Tough Mudder, a global brand synonymous with intense physical endurance events, is hoping to capture a larger share of the North American fitness market by rolling out a boot-camp fitness concept. The company is teaming up with Ferrara Jerum International, a Rochester, N.Y.–based retail real estate firm, to develop market strategy, manage site selection and negotiate deals, and provide transaction management to Tough Mudder Bootcamp franchises. Ferrara Jerum managing partner Douglas Jerum heads up the program.
The Tough Mudder boot camps will occupy 2,000 to 3,000 square feet of space and offer six classes, priced at $15 each, and intended to build physical strength, power, agility and endurance.
Tough Mudder is using the franchise model for speed to market. “We could have obviously just started building our own studios and maybe had a smattering of them by the end of the year, but we wanted to do it differently,” said Cathrin Bowtell, a company senior vice president. “Much like Tough Mudder has the reputation for being disruptive and taking a different approach to many things, we are doing the same thing here in the way that we are solving for the retail model of these boot camps, and doing it via franchising.”
Tough Mudder events draw some 3 million participants annually, Bowtell says, and the company has customer data to help guide locations for future units. Tough Mudder employs about 160 people, and Bowtell spent the past year and a half developing and testing the concept.
The Ferrara Jerum franchise system works for the franchisees — who pay a $50,000 fee — and also enables the company to maintain control over the brand. “We make sure that the real estate that is selected is going to enhance the brand and also enhance the performance for the franchisees,” said Jerum. “It really comes down to having a very clear strategy and a very clear structured process, and it starts even before prospective franchisees have made a purchase. We know franchisees are not experts in real estate, so they can focus on running a successful boot camp and let us be the experts from zero to getting that store open.”
At press time Tough Mudder had officially signed its first franchised unit, in Burlington, Mass. The program will roll out in earnest in early 2018. “We’ve got a lot of interest in this concept so far,” said Bowtell. “We are starting to open our first units early next year, and then I am seeing a scenario where we are selling something like a hundred units in that first year. People already understand Tough Mudder and understand how that translates to the in-studio product and the business opportunity to own their own studio.”
The ideal real estate fit is a 150,000-square-foot, grocery-anchored shopping center with large-box tenants such as T.J.Maxx or Marshalls, Jerum says.
Tough Mudder is targeting secondary and tertiary markets rather than larger cities. “This is where we see our customer databases being really strong,” said Bowtell. “They are really wonderful places where we think this concept is going to make a big difference and a really big splash, and where the competitive dynamic is such also that we are not entering a market where there are these super high-end, high-priced fitness concepts to battle with.”
By Ben Johnson
Contributor, Shopping Centers Today