In years past, there was an abundance of independent mid-sized gyms and health clubs that were profitable. This is no longer the case. The advent of $10-per-month chains and high-end boutiques has put pressure on, and just about eliminated, this business model.
The customer has also evolved. Time has become very precious. People’s patience levels at the slightest inconvenience or delay seems to be at an all-time low. Customers want to plan their experience through the internet prior to entering the facility, and not be distracted by anything once they arrive.
There seems to be a health club on every block. The level of competition — and therefore, expectation — of the customer is at an all-time high. Let’s look at the areas and items that are now required to be successful in business, no matter what size facility you operate.
Online join, online scheduling and kiosk check-in are not a convenience, but necessary for the majority of members. Purchasing personal training or products, obtaining receipts or accounts receivable history, or making account changes should be readily available. In most cases, customers do not want to be required to interface with other people.
Your marketing must optimize its search engine ranking to achieve the highest amount of new visitor traffic. Emails and texts are required to contact potential customers. Analytics must be used to determine who is looking at your website and emails to qualify your leads.
The customer experience once they are inside the club must be tremendous. There should be no wait, the entire facility should be clean — including and especially the locker rooms and equipment. An owner must know the members and the audience. The balance between quiet and music, along with what type of actions and noise are allowed from other members, should be regulated depending on your demographic focus.
Any type of group exercise remains the greatest method of achieving maximum revenue per square foot. Paying top dollar for instructors who are excellent at their craft — in addition to having the personalities to make people happy, socialize and increase retention — is a cost of doing business.
As an owner, you must ask yourself: Is my goal to be low dollar and sign up thousands of members who will not show up and hopefully not quit due to the low-dollar membership? The alternative is a higher dollar membership, or higher dollar ancillary charges to maximize the experience and percentage of members who attend your facility. What hours will you be open, and will you staff the location during all open hours?
The biggest takeaway for an owner is they must be proactive in determining who, what, how, when and why they are in business, and what is the best business model and demographic customer base to be focused upon. Too many owners open a gym or health center based upon what they like, and then incrementally react to each situation or issue that occurs.
It is critical when maximizing revenue and profit that a business owner partner with a consulting and software team that is experienced as club owners, knows the industry, and has a web-based software that is capable of meeting all the requirements of a particular customer market. The key is to team up with a company that can work with you as an owner to determine your business model, and then develop the attributes of your health club and software to achieve your desired result.
David Porter has been a sales consultant at Twin Oaks Software Development for the past eight years. Previously he ran several businesses, including 10 years as an owner and operator at Suburban Athletic Club outside of Boston. He can be reached at 860.829.6000 or dporter@tosd.com.
