, we saw Curves out front with a remarkable business,” said Smith. “And we saw a muddled water of people jumping in, and it looked a lot like what we saw in the sandwich business 10 years ago.”

Smith said most industries have room for two players as long as they are differentiated enough, and he and Schaden didn't see anyone in the fitness business that was truly different from Curves.

The first 123 Fit health club is slated to open this May in Houston but the company is also marketing clubs in Cleveland; Columbia, Mo.; Denver; Fort Lauderdale; Seattle; and southern California. Smith does not plan to open any corporate 123 Fit clubs.

“Our efforts and human resources always need to be to help our franchisees succeed and help their customers better,” said Smith. “When you operate company stores, that gets in your way because you are worried about your own centers.”

Quiznos currently opens three stores each day, but Smith said that 123 Fit will have to work its way up to that pace.

“To build a brand, you have to get your clubs up,” said Smith. “That enhances the value of the brand for your franchise owners and members. We feel an obligation to build a brand as quickly as we can.” However, Smith said that the company would not build thousands.

“We're going to build one that is successful and then do that over and over again,” he said. “We see franchisers make the mistake of saying that they are going to build thousands of these and they forget that at the end of the day, you have to have thousands of successful franchise owners.”

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