Mike Chaet, known to most people in the industry as Clubdoc, worked in his first club manager job in 1965 at the Heritage Pool and Racquet Club in Concord, MA. He was 18 years old at the time. Since then, Mike has been dedicated full-time to the club industry, without a break. In 1975, he founded CMS International, a club consulting firm, with consultants in more than 50 countries, which specializes in helping independent club owners and operators. His company, CMS International, was the first inductee of IHRSA’s wall of fame in 1985. Just last year, he was presented with CanFitPro’s Lifetime Achievement award in Toronto. Most recently he authored the bible for independent club developers entitled, The New Club Guide.
CS: It’s great to be able to sit down with you and ask some of the pressing questions that have been asked by independent club developers regarding new club development. Let’s start with your thoughts on being an independent club operator today.
ClubDoc: I believe there are great opportunities out there for independents as long as they are smart about it. The large chains have their own systems and resources, but in many cases, they are bogged down by corporate demands, needs and cultures. Independent club operators need to be able to maintain their independence, fluidity and flexibility, but they should still be part of a network of clubs so they can take advantage of collective knowledge and resources. That is where we come in, we provide that network, system, backup, and collective resources.
New independent club developers are at a distinct disadvantage when they try to figure out everything on their own. They may go to great trade shows and belong to associations, like IHRSA (International Health and Racquet Sports Association) and ICOA (Independent Club Operators Association), but of course, the people in the trade show booths are salespeople trying to sell products. We help the independent developer to sort through the noise and to make intelligent, unemotional decisions.
CS: Let’s get right to it – What are the three most important lessons you have learned about developing a new club?
ClubDoc: I would say that the three most important lessons I have learned are:
First, PREPARE FOR SUCCESS. The club developer must know absolutely everything about the market they are about to enter. For example, traffic flows, economic base, education levels and competitive analysis to population demographics are essential information – even religious preferences are important. I once did a study in an area heavily populated by Muslim families in which adult males and females do not mix in health clubs. We were able to help the owner to make good decisions in this situation.
Second, GET IT RIGHT THE FIRST TIME. You only get one chance to make a first impression. If your positioning and marketing is done properly from day one, you can open your club and it can be full of paying members from day one. This is great for cash flow. Many times, I have observed projects with a haphazard approach to this, and they end up behind the eight ball from day one. It is so, so hard to catch up once you’ve fallen behind. You need to be sure to budget enough to fill the club during the pre-opening period – at least 10% of the development cost or $100 per membership, whichever is greater. Make sure you are properly capitalized right from the very beginning.
Third, THE JOB OF DEVELOPMENT IS NEVER DONE. Even though you think you are building a new club, you need to understand this industry is one of constant change. You are actually just at the beginning of a long-term process. You need to plan for remodeling, re-equipping, re-development, and re-Grand Openings, on a constant basis. We build that into the business plan, and let the bank know that this is part of the process. We build it into the design plans, and even make arrangements with equipment companies to replace equipment on a schedule.
CS: What is the favorite project on which you have worked?
ClubDoc: I have to say my favorite project is my longest standing client from Schererville, IN, Omni 41 Sports Complex. We started with them in 1981; I can’t even count the changes we have made over the years. They are now well over 200,000 square feet and 10,000 members, and one of the single, most successful clubs in America. I like them so much because of their growth, and their willingness to change and improve mentality. Marci Crozier and Sharon Sporman have been great to work with.
CS: What is your favorite type of club?
ClubDoc: In today’s market, more than ever before, there are so many models to choose from – full-service, women’s only, 24-hour key club, small “fit stops” to big box clubs, and some are even sports-specific, like tennis only. My favorite model is the one that works! Each market has different people with different wants, needs and desires. There are two ways to look at this:
1. Pick a model you like, such as a Curves franchise, or a Bally’s Total Fitness, and place it in a market that needs that model.
2. Or, find a market that is underserved and match the model to that market. For example, a densely populated area with no family club would be served well by putting one in.
As I said, my favorite model is the one that works in any given location. Our job is to help the developer make sure he or she makes the right choice.
CS: With whom do you typically work?
ClubDoc: Many times we end up working with people who are successful in their own right in an unrelated business or profession. Today, fitness is part of the fiber of society so people see it as a good investment. That’s where we come in. We help our clients to make good decisions from day one and to stay out of trouble. On occasion, we may even talk them out of coming into the industry – if it looks like they are headed for problems. The earlier we start with a project, the better it will go. We always start with a free evaluation meeting. We look at the project and see if it makes sense to go forward, from that point, we work with the owner to develop a plan to do so.
CS: Why do people want to get into the club business?
ClubDoc: For a variety of reasons. The most dominant one is that people believe in fitness as a lifestyle; so they see it as a good investment. In many cases, this is in fact the case, but a word to the wise: A health club is no different than any other business; it has rules and must be run on sound business principles. A “build it and they will come” mentality does not work, and is truly a good way to lose money.
CS: How do you start with a new club project?
ClubDoc: Each and every project starts with a clean slate. We have a huge bank of systems, resources and knowledge on which to draw. We start with data collection, we then run it through the computers and generate a feasibility study. This gives us a good picture of whether the project will work or not. If in fact it is a go, we then will help prepare loan presentations; work with designers and architects; develop and execute a presales program; set up the operating systems, and train the staff. It’s quite a process, but it’s all systemized, and goes quite well. I must add that we only work with one club per market area. We always need to make sure we don’t already have a club in that area before we proceed.
CS: Do you stay with the club once it is open?
ClubDoc: Absolutely, we have an ongoing program of marketing and management support that will keep the club right on track after they open, and forever after. Once our systems are put into place, we provide ongoing training, marketing and support. We even have our own convention where our consultants, clients and preferred vendors get together to network, learn and have a great time.
CS: What are the six most important things that you would like to leave our readers with?
ClubDoc: The six things I would suggest to a club developer are simple:
1. Prepare for success by acquiring all the good information you can.
2. Trust your gut, if something doesn’t feel right, it probably isn’t.
3. Make sure you have enough money to get the project done properly.
4. Treat your employees like gold – it’s a luxury cruise or shipwreck journey.
5. Show up every day – knowing it isn’t enough, you have to do it.
6. Get involved with a support group like ours – it will help you stay out of trouble.
Mike Chaet, the Clubdoc, is Owner and Founder of CMS International. To see if your club qualifies, or if you need more information, call 406.449.5559 or email clubdoc@cms-clubweb.com, or visit the website at www.cms-clubsuccess.com.
