Great article spotlighting my dad, a mentor to many.

1. A Mentor to Many:
Joe Pepe Steps Into the
Franchisee Spotlight
page 18
A New Lease on Life:
Tips for Structuring a Contract
to Boost Your Bottom Line
page 24
2017 Issue 1

2. 2017Issue1 |GearedUp
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franchisee sp tlight
Joe Pepe Steps into the Franchisee Spotlight
W
hen Joe Pepe went to his dad in the early 1980s
looking to borrow money to open his first women’s
weight loss center, his father couldn’t say yes fast
enough. But Pepe will profess that it was never that
first family loan that set him up for success – it was the unwavering
support of his father that led him to where he is today. That
support Pepe knew early in life has been sustained by his business
partners, his wife and his family. In return, Pepe has served as a
mentor to a host of Planet Fitness® franchisees, providing them
with guidance and years of wisdom.
“The best thing my father ever gave me wasn’t the MG,” said
Pepe, referring to the car his dad offered him before he left for
college. “It was that he believed in me because that lasts a lifetime.
I always say to people, ‘When you can believe in someone or
someone believes in you, it’s so powerful.’”
Few know that support like Pepe’s business partner, CJ
Bouchard. After Pepe left weight loss centers and after a stint in the
tanning industry, he opened a World Gym where Bouchard was a
A
Mentor
to Many:

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trainer in the early 1990s. After a decade at World Gym, Bouchard
left to open his own clubs in North Carolina.
Less than a year later, Bouchard gave Pepe a call, and he had a
proposition – become his partner and Pepe could have 70 percent
of the business.
“I had just opened up my first location but I wanted to do
more, and I really needed somebody I could trust and who I
knew was financially set and willing to move forward,” reflected
Bouchard. “He told me he wouldn’t do it for 70 percent; he would
only do it 50/50 because he felt that, in the future, I would resent
the fact that I gave him 70 percent of the business. We’re 50
percent partners. He never thought once of having 51 percent.”
Stories like this can be found throughout the PF® system,
attesting to the mentorship and kindness Pepe offers to everyone he
meets.
“The impact Joe has had on me as a franchisee and business
owner has been incredible and life-changing,” added Chris Klebba,
franchisee with Klebba Group.
Klebba was given Pepe’s contact information by a mutual
business associate when he was first exploring the Planet Fitness
brand. When he called roughly a decade ago, Pepe answered, and
the friendship has strengthened ever since.
“He was gracious with his time and shared openly everything
from deep in his operations and all of his best practices with no
expectation of anything in return. Since that day, he has continued
to be a mentor, friend and advisor to me, my family and my team,”
said Klebba. “He even traveled here to Michigan at no charge to
help our team with extremely valuable advice on customer service.
Stories like that go on throughout our 10 plus-year relationship.”
Bouchard said he could easily name another 30 people in the
Planet Fitness system who became involved in the brand because of
Pepe.
“I’m not just saying this because he is my partner, but I don’t
believe that Planet Fitness would be where it is today without his
involvement at the very beginning,” said Bouchard. “He’s engaged,
he loves what he does, and he’s very much in tune with the
industry.”
Read our conversation with Pepe below to learn more about
his business and how he views the PF brand.
Name: Joe Pepe
Company name: Planet Fitness of Raleigh
Number of clubs: 13, two under development
States your clubs operate in: North Carolina
How did you become a Planet Fitness franchisee?
We knew LA Fitness was coming to town, and what if we
weren’t a Planet Fitness? Someone else would eventually be one.
When you put those two things together, Planet Fitness and LA
Fitness, our conventional club would have had a very, very difficult
time surviving. We didn’t like the process of changing over. It wasn’t
fun. I mean, we were changing culture overnight, but the best deci-
sion prevailed. It’s kind of like necessity is the mother of invention.
When you’re dealt some things, you say, “OK, this is the situation.
How are we going to handle this, and what are we going to do? We
can’t do nothing; that’s not going to work.” And, if we weren’t Planet
Fitness, we were still going to be a low-cost provider, but we’re happy
to do it with Planet. It’s been a wonderful ride so far.
How did you meet your business partners?
First of all, Ron, who does the real estate, is my nephew and
became my partner in 1993 in World Gym and now works for
Exaltare. Chuck, I had signed him up at a health club when I was
working years and years ago when he was probably 16 or 17 years
old. He grew, and little by little, we brought him aboard. He had
been my partner up until the time we finally sold four years ago.
CJ was a trainer and nutrition guide in my gym for about 10 or 11
years, so I knew CJ well. He was a model person and a wonderful
trainer. All of the things you look for – he has strong character,
strong integrity, very honest, very humble, good operations guy.
CJ is my partner now, and we have a wonderful relationship. I say
to people, partnerships are like marriages. There’s a lot of compro-
mising and a lot of change that may happen along the way.
In your opinion,what stands out about the Planet Fitness
brand?
You have the things that stick out physically. It’s the purple,
the yellow, and I think most people that know anything about
fitness when they see purple and yellow they start to think of Planet
Fitness. The physical presence of it is there. Obviously, the logical
things are $10 and all that stuff that goes with the market.
Once you get into the real layers of what it is, Planet has
wonderful franchisees – very smart, intelligent, bright people that
are always willing to help each other. We take knowledge that we
have and we help someone else. We share it with them. Sometimes
you need people to talk to. I think that has a lot to do with success
because these people have moved the Planet system forward as it
needed to be. We couldn’t build yesterday’s clubs and be successful.
That takes franchisees and people willing to step out of that
comfort circle, and in order to get positive change, you’ve got to
be stepping out. Clubs got bigger. They got better. We invest a lot
Joe Pepe, right, met his business partner, CJ Bouchard, in the 1990s. Today,
the pair operate 13 locations in North Carolina.
Continued on page 20

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more money in what a club looks like. There’s a lot more time we
spend finding a great location. We’ve learned through the years
– and are continuing to learn – how to keep the model evolving
and positively changing. So, what I see with Planet goes beyond
physically what you see.
What was your motivation for bringing franchisees on
board and what kind of advice did you give them as a
mentor when they were starting out?
As corny as this may sound, I love helping people. I saw
people in the World Gym system and the Gold’s Gym system really
struggling and working hard because the market was shrinking. I
bring people in, and I answer their questions straight up. I help
these people because I like doing that. We’ve done a lot of sharing
of wisdom, and that’s what I think is good about the franchise. I
think there is a lot of trust now because I’ve already told them the
truth. It’s scary when you convince someone to shut down because
all they know is the members that they have, and you know the
members they have aren’t going to be really happy through stage
1 of the transformation. People take their gyms personally, and
they should. I walked them right through the procedure we went
through. If you don’t do this, you’re going to have a Planet near you
or something that’s like it, and you’re not going to be really happy.
Planet changed the industry. It really did. I believe if you want to
get what you want, help other people get what they want as long as
it’s good stuff.
What is the best piece of business advice you have ever
received?
A lot. It came from miscellaneous people. One is, when you
go to open your business, whether it is a gym or any other business,
try to learn every possible thing you could learn about it. Take
copious notes, and do that for five months. What you just learned
won’t become obsolete. It will become a minimal part of your
success. Another thing I have heard from really successful people is
to be humble, and I always try to practice that. I always try to tell
people to be humble because things can be taken away tomorrow.
Shared vision is another one. It could be someone buying an ice
cream store or whatever – if they come to you, share your wisdom
with them. It’s not like it’s etched in stone that it is the right thing
to do, but when you share your wisdom, people take to it. A big
thing, too, is change. Absolutely embrace change. People say they
like change and they’re OK with it, but I find that most people
aren’t because change is scary. Change is an unknown, but there
isn’t any business out there that has been around for 10 or 15 years
that hasn’t changed.
Looking ahead,what are your top three business goals
for the company?
I don’t know if there’s three of them. We have 15 clubs, so my
quick answer is we want to get to 20 clubs. How are we going to do
it? We’re looking to open up two to four this next year.
Customer service is a huge factor and people say, “Well, is that
a goal?” Yes. Customer service is always a goal. It’s a goal I call the
infinity goal or education with no graduation, meaning you are
always striving to get better.
Another goal – and this gets into a corporate thing – is same-
store growth. My appeal and my sort of hidden goal here is to be
able to work together and to be able to create some sort of growth
internally in our clubs. I’ve been around long enough to know that
everything takes time and money. All I’m saying is let’s start with
the big picture. Why shouldn’t we be able to provide services to our
customers where the customer wins and we win and corporate wins?
What do you feel is the biggest challenge currently
facing franchisees?
I think you have two. A healthy franchisor-franchisee relation-
ship is at the forefront of every franchise system’s list of objectives.
We want to continue to work in a positive, collaborative manner
with corporate, creating a win-win-win situation. I think franchi-
sees have another factor, and that is staying with their territory
commitments. What happens is you have to change your equip-
ment out every seven years or whatever. If people haven’t financed
those properly or if they still have some major debt, when it is time
to refresh the club that is going to put them in a very awkward,
very challenging position. Of course, in-store growth is also a
typical challenge we will always work with.
What is the biggest industry change that you have seen
since you started?
The biggest industry change might be Planet because it
changed the industry. Years ago, we put up a gym in a warehouse;
now there’s no such thing. We look for A-plus locations. Planet
would have told you 15 years ago that their model size, their best
size and their most powerful size was 12,000 square feet, and now
it’s 20, 25, 30,000 and God knows where it’s going. How we outfit
and the money we spend on it are totally different. Your customer
base. Everything.
Tell us a little bit about your family.
I have a great family. They make me smile like crazy. My wife,
Mary Ellen, is awesome. She was always there to be supportive, and
I tell anyone who is going into business that support is critical. I
have three sons all grown up, wonderful kids, top of their class. One
went to Georgetown and he’s an attorney. One went to Seton Hall
and has started another business in Raleigh, North Carolina, called
Zaniac; it’s a learning center-type of business. One went to Wesleyan
and Columbia University, where he received his MBA, and he is
president of the 21 clubs in Connecticut. I have two granddaughters,
Stella and Caroline. I couldn’t have a more perfect family.
Outside of the gym world,what are your personal
interests?
I love to play golf. I love to workout. I’m so comfortable in a
gym. It’s like a home away from home. I love to run. I love to read
biographies. I love to read a lot of leadership-type books and people
that we don’t really think of as leaders, like some of the football
coaches of the world and what motivated them to become a coach.
If I weren’t a franchisee,I would be …
That’s actually the toughest question. My first, honest,
impulsive answer is I don’t know. It would be something in the
fitness world. If it took me out of the fitness world all together,
it might be real estate because I enjoy that. It would have to be
helping someone be better. G
Franchisee Spotlight
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