The Minnesota-based franchise chain Snap Fitness plans to open two fitness centers in Bangalore and Mumbai in a deal with India’s Force Fitness India. Photos courtesy of Snap Fitness

CHANHASSEN, Minn. – India's torrid economic growth and rising affluence have lured yet another U.S.-based company to set up shop there, but this one doesn't hail from the industries that Americans typically associate with the South Asian nation.  In fact, this company may be the first of its kind to expand to India: Snap Fitness Inc., a fast-growing health-club chain based in the Minneapolis suburb of Chanhassen, recently announced that it will soon open a pair of fitness centers in Bangalore and Mumbai.

Force Fitness India Pvt. Ltd. – described by Snap Fitness as an "experienced area developer of fitness franchises in India" – will own and operate the facilities, which are currently under construction and are scheduled to open later this year. India represents the first venture outside North America for Snap Fitness, which was founded in 2003 and currently has more than 1,500 locations in the United States and Canada.

"We couldn't be more excited about our expansion to India," Snap Fitness chief executive officer Peter Taunton said. "India represents a huge opportunity for us and I don't think there is a more qualified company than Force Fitness to own and operate our facilities th­ere."

Snap Fit­ness offers health clubs that emphasize fast, convenient and affordable workouts. The typical location covers about 2,500 square feet, is open around the clock every day of the year, and features the same, modern equipment found in larger health clubs, but in a smaller, less-intimidating setting. The company also touts its membership prices as much less than its competitors. Taunton estimated the size of the Bangalore facility at about 2,500 square feet and the Mumbai club at a much larger 4,500 square feet.

Snap Fitness CEO Peter Taunton.

"We are always looking for new ways to enhance our member experience, and staying open 24 hours a day, seven days a week is just one way to do that," he said. "We give our members many different tools to improve their workouts, such as allowing them to build their own My Snap Fitness Web page, and the Bangalore and Mumbai clubs will offer the same benefits."

Both clubs are scheduled to open for business during the fourth quarter of this year, though Taunton conceded that construction delays could push back the openings into early 2009.

Force Fitness is an area developer, and not a franchisee, of Snap Fitness health clubs in India. Taunton said the difference is significant: as an area developer, Force Fitness is one step below the corporate parent and will oversee franchisees in a particular area. In this case, that area is India. As such, it will pay Snap Fitness an annual royalty.

Force Fitness will operate the Bangalore and Mumbai clubs under the Snap Fitness brand, but it won't own the land upon which they are being constructed, or the buildings that will house them. Taunton said this decision was forced by the high cost of real estate in India. "We don't want to own the buildings or land – we're just renters," Taunton said. "From our standpoint, that works best for us."

Snap Fitness is targeting Indians living in urban areas who are interested in improving their health and wellness -- and those who have money to burn. "With people earning more money in India today than ever before, many have an increasing propensity for spending their disposable incomes on ways to look and feel better," Deepak Lalvani, Snap Fitness India sales director, said. "For many of the workers in call centers and other business services that must work unusual hours, there is great demand for a fitness club such as Snap Fitness that is open 24/7, and emphasizes fast, convenient and affordable workouts."

Yet, in a bit of irony, India wasn't Taunton's first choice for international expansion. He said that he considered other markets, including Mexico and Europe, before officials at Force Fitness reached out to him about a year ago about bringing the chain to the subcontinent. After listening to their pitch and then, visiting the country, Taunton said he was sold on expanding to India.

"Force Fitness approached us last year about coming to India. At the time, we were looking at other markets, but I listened to what they had to say," he said. "They looked at our business model and said we want to take what you've done in the United States and bring it to India. So, we went through the vetting process and they met all of the criteria that we have established for our area developers. That's when we knew that they would make a great strategic partner for international expansion."

Snap Fitness has experienced tremendous growth in the nearly six years since Taunton founded the company.

The chain has added nearly 200 locations in 2008, including 86 new clubs during the second quarter alone, and Taunton expects to close out the year with more than 1,000 new locations and over 2,000 markets sold. Internationally, Snap Fitness is looking to open additional clubs in India and enter Europe, Latin America, the Middle East and Asia.

"We were the fastest-growing franchise in the world last year, and in the United States, we've been opening between 25 to 40 clubs a month," Taunton said. "That's a store a day, which is pretty good growth. As we start growing in other parts of the world, you can expect those figures to go even higher. We plan to open 250 new clubs internationally within the next five years."

The chain's rapid growth hasn't gone unnoticed in the franchising industry – Entrepreneur magazine ranked the company number three on its 2008 list of the top new franchises, number 24 on its list of the fastest-growing franchises and in the 96th spot on its annual Franchise 500 list. Meanwhile, trade publication Franchise Market magazine ranked Snap Fitness number one on its annual list of the Top 100 New Franchises last October.

"Fitness is emerging as a new, rapid-growth category of franchising,” Matt Russell, publisher of Franchise Market, said in a statement. "Snap Fitness and other health-club franchisors are a fascinating phenomenon to watch, as their growth drives change within the entire fitness industry."