Case Study: Cash Flow Turnaround for a Multi-Location Fitness Franchise Group

Cash Flow Turnaround for a Multi-Location Fitness Franchise Group

How a 6-studio fitness franchise group went from “we don’t know where the money’s going” to a clean 13-week cash view, location-level profitability, and confident growth decisions.

6 studios, $8M+ annual revenue
13-week cash flow by location in 30 days
Payroll timing and rent risk eliminated
Studio-level P&L clarity for every head coach & GM

Client Snapshot

Brand: National fitness franchise (independent multi-unit group)
Footprint: 6 studios across one major metro
Annual revenue: ~$8M
Engagement: Fractional CFO (6 months)
Systems: Member management platform, QuickBooks Online, Gusto Payroll, Excel

The Situation

On the surface, this fitness franchise group looked successful. Classes were full, membership drafts were strong, and new locations were on the horizon.

Under the hood, it was a different story:

Cash balance swung wildly week to week.
Payroll, rent, and marketing spend were happening on different cycles with no clear view.
Ownership couldn’t answer simple questions like “Which studio is actually profitable?”
QuickBooks was being updated, but no one trusted the numbers.

The owners didn’t need more reports—they needed a real cash map and studio-level unit economics they could run the business on.

Key Challenges

No 13-week cash view. Draft revenue was predictable, but vendor payments, rent, and payroll created constant surprise dips.
Studios treated as “one big pot.” All cash sat in one operating account, so leadership couldn’t see which locations were funding others.
Messy chart of accounts in QuickBooks. Inconsistent coding made location-level P&Ls hard to trust.
No owner-friendly dashboard. Data lived in spreadsheets and ad-hoc exports from the membership system; nothing tied cleanly into QBO.

What Stratego Did: From Guessing To A 13-Week Cash Engine

Step 1: Clean the Books & Rebuild the Chart of Accounts

We started with a 90-day cleanup of QuickBooks Online:

Standardized the chart of accounts for all 6 studios.
Tagged every transaction by location and category (draft revenue, drop-ins, retail, payroll, rent, marketing, tech stack, etc.).
Reconciled bank and credit card accounts to remove old noise.

This gave us a single source of truth for studio-level P&Ls.

Step 2: Build a 13-Week Cash Flow Model

Next, we implemented a rolling 13-week cash forecast:

Pulled recurring revenue from membership drafts and average weekly ancillary sales.
Mapped all fixed obligations (rent, payroll, software, loan payments) by week.
Layered in variable expenses like marketing, events, and repairs based on historical patterns.

Within 30 days, ownership saw exactly which weeks were tight and which levers to pull to stay ahead of cash crunches.

Step 3: Studio-Level Unit Economics & Benchmarks

With clean data, we built studio scorecards:

Revenue per active member
Payroll % of revenue (total & coaching split)
Rent % of revenue
Marketing ROI by channel

We set target guardrails for each metric so owners and GMs could see when a studio was out of bounds and what to adjust.

Step 4: Owner Dashboard & AI-Assisted Reporting

We then stood up a simple, owner-friendly dashboard:

Weekly email summary of cash, AR, and upcoming obligations
Monthly studio P&Ls with trend lines
AI-generated narrative summaries (“Studio 4 labor trending high vs. target; Studio 2 rent leverage best in portfolio”).

This turned financials from a rear-view mirror into a steering wheel.

Step 5: Cash Governance & Decision Rules

Finally, we created simple cash rules of the road:

Minimum operating cash threshold for the group
When to pause discretionary spend
When a new studio could be green-lit based on cash + unit economics
How/when to pull owner distributions without starving the business

The Results: Calm Cash, Confident Growth

13-week cash visibility for all 6 studios in the first 30 days.
Payroll, rent, and loan payments fully mapped, eliminating surprise shortfalls.
Studio-level profitability clarity—owners could see exactly which locations were carrying the portfolio.
Labor % reduced by 3–5 points in under 90 days by resetting staffing and class loading against targets.
Owner distributions put on a schedule, instead of one-off withdrawals.

Most importantly, the owners stopped asking, “Can we make payroll?” and started asking, “When do we open studio #7—and with what cash + debt mix?”

Want This Level Of Clarity For Your Studios?

If you’re running a fitness franchise or multi-location studio group and cash feels tight even when classes are full, it’s time to rebuild the finance engine.

We’ll walk your numbers the same way we did for this group—cash, unit economics, and AI-powered reporting—on a 30-minute CFO Strategy Call.