Ok ya got me. I don't know if they're profitable or not, but in Western Australia they keep popping up everywhere. Maybe they just market hard and let the franchisee eat it if the wheels fall off.
It's a lamentable fact of modern business that most consumers will choose a cheap shoddy product over a more expensive quality one. I don't congratulate them for capitalising on it, but that's probably the chain gym's rationale.
Chain gyms do the initiation fees, processing, cancellation fees, sales pitches, contracts,etc etc. My gym does none of that. It's $28/month +tax and that's it. Personal Training is $60/hr. There are no package deals, etc etc. It's not about #'s with me, it's about doing it how I feel is the right way to do it. Turns out, a lot of people like the honest no nonsense approach and my gym has done quite well. I'm not getting rich but that's not my objective. I wanted a clean, positive energy gym in which to train my clients so I opened my own place. It's not a training studio, it's a gym but it's a lot different in most respects to a lot of gyms. I'm proud of that.