BUTTERFLY LIFE: CA Adds Insult to Injury
April 14, 2009 by Sean Kelly
Filed under BUTTERFLY LIFE
Two years ago, I posted the question IS BUTTERFLY LIFE A GREAT FITNESS FRANCHISE?
The answer came in a torrent of nearly 500 comments from franchise owners, mostly critical of the franchisor company and owners Mark Golob & Tom Gergely.
Our post Will the REAL Butterfly Life Franchise Please Wave Its Wings? prompted 162 comments, and Troubled Fitness Franchise Butterfly Life Lowers Franchisee Royalties garnered 40+ comments.
The woes of Butterfly Life franchisees were also covered by such publications as Fitness Business Pro (Butterfly Life’s Golob: Failed Franchise Owners Should Blame Themselves), FORBES (Butterfly Life Franchise Lawsuit in Forbes) and FORTUNE (Fortune Article Spotlights Butterfly Life Franchise Woes).
UnhappyFranchisee.com posted interviews with 7 Butterfly Life franchise owners, who told of hard sales pitches, unkept promises and, eventually, failure and bankruptcy.
It was just a matter of time before California franchise regulators swept into action, right?
UnhappyFranchisee.com has posted the Desist & Refrain Order (see BUTTERFLY LIFE: Cease & Desist Order) issued by the California Corporations Commissioner. It states that from May, 2004 to May, 2005 Golog and Butterfly Fitness, Inc. violated CA corporations codes by collecting franchise fees prior to training. It also states that Golob & Butterfly Fitness, Inc. made untrue statements in filing its CA franchise registration renewal.
What’s the penalty? Golob and Butterfly Fitness, Inc. must “desist and refrain” from further violations of CA franchise registration and must “desist and refrain” from making untrue statements in order to sell Butterfly Life franchises in CA.
That’s it.
Funny thing is, Golob has no intention of selling Butterfly Life franchises in CA or elsewhere. He’s already cashed out… and sold (what’s left of) the whole shebang to Diversified Health & Fitness.
This is yet another cautionary tale to prospective franchisees: take due diligence seriously and choose your franchise company wisely.
If you think government franchise regulation will protect you… think again.
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graphic: FranBest.com
logo: Butterfly Life
BUTTERFLY LIFE: Interview with Former Franchisee Jeff Marks
August 6, 2008 by Sean Kelly
Filed under BUTTERFLY LIFE
BUTTERFLY LIFE: Jeff Marks, Ex-Franchisee
Butterfly Life is a women’s 30 minute fitness franchise chain that claims to be an improvement over Curves for Women. It was founded by Mark Golob, Tom Gergley, and, supposedly, Mark Mastrov. Golob & Gergley both have checkered pasts and a history of litigation in the health club industry. Many franchisees were attracted by the highly respected Mastrov (of 24 Hour Fitness), whose involvement ceased after they joined. (Read Butterfly Life Franchisees Allege Bait & Switch… of Execs)
Jeff Marks was an early, multi-unit franchisee in GA who claims to have lost $350,000 within a year of opening two Butterfly Life clubs. He says that he paid a $29,000 franchise fee plus a monthly $1000 royalty/marketing fee for each club, yet never received the branding, advertising or operational support promised.
BUTTERFLY LIFE: Jeff Marks, Ex-Franchisee
Read interviews with Butterfly Life franchisees at UnhappyFranchisee.com
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Franchisees, customers & experts vote for their favorite new franchises at Top New Franchise: Who’s hot. Who’s not.
BUTTERFLY LIFE: Interview with Former Franchisee Carol King
August 6, 2008 by Sean Kelly
Filed under BUTTERFLY LIFE
BUTTERFLY LIFE: Carol King, Former Franchise Owner
Carol King is a mother and fitness advocate with a degree in physical education from Cal State Northridge. In 2004, she and childhood friend Linda Canale pursued their dream of helping women live happier, healthier lives by opening what they thought was an innovative new fitness franchise supported by a team of dedicated, experienced, trustworthy industry experts.
According to Carol, her dream of business ownership almost immediately became a personal and financial nightmare. She now puts her energies into helping to educate potential franchise owners how to avoid the same mistakes she made, and advocating for more equitable treatment of the franchisees of Butterfly Life and other chains. Carol & Linda opened their Woodland Hills, CA Butterfly Life location in October, 2004 and closed in April, 2005. They’ve lost $240,000 to date.
BUTTERFLY LIFE: Carol King, Former Franchise Owner
Read interviews with Butterfly Life franchisees at UnhappyFranchisee.com
WHAT DO YOU THINK? SHARE A COMMENT BELOW.
__________________________
Visit FRANBEST’s: Unbiased franchise information, franchise interviews and detailed, searchable information on 400 franchise and business opportunities.
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America’s Next Top Franchises.
Franchisees, customers & experts vote for their favorite new franchises at Top New Franchise: Who’s hot. Who’s not.
Article Scrutinizes Quiznos Rick Schaden, 1-2-3 Fit Franchise, Butterfly Life Franchise, Contours Express Franchise & Fitness Franchise Woes
February 15, 2008 by Sean Kelly
Filed under 1-2-3 FIT, 24 HOUR FITNESS, BUTTERFLY LIFE, CONTOURS EXPRESS, CURVES FOR WOMEN, Lady of America, QUIZNOS, ShapeXpress Fitness
Stuart Goldman of Club Industry’s Fitness Business Pro, a leading health club industry trade publication, has written an extensive and well-researched article on the struggling 30-minute fitness franchise chains and some of the powerful names that were instrumental in putting the match to this “hot new franchise” phenomenon.
I plan to look at particular points of this article in upcoming posts. Please share your initial comments below.
Here’s an excerpt. Click a link to read the entire article:
Source: Lights Out by Stuart Goldman, Managing Editor, Fitness Business Pro
The troubles that continue to plague circuit club companies also extend to business-savvy franchisees who trusted the reputations of some of the biggest names in the industry.
1-2-3 Fit, Denver, was founded in 2005 by Quiznos restaurant executives Rick Schaden and Brooksy Smith, who combined their efforts with fitness legend Ray Wilson. The 1-2-3 Fit Web site lists 27 stores open in 11 states, with seven more stores opening soon. One franchisee says 22 stores have closed since the company’s inception.
It sounded so simple. It made so much sense. Experienced, knowledgeable people banked on the marriage of a well-known sandwich chain and a fitness industry legend to create an exciting new circuit club franchise. At another promising company, people counted on the experience of a group of investors that included the founder of the biggest revenue-producing chain in the industry.
1-2-3 Fit, Denver, which opened in 2005, was the brainchild of Rick Schaden and Brooksy Smith, two men who made Quiznos a successful national restaurant chain. Schaden and Smith called upon fitness legend Ray Wilson, whose background includes opening several club companies, to help them with their venture into the fitness industry.
“It was the perfect mixture of franchise team and fitness team,” one former 1-2-3 Fit franchisee says.
Butterfly Life, San Ramon, CA, opened in 2003 and had the initial backing of Mark Mastrov, the founder of 24 Hour Fitness who resigned last month as chairman of 24 Hour. Mastrov’s colleagues, Mark Golob and Tom Gergley, had operated Linda Evans clubs in California before opening Butterfly Life.
“With Mastrov’s name, how could you go wrong?” one former Butterfly Life franchisee says.
But according to many franchisees at the two companies, plenty did go wrong…
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