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Entries in independent club (4)

Wednesday
Jul192017

U.K. Independent Clubs Need Laser Focus to Compete with Low-cost Gyms

The United States and the United Kingdom have a lot in common, from our shared language to our shared love of caffeinated beverages (be they coffee or tea). However, while we have a number of similarities, we also have many differences—especially when it comes to the health and fitness market.

Ask any American health club owner what poses the biggest threat to independent clubs and they will likely tell you the same thing: boutique fitness studios.

But if you ask a U.K. club owner the same question, chances are you’ll get a different answer: low-cost gyms.

The U.K. health club industry earns more revenue than any other country in Europe, according to the 2017 IHRSA Global Report. (Click to enlarge)

Continue reading "U.K. Independent Clubs Need Laser Focus to Compete with Low-cost Gyms."

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Thursday
Jun092016

Best Practices: Strategic Planning for a Small, Independent Club

The following post was written by Joe Cirulli for our Best Practices series. 

Question: I’m currently developing a small independent club, and need to create and implement a strong strategic plan. Do you have any tips? 

Joe Cirulli: Strategizing, of course, is the first essential step when launching any company. You have to define the concept, choose the most appropriate business model, and decide how your club will differ from, and prevail over, the competition. 

The vision, mission, core value, core purpose, and culture of the organization have to be defined and clearly described. The company has to be structured and staffed to achieve your objectives. Everyone needs to understand and be aligned behind the club’s values and goals. 

One of the benefits of articulating a business’ core values is that it indicates the type of people who should be working for you. Changing a person’s core values is virtually impossible, so your entire hiring process should be designed to find individuals who share your company’s philosophy and principles. 

The right staff, in turn, will create the desired culture. 

Develop your team’s leadership skills, and always be on the lookout for new talent. 

Once your club is up and running, you need to differentiate it, distinguish it, from the competition. And what I’ve discovered is that execution is generally the defining hallmark of exceptional companies. 

Joe Cirulli
President & Owner
Gainesville Health & Fitness Centers
Gainesville, FL

Monday
Nov162009

Independent Club vs. Franchise

This week, experts Barry Klein, Amanda Oborne, and Constance Ruiz discuss the benefits of both independent start-ups and franchise businesses:

Q: “I am looking to invest in a start-up health club and trying to decide between an independent club and a franchise. What are the benefits of each?”

A: There are benefits and challenges to opening either an independent or franchise health club. Regardless, PLEASE gain all of the experience you can by at working at a club and studying business before jumping into ownership. Loving fitness is not enough. Having had personal success in a gym is not enough. You are opening a business that happens to be a health club, not just a health club business.

A well-run franchise can eliminate an enormous amount of risk to its franchisees with best practices, advertising, purchasing programs, mentoring, etc. This comes at a price with both up-front and recurring fees, as well as in giving up flexibility in how you run the business.

Both models can work, but it will be your experience, intelligence and hard work that will be most important. Independent gyms are the polar opposite. You can run your gym however you want, but there is no “mothership” to turn to – or pay - for coaching, best practices, advertising, or discounts. This is an emotional decision as much as a business decision.

Franchisers say that their franchisees have a higher rate of success. Independents point out the large number of failed franchises in our industry. Both models can work, but it will be your experience, intelligence and hard work that will be most important.

Barry Klein, Owner
Elevations Health Club
barry@elevationshealthclub.com
www.elevationshealthclub.com

A: Based on what I’ve learned working with the independent club owners who are members of the FitLife Club Network, the choice between independent and franchise really comes down to what kind of owner, and really what kind of person, you are.

Independent owners want to retain complete control over their brand, operating procedures and member experience. They are loathe to pay royalty fees for what amounts to a product created out of their own blood, sweat and tears. They also believe the buck stops with them and don’t want to be beholden to a centralized office that may or may not come through on promised support or make decisions that don’t fit their local needs.

That said, there are some very strong practical reasons for considering a franchise. The business model for a good franchise has already been proven, the brand is already known (there’s no underestimating how expensive it is to build a brand from scratch!), group purchasing lowers equipment and supplies costs, and it can be easier to recruit good staff to a known entity.

Many of the benefits of franchising are available to independents if they join a good regional trade association like the FitLife Club Network or one of the IHRSA regionals. Such associations offer education and networking opportunities, group purchasing offers and a backbone of support and information to assist the independent operator. Visit www.fitlifeclubs.com to learn more about regional associations.

Amanda Oborne, Executive Director
FitLife Club Network
amanda@fitlifeclubs.com
www.fitlifeclubs.com

A: An independent start-up is a good idea if you have two essential elements: knowledge of the industry, and knowledge to work “on” your business and not “in” your business. The book that explains this the best is the E-Myth by Michael Gerber. It is a mistake to be a good “technician” and believe that is the only skill set you need to be able to successfully run a business.

A fitness franchise business helps when either one of the two essential elements is missing. If you are from the industry and invest in a franchise, hopefully the systems and support are sufficient enough for the business to take-off. This will allow you the opportunity and time to invest on running the business including administration, marketing, and overseeing that all the processes are in place with the right people to carry them out. On the other hand, if you have management and business experience but don’t have the industry background, again franchising can teach you this.

The best case scenario is if you have both the above skill sets and invest in a credible fitness franchise that knows they are in the franchising business along with enough industry knowledge to make it work.

Constance Ruiz, President
Vivafit
281-732-9757
constance@vivafit.eu
www.vivafit.eu

Monday
Aug312009

How To Implement A Strategic Plan

This week, experts Barry Klein, Joe Cirulli, and Jill Kinney discuss how to create and implement a strategic plan:

Q: "I am currently developing a small independent club. What are some tips on how to create/implement a strategic plan?"

A: This is a wise question!

The key issue to consider is why your facility will be unique. Every fitness facility has the same check-list of features – weights, cardio, etc. Why will your facility stand out? To whom will it appeal? Are there enough of these target prospects in your market (an 8 to 12 minute travel time from your facility).

With a unique value proposition and confidence that there is a market, you must create financial projections and you must write a business plan. “Thinking about it” is not adequate (and banks and investors will need a written plan). Use this as an opportunity to run various scenarios. The most likely scenario is that your initial revenue will be ½ of your projections and your expenses will be twice your projections (trust me…).

When you step back and consider the full scope of your plan, you should see consistency. If you want to be the low-cost player in your market, then your plan should be consistent with that vision (in terms of target members, expense structure, expected attrition, etc.) Similarly, the profile of muscle gyms, women’s-only gyms, Gen X gyms, senior citizen gyms, etc. are all different. Good luck!

Barry Klein, Owner
Elevations Health Club
barry@elevationshealthclub.com
www.elevationshealthclub.com

A: A good strategic plan begins with a thorough understanding of the marketplace and leads to realistic expectations on the most critical aspect of your new business, the membership projections.

Start with a model that identifies the number of people (residents & workforce) within a 10 minute radius of your club. Take into account only those people who meet your age, income and educational criteria. Multiply this number by 17-20% (the average percentage of the population likely to join a health club.) This will give you a good estimate on the number of people in your market who are likely to join any health club.

Now, develop a complete list of all of the competitors in the marketplace (including facilities that may not be exactly like your club model) and estimate their membership capacity (not their current membership level). Reduce the number of likely health club joiners by the competitors capacity and you will have a good sense of how many available likely health club joiners their are in your market. This number should be 2-4 times higher than the number of members you need to be financially successful.

In the process of creating this market analysis, you will gain not only insight into the number of members you are likely to attract, but the competitors strengths and weaknesses. Together, this should predefine the challenges you are likely to face in launching your new club.

Good luck!

Jill Stevens Kinney, Managing Director
Clubsource Development Partners LLC
jill@clubsource.com

A: The first step is Strategy. Determine what separates your club from the competition. Why would someone be willing to spend his or her money on your service versus a competitor? Then everyone in your organization has to understand it be aligned behind it. That means the Vision, Mission, Core Values, Core Purpose and Culture of the organization has to be defined and well understood. Everyone has to support it.

The Structure of the company has to be designed to accomplish it. So design a company that is easy for the customers to do business with.

Determine what separates your club from the competition. Execution is what usually separates out the exceptional companies. The best mechanism I have found is a regular 2-hour meeting every Monday morning for all management. During that meeting we evaluate how we're doing in a number of areas. Everyone knows what their responsibilities are and that they'll be held accountable for them. Once a year we set the Strategic Plan and Budget. We evaluate our progress on a monthly basis at these meetings.

It's the staff that makes up the culture. The value of knowing the core values of a company is that it makes you aware of the type of people that should be working there. Your entire hiring process should be designed around finding people who have the same values as the company. Trying to change a person's core values is virtually impossible.

Develop the team's Leadership Skills and always being on the lookout for new Talent.

Mr. Joe Cirulli, President & Owner
Gainesville Health & Fitness Center
jcirulli@ghfc.com
www.ghfc.com