Polestar Studio Franchises

Chapter 1

Introduction

Today, I'm here with Brent Anderson, the president of Pollstar International. And what we're going to talk about is Brent's new business opportunity, which is to take a Pollstar franchise for your studio brand. Can you tell us about your new venture? Well, we're excited too to launch finally a product from Pollstar that our graduates and others can actually use to build their own business. Their own plot is business and, uh, pollster has been in the business of teaching professionals in education and licensed in 40 countries with many graduates around the world. But we've never ever produced a product that would allow sort of the aftermath of graduation. Well, what does somebody do when they graduate from, you know, applaud his program. And so for the last six, seven years, we've been building a model and testing the model to see if we create a small studio space that could provide an opportunity for ownership of our graduates and others who are interested in, in Adina pilates, in a wellness movement studio. Cool.

And so is this program aimed primarily at people who are thinking of opening their first studio or for people that are looking to maybe convert their studio? You know, it could be either one. We sort of have, we have three options that we are working with. One is obviously somebody comes and they just want, they want the blueprint, they want the operation manual, they want the guidance and direction, the look and feel. Um, and they can really do a plug in place so they can come in and they can buy the franchise and the studio and reproduce it. Uh, the second though, which we're finding a lot of interest, uh, is actually conversion. So being that we have over 6,000 graduates in the world, there's a number of them. They already have studios and some of them have expressed interest, even a couple around the world recently that they would like to convert into a Pollstar studio from whatever their private plot, his practice was.

And then the third one is we've had people who want to invest in the wellness business and then we'd be hiring the, apply these graduates to be able to come in and, and work the business. If somebody wants to apply for a franchise with you, do they have to be a Pollstar graduate? They don't have to be a pulse star graduate to be able to apply. What we do ask is that they must be PMA certified, uh, from a comprehensive training. Then we give them about six to eight months to go through a transition program.

And that transition of bridging program sort of as more of the indoctrination of being Pollstar. And if I live outside the u s can I apply for a franchise? Yes. The, the current franchise law, and I've become almost a, an expert over the last year with the franchise law. But, um, there's what's an FTD which is a disclosure document of the franchise that, um, by law in United States must be given. And many, many countries just follow the same exact exact application. So if it's accepted in the United States, there's like 30, 40 countries that automatically accept it. Even inside the United States though, there's a number of states that require separate filing. So there's like 38 states that are part of the federal filing and then there's a few states, California, New York, uh, there will be filing in separately. Uh, and some countries are the same way.

Chapter 2

Cost of the Franchise

If I'm a recent Pollstar graduate, I have a couple of choices in where I could go and work. But one of the, the one that interests me is should I open my own studio, which is the sort of traditional model of unbranded or should I go with a brand like pollsters and pay the franchise fees? You know, can you help a potential franchisees think through the pros and cons of that? Well, in, in any franchise business, I think this is important. The statistics show that a franchise has an 80% greater likelihood of being in business five years down the road than a private business. That could be anything from a restaurant, a pizza parlor, it could be window washing business, any business that's in the franchise. So there's, there's very good statistics that show that when you belong to a brand and their structure, and I think this is the biggest lesson I learned was, I mean it really structured my own business.

Going through and creating the operation manual. For example, for a franchise we had to go through and really structure our own business to be every I dotted, every t crossed, everything thought of and really enhanced our own business, our business shot through the roof, profitability wise, just by implementing those policies and procedures. So I think a lot of times when somebody comes out and they love what they do, they have a little bit of entrepreneurial-ism at them. I think that's the key thing. So you know, there's nothing wrong with going and working for another place. I mean, it's a great if you just want to go and have that work. But there's this thing in some people's blood, that entrepreneurial spirit that they want to have ownership. They want to be able to see the fruits of their labor in different ways from a business standpoint. And in that case, I think that you significantly decrease your risk by going with a franchise.

Uh, and the, the differences is do you have enough entrepreneurial-ism to really build your own brand? And that would be the question that I would ask myself. And do I have enough funding to be able to build that brand? I think that's another big question where in the franchise it's, you know, it sometimes seems like it costs more up front, but it really is less when we compare it to what people would have to spend to invest in their own business. It's usually quite a bit more, the franchise in any business is able to get equipment and all of those things and services for much, much less because of the leverage that we have by the volume. Just the sheer volume. Right. Uh, are you happy to share that, what the fees are and what the investment might be to open a studio? You know, I have to share it with everybody now because once you formally file a franchise, you have your disclosure document and it's open to the world. Um, we're starting off with $24,900 franchise fee. And if you looked at the market, they could range anywhere from that 25,000 to a hundred thousand dollars depending on the type and the brand and how well known it is.

So we say that we're starting at the 24, nine. Um, the cost to get into a, our studio probably is going to be somewhere around 150 to $200,000. I'm completely equipped some working capital, the cost of the franchise, pretty much everything included. And our, there's particular equipment that you want to see in a studio. Yes, there is always, I think that, um, you know, I'm, I'm biased in equipment that I've used forever and part of it we've had some designing features in, but I also think that we particularly named it the Pollstar studio and we'd call it the pollster studio so that we can list plot eas as one of our primary, uh, services that we provide. But it also leaves the door open for other things that we bring in. So if there was yoga and suspension and other things that we do in our own studio, Gyrotonic jar kinesis that those services can also be rendered in their, with Pollstar studio primarily being a studio of movement and wellness that we are, we're launching the services. So that means that there are different types of equipment that come in.

We of course will have a politesse reformer and tower classroom that's sort of typical of Pollstar and we will have a chair classroom and that chair classroom can be used for other things like yoga and motor and suspension and yoga and those kinds of things. We can move around and then we'll have a traditional studio that's in there. So it's about 22 to 2,400 square feet of equipment. And sometimes depending on where it's located, it might depend on who manufactures the equipment. For some people it's cost prohibitive for us to bring in, for example, balanced body equipment in some of the regions and countries. And uh, but typically in the United States. And you know, my, my preference is, has always been the balanced body equipment.

So it seems to me that your doing a lot more than just group performer classes

Chapter 3

Services Offered at the Studio

in your studios. Is that the intention? It is. I mean, I think that, you know, probably one of the deepest seated things in pulse stars, our ability to do analysis is really to take a look at somebody and customize or modify a class or a session to build, to make sure that everybody has access to the PyLadies or to the [inaudible] or to the yoga class. And in that being said, I think that's the unique variable that separates Pollstar from many other schools. Um, you know, we, our reputation from the rehabilitation side, but even carrying over into the wellness side has really been focused on, you know, how do we make these things available to people? And that could be anything from, you know, our future ventures with running and running clubs and, and, uh, wellness and meditation and those kinds of, we're willing to bring in that are part of what I consider to be Joe's original, uh, sort of formula for health and wellness. It was, it was, uh, exercise, nutrition, good sleep habits, good hygiene, uh, plenty of sunshine and fresh air and a balance between work, play and rest. So to me, anything of those things that I can bring in to help sort of overcome the disease of Sedentary Ism that we deal with today rapidly throughout the world, uh, to me is really of interest. And I'm open to, and so I don't want to close myself to saying that, oh, it's just reformer classes, or it's just this kind of a class. It really is, um, is diverse the way that we've always been. You know, you can come in and do applaud. He's reformer class a chair, class, a Combo class, you can do a motor class. We do things with, Ooh, that's a new product that we use. Um, the Mat classes, yoga classes, et cetera. So I really want to keep the options open. What it's built around is movement, successful movement experiences for people who otherwise might not have successful movement experiences. So you'd expect the people, um, the Franchisee to offer both private and group classes? Yes, the, each of the franchisees will have a studio space for private sessions as well as having two classrooms. So our model sort of runs where the classroom is our lowest cost, uh, interaction with our customers.

But we often find that they need to be able to be pulled out and to have that private session or have the private sessions before they go into the group. So we still, we never want to forsake the quality that we've established. This was probably my biggest hang up over the last five, six years being pushed by my team. Like, let's get the franchises out. And I'm like, I can't sacrifice the quality of what we do in the clinic. In what we do in the studio and we feel that we've really had a step up and look and think, you know, we have 6,000 graduates who have gone through the rigorous training and pollster that we sort of have. We say the only way you're going to pass and be a Pollstar Grad is if we think you're good enough to, to, to work with my mother. So that stamp of approval, I mean that's a really high level of who the graduates are, not everybody graduates and everybody passes the pollster exam that goes through the training. Um, it's competency based and we had to come to the realization that if they are a Pollstar graduate, then we know what the quality is and the level of quality is going to be delivered in, is going to be built around the individual having a positive experience even in the group classes. Right.

There's the studio size that you mentioned. Was it 2100 square feet? 2100. I think that makes it bigger than a lot of normal kind of high street. Um, you know, the kind of studio you might see on the high street, which has, you know, 10 reformers and just as group performers. So is this a bigger investment than some of the competitors? You know, it actually isn't for the way we structure it. Um, you know, like I said, you've probably looking at between 150 to $200,000 to build a studio that has the ability to generate $500,000. So it's a little different model and we typically think that 200 to 400 people in a community that would be participating in their regularly would be a very, um, functional operating, successful, profitable studio. Yeah. When you think about it, the 200 to 400 people to participate in a studio, in a community with prices as low as, you know, in Bolivia, we can offer the classes for five and $7 for a group class based on their economy. In Japan it might be $40 a class based on their economy. So it has that flexibility as well to change based on what the rent costs in that particular district, where they're at. And we do want it to be storefront.

We do want it to be visible. We want to focus on the branding and people to know that they're participating in a Pollstar product. Right. So are there rules around where the location can be? Obviously you want to control the branding and the signage? Um, we definitely have a lot of regulations as far as how signage can be used. Uh, the exposure that we want the studio to have there is exclusivity and the property and territory. Uh, right now we're looking at a three mile or 40,000 populace to, to be able to do that. And there's flexibility in that. I mean, we have, um, you know, certain areas just don't lend themselves to have more than one studio in that area, maybe based on the socioeconomic level of it.

So we might expand those borders to be more like five miles or seven miles depending on that or also the population. So there are socioeconomic and demographic figures that we're really looking at to be able to make sure that we have successful practices. But what we find is on our sliding scale, like I said, we can go into a country like Bolivia [inaudible] Gueye we can go into Malaysia, we can go into Italy and some of the, even the European economies, Greece where they've had, you know, difficulties to be able to afford it. And because it's to scale, the teachers are paid to scale the renters to scale. Therefore the pricing of the product is to scale and it's by far the lowest price entry level price to be able to participate in regular pilates classes.

We've never had anybody compete with us on our pricing. And part of that is because our spaces a little bit bigger and we can process a few more people through our training and our education. When I'm, if I decided that I wished to have a franchise, I'm obviously gonna look at the competitors. Yeah. Um, yeah. Who Do you, who are the competitors you're worried about or the significant in this and why are you different? Yeah, I mean, I, I think that, um, first of all, you know, how many billions of people are there in the world and we're so far away from being saturated that I never really see from an education or apply studio standpoint of really having competition. I think that the differences is what do we decide to put our fingerprint on? Like what's our niche? What, how are we going to be able to impact Joseph [inaudible] and Claire plot his dream in our community? How do we do that? How do we work in, you know, community programs, prisons, hospitals, uh, underprivileged areas. For example, in pollster, we just opened up a, a fully volunteer studio at an organization called shake.

A leg would serve as um, veterans, spinal cord injuries, cognitive disorders, underprivileged children. And it's on the water and the whole thing is water centric. And so for the last couple of years we've been working on building a wellness center. And just last week we finished funding. We raised it through crowd funding. We raised up money and pulse started to be able to put a plotty studio in the shaky leg facility. There'll be completely run by voluntary plot. His teachers, not just Pollstar teachers, but community party's teachers. And so, you know, again, I asked the question, what's, you know, what's your fingerprint going to be? So when you asked me, you know, the competition, if you were to look at competition out there as far as who else is doing franchises, um, there's jet [inaudible], there's IMX PyLadies, there's club plotters is probably the largest and best seen right now and they're moving well and doing great, which is encouraging to me as well that there's a need for it and there's a demand for it. And again, different populations, different fingerprint, different niches that we're looking at. Um, probably the biggest difference for us is we already have a pool of, you know, over 6,000 teachers and 20 languages around the world that are looking for opportunities. So even if you know, different from maybe a club [inaudible] trains their people to be able to as part of their franchise.

So the training doesn't have the same caliber necessarily that we've been developing for 30 years. Um, you know, our graduates, when they go through the rigors of our training, it is really the training. We don't train them to necessarily own studios. We train them to be phenomenal [inaudible] teachers. Now in that group of polys teachers, we think we have a huge advantage of at least five or 10% of them that have that entrepreneurial spirit that maybe not enough to go and completely create their own business. And we also think there's going to be a lot of, uh, our graduates that have been working in other facilities. And, um, you know, it's hard for them sometimes. I mean, we get a lot of concerns and complaints that, you know, they've been trained to think in plies and they go work for another studio and that studio doesn't let them think. They tell them you have to teach it in this sequence.

You have to teach in this order. And you know, we're teaching an individual. And so when you're trained to think that way and then you go out and get a job and that job forces you to think a different way, they're not happy. So we were hoping that that population as well of our graduates that are working in other places might be thinking, Hey, you know, I can, I could do this, I could make this work. I'm a, I'm a good teacher, I have a good following. I just need direction on how to run the business. When it comes to the direction you talk about initially, you help them set up the franchise and the business, you give them advice, there's a manual, there's training. And what about the ongoing, you know, once you're two years into this, what's, I mean we're an education business.

Our trainings always ongoing. Each one of the centers actually is equipped with a broadcasting capacity. So the idea is that whether they have a projector or a large screen TV, the idea is they're tapping into our continual education system. They must continue with con ed every year. Uh, we were looking at our events in the marketing and everything that we do, we're distributing to them. So they have this continual sort of stream. Everything we do from our social media, from our advertisements, uh, paid advertisements.

There's a fund that's set up specifically for regional marketing for the, for the different studios and you know, to me what I'm most excited about is just being able to know that our students also are able to go and do some of their practice hours and those things in these studios, which always brings the quality of the plot, his teaching up whenever, whenever education's involved, the quality to the consumer always goes up. We always, we, we see that over and over and over again.

Chapter 4

Teacher Training

Do you expect some of the franchises to become training centers? That's actually a great question. You know, we're, we're in over 160 cities around the world that we provide our education and we have a very specific formula where we call them our affiliates and our affiliates are people who have proven themselves through and through. They'd been teaching pies for 10 years and there's some very specific requirements that they have to meet to be able to be a host site for our formal education. That being said, I do see the studio opening the door for those educators, affiliates to be able to provide practice hours and internships and the support education that they're often missing or struggling to be able to provide in their areas. Uh, for example, when somebody comes to do education, they might come six formal weekends over a period of eight months and they have so many hours they have to do practice teaching, practice, demonstration. Those things, uh, if they're traveling, two hours are flying in to be able to do that at the actual education center, uh, that can be burdensome for them for their practice hours.

So being able to have a pollster studio that they can practice, they get their teaching hours and potentially be hired. I mean, I think that's the other big thing is, you know, when we look at partnering with our affiliates, they're, they're recruiting and advertising as much as we are to increase the awareness of Pollstar plots in their communities. So by having these studios that are not in competition with them because the, the demographics of it are not going to allow them ever to be in competition with an affiliate. But the nice thing is, is that they can start building a community that you could say, oh yeah, I have somebody out in, in red in the Redlands that, uh, we can send you to. We have somebody down in San Diego, somebody in Palo Alto, we have somebody in, you know, Reno, Nevada. So when these people are coming in that there actually are places for them that are close by to really enrich their education process.

Chapter 5

Ongoing Franchise Fees

Um, if I've been in the business, you know, if I've had my franchise a couple of years, how much am I paying to you every year as the kind of ongoing franchise fee?

It's actually a monthly fee and most franchises are somewhere between, you know, 5% to 8% of the gross revenues that come in and pollsters chosen 6% is our royalty revenue. And the way that we look at it from more of the corporate standpoint is if I, if we're not doing enough by the brand and the mechanism of marketing those things to generate at least, you know, 10, 20, 30, 40, 100% more than what you would generate on your own, then the franchise doesn't really have its value. And that's why we've taken the time to painstakingly really look at what's the formula to feel your studio, what's the form of the, to retain the clients that come in, how do we progress our clients and keep them stimulated to come in and how can we broaden the population of people that we work with? And I think that's, again, one of those very unique factors of Pollstar is in, in attributes of pollsters that we can work with a very broad population very safely based on our comprehensive training. So we can work with people that have, you know, that are in wheelchairs or spinal cord dis disorders and, and neurological problems and Alzheimer's and, uh, the active aging community we can work with children with. So we really have spent the time teaching our teachers how to work with these diverse populations and diverse levels all the way up to elite athletes and, and uh, you know, really mined conscious individuals, which we're seeing more and more of, you know, I think this is, this is the time of, of awareness I think. I hope it's the time of awareness.

I see this next generation and my kids as young adults that they really want transparency. They want to be aware, they want to be conscious. And we know that when people have conscious movement experiences, they have conscious spiritual and emotional experiences as well. And I think that's where looking for, and I think we're going to see that whatever sport it is you want to do, that's fantastic. You know, you want to be in crossfit, you want a paddleboard, you want to surf, you want to ride, bike. Those are all fantastic running. I still think that everybody needs to have a mind, body conscious workout and training to be able to truly enjoy those activities. You know, when we look at our runners, when they go out running and they're able to be outdoors experiencing that and they can do it more days of the year, they can do without injury, they can do it with uh, with greater pleasure. That's, that's going to keep them from being sedentary and sedentary diseases.

And that's what we're looking for is that nice, full healthy integration of the human.

Chapter 6

Applying for a Franchise

So if I become interested as a result of watching this great video of us talking here in opening a franchise, what are the steps that I go through? I would love to have John Marston on a pull up Pollstar poly studio. Um, it's actually quite simple and even the steps once you decide you want to do it are quite simple. Uh, the first thing we do is Russell Goldman is our vice president of the franchising company. And um, Russ has been running our studio for the last three years doing a very good job. And he's the one that has really built and laid down the foundation of the business aspect of it.

So we typically ask people to do as they can go on the website, they fill out a little questionnaire that gets immediately sent to Russ and typically Russell will call within 24 hours and I'm at that point in time, he'll do an interview with you on the phone and if it seems like it's something that's of interest, Russ will then send a pdf of a basically an application, very simple, very like one page application to fill out the application. Just sorta to let you know kind of what was really a franchise is about if it's really what you're interested in, if you're the right kind of candidate for that. Once that happens, Russ then sets up or I set up a time to do like a a Webinar and we go through our deck and really explain the details of the franchise in a phone conversation. That could be 45 minutes long online where we can share information. At that point in time, if somebody is interested and they're saying, yes, this is for me. And we say, yes you are for us. It goes both ways. I mean, I, you know, we, um, the other day we met with somebody and realize that they were not the right fit for us. We liked meeting with them, we liked their ideas but realized it wasn't the right fit. And um, at that point in time we by law give them the FDD, which is the franchise disclosure document and that's a fairly lengthy document by law, they need to have 14 days to go through it. We encourage them to take it to their attorney, to their legal counsel to be able to really delve into it and fully be disclosed at that point in time.

At 14 days we can sign a contract and once that contract's signed, the franchise fee typically is paid at that time. And then they go through the steps and the steps go day by day. This is what you do on day one. If we're going to open up in 90 to 120 days, depending on finding a space and getting a lease signed. We do this on day one this Sunday to this Sunday three. And I think it's important. Understand other really cool things.

We learned is that, you know, a lot of people think, well, I don't know if I could have, you know, $150,000, how would I do that? SBA loves to loan money to Franchisees, loves to do it, and we've filed for that process. And so the idea is that, um, we're hoping to hear from them in the next week or two, but once it's been preapproved by SBA, then it's even easier for somebody who's interested that has a decent credit score or new business. So again, SBA is to help us, um, have business opportunities and help that entrepreneurial spirit spirit from the government subsidize your opening and being a business owner. And they'll hope is that they know that they're going to have greater likelihood of you being successful with a franchise than if you just went to the bank and got a loan for your own private business. And I think that's the big different. So somebody could, you know, as little as 10% down, um, or 5% down, even on some SBA loans and be able to do that. And it's in that perfect pocket.

So we're trying to really make it so that the owner operator could, that graduate could say, you know what, I can do it. I can make that happen. And the timeframe on it works just about perfect with those in 90 to 120 days from the financing. And then we have the special arrangements with our vendors and you know, balanced body, mind, body online that we have very unique, um, packages and the discounts in there more than, you know, cover the cost, even of the franchise fee. So the savings that they would have by our packaging in our volume. So I think that's important to understand too, is that it's not as far out there as some people might think, um, that there's, there's ways to get into it.

And with the way the models run for us and what we've been able to do, uh, it's been very successful. So I'm going to put a link just below down here so that everybody can see and

Chapter 7

Vision of the Future

click to go through to the Pollstar franchise program information on your website. So just link below in the description for that. Um, where do you hope this business to be in five years time? You know, Pulse Star's vision statement is impacting the world through intelligent movement. You know, we, we've always been a business to professional and you know, realizing that if we're really going to impact the world, we have to be able to reach consumers, right? And the only consumers we've really reached have been directly have been those that have gone to our studio in Miami. Um, or through plies. Anytime we've, we reached a lot of people through plotters anytime. And I think that's where it's the collaboration. You know, it doesn't matter if it's on an online platform or if it's in a studio or if it's in a, you know, a not for profit organization.

It's serving the community or a prison. I think that the key for me, especially, I can, I'm in my, in my fifties now and I'm thinking, have I really impacted the world yet? And when I look at, uh, the Franchisee model in particular, you know, I look at something like massage envy that has over a thousand, you know, studios that are successful. And it's a, it's a great business and it's a good model and it's sort of the same size and the same population. And so, you know, I have no idea where it's going to go. I have, um, I have hopes that we would be able to have a distribution that was international. Uh, we just found out a couple of weeks ago that our licensee in Australia and our licensing in Spain are both converting their studios, their principals into Pollstar studios to, you know, continue that thought process of, you know, distributing and branding the name so people know, look, we teach this education, we also provide these services. And so just to, in a couple of weeks of a soft launch, you know, we're over 60 people that are interested that Russell's meeting with already and we haven't even started advertising to our 6,000 graduates. So I am hopeful. I would like to think of it more, you know, not even so much from the business standpoint and other that that excites me, but really just the distribution. Like, I really want to know that our graduates are working, that they have ways to, you know, make a living for their family that is good and wholesome, that they're making a difference in their communities and that people are attracted to them because of the name poster.

The poster means something to the community. Cool. I wish you great luck. Thank you very much. Appreciate everything pies anytime does for me. So thank you for coming in and saying thank you.