Exercise franchise joins entertainment

Date: MAR 25th, 2008

Topic: Franchise News

Dartmouth-based Bulldog Interactive Fitness Inc. will be fit to pursue North American growth aspirations following its acquisition by DHX Media Ltd.

The deal announced Monday is valued at about $625,000 in cash and includes performance bonuses and some DHX Media shares for Bulldog president and founder Holly Bond.

She opened her first entertainment and fitness centre for kids at 644 Portland St. about three years ago.

She expanded the franchise operation to eight locations in Canada and the United States.

"There is a lot happening and it’s all very good," Ms. Bond, who retains her position at the helm of the organization.

"There is a huge amount of synergy between the two companies and this allows us to operate at an entirely new level."

Other businesses have tried to penetrate the youth entertainment and exercise market, but few have achieved the consistent and impressive numbers of Bulldog Interactive, said David A. Regan, executive vice-president of corporate development of DHX Media.

The Halifax company is one of Canada’s leading independent international producers and distributors of television programming and interactive content.

"We’ve been tracking these guys for a while as they’ve been refining their model and think they’ve come a long way from where they started out," Mr. Regan said.

DHX Media’s production companies are producers or co-producers of about 17 original television series and theatrical releases.

The acquisition of Bulldog Interactive meshes smoothly with plans by DHX Media to enhance its involvement in the evolving field of interactive technology, said Mr. Regan.

"Our traditional business goes top-down through broadcasters to get to kids. This is a way we can go bottom-up through a bricks-and-motor approach to gain a direct relationship with kids."

Besides the possibilities generated by an "overlapping core target market," there is also the huge potential Bulldog Interactive offers for growth on the franchising side, mostly because of increasing concerns among parents about obesity and sedentary lifestyles among children.

Bulldog Interactive has concocted an effective recipe for entertainment and exercise in a safe "no bullying" environment.

"Drop into any one of these locations and you will see kids having the times of their lives," said Mr. Regan.

Ms. Bond said the business started out as an interactive, electronic gaming concept but far exceeds that today and includes programs designed to build self-esteem and overall health in a safe environment.

"The games are a front to the lure the kids in," she said. "Soon after they arrive they find themselves in a good old-fashioned gymnasium."

A Bulldog Interactive franchise can be had for a franchise fee of $35,000, with average capital costs expected to run between $350,000 and $400,000, said Ms. Bond.

Royalty payments are seven per cent. Advertising fees are two per cent.

She said people pursuing a Bulldog Interactive franchise should be looking for a location in the range of 5,000 square feet.

For a testimonial about the fun and effectiveness of the Bulldog Interactive approach, it is interesting to talk to Matt Dempsey, the 17-year-old son of the founder of the business.

He remembers his mother, a fitness consultant, filling the basement with interactive fitness equipment, such as dance pads and exercise bikes, linked to video games.

"It was like having a fitness laboratory at home. My friends and I were using this stuff all the time. I lost 23 pounds," said the student at Prince Andrew High in Dartmouth.