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Jazzercise Moves Ahead of the Pack in Franchise Rankings

Sun, 02/06/2011 - 10:33pm
San Diego Business Journal

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Judith Sheppard Missett

JAZZERCISE INC.

CEO: Judith Sheppard Missett.

Revenue: $96 million for 2009-2010.

No. of local employees: 90.

Investors: N/A.

Headquarters: Carlsbad.

Year founded: 1969.

Company description: Franchises a workout program using choreographed dance steps set to music with independent instructors.

Judith Sheppard Missett is still stick kicking up her heels, literally and figuratively.

The 60-something Missett, founder and chief executive officer of the 41-year-old, Carlsbad-based Jazzercise Inc., continues to teach classes that use dance steps for an aerobic workout and continues to be recognized for her business savvy.

Entrepreneur magazine recently put Missetts dance fitness franchising business in a number of top categories in its annual 2011 Franchise 500 list.

The magazine ranked the franchisor No. 1 in the business fitness category and 21st in the fastest-growing franchises category.

The magazine also ranked the privately held concern No. 4 in the rankings of top home-based and low-cost franchise categories.

And it gave the concern a No. 17 position overall on its closely watched list.

Not bad for a business doing $96 million a year in sales, and with a network of 7,800 instructors teaching 32,000 classes in 32 countries.

Hearty Presence

San Diego State University management professor Congcong Zheng says it is rare for a franchise, especially a fitness franchise, to survive so long and yet do so well.

Only one-third of all businesses survive after the first 10 years, said Zheng. By still being in business 41 years, they have done extremely well.

Franchising is a good way to go, but franchisors have to create a very stringent and vigorous process to qualify the franchisees so that the two can be successful, she added.

Missett started out in 1969 teaching a dance class once a week in Chicago while she was a student in theater arts at Northwestern University.

The classes were second in command to everything else I was doing, recalled Missett during an interview with the San Diego Business Journal.

However, students loved the workouts, and clamored for more classes to better fit their schedules, especially after she moved to Southern California in the early 1970s.

Instructors Step Up

So Missett started hiring instructors as independent contractors to handle demand, and was soon running a thriving enterprise.

Its what I loved doing, she said. Not for the money.

She decided to transform the business into a franchise operation in the early 1980s due to the headache of managing so many workers, which was more than 1,000 at the time.

It was a strategic decision, she said, adding. (But) it wasnt much of a decision for me to make.

It made life a lot easier.

At the time, franchising was still in its infancy, more centered on hamburger chains and print shops than dance routines posing as exercise classes, she says.

We wanted them to feel like they owned a piece of their own business, that they had the power to do things within my parameters, she said. So being a franchisee worked beautifully.

Changing Growth Pattern

These days, Missett is fine-tuning the business plan to keep the company growing.

Most franchise owners rent space for their classes in noncommercial buildings, such as the local recreation center or town hall. Its a part-time operation.

But thats changing.

Now, were moving toward more brick-and-mortar fitness centers, she said, because of the flexibility.

At the company-owned workout center in Oceanside, for example, 52 classes are offered weekly.

The business has opened a second company-owned center in the La Costa Towne Center in North County, and counts 300 franchisees who now have their own facilities and operate under the Jazzercise Fitness Center nameplate.

Our customers dont have a lot of time to work out, so when you can only teach five classes a week, that doesnt give your customer a lot of choice, she said.

Besides La Costa, Jazzercise Fitness Centers in the county include locations in Oceanside, Vista, San Marcos, El Cajon, Poway and Bonita.

The franchisor charges $1,000 plus 20 percent of sales for classes for the basic level, and up to $75,000 for franchisees who open a stand-alone fitness center.

Family Takes Active Roles

Daughter Shanna Missett Nelson serves as president.

Both mother and daughter continue to teach classes.

In fact, the elder Missett is still involved in the choreography and other details of the classes that are taught worldwide.

Every 10 weeks, she readies a DVD with 90 new choreographed routines that franchisees can use to assemble a workout. The DVD includes different music and different ways to combine the steps to keep the routines fresh and up-to-date.

Thats my joy, said Missett. But I love the business part, too.

Young McCarthy, a 16-year veteran instructor who is a former franchisee in North County as well as a paid teacher at the two company-owned fitness centers, likes the diversity, with one class in Oceanside containing more than 60 students people of all ages, while two others in La Costa average the more typical 20.

She says its not often that one can do what one loves and make money doing it.

Its really rare to be able to meld the two in life, she said. I didnt realize that at the time when I was 18 and just starting. But I see that now.

Tom York is a contributing editor for the San Diego Business Journal.

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