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Club Solutions Magazine

Anytime Fitness

June 10, 2013
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John KershWhen John Kersh wakes up each morning there is no telling where he will be in the world, but no matter where he is, there are two things constantly on his mind. First, “How do I improve our clubs,” and second, “How do I provide more places for individuals to exercise?”

Kersh, the vice president of international development for Anytime Fitness, has been crucial in the worldwide expansion of the brand since he came aboard in 2008. However, Kersh is nowhere new to world travel.

After graduating from Michigan State University in 1986, Kersh worked in the hospitality industry, until he took his position working with Jeff Brewer, co-founder of Brewer’s Ledge, selling the Treadwall. Brewer had been inspired to build a product that allowed him to practice rock climbing in his own backyard. Being a fitness enthusiast, and in need of a job, Kersh was sold.

Kersh worked for Brewer’s Ledge selling the Treadwall from 1991 until 1992 when he had an opportunity to begin working for the International Health, Racquet & Sportsclub Association (IHRSA). Still young, Kersh found excitement working in international business development.

“I like the sense of adventure and going some place,” said Kersh. “If I spend too much time at home I get nervous and feel like I need to get out and go somewhere. International travel gives me that, and I enjoy meeting and interacting with people around the world. It’s something I do very well, in terms of communicating and building relationships, and I really enjoy it.”

Kersh’s major in communications and working in the hospitality industry prior to Treadwall, primed him for being good at developing relationships. Early on, it was the relationships that he developed while attending IHRSA trade shows that helped him be a top candidate for a position with the organization.

“While I was working at IHRSA in the early 90s, they would receive these inquiries for health clubs in Europe, Asia and Latin America, and people were interested in membership with IHRSA, or finding out more information about the industry,” explained Kersh. “I would always raise my hand and say, ‘I’ll take care of the inquiry for you in Germany or Japan.’ I was kind of the go-to person in the beginning stages for a lot of the international inquiries that would come into IHRSA.

“In 1994, IHRSA hired a gentleman by the name of Hans Muench, and Hans had a very interesting industry background. He came on board as IHRSA’s first director of international development. He was the one that initially got out there around the world and connected some of the dots with people he knew, and helped get IHRSA exposed internationally.”

Kersh worked closely with Muench to help establish IHRSA’s international framework. “When Hans left IHRSA in 1998, I took over his position as director of international development,” said Kersh. “After which we put together some pretty interesting programs, a major conference in Europe, a major conference in Asia and a major conference in Brazil, which two of those are still going on to this day, and are very successful.”

IHRSA allowed Kersh to travel the world and get to know club operators in every corner of the globe. He could look inside the struggles and the differences that made clubs successful in their respective countries, and discover tips that could help  clubs elsewhere become more successful.

John KershThe crucial aspect that Kersh learned in his career at IHRSA was the importance of listening. “If you’re able to listen carefully, and really understand what someone is trying to say, even though their English might not be perfect, and even though you might only understand 60-70-80 percent of their message, by listening carefully you can get much farther along,” he explained. “To be able to reply or to answer a question, based on a real understanding, fundamentally it’s the most important thing — obviously, in any kind of business relationship, but absolutely on the international side.”

Kersh spent over 11 years at IHRSA. “I really enjoyed working for John McCarthy,” he explained. “John is a guy that I find to be a fascinating leader, and he’s a really smart and compelling kind of guy. To be able to spend time with John and observe how he interacted with people, how he approached them, was really good. I would say that was the number one thing that kept me at IHRSA for so long, combined with the fact that there were still lots of opportunities for IHRSA to be more influential around the world.

“By the time IHRSA had established itself in Europe, Asia and Latin America with some events and magazines, once those goals were reached, I kind of feel like I had accomplished what I had set out to accomplish there. It was a good time for me to leave, when I left.”

After leaving IHRSA in 2004 to open clubs in Brazil, Kersh jumped back into international development in 2008 with his new role at Anytime Fitness. While Kersh traveled the globe with IHRSA, he was able to see health clubs operate on many levels. “They were beautifully designed, with quality instructors and great education and passion about fitness,” he said. “A lot of programs and products are unique and worthy of considering on a global scale. There is a lot going on out there that people aren’t aware of.”

Once Kersh was introduced to the Anytime Fitness co-founders Chuck Runyon and Dave Mortensen, he saw in their brand what he had seen in other successful clubs around the world. “At the time, Anytime Fitness was just beginning an international expansion program,” said Kersh. “They had just concluded a deal to extend into Australia in 2008, and I think they were smart enough to realize that they needed someone to devote 100 percent of their attention towards international development. There was a big opportunity out there and you have to have someone own that project.”

Anytime Fitness’ search for that person led them to Kersh by way of an introduction from McCarthy. “It’s been a good fit,” explained Kersh. “I love the DNA of Anytime Fitness and the corporate culture. For me personally, it’s a great match.”
In terms of opportunity, Kersh said that outside the U.S., he has seen clubs of all sizes that could rival anything that we develop in the U.S. However, what kept him at Anytime Fitness was that he hadn’t seen clubs internationally that had the appeal of Anytime Fitness. “They are simplified with systems that have been evolved over time and proven to work,” he explained. “From a concept standpoint, the concept is extremely strong. Parallel, the company has really embraced franchising, which stacks up quite well with franchise companies in other industries. Anytime Fitness is a great franchise company. Those two fundamentals are crucial in developing internationally.”

Additionally, Kersh believes that the Anytime Fitness model has helped it grow as a franchise, as opposed to other larger clubs that also franchise. “To do a bigger club you might be on the investment level of say a McDonald’s, which might cost you $1 million or $2 million, or more,” he said. “The cost factor is different. You start to exclude potential franchisees that don’t have the financial capacity to open up a big club that has a much more expensive build out. In franchising, it’s all about creating a reliable system that works. The larger a facility, the more difficult it is to develop and train franchisees on exactly how to do it right. You end up with franchisees doing it the way they want to do it, and you might have variations on the system that cause it to be less successful. A smaller club, and smaller concept is more focused on fundamental activities that have to be done this way for the business to have a higher chance at success.

“When we go into a new country, we typically like to do it with a partner in that country who has some business experience, who has franchising experience, perhaps fitness industry experience. They know the marketplace, the local culture. They know how things work and how to go through the tax systems, the legal systems to get things done. That’s the kind of partner we call a Master Franchisee.”

John KershThe Master Franchisee maintains multiple roles for Anytime Fitness. In fact, Kersh framed the Master Franchisee as a “Runyon-figure” or “Mortensen-figure” in that country. Someone that can truly understand the business, what makes it successful and can help other franchisees grow and be successful as well. “The Master Franchisee essentially owns the rights to develop the Anytime Fitness concept within the particular territory that we identify,” Kersh explained. “They own the rights to our concept. We support our Master Franchisees to replicate what we do, then they go out and find franchisees locally by doing some of the same things we do in the United States. Perhaps going to franchising trade shows, probably advertising in franchising publications, promoting through electronic sources, websites, Google and other lead-generation sources from franchisees.”

Finding a Master Franchisee has been like finding a needle in a haystack. “We get hundreds of inquiries, and rarely are the people we speak with the type of people that are capable of doing the job as a Master Franchisee. It takes a lot of time, a lot of trips to those countries, a lot of e-mails and telephone calls, to narrow down someone that might be the right person for us.”

Anytime Fitness looks for multiple aspects in potential Master Franchisees, beginning with a certain financial capacity. “A Master Franchisee has to open up a first Anytime Fitness club in their territory, so there is a cost associated to that,” said Kersh. “They’ve got to develop all the franchise materials to conform to local franchise laws, translation involved, some technology involved, so there is definitely an expense in there. We like to have a Master Franchisee with at least a million dollars available in capital to invest in the beginning stage of the project.”

However, Kersh doesn’t necessarily believe that finances are the most important aspect to becoming a Master Franchisee. “Our Master Franchisees have to really believe in Anytime Fitness and feel passionate about Anytime Fitness,” he said. “That’s what makes our business strong. We say at our corporate office that we bleed purple. It’s a very important factor for us as a company, and very important for our culture that we bleed purple. We bleed purple, our franchisees bleed purple, and often our members bleed purple. We want our Master Franchisees to feel the same way. We want them to be extremely excited and proud to be involved with Anytime Fitness, and we can’t teach them that. We can’t sell them on that idea — they have to gain it themselves.”

The Master Franchisee, once established in their country, assists new franchisees in development similarly to a franchisee in the U.S. However, as businesses are developed, they are not always the same as in domestic markets, and it’s Kersh and the Master Franchisee’s responsibility to ensure that clubs can be established with the same success rates, in terms of retention, sales and marketing, as clubs throughout the U.S.

Over the years Kersh has realized these differences, which has made him successful at international development. He has been able to listen to the Master Franchisees to discover obstacles in their countries, and how new franchisees might be able to become successful.

He referenced Anytime Fitness locations in Japan that have had to adapt to the culture. “In the United States we have a pretty high participation rate for fitness,” explained Kersh. “In Japan for example, it’s quite low, it’s about 3 percent of the total population are members of health clubs. But, that 3 percent of the population is quite educated, they’ve got good levels of income and they’re quite stable and secure. Whereas in markets where you have bigger percentages are members of health clubs, you kind of have all kinds of people. You have people that are experienced club members that want to try new things. And you have people that are newcomers and they find it hard to develop the habit. You have young people that are bouncing around to different offerings. There are a lot more challenges, and probably a lower attention span in the United States than there is internationally.”

The process of finding the next great location for Anytime Fitness follows Kersh and the aspects he believes will make for a successful territory. “We look for more advanced and developed markets in many ways because the components for franchising are already in existence,” he said. “That’s in the U.K., or the Netherlands, or Spain, or Australia, or Japan. These are markets that have a lot of those elements in place. I look at Europe and I see places where we ought to be active in the future and probably will be. I look at Asia and very interesting opportunities around Asia, and Latin America as well.”

For Kersh and Anytime Fitness, Europe, Asia and Latin America have provided a stable landscape of successful club operators that could potentially become Anytime Fitness franchisees, or Master Franchisees. Somewhere in the world, almost daily, an Anytime Fitness opens. “We have a pipeline of openings scheduled in every market that we’re operating in,” said Kersh. “I wouldn’t put money down on where we’re going to open one next, because it could be anywhere.”

 

By Tyler Montgomery

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1 Comment

  1. Paul Taicher August 8, 2013 at 12:58 pm

    Hello I have seen that you have expanded in Spain and want to grow thru other Countries in Europe.
    I have the Perfect Location as a Marketing Tool to grow faster in this part of the World and have something very Special!
    How would you like a Gym at 2,000 meters up in the mountains at the World renown Ski Resort Sierra Nevada in the Province of Granada, Spain?

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