In 2005, Entrepreneur magazine ranked fledgling women’s workout franchise Liberty Fitness #415 on its Franchise 500® list, #101 on its Fastest-Growing Franchises list and #39 on its Top New Franchises ranking. In 2006, Liberty Fitness’ position on its Franchise 500® had slipped to #460 and its Top New Franchise ranking slipped from #39 to #42.
By 2007, Liberty Fitness had disappeared from all of the Entrepreneur magazine listings.
The Entrepreneur franchise listing for Liberty (now titled Liberty Weight Loss) tells an more dire tale. It shows 55 Liberty Fitness locations in 2005, 30 in 2006 and 31 in 2007. Today, the Liberty Fitness website indicates that there are just 6 locations remaining.
A former Liberty Fitness franchisee, posting on UnhappyFranchisee.com, predicts that within three months there will only be three Liberty locations remaining.
UnhappyFranchisee.com has posted emailed comments from this former Liberty Fitness franchisee that provides some important lessons of mistakes to avoid in investing in a franchise.
Liberty Fitness Franchise Owner Describes Chain’s Decline warns about the dangers of buying into a “hot new franchise” that has not weathered tough economic times.
Diversified Health & Fitness Wants Failed Liberty Fitness Owners to Pay Up tells of the dangers of the leadership bait-and-switch that can occur when a beloved founder sells the company to a multiconcept conglomerate that pursue their franchisees for money even a year after their failed clubs closed.
Does this mean that franchises are a bad investment? Not at all. It means that the wrong franchise – either the wrong concept, the wrong company, or both – is a bad, sometimes devastating, investment.
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