In both business and life, change is inevitable.
What’s not inevitable is how businesses and leaders approach change. As Irish playwright George Bernard Shaw once said, “Progress is impossible without change, and those who cannot change their minds cannot change anything.”
Jim Worthington, the owner of Newtown Athletic Club in Newtown, Pennsylvania, has understood the importance of change since he took ownership of the club in 1981. Over the course of his tenure he’s spearheaded a number of shifts in the club’s business model — the first of which being the transition from a racquet sports facility to a multi-purpose fitness offering, which occurred in the mid-80s.
“I knew there was more to be done than just racquetball courts and tennis,” recalled Worthington. “Back then I envisioned a country club without a golf course. I didn’t understand what exactly that was going to be, but I did understand it was going to require a bigger campus and there were going to be more offerings.”
Driven by this understanding, over the years Worthington has continued to look for opportunities to grow the business in size and scope.
One of the most significant changes came in 2013, in the form of Newtown Athletic Club’s $8.5 million “Big Build.” The renovation and expansion project added 12,000 square feet to the club’s existing 7,000-square-foot fitness center; and brought to life the additions of a four-acre, outdoor aquatics complex, and 41,000-square-foot sports training and events center.
According to Worthington, the Big Build resulted in a paradigm shift for the organization, in its quest to become a true “lifestyle” offering.
“Those additions really changed us from being a nine-month-a-year business to a year-round one,” explained Worthington. “When you have a year-round complex, families are more inclined to join, and people are now using the club as their summer vacation spot. The project really did what we hoped it would do, which is make us more of a resort, lifestyle complex. It was the best thing we’ve done in years, in terms of growing the business so dramatically.”
For evidence of this, look no further than the numbers. Within a year of the Big Build’s completion, Newtown Athletic Club jumped from $11.5 million in annual revenue to $16 million — and today reports $18 million.
However, the Big Build was just Phase 1 of the brand’s transition to a true lifestyle offering. Phase 2 is currently under development, in the form of a second $14 million renovation and expansion project labeled “Breaking Boundaries.”
According to Linda Mitchell, the director of public and government relations at Newtown Athletic Club, Breaking Boundaries will provide a “refresh” to areas that haven’t been changed in a significant way over the last 40 years, as well as add 35,000 square feet of new space. “We’ve made improvements, but it was time to take certain areas to the next level,” she said.
For example, the club’s salon and spa will undergo a complete renovation, along with the café. In addition, the adult locker rooms are in the midst of a complete update and expansion that will provide members with features such as floor-to-ceiling windows, hot and cold plunges, seating areas with big-screen TVs, high-end finishes and more — totally an investment of around $350 per square foot.
Breaking Boundaries also includes the addition of a 6,000-square-foot wellness wing that will house services such as the 90-day, HealthyCare lifestyle program and physical therapy. The club has also aligned with Capital Health — a nonprofit hospital group that will serve as Newtown’s medical partner.
“Capital Health is a great partner for us, because they too are very entrepreneurial in their approach to medical services,” said Mitchell. “We’re looking at ways to incorporate Capital Health into the wellness center with services they already provide. And then there are other services we may consider for the wellness wing, such as concierge medicine.”
In addition, the club’s multi-purpose group exercise rooms will be eliminated and replaced with brand-new, boutique-style group exercise studios created specifically for modalities like yoga, Pilates and “Six Zone,” a unique HIIT program proprietary to Newtown Athletic Club.
Worthington explained his vision for each studio was to create a “club within a club,” each with its own unique store front and curb appeal. “You’re going to feel like you’re in a high-end retail environment, where you’re having these different disciplines being offered,” he said.
In fact, Worthington predicts the days of multi-purpose studios within health clubs — at least for those that have the money and resources to change — are over. “Back in the day, it was all about maximizing space and getting as many bodies in the door as you could,” he explained. “But now, people want a higher-end experience, and that’s what we’re striving to create through these boutique offerings. Our goal is to provide a superior experience that is packaged even more attractively than a boutique studio and includes not just one, but all our offerings for the same cost as a boutique — or in some cases, even less.”
Another way Worthington plans to add value is through the addition of a preschool on Newtown Athletic Club’s campus, set to open in September 2019. In addition, plans are in the works for a brand-new restaurant, outdoor fitness area, business center and overnight summer camp.
“The whole idea is that you spend your day here in a suburban setting,” explained Worthington. “We’re going to begin offering more things that are non-fitness related to be included in this campus.”
Of course, with each change Newtown Athletic Club undergoes, a new set of challenges arise. According to Mitchell, the completion of the Big Build project resulted in a larger annual rate increase — and since, they’ve continued to strive to break the glass ceiling of perception of value, versus price.
“The typical concern members will have is wondering how much their dues are going up, because the last time we did a big project, their dues went up a lot,” explained Mitchell. “They will go up a bit after the Breaking Boundaries project, but not to the same degree they did before. However, the biggest part of managing people’s responses is communicating.”
Newtown Athletic Club prioritizes communication in a number of ways — utilizing platforms like social media to share video updates of progress, and physical tours of key areas that are close to completion, for example.
In addition, the club utilizes Medallia’s survey software to ensure members have a mechanism in which to share feedback and express concerns.
“Medallia offers a framework for us to receive and answer questions effectively,” explained Mitchell. “It is time consuming, but it’s worth it, because before we had Medallia we had no mechanism for handling those inquiries. Half the time we wouldn’t hear them, and that’s the last thing you want — is someone with a concern who has no way of expressing it. Then they may express it to others negatively, and you don’t want that.”
These tools, and more, will be key as Newtown Athletic Club continues to break barriers in terms of what both the market and members expect.
“It’s our job to educate members on the fact we’re much more forward thinking and have a vision to take things to the next level,” said Worthington. “Thirty-seven years ago we broke the barrier when we added fitness. We broke another barrier when we added the expanded fitness center and outdoor pool complex 7 years ago. And this is the next wave. As each wave happens you have to pay more, but if we can show them that what you’re getting here you can’t get anywhere else — then that’s going to be what’s going to push us over the top.”
As Worthington paves the way at Newtown Athletic Club, he also strives to do so for the industry. In addition to serving as the board chair for the International Health, Racquet & Sportsclub Association (IHRSA), the fitness leader sits on the President’s Council on Sports, Fitness & Nutrition.
“I love this industry,” said Worthington. “I want to see it get bigger and better and grow and everybody progress, whether it’s the $10-a-month club or the $240-a-month club. There’s enough for everyone if we just pursue quality, run good operations, learn from, support and promote each other.”
He’s also a passionate advocate for the Personal Health Investment Today (PHIT) Act — which, if passed into law, would allow Americans to allocate funds from tax-free Health Savings Accounts and Flexible Spending Accounts to activities like gym memberships and youth sports.
In July 2018, the PHIT Act passed in the U.S. House of Representatives by a vote of 277-142, but languished in the Senate late last year. However, Worthington is confident it will pass in 2019. “We will get this done,” he said. “It really is important for our politicians to come together on this, because we are the solution to the healthcare crisis. We have to get Americans moving.”
And Worthington’s goal is to be the change agent that gets the PHIT Act across the finish line — leading the charge for progress in an industry he’s called home for the past 40 years.
“For me it’s about leaving a legacy — something where you can look back and people say, ‘Wow, look at what they did,’” said Worthington. “That’s why I’m so passionate about the PHIT Act and pushing my club to the next level. You get one shot to make a difference and every day I get up trying to think of how I can make a difference and leave a mark. Everyone has a shot to make this world better, and that’s what motivates me.”