To franchise or not to franchise…

by Rebecca Burn-Callander - Thursday, 22nd May 2008 -

VirtualGym founder Richard Davis weighs up how best to snare wannabe fitness freaks outside the UK.

The great thing about the VirtualGym business model is the low overheads. But developing an international operation could well squeeze margins: bills add up once several offices are dotted around the world.

To avoid absorbing these additional costs into the business, Davis is considering the franchise option. “Over the course of next year, I plan to expand with a studio in North America,” says Davis. “If that goes to plan, we’ll move into the Far East next. Ideally, we’ll have local instructors for all the regions we operate in, broadcasting in local languages.”

Rather than oversee these studios himself, Davis is currently fielding applications from instructors wishing to run these international operations. The franchises will be fairly autonomous, with content prescribed specifically for the target markets.

It’s a guaranteed winner. People all over the globe already access VirtualGym, despite the UK bias. “When users hit our site, they indicate where they live in the world,” explains Davis. “Then they are automatically directed to the content relative to their own time zone.” There’s no problem processing international subscriptions either. The bespoke back-office system, designed using a wedge of the £400,000 start-up fund, processes different currencies with ease.

Picture source

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