Curves International, Inc. - Company Profile, Information, Business Description, History, Background Information on Curves International, Inc.

400 Schroeder
Waco, Texas 76710

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We commit our methods, systems, and motivation to helping people, whether a Curves' member or franchise owner, to help themselves in their quest to attain a better quality of life.

History of Curves International, Inc.

Curves International, Inc. (Curves for Women), founded in 1992, is the world's largest fitness center franchise, with more than one million members. In 2002 it had 3,000 franchises in all 50 states and five countries. Curves is the first fitness company to offer a complete 30-minute workout with facilities for women only. For its franchise locations, the company targets small towns where competition is minimal. In January 2002 Entrepreneur magazine's Franchise 500 list ranked Curves for Women the third fastest-growing franchise in the world.

Women's Fitness on the Quick and Cheap: 1992-95

Curves' founder and CEO, Gary Heavin, was already a fitness industry veteran when he opened the first Curves for Women gym in Harlingen, Texas, in 1992. In the 1970s, in his first foray into the business, Heavin dropped out of college to take over a failing fitness center in Texas and spent the next decade building a fitness center chain with 20 locations in all. During this time Heavin developed a missionary zeal for bringing the benefits of exercise to average, small-town American women, and he tasted the success of women-only facilities.

In the early 1990s Heavin and his wife, cofounder Diane Heavin, conceived Curves for Women with the idea that there were a few basic barriers, both real and psychological, preventing a whole sector of women from maintaining basic fitness: working out takes too much time; gym memberships cost too much money; and gym environments are often intimidating. The Heavins knew that if they could remove these barriers, they could meet the needs of an as of yet unserved demographic and in so doing build a massive clientele and a booming business.

Gary Heavin designed and patented Quickfit, a workout program specifically developed for women with busy schedules and moderate fitness goals. Quickfit, the first complete 30-minute workout, was a highly structured program involving cardiovascular exercise, strength training, and some stretching. During the workout, exercisers rotated around a circuit of hydraulic resistance machines (tailored specially for women's bodies per Heavin's design) and stationary aerobic platforms. Upbeat, motivational music played, and a taped voice cued exercisers to move on to the next station at 30-second intervals, and to check their heart rate every seven minutes. Exercisers followed the script, completed three circuits in 30 minutes, and the workout was done. This workout, done three times per week, met the basic recommendations of fitness experts and became enormously popular with women who wanted to build and maintain basic endurance and muscle tone.

Just as the Quickfit program reduced actual workout time to the bare minimum, the Curves for Women facility itself was also remarkably "fat free." That is, these facilities offered none of the amenities traditionally provided by regular, full-service gyms. By doing away with frills such as locker rooms, weight rooms, showers, saunas, and televisions, and trimming hours of operation down to 40 or 50 hours per week (many Curves gyms were closed during midday and on weekends), Curves for Women was able to offer some of the lowest membership fees around. In the early 2000s full-service gyms typically charged initiation fees of up to a few hundred dollars and monthly dues of at least $50-$60. Meanwhile, Curves' customers paid a one-time initiation fee of around $50 and monthly dues of only $29, if they paid for a year at a time, or $39, if they paid month-to-month.

Not only did Curves make exercise time-and-budget-friendly, the women-only facilities greatly reduced the intimidation factor that less active women often associated with working out at public gyms. This was another reason Curves' gyms caught on in the 1990s. Many women were relieved not to have to navigate through rooms full of sweaty, weight-lifting men or slender, young women with boundless energy. Because many of the members at Curves were in their 40s, the Curves gyms succeeded in fostering camaraderie and non-competitiveness. Many women attested that these intangible benefits were critical for keeping them coming back to Curves month after month.

Fast and Furious Franchising on the Wal-Mart Model: 1995-2002

Based on the overwhelming success of their fitness concept, the Heavins sold the first Curves for Women franchise in October 1995. The franchise opened in Paris, Texas. By September 1998, less than three years later, the number of franchises had skyrocketed to more than 650 in 42 states.

Heavin attributed Curves' phenomenal success to common sense, solid values--especially a passionate commitment to improving the lives of others--and Sam Walton's Wal-Mart model of business. The key to the Wal-Mart model was twofold: start in small communities and suburbs where competition was scarce and then offer your product at the lowest price in town. Many small towns in the United States had no fitness center of any kind when Curves arrived. While larger, full-service gyms would likely be unable to survive in such communities, "Curves can thrive on 100 members in some markets," Heavin told the New York Times in January 2002. On average, a Curves franchise served between 250 and 350 customers in towns with populations of 10,000 to 20,000.

Keeping costs down at Curves facilities meant low membership fees; it also meant that an individual could buy a franchise with a relatively low investment. A Curves franchise cost around $20,000, with equipment included (depending on real estate values) plus additional start-up costs between $5,000 and $20,000. After this, franchisees paid the parent company a royalty fee of $395 per month. Franchisees needed no prior knowledge or experience in the fitness industry, but all potential franchise owners were required to attend a weeklong training session, dubbed "Club Camp," at company headquarters. Franchisees learned how to manage the business, received tips on sales techniques, and were taught the basics of exercise physiology, as well as first aid and CPR. The potential franchise owners then had to pass tests on the materials before receiving approval for franchising.

In return for their investment, franchisees received a wide array of benefits and support from Curves International. Diane Heavin leveraged her 15 years' experience in the fitness industry to create quarterly service packs for franchise owners. These packs contained information and resources for promoting and advertising the franchises. The investment paid off at both ends: by 2001, 95 percent of Curves franchises were profitable, according to Heavin.

In 2001 Gary Heavin published Permanent Results Without Permanent Dieting: The Curves for Women Weight Loss Method. This book was meant to serve as a companion to the Curves for Women workout program. In the book Heavin explained the causes of obesity and concepts about metabolism in plain, simple terms. His approach to discussing weight loss was consistent with Curves for Women's character as a supportive, encouraging, and personable entity.

Plans for Growth: 2002

By January 2002 the number of Curves franchises was up to 3,000 in all 50 states, with 30 to 50 new sites opening every week, and Entrepreneur magazine named Curves for Women the third best franchise in the world on its Franchise 500 list (the ranking was based on a company's financial stability, its rate of growth, and the quality and breadth of services it offered to its franchisees). Entrepreneur also ranked Curves as the third-fastest-growing franchise in the world. This was a marked improvement over Curves' placing in the 1998 list, which listed Curves at number 187 in the overall Franchise 500 ranking and number 32 among the fastest-growing franchises.

Just as women were enthusiastic about the women-only workout, they were attracted to the business opportunity that Curves presented, too. Indeed, the vast majority of Curves' franchisees were women, most of whom started out as gym members and believed so much in the concept that they decided to invest. For the Heavins the benefits of this grass-roots growth were tremendous. In January 2002 Gary Heavin told the New York Times, "Ninety-nine out of every 100 franchises are sold by word of mouth. We spend one percent of our revenues on advertising in an industry that normally spends up to 40 percent." The financial benefits of this growth were evident as well: in June 2002 Heavin noted in the New York Times that since 1995, the company had reaped $80 million in franchise fees and nearly $20 million in monthly fees.

Though the business climate for Curves International continued to be favorable during 2002, with issues surrounding women's health and fitness still at the forefront of media attention and recently laid off entrepreneurs seeking small business alternatives, Curves for Women faced new competition. Other enterprising purveyors of fitness jumped on the women-only, 30-minute workout concept: Contours Express, Slender Lady, It Figures, and Ladies' Workout Express offered similar services to members and comparable business packages to franchisees. These businesses tried to distinguish themselves from Curves for Women; for example, Slender Lady offered a program that concentrated more on nutrition and weight loss, while Contours Express contended that their equipment was more sophisticated and their training more thorough. Still, where brand name recognition and market penetration were concerned, Curves for Women remained in a league of its own.

In 2002 the Heavins began building a 30,000-square-foot office complex and a 14,000-square-foot training center to replace the company's original Waco, Texas, headquarters. With its success in small towns across the country, the Heavins planned to expand into metropolitan areas. Though Heavin said he expected to have saturated the market by the end of 2003, it remained to be seen whether Curves would be as popular with or as convenient for urban women, who often exercised before or during their work day and were more likely to depend on full-service facilities with lockers, showers, and dressing rooms.

The Heavins also looked toward expanding their international presence. Their ultimate goal was to establish 10,000 sites in North America and another 10,000 abroad. By mid-2002 they had already established 300 Curves facilities in Canada, three in Mexico, one in England, and 35 in Spain. The company hoped to secure more franchisees in these countries as well as in Australia, New Zealand, Central and South America, Japan, and Western Europe.

Principal Competitors: It Figures; Ladies Workout Express; Contours Express; Slender Lady.


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