Again achieved system-wide sales of $235 million in 2008, down 6% from sales of
$250 million 2007, according to the annual report of its parent Winmark Corp.
For the years ended 2008, 2007 and 2006, Play It Again Sports contributed
royalties and franchise fees of $9.8 million in 2008 versus $10.4 million in
2007, a decline of 5.7%.
According
to the filing, Play It Again ended the year with 364 stores at the end of the
year versus 374 at the close of 2007. It added 14 stores and closed 24.
In 2008,
nine Play It Again Sports franchise agreements expired. Of those franchise relationships, 9 were
“renewed” with the signing of a new 10-year franchise agreement. In 2009, 2010 and 2011, 12, 26 and 56 Play It
Again Sports franchise agreements will expire, respectively.
Play It
Again Sports franchises sell, buy, trade and consign used and new sporting
goods, equipment and accessories for a variety of athletic activities including
hockey, wheeled sports (in-line skating, skateboards, etc.), fitness,
ski/snowboard, golf and baseball/softball.
According
to the filing, at December 27, 2008, the franchise fee for all of Winmark's was
$20,000 for an initial store in the
and $20,000CAD for an initial store in
can open additional stores, in any brand, by paying a $15,000 franchise fee for
a store in the
$15,000CAD for a store in
provided an acceptable territory is available and the franchisee meets the
brands additional store standards.
Beginning in March 2009, the franchise fee will increase to $25,000 for
an initial store in the
The franchise fee in March 2009 for an initial retail store in
retail store in
will be $18,000CAD.
The
franchise agreement has an initial term of 10 years, with subsequent 10-year
renewal periods, and grants the franchisee an exclusive geographic area, which
will vary in size depending upon population, demographics and other
factors. A renewal fee of $5,000 is
payable to us as part of any franchise renewal.
Under current franchise agreements, franchisees of the respective brands
are required to pay Winmark weekly continuing fees (royalties) equal to the
percentage of gross sales outlined in their Franchise Agreements, generally
ranging from 4% to 5% for Play It Again Sports.
Beginning in March 2009, the royalty rate for Play It Again Sports
franchisees opening their second or additional store will increase from 4% to
5%.
Each
franchisee is required to pay an annual marketing fee of between $500 and $1,000. Each Play It Again Sports franchisee is
required to spend 5% of its gross sales for advertising and promoting its
franchised store.
Other
Winmark franchises include Once Upon A Child, which had sales of $136 million
last year; Platos Closet, $164 million; and Music Go Round, $26 million.
