As you very well know, there is a lot more involved to running a health club than simply boasting personal trainers, engaging Group X classes and high-end fitness equipment. What members enjoy on the front end is the result of a myriad of back-end processes, procedures and systems that must work in unison to keep the doors open.
Billing and collections are important pieces to that back-end puzzle. Without proper systems in place for processing membership dues and collecting past-due payments, your gym could quickly go from thriving fitness center to flailing business.
“It is critical for billing and collection processes to be effective and efficient,” said Christy Bachara, the director of business systems for Power Wellness. “Investing time to identify best practices for account management, including leveraging efficiency tools within Compete’s software, has definitely allowed us to reduce resources dedicated to our monthly audit. Our tactics result in membership retention, report credibility and resource efficiency.”
With this in mind, the following are key strategies vital to an efficient and effective billing and collections process.
Finding a Great Partner
At The Claremont Club, ABC Financial is used for the operation of the entire club, minus the salon and spa. Philip Pandy, the club’s chief financial officer, touted the benefits of partnering with software providers to streamline back-end operations like billing and collections.
“ABC Financial bills and collects all dues and club account amounts,” explained Pandy. “All memberships are set up for charging by credit card, debit card and/or ACH drafting. ABC Financial is a full-service club solution entity — they can bill and collect as well as forward to collection services.”
For Power Wellness, which manages 30 clubs across the U.S., it has found a trusted partner in Jonas Fitness — and uses the company’s Compete billing and collections solution.
“We are in very capable hands with Jonas’ EFT billing support team,” explained Bachara. “At times, there’s a need to contact support to determine why a form of payment is not allowing EFT withdrawal or to inquire about a billing file. Their team provides assistance with care and expertise.”
Another challenge Jonas Fitness helps Power Wellness solve is encountering closed bank accounts due to credit card fraud. “Compete’s Account Updater service is a simple and efficient method we employ for receiving automated updates to customer account information,” said Bachara.
The software is also helpful to members, allowing them to manage their own account information. “Customers lead busy lives,” said Bachara. “Compete’s services include a self-service portal members can access 24/7 from any location to view account information, make payments and update their form of payment — when it’s convenient for them. This allows for a greater response to account resolution.”
Establishing Clear Communication
Unfortunately, billing and collections can’t be left solely in the hands of a software partner. Efficient and effective communication on a club’s part to members is also key to success.
The Claremont Club communicates to members at all stages of the billing and collections process, beginning with ensuring members understand the club’s policies as soon as they come onboard.
“Be transparent and tell your members what they will be charged for and why it is the best practice,” said Pandy. “We have membership policy handbooks that outline the member’s rights and our policies, which include billing and collections and methods to resolve disagreements. With all prospects, we review the policies of our club, what we expect from members and what we pledge to provide and do.”
In addition to in-person communication, The Claremont Club also uses email or mail notices to share updates or changes in billing policy, or to notify a member their account is past-due.
“We mail letters and emails to all members whose accounts are not resolved starting on the 7th,” explained Pandy. “We use a series of letters — one for those zero to 30 days past due, another for those 31 to 60 days past due and another letter to those 61 to 90 days past due. The letters ask for us to be contacted and each is more direct and demanding in content. The latter normally contains a date for us to be contacted to avoid being sent to a collection agency. If there is no response to the letter for the 61 to 90 days delinquent accounts they are written off, cancelled and assigned to an outside collection agency.”
According to Pandy, they have ceased using the Town Hall meeting method, where members are asked to come in for a meeting to resolve their account. “We tried the Town Hall meeting route but it was not well received,” he explained. “No one wants to be told when to come to the club for a meeting.”
Seek to Understand
Ultimately, Power Wellness has found resolving to work with members throughout the billing and collections process has provided a greater return for the business as a whole.
“Our team works quickly to resolve any billing concerns,” said Bachara. “Membership retention is a key priority, but equally as important is our commitment to the communities we serve. Situations vary — we work with members on a case-by-case basis to explore membership preservation options.”
Pandy agreed, stating that listening to the concerns of the members and trying your best to resolve a billing disagreement is key. “In other words, don’t transfer or send members to other departments or persons to solve their problem,” he said. “The quicker you resolve, there is less of a need to follow up for collection in the following month, plus there is closure. In challenging discussions with members, if you refer them back to the membership policies most often they will agree and work with you for a resolution.”
Pandy added it’s also important to admit when you are wrong. “Whenever this happens we absolutely desire to resolve the situation with the member immediately,” he explained. “This may also include offering a guest pass or some gesture to appease the member. Verbal apologies many times are enough.”