After acquiring the two boutique fitness concepts, Extraordinary Brands intends to play the long game to ensure success for Rumble Boxing and CycleBar, the company’s COO tells ATN
Now under new ownership, Rumble Boxing and CycleBar are slowing down to speed up.
Extraordinary Brands, which acquired the two boutique fitness concepts last month, says that over the next year or so, it will focus on stabilizing both brands by working closely with existing franchisees to drill down on business fundamentals and establish a culture of open communication.
After that, the franchisor will look to kick expansion back into high gear for both brands.
“Focusing on transparency and communication, assessing the health of each individual location and focusing on franchisee profitability is what we need to do, and what we’ll continue to do for the next 6-12 months,” Katy Richardson, the chief operating officer of Extraordinary Brands, tells Athletech News.
Richardson says this is part of a plan to “stabilize the systems and then get them back into growth mode once they’re stable.”
Richardson shares that in sending out surveys and having one-on-one conversations with Rumble and CycleBar franchisees over the past few weeks since the acquisition was made, she’s learned that many franchisees feel like they weren’t getting enough support from previous ownership.
To remedy that, Extraordinary Brands has appointed a new president to lead each brand, including one very familiar face.
Andy Stenzler Returns to Rumble
Rumble co-founder Andy Stenzler has returned to the boxing fitness brand as its new president, while franchising vet Lori Klein has been tapped as president of CycleBar. Stenzler and Klein will oversee the appointment of several “franchise business coaches,” who will work one-on-one with individual franchisees at Rumble and CycleBar, respectively.
Richardson says early priorities will include helping franchisees focus on the baseline operations of their business, “versus just focusing on top-line revenue.”
“Just because they’re in the top 10% of revenue doesn’t mean that location is profitable,” she explains. “So we have to assess each studio’s profitability to know what we need to do to coach those franchisees to either find more money externally, lean out their operations to find more money internally, or a combination of both. “
After this initial six to 12-month stabilization period, Richardson believes that Rumble, which currently counts over 100 locations, and CycleBar, which has over 200, can get back into growth mode and sign new franchise deals.
However, she notes some contraction may be on the cards, especially for CycleBar, which has been challenged with a post-pandemic drop in demand for cycling.
“We’re fully expecting CycleBar to contract before it grows again,” she says. “But that’s not necessarily a bad thing, because it will allow us to focus on markets with stronger unit economics.”
The Case for a Cycling Resurgence
While indoor cycling has been on a downward trend since the pandemic ended, Richardson is confident the modality will be back on the upswing soon, citing the cyclical nature of boutique fitness trends and some reassuring conversations she’s had with owners of cycling studios.
“Modalities are always going to see ups and downs, and this is not the first time cycling has been in a downswing,” she noted. “It will come back around. There are lots of independent studios in the market — I know owners and founders who are already seeing an upswing.”
What’s Next for Extraordinary Brands
Based in Charlottesville, Virginia, Extraordinary Brands acquired Rumble and CycleBar from Xponential Fitness late last month, which followed the franchisor’s acquisition of another Xponential Brand, Row House, last year.
The franchisor currently has 6 brands in its portfolio, including Neighborhood Barre, which Richardson founded before joining the Extraordinary Brands portfolio last year.
While Rumble and CycleBar (Row House, too) are pumping the expansion brakes at the moment, Richardson says Neighborhood Barre is in “growth mode,” with 23 studios open, two in pre-opening and several more in the franchise pipeline.
“Since joining Extraordinary Brands, Neighborhood Barre has seen 20-plus percent average unit volume growth month over month, consistently since the second month we were part of the portfolio,” Richardson notes.
Looking ahead, Extraordinary Brands is interested in adding another brand to its portfolio. All fitness modalities are on the table as acquisition targets, Richardson says, along with wellness concepts such as contrast therapy studios.
“We’re definitely still in growth mode and interested in acquiring new brands,” she says. “ I think we’ve proven to ourselves that we can acquire brands that already have some significant scale. So we’d be looking for something that already has at least a regional scale that we can build on.”
