From the June 2001 issue of Entrepreneur

Unlike those reptilian creatures that eat their young, we keep loving ours, despite their ability to harvest our time and try our patience. We want them to grow, to prosper-to get along well with others. Besides, the parents of a "wild one" occasionally need to get out of the house. If you see this need concentrated in an area of young families earning moderate to high levels of discretionary income, you may have stumbled across a good place to put a Gymboree.

The Gymboree Uniform Franchise Offering Circular explains the company this way: "The franchisee will operate a nontherapeutic sensory-motor child/parent play and music program . . . for children from birth through 5 years."

That description is a perfect example of how legalese can ruin the fun. My sister, who has two toddlers, simplifies Gymboree's appeal to customers like her: "It's a great way to meet people and watch your child play with the other kids."

Other mothers have told me Gymboree helps them identify their children's personalities and teaches kids manners-all while allowing parents to witness their children pulling another kid's hair for the first time. According to longtime Dallas franchisee Carol Watters, "Gymboree lays the foundation for learning from a social, emotional and intellectual basis."

Basically, franchisees conduct classes with no more than 20 children apiece on the premises, and customers usually pay $10 to $20 per session for 12 weekly sessions. Though Gymboree doesn't make earnings claims, the store with the highest total enrollment for one calendar quarter in North America in 2000 counted more than 800 enrollees.

Franchisees also derive sales from other things. For example, you can sell Gymboree-branded products and host birthday parties starting at $150 for 90 minutes. You can also offer "Gymboree On The Go" classes in other venues, such as recreation or day-care centers.

One of the main issues for new franchisees is finding the right location. Gymboree can require a fairly large rental space. Although the UFOC says spaces generally run between 1,800 and 2,400 square feet, I spoke with two franchisees opening new locations, and each was committing to a lease of no smaller than 3,600 square feet.

You should locate within a convenient, 20-minute drive from the homes of young, affluent families-and close to a mall or a large grocery store. "Once in a car with a child, mothers want to multitask," Watters explains.

Another tip: Locate in a market with an existing advertising cooperative, and make sure the franchisor is willing to spend national marketing funds in your market.

For such a well-established brand, I'm surprised that Gymboree hasn't grown much over the past few years. In 1999, only 24 new franchises were awarded and 21 existing licenses were transferred to new owners. So before buying, you should investigate this phenomenon further.

Gymboree is seeking potential franchisees with a net worth of at least $150,000 and a willingness to run the business full time.


Todd D. Maddocks is a franchise attorney, small-business consultant and founder of Franchisedecision.com.