How CR Fitness Became the Top Crunch Franchise Group
Together for a decade, the CR Fitness team’s story is one of relationships, perseverance and a deep-rooted commitment to building top-quality gyms
From professional sports teams to blockbuster film casts, the term “dream team” can be used to describe prestigious groups in a multitude of settings. But when it’s mentioned in the fitness and wellness industry, specifically in the southeast corner of the United States, CR Fitness comes to mind.
With over 150 years of combined experience, competition and friendship, Crunch Fitness’ most successful franchise group stands alone in its makeup and level of success.
“We’re highly driven individuals,” said Tony Scrimale, CEO at CR Fitness Holdings. “Every one of us raises the bar for each other. A lot of times you see people in the industry who are absentee owners or they get into the industry (only) because they have a passion for working out. We just want to win. We’re record-breaking people who are all-in on everything that we do.”
What CR Fitness has done is build out the most successful franchise group in all of Crunch Fitness, opening 17 locations across Florida, Georgia, North Carolina and Texas this past year alone to amass 62 clubs in total. Backed by private equity firm North Castle Partners, the franchise group recently announced plans to launch a Mega-Crunch club in Altamonte Springs, Florida, with 16 more locations set to open in 2024. By 2026, CR Fitness plans to own and operate 100 clubs.
Alongside Scrimale stands executive chairmen Vince Julien and Geoff Dyer. Jeff Dotson, chief financial officer, completes the “dream team.” How they all came together is equally impressive as what they’ve accomplished.
Early Connections
Julien started in the fitness industry right after high school at around 18 years old. He was one of the first to recognize the growing market for women’s-only fitness and take advantage. He quickly established a go-to fitness center for women looking to exercise in a facility devoted to their unique needs.
In 2011, Julien invested in his first Crunch with Dotson and Scrimale before teaming up with Dyer three years later, though the group had long been acquainted with each other by that point.
“I started in the business right out of high school, 17 or 18 years old,” said Julien. “When I was 24 or 25, I owned my first company called Shapes Total Fitness. I also started another company called Southside Athletic Clubs. I sold those clubs to Geoff Dyer, as they were trying to increase their footprint in Florida.”
Before Dyer joined CR Fitness as an executive chairman, he founded Lifestyle Family Fitness in 1982 with its first location in Lakeland, Florida. Under his leadership, Lifestyle grew to 55 fitness centers in Florida, North Carolina, Indiana and Ohio with about $135 million in annual revenue.
“We were competitors,” Dyer recalled of his early relationship with Julien. “But we weren’t directly competing. In fact, at one point, we actually did a promotion, gave away $1,000 in cash and split the leads up based on our territory, which was amazing. We continued that relationship, meeting every couple of weeks to guardedly share best practices. I learned a few things from him, and I think he learned a few things from me. That’s where the friendship began.”
After hearing of Crunch Fitness’ plans to get into franchising in early 2010 with an intent to create a nationwide high-value, low-price (HVLP) brand, which allied with what both Dyer and Julien hoped to achieve, the path forward became clear. They purchased rights to a few Florida locations and were off and running from there.
Humble Beginnings
Julien, Dyer and Scrimale all started at the bottom of the food chain before rising to become sharks in the industry. Scrimale began his career at just 19 years old, selling club memberships and cleaning gyms. In 1997, he began working with Julien at Southside Athletic Clubs until it was sold to Dyer’s Lifestyle Family Fitness. By working with Julien and then Dyer, he received mentorship from each of his future executive chairmen and had a front-row view of this budding relationship that would one day serve as the foundation for CR Fitness’ success.
“I was just an employee watching these guys and hearing the sidebar conversations,” Scrimale recalled.
Not to be forgotten is Jeff Dotson, who rounds out the group as partner and chief financial officer of CR Fitness. He rose beside Julien, working as his financial arm for decades, first joining him at Shapes Total Fitness before coming on board with Scrimale in 2011.
“I worked for the accounting firm that represented Vince and his previous two partners,” Dotson recalled. “The greatest part of this group is that we’re very respectful of each other, and we’re very respectful of where our strong suits are, even though we all feel like we can step in and give each other input.”
Everyone Brings Something to the Table
While Dotson focuses on the financial side of things, he also takes on tasks that go beyond what a normal CFO role entails. Both he and Dyer keep a close eye on new sites, even going out into the field to do research.
Julien oversees a variety of elements of the business, but keys in on the construction side of things and employee development. Scrimale heads the ship as CEO.
“We all have additional strengths that we take on as an ownership group,” Scrimale said. “If you have five point guards that are all talented in the same way, you’re not going to be able to tackle the game. We all offset each other. It’s a perfect synergy.”
That chemistry is rare not just in the fitness industry, but in all areas of business.
”We’re swift,” Scrimale said. “Anybody who has come into our company from another organization says that nobody can compete with our pace. We move fast on everything and we look at every opportunity.”
Blueprint for Franchising Success
Keeping one eye on their own line of gyms and another on the competition, all while keeping debt at a reasonable level and putting a strong focus on marketing, has combined to help the CR Fitness team find success.
With every five new gyms that CR Fitness adds, they make sure to go in and rebuild two existing ones. Equipment is always paid in full at the point of the sale when those new gyms are launched. The team spends well above industry averages in capital expenditures (CapEx) and is always adding new equipment to clubs, new amenities as they become available and frequently making repairs.
“When we started the first Crunch we made a commitment that we were constantly going to be in our clubs,” Scrimale said. “Geoff Dyer and I just went on site tours. If we passed a competitor I’d say, ‘Stop the car,’ and either Geoff or myself went in and got a quick tour of the club. It’s the same thing with our clubs. If we’re on a site tour and we see one of our clubs, we stop the car and we go in.”
This level of involvement gives CR Fitness a competitive advantage over other franchise groups, Scrimale believes.
“You have people that haven’t even visited some of their clubs,” he said. “There are competitors out there that are slowly lowering the bar and they don’t really know what’s going on within the organization. Personally, I cannot comprehend investing millions of dollars into a business, walking away and trusting somebody else to run it without inspecting it.”
The CR Fitness team also spends above industry standards when it comes to marketing. They feel as if there’s no good in building out a great gym or remodeling existing clubs if it remains a best-kept secret, so spending is aggressive and consistent.
In terms of growth, the CR Fitness team adds 12 to 17 clubs a year without taking on any additional debt. With their goal of launching 100 clubs by 2026 well in sight, they’ve set 200 clubs as the next target.
However, there are no plans to stop there. In accordance with the grit and willingness to go the extra mile which got them to where they are, the team preaches a continued desire to grow, not getting too caught up in the victories that might come along the way.
“I’m the kind of guy that loves to have his back up against the wall a little bit,” Scrimale said. “I love having a challenge in front of me. I love doing something and every one of my partners is the same exact way. I think the growth is in front of us. I think that we have twice as far to grow. We’re just scratching the surface.”