The first quarter of a new year in the fitness industry is always stressful, but also a great opportunity to take advantage of new member sales and increased revenue. Now that the excitement of the New Year has quieted down, it’s a good time to audit your business and to see where you can add revenues and minimize costs to make your center more profitable.
Increase Revenue Streams
Focus on Marketing – Typically half of new member sales take place in the first quarter of the year. Reap the rewards for the rest of the year by ensuring that you have incoming traffic now. Be aggressive with known successful marketing techniques and keep an eye out for new ones. If you are the low-cost provider, get that message out with aggressive price offers. If you are a high-service provider, use your marketing to demonstrate why your center is different.
Train Your Sales Staff – Capitalize on the increased traffic by setting aggressive sales goals and training your sales team (dedicated salespeople or the entire staff). Train on basic sales techniques to optimize closing percentages and using “assumptive closing” techniques to pre-handle objections and close sales. Proactively follow up on all misses with phone calls, e-mail blasts or direct mail pieces. Use your software to employ targeted e-mail offers, personalized direct mail pieces and to keep track of the follow-up on prospects.
Highlight Your Other Profit Centers – Run specials on pro-shop items, juice bar, programs, etc. to highlight all of the products/services you have to offer. Make presentations about personal training to all new members right away –when they are excited about reaching their fitness goals. Be sure that trainers have the sales skills needed to convey their importance. Utilize software that helps trainers through the sales process to make their case and improve closing percentages.
Get Creative with Expense Management
Utilities – Look into ways to cut costs on the monthly utility bills. Have an energy audit performed on your club. Research energy-efficient heaters, alternative electricity suppliers – you may be able to save 20 percent or more over your local utility company – motion-sensor light switches, etc. How about getting your electricity for free? Hook up your spin bikes to the power grid and make your electric meter spin backwards – it’s being done in clubs now.
Over-the-Counter and EFT Merchant Fees – Shop merchant fees to find savings. You might save hundreds in credit card processing fees by changing your merchant company. Are you paying more than 2 percent and 20 cents per EFT transaction? Are you paying transaction fees for checking? If so, you can probably save. Most merchant companies will do a free cost comparison to earn your business.
With both over-the-counter and EFT merchant fees, use a billing and/or software company that are PCI compliant. This level of credit card security must be met by all clubs to avoid penalties, and equally important, to safeguard your business against the damaging effects of a security breach.
Software – Have you shopped to see if other club management software vendors can offer the same functionality (or more) at a lower price? Most will do free cost comparisons. Get the total costs – determine if the company charges for tech support, upgrades, training, number of members, number of computers being used, etc.
Group Purchasing Power – If you are part of a franchise, use that power to purchase products and equipment in bulk at reduced prices. Many vendors offer preferred pricing when selling to large groups. Even if you aren’t a franchise, try developing relationships with other center owners to create an alliance to lower your costs with vendors.
With a new year underway it is not too late to take a look at your business and make necessary changes to ensure greater profitability. Doing the same thing year after year against increasing competition in a still slow economy will not increase profit – you need to make intelligent changes to continue to grow your business.
Len Bell is a sales associate with Twin Oaks Software. He can be contacted at 866.278.6750, or by e-mail at firstname.lastname@example.org, or visit www.tosd.com.