Did we just see Planet IPO as an equipment distributor?
With 44% of their revenue coming from the sale of equipment to their franchisees... did we just see PLNT raise over $200M as a club operator or an equipment reseller?
It could be argued that the lack of differentiation in the commercial fitness equipment space paved the way for Planet's recent IPO. In an effort to chase the top line, the equipment manufactures created an environment where Planet turned into the largest distributor of commercial fitness equipment in the country!
THANK YOU LIFE FITNESS!
Founder
8 年Rich Novelli- as far as the independent franchisee's businesses are concerned, I think that in the right market the stores can do well... The bigger question, relative to the small run on PLNT stock, yesterday, is what happens to Planet Corp when they hit critical mass, stop opening new stores and lose their biggest revenue stream (the reselling of commercial equipment). They have the perceived value of adding ancillary revenue streams like PT... but perhaps the potential value of adding new revenue streams is more valuable (relative to market perception) than actually doing so and taking the chance that it won't work! Time will tell!
Consultant, Mentor, Advisor
8 年In a world populated with smarter, conscience consumers product or service differentiation is key. Other than purple/yellow equipment it appears that the consumer is realizing that low price does not always equal high value. Could this be another franchise model making money at the expense of gullible franchisees or I am being cynical?
Co Owner at Design2Wellness
9 年Only if you like purple & yellow equipment. Will new club operators build their own brand around those colors?