HOTWORX, a fitness concept based on infrared sauna technology, cranks up the heat as it eyes expansion to Canada
By Gina Makkar
Whether you’re a seasoned fitness pro or new to the workout world, there’s an exciting new workout solution that will soon be available to Canadians. HOTWORX, a 24/7 exercise studio, offers sessions led by virtual trainers in an infrared sauna environment that turns up the temperature on your regular, everyday sweat sessions—literally.
Founded in 2017 by owner and CEO Stephen Smith, the brand boasts over 700 locations worldwide, including studios in the United States, Saudi Arabia, and Ireland. Smith says his athletic background and encouragement from his football-playing father paved the way to his success. “He instilled that competitiveness [in me],” says Smith. “I guess it’s built into my DNA now. Going into an industry that involves athletics was natural for me. I have a huge passion for fitness.”
“The sauna was designed for up to three members to workout and detox,” explains Smith. “As a personal trainer myself, I knew that three people is a perfect number for small group training.” From there, HOTWORX was born.
Holistic sessions with an impact
According to the company, its saunas use infrared heat to increase core body temperature, accelerate metabolism, and remove toxins. The HOTWORX method, called “3D Training,” claims to shorten warm-ups, activate the regenerative process, increase heart rate, and maximize calories burned, resulting in a more effective workout in less time—and with shorter workouts, more people can use the small, private exercise saunas in a single day. Twelve distinct programs also provide variety for everyone’s preferred workout, from yoga to cycling, and beginners and athletes alike can adjust the intensity to their personal comfort level.
Smith is confident about the expansion. As he explains, “We’re bringing HOTWORX into Canada, but it’s still an emerging brand in some ways. Because of our experience in franchising, we’re able to grow the brand. We have a lot of experience. We still make mistakes, but we don’t make the ones that we used to.” To help steer the ship north of the U.S. border, he hopes to secure franchisees to be his feet on the ground and spearhead the Canadian development. “We are going to have a lot of new franchisees in Canada soon,” he predicts. “I expect to expand the way we did in the U.S.—probably better, since the longer you do something, the better you are.”
Effective by design
The concept is rolling out its expansion plans with an eye on what Smith refers to as “white space,” underdeveloped areas that have the potential for locations. “It’s worked well for us in the U.S.,” notes Smith. “We want to find a location for every 100,000 people in the population. That’s our rule of thumb: we will give a two-mile radius of exclusive territory.”
The brand has partnered with The Behar Group, a full-service brokerage and advisory firm in Toronto with expertise in the commercial real estate industry. In the United States, the market is segmented by designated market areas (DMAs), but Smith says they’re approaching the Canadian market differently. “We’re not looking at markets in terms of DMA like in the U.S., we’re looking at the markets in terms of voting territories.” With these parameters in place, Smith projects 300 to 350 locations eventually landing in Canada.
In addition to those with suitable financing, HOTWORX is looking to partner with franchisees who have the desire and passion to develop the brand, and investors come from all walks of life—no gym experience required! “If someone has a fitness background, that’s an advantage, but we’re also seeing general managers who do very well, and they didn’t come from that background.”
In fact, 80 per cent of their franchise growth is organic, says Smith, and many franchisees began as members who fell in love with the concept. “They’re hooked because of the experience they have at HOTWORX,” he explains. “Everything from the décor to the effectiveness of the workout.”
A support system that WORX
With strong programs and proprietary software in place to manage everything from point-of-sale systems to workout videos, and due in large part to its semi-private workout environments, HOTWORX was able to continue operations during COVID, scaling back their offerings and reintroducing them as barriers lifted. “I don’t know how we could have done it any other way,” says Smith. “Because we’re so vertically integrated in terms of our software, we were able to pivot.” Within a few days of the initial lockdowns, they launched HOTWORX AT HOME, an on-demand streaming service, and the brand came back bigger and better than ever once social distancing was lifted.
Part of their success has been anticipating and responding to what may come next, even in times of adversity. “We came back strong,” recalls Smith when thinking back to those tough few years. “We hired a seasoned veteran marketing professional as VP of marketing, and he came in and did some strong things. That put us on a good trajectory.”
On the topic of teamwork, Smith has been working with Jessica Materne, vice president of franchise performance for the last 20-plus years, and their work relationship has extended today to the operations of HOTWORX. “I call her ‘The General,” he jokes. “She runs our department of business coaches,” which amounts to one coach for every 50 locations, a number that is rapidly increasing. Post-COVID, the team manages daily tasks from their homes, attending virtual meetings and facility inspections via FaceTime, which Smith notes is “so much more effective” than flying to meet each owner in person.
Measuring what’s important
As part of HOTWORX’s success metrics, coaches are tasked with duties similar to that of a football coach, in that they teach and motivate franchisees as part of the brand’s ongoing commitment to success. “Sometimes that motivation has to come in the form of being held accountable,” says Smith. “Much like [on a] football field, it’s better to run the play that’s sent to you by the coach. It’s the same thing in franchising. We’re here to score touchdowns for the fans, and the fans are our customers.
“If you want to fill your stadium—the studio—with raving fans, you better be scoring touchdowns all the time. Execute the playbook, or the franchise system, at the highest possible level.”
Smith cites many pillars of success, from customer experience to profitability. “If you’re not focused on being profitable, you’re not really an entrepreneur. You can only be truly profitable long term through the daily bliss of your customer base.” When it comes to the customer experience, he adds that the franchisee is in complete control. “For us, that means great workouts, a great concept, and great customer service.”
Smith advises potential franchisees to initiate the discovery process and watch it unfold. “You can do it as fast or as slow as you want,” he says, though he suggests approaching it expeditiously, because it will set the tone of how you’re going to run your business.
He adds that the interview process is a two-way street. “The prospect is going to be interviewing us, and we’re interviewing them. Either party can pull the plug at any time. […] Once we sign the dotted line together, it’s a 10-year agreement, and we both want to feel it’s the right fit.”
Smith resists summing up the brand in one line but says a good product can be a guide that speaks for itself. When HOTWORX first opened, it didn’t take long to realize that its popularity sprung from the promise of more results in less time.
“I guess if I were to say what our mission is, our mission is to give customers the best possible experience in the shortest amount of time for their fitness needs,” he says thoughtfully. “Saving customers time is never going to go out of style.”