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Premier Martial Arts: a Profitable Franchise Making $286K Revenue
If you’re considering getting into the combat franchise industry, you may have considered Premier Martial Arts. With a mere $303,000 estimated investment cost, it’s an affordable franchise especially if this is your first business.
But what about the profits? How much money can you realistically make with a Premier Martial Arts franchise? Is this worth investing $303,000 upfront (from a bank or investors)?
The good news is that Premier Martial Arts is a very profitable if run correctly: it makes $286,000 in revenue per year on average and reaches a 31% profit margin, impressive.
Interested? In this article we are analysing Premier Martial Arts and its latest Franchise Disclosure Document to find out whether you should buy this franchise. Let’s dive in!
Key figures
| Franchise fee | $49,500 |
| Royalty fee | 7.0% |
| Marketing fee | 6.0% |
| Investment (mid-point) | $303,000 |
| Revenue | $286,000 per year |
| Revenue per square foot | $191 |
| Sales to investment ratio | 0.9x |
| Payback period* | 7 years |
| Minimum net worth | $330,000 |
| Minimum liquid capital | $75,000 |
Download the Premier Martial Arts franchise business plan
Updated with Franchise Disclosure Document
5-year pro forma financial model
Free support
What is Premier Martial Arts?
Premier Martial Arts is a fast-rising martial arts franchise committed to instilling important life skills through the power of self-defense.
Founded in 2004 by Barry Van Over, the brand offers a wide range of services to children and teens of 3-17 years and adults of all ages, including freestyle martial arts, taekwondo, karate, kickboxing, krav maga, group fitness and jiu-jitsu.
Headquartered in Tennessee, the martial arts franchise is a subsidiary of Unleashed Brands and uses a monthly subscription model for its fitness services.
Premier Martial Arts started franchising in 2018. Today, the brand operates in over 228 locations worldwide, with 218 studios in the US.
Premier Martial Arts franchise pros and cons
Pros
- Small footprint: franchisees operate across 1,200 – 1,600 square feet of studio space.
- Diverse income streams: franchisees attract revenue through the membership fee, monthly subscription fee and sale of upgraded training programs, merchandise and training gear. Additional income streams include self-defense classes, seminars, private lessons and special events like kids’ parties.
- Classes delivered four days a week: studio owners can pursue other business interests because franchises only operate four days a week.
- Easy to operate: the franchisor uses a standard curriculum that students know and appreciate, making it easy to start and operate a new studio.
- Extensive business training: the franchisor offers comprehensive initial training, instructor training, curriculum training and ongoing support to ensure franchisees understand everything about the business model. The corporate support and marketing strategy help franchise owners attract and retain clients.
- Simplicity: only 1 or 2 trainers are required to run the entire studio, reducing costs while maximizing profits. The small footprint minimizes the overhead, making it a low-investment franchise that’s easy to scale up.
- Easy-to-follow business model: the franchisor designates the critical studio operations to a fully trained instructor with a daily list of goals to achieve. Brand owners know exactly what to focus on when investing in a Premier Martial Arts franchise.
- No experience in martial arts required: franchisees don’t need a martial arts background to start and operate a new studio. The highly trained instructors handle everything, allowing franchise owners to focus on the business’s most crucial aspects.
- Financial assistance: Premier Martial Arts has relations with third-party financing institutions to help studio owners cover the franchise fee, startup costs, inventory and equipment.
Cons
- No absentee ownership: franchisees must stick to the scheduled operating hours every working day.
- Not a part-time investment: Premier Martial Arts franchise isn’t a part-time investment.
- No exclusive territories: the franchisor doesn’t provide protected territories. Franchisees may compete with other Premier Martial Arts studios within the same location.
- Can’t operate from home or as a mobile unit: franchisees must operate from physical locations.
- Competition from other combat sports franchises like UFC Gym or TITLE Boxing Club to name a few
How much does a Premier Martial Arts franchise cost?
On average, you would need to invest around $303,000 to open a Premier Martial Arts franchise. This also includes the initial franchise fee of $49,500.
The investment amount is an average that depends on several factors like the gym’s size, location, etc. Indeed, It may change depending on those factors. According to the 2022 Franchise Disclosure Document, the investment ranges from $184,000 up to $422,000.
Startup costs
The initial investment covers all the startup costs you may need to start a gym or fitness club business. You must pay an initial franchise fee of $49,500 to the franchisor. In addition to the initial franchise fee, the investment amount also covers:
- Formation Costs: training expenses, leasehold improvements, equipment, furniture, signage, licenses, architect fees, computer system, software, etc.
- Initial Marketing: grand opening advertising, presale coordinator, digital marketing, social media setup, etc
- Operating Costs: two to four months salaries, rent, insurance, initial inventory, supplies, and working capital for first 3 months, etc.
| Startup cost | Low | High |
|---|---|---|
| Initial Franchise Fee | $49,500 | $49,500 |
| Formation Costs | $90,825 | $258,300 |
| Initial Marketing | $20,000 | $26,000 |
| Operating Costs | $23,325 | $88,000 |
| Total | $183,650 | $421,800 |
Download the Premier Martial Arts franchise business plan
Updated with Franchise Disclosure Document
5-year pro forma financial model
Free support
How much revenue does a Premier Martial Arts make?
A Premier Martial Arts studio makes $286,000 in revenue per year on average. This number is the average revenue per gym in 2021.
Out of 166 franchised-studios at the end of 2021, the top 15 studios generated $508,000 or more in revenue, whereas the bottom 15 only $157,000.
How profitable is a Premier Martial Arts franchise?
Premier Martial Arts franchises make about $89,000 in annual profits. That’s a 31% EBITDA margin, as disclosed in the Franchise Disclosure Document.
This 30% EBITDA margin is on the higher end compared to other fitness franchises (~30%).
We have provided a profit-and-loss below representing the average performance of franchised Premier Martial Arts studios, as disclosed in the Franchise Disclosure Document. Yet, note that the FDD only reports these numbers based on 59 studios, as they were opened for all of 2021.
Also, please note that your franchise profit margin may differ from the one presented here, as it varies based on a number of factors like your studio location, its size, etc.
| Profit and loss | Amount | % revenue | Sources |
|---|---|---|---|
| Revenue | $286,336 | 100% | as per FDD |
| COGS | $(19,757) | 7% | as per FDD |
| Rent | $(39,524) | 14% | as per FDD |
| Payroll | $(81,478) | 28% | as per FDD |
| Marketing | $(27,146) | 9% | as per FDD |
| Other operating costs | $(29,290) | 10% | as per FDD |
| EBITDA | $89,141 | 31% | as per FDD |
Should you invest in a Premier Martial Arts franchise?
In other words: are the profits worth investing the average upfront investment of $303,000?
We think it does. Indeed, Premier Martial Arts have a 7 years payback on average, this is a great payback period for a fitness franchise.
In other words, you would repay all creditors (a SBA loan for example) and any investors (including yourself) within 7 years on average, using the profits generated by the business itself. Impressive.
Therefore, we do consider Premier Martial Arts to be a profitable franchise investment opportunity for whoever wants to get into the fitness franchise industry.
Yet, note that this is purely an estimation, based on the average performance of Premier Martial Arts franchises as disclosed in the latest Franchise Disclosure Document. As such, it does not guarantee your Premier Martial Arts franchise will perform as what is being presented here.
Download the Premier Martial Arts franchise business plan
Updated with Franchise Disclosure Document
5-year pro forma financial model
Free support
How does it compare vs. other fitness franchises?
| Franchise | Net worth ($) | Liquid capital ($) | Investment ($) | Revenue ($) | Payback (years) | |||
|---|---|---|---|---|---|---|---|---|
| Anytime Fitness | https://sharpsheets.io/blog/anytime-fitness-franchises-costs-profits/ | 350,000 | 175,000 | 510,165 | 338,810 | $68 | 10.0 | |
| Planet Fitness | https://sharpsheets.io/blog/planet-fitness-franchises-costs-profits/ | 3,000,000 | 1,500,000 | 3,273,300 | 1,564,877 | $80 | 13.9 | |
| Orangetheory Fitness | https://sharpsheets.io/blog/orangetheory-fitness-franchises-costs-profits/ | 1,000,000 | 300,000 | 1,381,432 | 805,251 | $244 | 11.4 | |
| Club Pilates | https://sharpsheets.io/blog/club-pilates-franchises-costs-profits/ | 500,000 | 100,000 | 287,000 | 544,703 | $363 | 3.5 | |
| Pure Barre | https://sharpsheets.io/blog/pure-barre-franchises-costs-profits/ | 500,000 | 100,000 | 335,812 | 259,534 | $173 | 8.6 | |
| Snap Fitness | https://sharpsheets.io/blog/snap-fitness-franchises-costs-profits/ | 750,000 | 250,000 | 783,328 | 194,124 | $37 | 26.9 | |
| Burn Boot Camp | https://sharpsheets.io/blog/burn-boot-camp-franchises-costs-profits/ | 300,000 | 150,000 | 314,846 | 400,526 | $76 | 5.2 | |
| Crunch Fitness | https://sharpsheets.io/blog/crunch-fitness-franchises-costs-profits/ | 2,000,000 | 400,000 | 3,092,000 | 1,863,627 | $48 | 11.1 | |
| CycleBar | https://sharpsheets.io/blog/cyclebar-franchises-costs-profits/ | 500,000 | 100,000 | 417,410 | 335,855 | $168 | 8.3 | |
| Stretch Zone | https://sharpsheets.io/blog/stretch-zone-franchises-costs-profits/ | 250,000 | 150,000 | 161,027 | 357,632 | $286 | 3.0 | |
| Workout Anytime | https://sharpsheets.io/blog/workout-anytime-franchises-costs-profits/ | 500,000 | 175,000 | 1,519,450 | 511,628 | $49 | 10.0 | |
| Fitness Together | https://sharpsheets.io/blog/fitness-together-franchises-costs-profits/ | 175,000 | 80,000 | 292,013 | 400,000 | n.a. | 4.9 | |
| The Camp Transformation Center | https://sharpsheets.io/blog/camp-transformation-center-franchise-costs-profits/ | 100,000 | 75,000 | 287,000 | 495,067 | $99 | 3.9 | |
| Retro Fitness | https://sharpsheets.io/blog/retro-fitness-franchises-costs-profits/ | 1,500,000 | 300,000 | 1,681,341 | 998,459 | $66 | 7.0 | |
| F45 Training | https://sharpsheets.io/blog/f45-training-franchise-costs-profits/ | 300,000 | 100,000 | 457,650 | 632,902 | $253 | 4.8 | |
| Gold's Gym | https://sharpsheets.io/blog/golds-gym-franchise-costs-profits/ | 1,000,000 | 400,000 | 4,043,875 | 1,638,000 | $47 | 16.5 | |
| Fit Body Boot Camp | https://sharpsheets.io/blog/fit-body-boot-camp-franchise-costs-profits/ | 100,000 | 65,000 | 198,350 | 167,364 | $61 | 7.9 |
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