9Round’s kickboxing king Shannon Hudson is knocking out his company’s competition.
In 2011, Shannon Hudson had reached the pinnacle of his lifelong ambition. He was in Toronto, accompanied by his wife Heather, preparing for the International Kickboxing Federation World Light Middleweight World Title.
After he paid for his travel, lodging, his wife’s hair appointment and her new outfit, Hudson found himself paying to compete for a title. However, for Hudson that realization wasn’t too bad, because in 2008 he had started his own successful company, 9Round.
9Round’s development was born out of his lifelong passion for Karate. “I have an older brother who is nine years older than me,” said Hudson. “He started Karate when I was born, so I grew up going and watching him do Karate, sitting on the side. I grew up in that martial arts atmosphere. When I turned 7 years old, I of course wanted to follow in my big brother’s foot steps and do what he was doing.”
Hudson’s brother started kickboxing when he was 16 or 17 years old. In the 1980s, kickboxing was a rapidly growing sport, supported by movies such as The Karate Kid, Bloodsport and Kickboxer. “It was pretty popular,” said Hudson. “Just watching full-contact kickboxing, I just got the bug of doing it. When I turned 18, I started amateur boxing and amateur kickboxing. I used to travel all throughout the Southeast. I would fight anybody, anywhere, any weight, I didn’t care — I just loved to compete.”
In 2005, Hudson turned professional and began competing on Chuck Norris’ World Combat League, a team fighting league that Norris had developed. “I fought every season that he had, for three seasons,” said Hudson. “It was really neat, had a very big production and almost got on Spike TV, but they signed UFC instead.”
Hudson fought all over the world, in Europe, the U.S. and Canada. “People ask, ‘are you retired?’ and I’m only 34. I guess I’d say semi-retired,” explained Hudson. “Physically, I think I could do more fights, but just mentally and time-wise it’s challenging because of [9Round] and family. I have two kids now. To fight at that level, it takes a lot of mental stress. It pulls you away, and I have to travel to train because South Carolina isn’t a hotbed for fighters.”
Along the way, Hudson taught Karate with his brother, who had purchased the martial arts studio the brothers had grown up in. “Back then the owner was a starving artist,” explained Hudson. “They had a real job and did Karate in the evening as a hobby. They didn’t run it as a real business. The owner was behind on rent and my brother talked to him about taking over the Karate school, and during that time I learned a lot about business. Partnering with my brother after I graduated from the University of South Carolina, I helped him grow the Karate school businesses, and we grew them to three locations.”
Hudson was attracted to membership models and really understood how the membership businesses operated. Throughout college Hudson had also garnered experience as a personal trainer, which helped him develop a vision of a successful fitness model.
“In 2008, I had the idea of 9Round, and there was a space next to the Karate school that my brother and I owned, and I went out on a limb and leased that retail space next to me and built it out with no money,” he said. “I was recently married and [had] maxed out credit cards, borrowed money from a friend and did everything I could to get the doors open. I couldn’t even afford a sign on the building — I just had a banner out there.
“We signed up 100 members our first month. That’s when it hit me — we’ve got something here. The whole goal was to use franchising as the growth vehicle, to move this brand quickly, grow stores quickly and using other people’s money, other people’s time to build my brand. That was the whole goal.”
In 2009, Hudson again borrowed money and did what he could to get the franchise documents completed. “We awarded our first franchise in 2009 to a member,” he said. “In 2010 we did nine stores. In 2011 we did 17 stores, and then in 2012 we did 45 stores and that was when we really picked up.”
After 45 stores, Entrepreneur Magazine put 9Round on its list of Top 500 Franchises. In 2013, the franchise crossed the 100-club mark with stores operating in 31 states and registered in Canada, with hopes to open the first store there in 2014.
The franchise model for 9Round is highly intriguing for franchisees that possess a desire to break into the fitness industry. The total investment ranges from $53,000 to $90,000, the franchise fee is $18,000 and the ongoing royalty fee is $449 a month.
However, simply having enough capital isn’t grounds to open a 9Round franchise. Hudson takes the fitting of a franchisee with the brand extremely seriously. He said they once had interest from a person who had never been in a gym. They simply enjoyed the idea of the 9Round product. Not only was the person not into fitness, but they also didn’t live a healthy lifestyle. According to Hudson, that didn’t fit the brand and they had to part ways.
Each franchisee is required to pass a physical before they can become a 9Round franchisee. The routine is fairly basic: 1.5 miles in 15 minutes or less, 50 pushups on toes in two minutes and 50 sit-ups with someone holding toes.
“Our demographic is 60 to 70 percent female,” explained Hudson. “I think my wife is a big influence on what makes women like this model and why they like them, and why it’s good to appeal to females.”
Although the franchise is definitely co-ed, Hudson said women enjoy the workout because it empowers them. No one is staring at them, and they have clear direction each time they walk in.
When Hudson first developed the idea for 9Round he had the idea to pitch the concept to big box gyms. “I felt that if I could get inside there, it would be a winner,” he said. “I went to a local big box that has three stores. They have everything from the Italian lights to the showers, to the childcare, to the very nice equipment, to the restaurant inside … I went there and had my attorney come with me. I pitched the idea to these guys and they pretty much just laughed at me. They said they wouldn’t put this type of equipment in their nice $50 light bulb place. It was frustrating; they kind of shut the door in my face. I was young and had this idea — it was a tough moment — but it drove me to say, ‘fine, I’m going to open these up all over the country.’”
Hudson’s competitive and fighter nature allowed him to keep hustling and finding ways to grow 9Round individually. “It’s not inside a club,” he said. “It’s a stand-alone. That’s our stance moving forward. We make them all stand-alone units. They work independently, we create a niche culture, community inside the club and we rock and roll.”
Hudson has a saying, “stick to it until you do it,” which helped him get through the negativity prior to successfully launching more clubs and franchises. “We were so aggressive we opened our first store without a sign,” said Hudson. “We stood on the sidewalk giving out flyers to pedestrians walking by because we were beside a restaurant, which is good because you get a lot of walk-by foot traffic.”
Early on, 9Round put a lot of time into pounding the pavement. “We had no money so we had to beat the streets to give out passes, talk to people and try to go to the PTA thing, the health fair and get in the community,” explained Hudson. “We had to almost reverse engineer [the concept], and we narrowed it down to four things. Number one, no class time so that you’re never late because the bell is ringing every three minutes. You could walk in at 5:13 p.m. and we’re going to plug you into one of the nine stations.
“Number two, it’s full-body every single time. It’s a full-body dynamic functional workout every single time. You’re going to leave sweating. If you’re not sweating, people usually don’t think they got a good workout.
“The third thing we saw was that the workout changes every day. From my kickboxing background, martial arts background and fitness background, [with] one punching bag I can give you 100 drills. What we do corporately is we provide the workout every day for franchise owners in video format in the franchise portal. That keeps people from getting bored.
“The best part that people love is the trainer included at no extra charge. One club is 1,200 square feet and one trainer can monitor that floor very easily. They know everyone’s name and they can be really hands on in that small space. People like that they aren’t paying extra for the personal trainer.”
In addition to the four-step offerings, 9Round franchisees present a $49-per-month membership fee, but 9Round corporate actually allows the franchisee to name their own price based on where they may be located in the country.
“Depending on the lease rate and the area, some people charge more,” explained Hudson. “For example, in California some are charging $79 a month, [and] that is doing very well with that. We have a club opening in New York on Long Island and he’s going to charge $99 a month.” When Hudson opened the first 9Round location next to the restaurant, he realized he had a good real estate method. They look for secondary locations that have low rent, but good foot traffic. According to Hudson, locations near well-established restaurants work well.
“The thing about the world title is, no one has ever come in and said to me they wanted to open a franchise or workout at a 9Round because I won a world title,” said Hudson. “The average person just wants to know if we care about their fitness goals and care about them as a person. Are we going to treat them well, know why they’re here, know anything about them? When a franchise owner comes in and they see the world title belt on the wall, and there are pictures of me and Chuck Norris, it’s a nice touch. It adds what we call sizzle on the steak. But at the end of the day it comes down to — are we going to support our people, are we going to care about them, treat them well and fairly, and give them our best?
“I’ve got a great team around me in the office, and some have been with me from the very beginning. They are very loyal and I can trust them with anything.”
Hudson believes that 9Round is his opportunity to help more people — people that might want to be in shape like a fighter, but not necessarily be a fighter. “I can help more people with what I do,” he said. “Fighters are in the best shape in the world, so lets take that training regimen, take out the worst part of getting punched in the face, and lets just take the training regimen, the jumping rope, the kettlebell and med-ball work, the bag and hand pad — put it all together in a circuit and we’ve got something.”
In addition to the circuit, members also receive a nutrition component that they can access for guidance on their diet, as well as a doctor on staff that can answer questions on nutrition. “Those are some of the differentiators that make us unique,” said Hudson. “That’s why we’re growing quickly.”
The rapid growth and the unique fitness proposition was something that caught the attention of Lift Brands founder Peter Taunton. According to Hudson, the partnership with Lift Brands had been game changing.
“Peter reached out to me because he wants to own multiple brands,” said Hudson. “He likes the kickboxing space and liked our model. He told me he visited other competitors and he liked ours the best because it’s easy to scale and a small footprint. He reached out to me and wanted to buy the entire company, and this is my wife and I, this is our baby. However, I’m very coachable and I’m going into an arena that I’m not very familiar with — franchising. I know he’s got 1,400 stores worldwide, so why not partner with someone who has been there and knows more than I do?”
Hudson has eight people in his corporate office in Greenville, South Carolina, but he has 68 through Lift Brands’ partnership in Minnesota that he can lean on for marketing, legal, mapping, contracting, compliance and sales. “Everything I need is up there that can help me grow quickly,” he said. “Those guys have helped me a lot. The franchising documents we have cleaned up a lot, we’ve got them better. They introduced me to a couple of independent sales guys that are rock stars. They can sell very well and they understand my model very well.”
As everything continues to grow for 9Round, crossing the 100 mark was just a breaking point. “I told Peter, we just opened our 100th club,” said Hudson. “He said, okay, only 900 more to go. I said, ‘yup, that’s what I’m thinking,’ so it’s perfect.”