Gold’s Gym

In 1986 Angel Banos first walked into Gold’s Gym Venice and witnessed fitness enthusiasts that he had read about in major fitness magazines lift heavy weights with an uncompromised vigor. The club seemed to inspire those individuals to become stronger, fitter and more accomplished.

Being an avid fitness enthusiast, Angel became enthralled with the Gold’s Gym energy. Formerly the owner of a women’s shoe store, but an avid weight lifter, he saw the real retail opportunity in actually owning Gold’s Gym clubs of his own. He contacted his younger brother Willy, and the two decided to make a run at owning their first Gold’s Gym. Little did they know that they too would eventually own 11 Gold’s Gyms, including one of the most famous gyms in the world, Gold’s Gym Hollywood.

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Born 15 years apart, Angel and Willy Banos had always strived to stay close. Angel, being the eldest, of course looked after Willy. However, Willy’s sharp business mind was prevalent to Angel at a very early age, and he knew that they would work well as partners.

When Angel decided to open a fitness facility, he immediately asked Willy what he thought, and whether he’d want to be involved. “I felt such unrivaled energy in that place,” said Angel about Gold’s Gym Venice. “I heard the clinking and clanking, and people just working out, and walking around showing off muscles. People talking about nutrition and everything, I just said, ‘wow.’ This was like being in New York City for the first time.”

Angel told Willy that there was something different that he  experienced at Gold’s Gym that he hadn’t at any of the other fitness clubs he’d witnessed. “I thought it was unique and different,” said Angel. “It gave a different experience and feeling in the workout arena that we had to just go ahead and make that call.”

“I was 20 years old at the time,” said Willy. “I had some retail background from working in our prior business together, I’m a communicative person, meaning I can talk to anyone about anything, so I took the challenge. I thought it was going to be great.” Immediately Willy went into designing flyers and announcements for the opening of their first Gold’s Gym. “I sat there with Angel and we went through our heads on how it was going to look, how it was going to be laid out, what was the best spot for everything. When I first heard the idea there was an unreal feeling, because who was in the health club business? It wasn’t typical like it is today.”

In 1988 there really weren’t any big box gyms, Angel explained. There were a few, but not scattered all over like today. “At that time, the health club industry was very risky for a lot of people,” explained Angel. “When we went into it, my own lawyer said I was better off playing the lotto. I disagreed with him; I thought it was a great business to be in, especially with our retail background. We felt that we’d have great assets going into the club business. We were able to communicate and have that connection with our members because we came from the retail business.”

When Angel and Willy opened their first Gold’s Gym location in 1988, the struggles they experienced weren’t typical. In fact, the only real struggle they could say for sure was the size of the club. “Our first club was very, very small — it was 8,600 square feet,” said Angel. “From day one, it was a very successful gym. We ended up being very busy, to full capacity on most nights. So, the struggle was actually the size, and that was a big challenge for us.”

“We won rookie of the year our first year out from Gold’s Gym International,” said Willy. “We had sold the most presale memberships in the history of Gold’s Gym. Part of our motto was serving our community, one member at a time. We were there shaking hands, kissing babies. People weren’t committing to joining the health club, they were committing to a relationship with us. We still carry that today. Even though we aren’t in every club, we instill that in our staff and our key vice presidents that people will quit gyms, but they won’t quit relationships. At the end of the day, it’s still a human contact business — you’re meeting somebody, you’re shaking their hand, you’re sitting down, they are trusting in what you’re saying that you can better their health, better their life, live longer, feel better. If the trust isn’t there, I think you have a hard time developing that relationship, and I think your attrition numbers are much higher.”

The relationships that Angel and Willy developed allowed their first location to thrive and bring them vast amounts of members and credibility within the fitness industry and Gold’s Gym brand. Three years later, the brothers decided that enough time had passed, and riding on the success of their first club decided to open their second Gold’s Gym location.

“We ended up opening another club in the Hollywood area,” said Angel. “That club became one of the busiest clubs in the Gold’s Gym chain. We learned a lot from the first club on what to do and what not to do and we ran things different, with more professionalism and more communication to our members. At that time there was no Internet as it exists today. We still mailed out information to our members and we did a lot of advertising through the community and did a lot of promotions within the community. We did a lot of marketing within restaurants, it was all very much gorilla marketing, and we did a great job.”

To the brothers, the human contact was priceless. It was the roots of their business. “It became a very busy club, and it still is,” continued Angel. “It still is one of the busiest clubs in the world. It was a massive, busy club, and we are very proud of that one — it is sort of like the mother ship for us.”

“The struggle with California is finding real estate,” explained Angel. “Our cost of doing business here is probably 22-28 percent more than the norm of the country. We have a lot of high real estate costs, higher worker compensation cost, higher insurance cost, and also, from what I’ve learned, a higher labor cost. Our cost was higher, yet our membership prices weren’t higher — they were the same as everywhere else. In some cases we had to charge lower because the market was just so competitive.”

Aside from cost, finding the proper personnel that could match up with the same beliefs in business as the Banos’ was an additional struggle. “Creating that best service, creating the best workout experience in the world, is what made us different than the competition,” said Angel.

Willy said the cost being what it was created a business platform that had to be based on additional revenue coming from inside the club. They made a point early on to focus on personal training and juice bars. “It had to be part of our membership program,” he said. “We had to make it part of our push. We couldn’t just sit and sell memberships.”

Angel concurred with Willy and said that being able to sell the ancillary products was a direct resolution to prior retail business. “We were very savvy at experiencing the other part, the other businesses within the business of the health club,” said Angel. “On a single day, we could have five or six different companies within the club itself, operating retail, personal training, group exercise, sun tanning, etcetera, that are making money besides the memberships. Having that retail experience really helped us with that.”

What hasn’t changed for the Banos brothers over the years has been the ability to rely on a brand. “Just having the name itself, has definitely given us a huge edge in our market,” said Angel. “It differentiates us from our competition by just having the name. The expectation of our members is different. They know we supply them with great equipment that works, great products, great services, great group exercise. I feel that having that name entitles us to give the member a different experience than the competition because it makes us work harder by giving us the potential and an end result that puts us in a place that gives the best workout experience in the world.”

The end game for everyone involved on the staff is about giving the member the greatest workout experience on the planet. “We don’t keep it a secret, we get everybody involved,” continued Angel. “Having that plan, when they wear the brand, they buy into it and they are proud to be part of the family. Having the brand, being part of this makes us best.”

“We do an advertisement with the Kings at the Staples Center here in Los Angeles, and we have a flex cam that we put on, where everybody is flexing for the camera,” said Willy. “You should see the crowd — they take off their shirts and start flexing. There is a certain realization, or a certain pride, that comes with our brand, and we’ve taken it to another level. We are the largest franchisee in California. People know the clubs that belong to the Greater L.A. chain. It’s very clear, they know what to expect, towel service is included, the place is clean, it’s run like a hotel, it has  eucalyptus in the steam room, it has a different feel — you know when you are in one of our Gold’s Gyms. Not that other Gold’s Gyms aren’t great, but for sure when you are in the  Greater L.A. area, and you’re at one of our Gold’s Gyms, you’re going to recognize that it belongs to us.”

“Our tools and our equipment, as well as our programs and services, are the best in town,” said Angel. The Banos’ individualized Group X classes and programs to cater to each community throughout L.A. For example, if one of their 11 Gold’s Gyms is located in a predominantly Latino community, the Group X classes will provide more rhythm and dance, such as Zumba. “We don’t have any one gym that is cookie cutter,” explained Willy. “They are all a little different based on what the community wants and needs.”

The changes that the Banos’ have seen over the years exist a lot in how they interact with members and nonmembers. With Facebook and Yelp!, the owners can now know exactly when someone is either happy or upset with the club. They don’t have to wait around for a negative letter to arrive via Snail Mail, but they will receive Facebook comments and have to address concerns immediately. “We comment on our negative comments and we fix those problems immediately,” explained Willy.

“The big thing right now, is there is nowhere to hide,” continued Angel. “Our retail experience has helped us be in touch with our members. We don’t care if you spend $2 a day or $2,000 a day, they are all treated like VIP members, and that’s our philosophy.”

The values that the Banos’ have poured into owning clubs, has helped their success within Gold’s Gym and the fitness industry as a whole. Now, the brothers are ready to grow again. They have two more clubs slated to open this year, and have reached an agreement with Gold’s Gym International to have franchise rights to all of Southern California. This opportunity, according to the brothers, will add an additional 25 to 30 clubs in the coming years.

By Tyler Montgomery