Bonus Perks — Tips for Increasing Ancillary Revenue
When a potential member is shopping for a health club to join, they usually have numerous options to choose from. They will consider various factors such as location, price and facilities. Almost every gym has treadmills, strength equipment and locker rooms, but what can you offer to make your gym stand out from the rest?
This is where ancillary revenue and services come in. Not only do services such as personal training, a pro shop, or a smoothie bar provide members with an enhanced experience, but it also brings in extra revenue for your club.
Gainesville Health and Fitness Centers (GHFC) in Gainesville, Florida, uses various profit centers to provide a little something for everyone. The facility operates a smoothie bar, retail store and offers numerous training programs such as CrossFit and X-Force. “With such a wide variety of members, we try to offer a little bit of everything for everyone,” said Noah Hastay, the operations manager at GHFC. “We target different markets, whether it is by age, income, etc.”
A perfect example is the club’s in-house specialty-training program, X-Force. “It is for the working professional who doesn’t have a lot of time to workout, so they have these 30-minute workout options,” said Hastay. “And they get great results, so we always try to keep the focus on the results they can get.”
By offering a variety of training options, members are more likely to achieve their fitness goals, but they are also more likely to stick around. As Hastay explained, once a member gets sick of one program, they can move to another. “So rather than losing them as a customer, they just switch [programs],” he added. “That has been the design we have been putting together over the last 10 years, to create multiple studios under one roof. That way they are not going to another business to get the same product that we can offer here.”
Around the Clock Fitness, with several locations in Florida, provides several additional services to members beyond the typical fitness equipment. Similar to GHFC, Around the Clock Fitness offers CrossFit and other signature training classes. Beyond that, the club also runs a café where members can buy wraps, salads, protein shakes and more.
At the café, members can also purchase prepared meals by MEALSfit4U. Around the Clock Fitness partnered with the custom fitness meal program in order to give members ready-to-go, quick and healthy food choices.
“When we finally found MEALSfit4U, they were the right fit at the right price,” said Georgia Kline, the marketing director at Around the Clock Fitness. “So often these pre-packaged companies want to offer all of these great meals, but they are priced out of the ballpark so no one can afford them. With this, members can come in and grab a meal for themselves or oftentimes, we have moms that work and they don’t have time to cook, so they will pick up meals for the family.”
Members at GHFC also have access to healthy food options at the club’s smoothie bar and branded clothing at its retail shop.
When determining what to sell in both of these profit centers, Hastay explained they look at what is trending with customers. “We look at what is hot in terms of retail — not just in the fitness industry, but in the retail industry as a whole,” said Hastay. “It is also important to create exclusivity. Don’t keep something on the shelf for a long period of time. Bring out new releases on a frequent basis, in a limited supply, which creates this ‘get it while it lasts’ mentality.”
While providing members with a wide variety of services is an added perk, don’t go overboard. When adding a profit center or ancillary service, start small and slowly expand when you begin to see success. “The fewer options that you have, the easier it is to sell,” said Adrian Antigua, the general manager at GHFC. “I see a lot of health clubs that go for the full-scale restaurant or full-scale retail shops, and I hear how it is a struggle to make money because you are investing so much into it.”
The bottom line when starting to develop ancillary revenue streams: Don’t forget your mission. At the end of the day the main objective is to help members achieve their health and fitness goals, and it is important not to get distracted from that.
“Don’t get over your head with trying to offer everything, because you need to stay true to what your company stands for,” added Antigua. “We are not trying to be the next competitor to McDonald’s through our smoothie bar. We want to make sure we keep our focus on being the best health club we can be.”