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Monday
Dec072009

2010 Industry Projections

Bonnie Patrick Mattalian, Steve Krum, Bill McBride, Brent Darden, Herb Lipsman, and Melissa Rodriguez discuss industry projections for 2010:

Q: “Is there any information on projections for 2010 in the areas of membership growth as an industry percentage is concerned, member retention percentage, revenue growth (non-dues), and profitability of fitness clubs? ”

A: Every community in the country is different. Your center’s response to the current economic environment should be based on where you club is in its cycle of business development, how uniquely your center’s brand is positioned in your market, the value of your membership and the efficiency of your operations, and your programs/services offerings.

Although the worst of the recession may be “over”, the jobs market is still a challenge in most areas.As you work on your projections for next year, look at the latest demographic reports for your market area to determine any changes in household income and other factors in your potential target market, and challenge who your target market is and how your competitors are positioning themselves to determine your market capture rate for the coming year.

Depending on the economics of your specific market, we recommend being conservative with your projections, averaging about 2-3% growth over last year with a solid plan for execution.

Although the worst of the recession may be “over”, the jobs market is still a challenge in most areas. Be realistic about retention, and keep this in line with your average actual retention rates from the past year.

Many centers are starting to see a positive swing for this ancillary services/programs with a tie in to incentives, especially in group training and weight management/nutritional services. Some centers report up to 25-30% of revenues, although most clubs see 15-20% in ancillary revenues.

By managing payroll costs and implementing strict expense controls, we expect to see profitability back to 5- 17% for many centers.

Ms. Bonnie Patrick Mattalian, President
Club & Spa Synergy Group Consultants
bmattalian@clubsynergygroup.com
www.houstonianlite.com

A: 2010 is an unusually tough prediction for our industry, so our "Crystal Ball" may seem a bit conservative. It is obviously critical that one considers local economies, local unemployment rates, and both local business and residential growth census.

Despite a tough 2009 we remain optimistic about the profitability of our business and project new memberships growth rates of 5-9% at our established clubs.

Member Retention remains our #1 focus, and we hope to continue to achieve a retention rate of greater than 76% through value added membership programming and aggressive hospitality.

Despite a tough 2009 we remain optimistic about the profitability of our business...We agree with IHRSA's growth prediction in non-dues revenues and overall club profitability, and feel a simple "old school" approach toward enhancing the member experience is critical. We intend to grow non-dues revenues by providing more options. Depending on the member's time and budget, they may choose group fitness, private or semi-private training, small group training, or simply workout on their own. By helping each member develop their own "fitness road map" , we grow most revenue lines and have higher member satisfaction.

Steve Krum, Vice President of Facilities and General Manager
Spectrum South Bay
skrum@spectrumclubs.com
www.spectrumclubs.com

A: While 2010 is expected to be better than 2009 and there is much discussion about the “rebound”- unemployment and consumer confidence are key metrics that affect our growth. We expect retention to continue to improve and sales to be stronger than 2009.

Multiple factors affect each club – strength of sales team, operational excellence, reputation in the community, supply & demand in each market, as well as your value proposition. While there is no set standard I can give as to membership growth – 0-7% would be a broad range to consider based on the specifics of your club and market.

Bill McBride, Chief Operating Officer
Club One
Bill.McBride@ClubOne.com
www.clubone.com

A: In a recent meeting with twelve industry leaders / club owners from around the country, the topic of projections for overall revenue growth was discussed briefly. The consensus of the group was that almost all were forecasting a 3-7 percent improvement over 2009. In addition, the group felt that member retention would continue to be strong and that non-dues revenue would be the primary driver of revenue growth.

Brent Darden, General Manager / Owner
TELOS Fitness Center
bdarden@telosfitnesscenter.com
www.telosfitnesscenter.com

A:IHRSA has collected limited performance information from a relatively small sampling of members for the first half of 2009. Overall, the commercial health club industry felt the negative effects of the national recession during the first two quarters of 2009, but most of the reporting clubs noted their ability to maintain bottom line performance by aggressively managing expenses, in spite of reduced revenues. IHRSA’s annual data survey (Profiles of Success) reports average non-dues revenue of 30 – 33% with median membership retention rates of 70-75%. Those clubs reporting results for the first two quarters of 2009 reported steadily increasing performance in non-dues revenue and EBITDAR, with EBITDAR increasing by as much as 7.0%.

As the jobs data improves so will membership sales and retention.There is no scientific forecasting data available on a broad scale at this time. Anecdotally, many of the top industry leaders are pointing to continuing challenges for membership growth during the remainder of 2009 and the first half of 2010. Many of these same leaders point to the unemployment rate as a leading indicator for a return to membership growth. As the jobs data improves so will membership sales and retention. Non-dues revenue is likely to rise in concert with household income increases. In the meantime, the most successful club operators will continue to creatively manage operating expenses until such time as gross revenues begin to show significant movement upward.

Herb Lipsman, CEO
The Health Club Company
hlipsman@thehealthclubcompany.com
www.thehealthclubcompany.com

A: In IHRSA’s new Monthly Trends Survey this year, one of the items gathered were the business outlook of club operators. Each month, an overwhelming majority of club operators anticipated consistent or improved revenues in the upcoming months. As part of an industry that has remained solid throughout challenging economic times, club operators have reason to remain optimistic.

Overall, the industry is poised for continued success in 2010.The past four years have seen steady U.S. health club membership numbers. Loyal health club members have indicated the value they place on health and fitness as non-dues revenue increased by nearly four percent in 2008. In recent years, clubs participating in IHRSA’s annual Industry Data Survey (as reported in IHRSA’s annual Profiles of Success) have reported a median range of 30-33% of total revenue coming from non-dues sources. Median member retention for these leading clubs has typically hovered between 70-75%.

Although attracting new members may be the lifeblood of a health club, successful club managers find a way to control club costs and increase spending from current members. Managing these two aspects of a club closely will greatly contribute to profitability. IHRSA’s Quarterly Index of leading club-companies reported steadily improved performance in non-dues revenue and EBITDAR over the first six months of 2009. EBITDAR increased by as much as 7.0% for participants between the first quarter and second quarters of 2009.

Overall, the industry is poised for continued success in 2010. With sound management and innovative marketing skills employed by club operators, solid clubs can be expected to lead the way in member retention, non-dues programming, and ultimately, a healthy bottom line.

Melissa Rodriguez, Research Manager
IHRSA
mr@ihrsa.org
www.IHRSA.org

Monday
Nov302009

Staying Open For The Holidays?

This week, Gary Klencheski and Barry Klein discuss holiday hours, when to stay open, when to close, and when to shorten your hours:

Q: “Do most health clubs stay open for the holidays and why?”

A: It depends what holiday and how you balance the needs of yourself and your staff against the perceived requirements of your members. The “easy” holidays to close are Thanksgiving and Christmas. Your staff will appreciate it and even your most hard-core members will likely shrug and accept it. New Year’s Day and Easter are more controversial. It is ‘politically’ acceptable to stay closed on New Year’s Day, but the nature of our business and the impact of New Year’s resolutions certainly justify staying open at least short hours. Easter – always being a Sunday – is a toss up since most clubs have shorter hours on Sunday anyway. You might close, shorten your hours even more, have no group fitness classes ... or just do everything normally.

Other holidays – Memorial Day, 4th of July, Labor Day, the Day-after-Thanksgiving, Christmas and New Year's Eves – don’t make the cut to close, but you can easily offer short hours.

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

A: Fitcorp’s 11 clubs are open on almost all of the holidays except for Christmas, the 4th of July and Memorial Day. Our hours of operation might be reduced but most of our centers remain open.

...fitness never takes a holiday so neither should we.

Our philosophy is that fitness never takes a holiday so neither should we. Plus not all members are able to spend the holidays with their families. Consequently, we want to give them the opportunity to work out. We also encourage our members to bring a friend in for a workout on the holidays.

Gary Klencheski, President & CEO
Fitcorp
garyk@fitcorp.com
www.fitcorp.com

Monday
Nov232009

Weight-loss On TV

This week, Alex McMillan and Vaughn Marxhausen discuss weight-loss TV shows "lies" and how fitness professionals can spread the truth:

Q: “I am very concerned about current weight loss TV shows. I feel they are telling people lies about weight loss and sending the wrong message about the fitness industry and the fitness professionals. What kind of role can people of the fitness industry take to stand up against this?”

A: The hype is captivating and can actually help people take action because it caters to our emotional side, which often influences our actions. As fitness professionals let’s not fight this, but embrace this side of “the hype” as many people that come into our doors were sparked by this hyped filled media.

To be a beacon, baby you’ve got to shine...It’s true that the hype often sets up unrealistic expectations and can downright scare some people away, but as true professionals we can combat this, dominate over it and crush it by being beacons of the truth. To be a beacon, baby you’ve got to shine and to shine means that we’ve got to be outstanding and outspoken at the “captivation game”.

Let’s take a cue from the over the top hype filled TV personalities and the producers behind them. Let’s turn it on, turn it up and turn it out! Let’s start our own online TV shows and our own community video blogs, let’s be the shocking, fun, engagingly vibrant personalities that people remember, can’t wait to see and talk about constantly, but let’s spice it up with the truth.

People watch the TV shows because they have shock value and are quite entertaining, can’t we do that as good if not better?

Let’s dominate the hype by entertaining with the truth!

Alex McMillan, Ownerr
Fitness Profit Solutions
alex@alex-mcmillan.com

A: Whether it‘s a weight loss TV show, or other form of media, there will always be someone or a group of individuals that may not represent the fitness industry in the best light. This comes up in any industry: sports, entertainment, politics, legal, as well as the fitness industry.

While we cannot control what others do or say, we can however manage ourselves. Focus on being TRUSTWORTHY. Trustworthiness is a combination of high character and high competence. Unfortunately, there are people in our industry who lack in one or both of these areas, but it is up to us as fitness professionals, as true leaders, to maintain high competence and to be of high character.

In the political world, when politicians are campaigning, they have the tendency to spend their time bashing their opponent, and quickly it becomes a circus when everyone bashes each other. What would our views be of a politician who didn’t engage in that sort of behavior, but demonstrated the attributes of high character and high competence and focused on the truth, the issues at hand?

As fitness professionals, stay the course, maintain your trustworthiness, soon the others go away and will be forgotten.

Vaughn Marxhausen, Area General Manager
Houstonian Lite Health Club
vmarxhausen@houstonianlite.com
houstonianlite.com

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
Nov092009

The Role Of Foam Rollers In Fitness

This week, experts Kathie Davis, Annette Lang, and Mark Slavin discuss the use of foam rollers in fitness:

Q: “How significant of a role do foam rollers play in proper fitness? With all the different types of rollers in the market today (polyethylene foam, molded bead polyethylene, eva, etc) which is the best and why?”

A: In simple terms, a foam roller is like your own personal massage therapist. Massage is used to release muscular tension, and as a result, improve muscle tissue quality for improved force production and flexibility. Prior to an exercise session, use of the foam roller is thought to help improve blood flow, muscle warmth, tissue elasticity, joint range of motion and neuromuscular efficiency.

Other benefits include improved exercise recovery and decreased post-workout soreness. All of these components are highly beneficial for improved fitness. Much of this information is anecdotal, however, as minimal research has been performed to support such claims.

The appropriate type and density of the foam roller is up to the individual. The appropriate type and density of the foam roller is up to the individual; the denser the foam, the greater the intensity of the rolling session. Those familiar with massage might liken it to the difference between a soft tissue and deep tissue massage. For example, polyethylene foam is less dense and may be suited for someone who is new to rolling and/or does not have significant muscle mass. Molded bead polyethylene is much denser and might be appropriate for more muscular individuals.

Kathie Davis, Executive Director
IDEA Health & Fitness Association
800/999-4332
kdavis@ideafit.com
www.ideafit.com

A: Some form of foam rollers are seen in many health clubs today, and can be an important component of fitness programs. They are used for self massage (self myofascial release), relieving tension in the muscle fibers. This tension is caused by adhesions, or knots that form along the muscle fibers. They can be uncomfortable at one end of the continuum, and evolve into true trigger points which can be ultimately debilitating at the other.

The degree to which you need self myofascial release depends on several factors:

  • Muscle imbalances caused by repetitive habits such as training for a marathon where the same muscles get over-used and opposing muscles under-used.
  • Acute or chronic trauma from accidents or sustained postures like sitting at a desk all day.

The original styrofoam rollers are made of foam cells, that get compressed from the user’s weight over time. Molded bead rollers do not have cells. Beads of polyethylene are injected into a mold and then heat and high pressure is used to compress them. This gives the roller much more structure, and can withstand more weight over a long time.

EVA is a combination of ethylene, vinyl and acetate materials. They are very strong but still smooth. The type of roller depends on how much pressure you can withstand, and how often the roller is being used. If you are using it yourself, then the original styrofoam type is probably fine. If you are buying them for a commercial health club where many people will use them, consider the other types.

Annette Lang, Owner
Annette Lang Education Systems
646/284-7749
annette@annettelang.com
www.annettelang.com

A: The use of foam rollers has become quite prominent in the fitness industry today and trainers are finding them to be a quite versatile for their clients.

Foam rollers can be a versatile and inexpensive tool for balance and stabilization training as well as an inexpensive way to provide “self massage” to sore or overly tense muscles. In addition they are used for myofascial release and are especially popular for the Iliotibial Band and IT band syndrome. They are also used by Therapists and Athletic Trainers for treatment, injury prevention.

Foam rollers can be a versatile and inexpensive tool for balance and stabilization training as well as... “self massage”. However there are some in the industry who feel that the use of the foam roller may be out of the scope of a trainers function, unless that trainer has received training on the proper use as well as what medical conditions would warrant a caution or in some cases may be contraindicated.

As far as material the difference lies in both durability and density. For high use (commercial) and/or when a more intense pressure is needed the firmer Eva or molded bead polyethylene rollers are more likely to hold their shape. For light use (home) or when a more gentle pressure is desired, the softer foam rollers would be a better choice.

Dr. Mark Slavin, International Director of RTS
Genesis Health Club
slavin1014@aol.com
www.genesishealthclub.com

Monday
Nov022009

Personal Training Revenue

This week, experts Barry Klein and John Atwood discuss what percentage of a club's revenue should come from personal training:

Q: “In a fitness center only club of 8,500 sf with a beginning membership of 1,000 and membership of 2,000 when mature, what is the benchmark percentage of revenue between membership fees and personal trainer fees?”

A: The target membership vs. non-membership revenue for most clubs is generally 80%-20%. For most small clubs, personal training is the key non-dues revenue source, so – assuming there might be health bar, pro shop, tanning, etc. – at least 15% of revenue will need to come from personal training.

However, specific circumstances need to be considered. An 8500 square foot club that already has 1000 members is at reasonable capacity. Growing to 2000 members implies a facility with a low price point whose success is predicated on an abundance (over abundance?) of members. It’s difficult to imagine such a club having a clientele that would lend itself to the target split of 80/20 dues vs. non-dues. Personal training might just be a “cherry on top”.

By comparison, an 8500 square foot facility with only 500 members would likely be much more dependent on personal training and other non-dues sources. At 1000 members, it seems a 15% target would be reasonable. Indeed, much more could be possible. But, to grow to 2000 members, it seems that the energy and investment of the club would have to go toward that growth, and personal training might have to take a back seat.

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

A: The benchmark for all clubs non-dues revenue has hovered around 30%, with 10.7% for clubs less than 20,000 feet, and 8.1% for fitness-only clubs.

The personal training piece of this shows high end clubs reporting 10%-15% of total revenue coming from personal training, while the all clubs sample shows 3%-11%; and among fitness-only clubs 6%-14%. Keep in mind that these numbers represent a fairly small sample group and include only clubs that have their act together enough to keep and report their numbers.

Personal training should be the largest piece of your non-dues revenue equation If you plan to have personal training as a major focus in your club then these numbers fall short for you. You really need to know what the benchmark would be for clubs that are your size, demographic, fitness-only, and focus on personal training. Clubs that focus on personal training of course do much bigger PT numbers and the benchmark, if it were available, would reflect that.

Personal training should be the largest piece of your non-dues revenue equation and as a goal I would recommend that you shoot for 15-20% of overall revenue from personal training.

One concern regarding your club model is that 2000 members in an 8,500 square foot club is a stretch, and if you hit 2,000 there may not be space for multiple trainers, with multiple clients, using the fitness area along with all the regular members.

John Atwood, Principal
Atwood Consulting Group

508-654-6244
john@atwoodconsultinggroup.com

Monday
Oct262009

Reaching The Medical Community

This week, experts Amanda Harris, Dr. Wendy Williamson, Brad C. Wilkins, MBA, and Lloyd Gainsboro discuss how health clubs can reach out to the medical community:

Q: “How can we bridge the gap between the health club and the medical community? We want doctors to prescribe exercising at our club but don't know how to start reaching out.”


Amanda Harris, Vice President of Fitness & Wellness
ACAC Fitness & Wellness Centers
amandah@acac.com
www.acac.com

A: For the calendar year 2009 our company, Dedham Health & Athletic Complex will have 1500 physician referrals. 65 percent of these referrals will join our 60/60 Program with approximately 42 percent converting to 10 month memberships. Our goal for 2010 is to have 2500 referrals, 1625 joins and 731 conversions.

One of the ways we accomplish this goal is by having all of our fitness trainers have Bachelor of Science degrees in Exercise Physiology.

Additionally, we have a program which fulfills all the necessary processes and procedures of the medical community. It is HIPPA compliant and bullet proof to any criticism.

It is it very clear that we are not a typical “gym”. Presently we have two people, one who is full time and the other part time, on the road daily, seeing physicians. We also have ads on radio and television stations coupled with continuous hard work, focus and dedication. The branding of our facility permits us to be the antithesis of a “gym”. You need to totally deliver your product. Ours is “Exercise is Medicine”.

Lloyd Gainsboro, Dir. of Business Development
Dedham Health & Athletic Complex
glloyd@dedhamhealth.com
www.dedhamhealth.com

A: A solid relationship between a health club and the medical community is one of the most sought after and coveted in the industry. It’s one that most individuals in the industry think should be easy to establish (due to the obvious benefits of exercise), yet it’s not. However, it is worth pursuing; because the right relationship can pay big dividends.

So, how do you get started finding this coveted relationship? You network, network, and network. The thing to recognize is that it is a relationship, and like any solid relationship it takes communication, trust, respect, and dependability to be successful. Before you prospect potential medical community partners it is first important to understand your company’s strengths and weaknesses and what added value the company brings into a relationship. For an example, your club may have a particular niche or area of expertise with special populations (Parkinson’s, osteoporosis, arthritis, etc...). Secondly, it’s just as important for you to understand the goals, needs, and/or desires of the medical partner. Discover if there is something you can do for the medical facility in return – either in terms of promoting them at your facility or maybe sending a staff person there to do on-site exercise classes, lectures, or demos. Doing so will allow you to showcase your company’s value by aligning your strengths with their wants. The key is to create value for both parties.

So, how do you get started finding this coveted relationship? You network, network, and network. Utilize the relationships you’ve established with friends, clients, members, and/or businesses within your community to find your potential medical partners.

All solid relationships take time to develop. Take your time and find the right partner.

Brad C. Wilkins, MBA, Director of Fitness Management and Development
Cooper Fitness Center, a Cooper Aerobics Company
bwilkins@cooperfitnesscenter.com
www.cooperaerobics.com

A: In order for doctors to prescribe exercise at your club several things need to happen.

  1. Professional relationships need to be established;
  2. Fitness professionalism needs to be displayed; and
  3. Further education and skill sets need to be developed.

Many medical professionals walk through your clubs daily. Do you know who they are? Are they willing to present to your staff from a previously prepared “talk?”

Attending social events, open houses, sporting events are many reasons when interaction with the medical community can take place. Are you professionally interacting with the medical staff when seeking medical releases? The staff is just as important as the physician or surgeon.

Physicians often look to us for developing an exercise program. It is our job to provide suggestions. Have you offered a complimentary session to the doctors? We seek medical approval and additional information, but we also need to illustrate our assessment results and possible plan of action.

Respect, referral and reciprocation cannot take place until the fitness professional has proven their level of knowledge and experience. The demand for medical wellness is great and the potential revenue is unbelievable. Regardless of the recession, this specialty area has enormous potential.

Dr. Wendy Williamson, Post Rehabilitation Specialist
Genesis Health Clubs-Rock Road
wmsonwa@aol.com
www.genesishealthclub.com

Monday
Oct192009

Membership Specials That Work

This week, experts Doug Miller and Alan Leach discuss common membership specials:

Q: “What are the common "specials" that are offered in the industry and which ones tend to do better? What months in the industry are the best to run specials?”

A: You can run specials on the Enrollment Fee, the monthly dues or an Annual pre-paid.

I still use primarily the Enrollment Fee as the incentive...

Either one of two ways.

  1. I offer the prospect an opportunity to get back all of their Enrollment Fee - when they use the club a minimum of eight times during their first month of membership.

    This encourages retention (by training them to use the club) and puts the burden of proof on them. Normally 70% will get their Enrollment Fee "rebated" (I CALL THIS THE ENROLLMENT FEE REBATE.)

  2. Another way that I use the Enrollment Fee is to give them an option to either go month-to-month, by paying the full Enrollment Fee or they can remove the Enrollment FEE in full by committing to a twelve month membership.

I don't reduce the monthly dues (except for corporate accounts.)

I don't offer two for ones on Annual memberships either.

Obviously the best months to offer specials are Sept & January. Although, there is something to be said for not offering discounts when the customer is wanting to buy our product.

One other thing I do often is to offer a trial membership (either one week or twelve days) and allow the prospect to cash in their pass with a credit of either 7 or 12 times the daily fee if they redeem the pass - this is a countdown promotion - you can save $105 if you cash it in today and you lose $10 credit each day you wait - but we do offer you a ten day money back guarantee so you've got nothing to lose - except you'll be saving some money.

Although, there is something to be said for not offering discounts when the customer is wanting to buy our product. We could go on and on with different campaigns - referral schemes, internet offers ... The options are endless.

The best ways are to either use a specific date and offer that expires on that date OR use a "first twenty person who join " get a special offer. Some times I even will combine the incentives...

Every Club is different - but I normally try to develop my clients clubs to a state where they don't need 'specials' - just a well trained staff that can actually SELL your product.

Doug Miller, Owner
Sales Makers International
(44)1449 744 222
doug@salesmakers.com
www.salesmakersinternational.com

A: Membership sales has a sales ‘cycle’. And it implies people see your club before joining.

Once someone enters your sales cycle, use sales staff, direct mail, email, SMS, phone, and database management to convert them into members. Your ‘specials’ should always sell memberships or build your prospect database. Our database has 66,000 past members and 62,000 prospects. Every time we mail, we bring in over €1 MILLION – guaranteed.

Your most common specials come under 3 headings

  1. Prospecting: 63% of all people who are not members of health clubs WANT to participate in exercise . Use 4-day, 7-day, 12-day, and 30-day trial memberships to get them into your club.
  2. Referral Campaigns. Use referral campaigns to persuade current members to bring you new members. “Refer a friend and get a €120 PT voucher, €60 day-spa voucher, €100 pro shop voucher, or free fit kit – including trainers, towel, water bottle. (Note: Send ‘trial memberships’ to your members for their friends. It gets us a better response than when we offer a FREE gift.)

    Another huge ‘money-making’ referral campaign is the 1-Day ‘family-sale’. I’ve signed up thousands on these days.
  3. The BIG marketing campaigns. Offering incentives to people to join is a part of most health club’s marketing strategy. These can be either a discount or a premium, or a combination of both.
  • Join Now and get FREE enrolment
  • Enrol NOW and pay no dues until March
  • Join now and get 50% OFF enrolment
  • Join now and get €200 off initiation fee
  • 2 for 1 enrolment. Pay one enrolment and the second is free
  • Join NOW and get a FREE wellness pack

These are your most expensive campaigns, and targeting is extremely important. The best targets for these offers are your past members and previous tours/guests.

How to communicate your ‘Join Now’ special.

  • Direct Mail is very expensive but can bring in €MILLIONS.
  • SMS is easy. One campaign cost us €677. It brought in €96,000.00
  • Email is cheap but does not get return of direct mail.
  • With newspaper, radio, and TV you are paying to target people OUTSIDE your market

Golden rules for getting the maximum from your ‘specials’

  • A bad offer well executes always gets you more than a great offer badly executed.
  • No offer will EVER make up for not having a professionally-trained sales team.
  • If faced between spending money on an offer or sales training, choose sales training EVERY time. In the US you’ve amazing sales trainers; Doug Miller, Ed Tock, Brenda Abdila, Mike Chaet, Karen Woodward, Jim Smyth - or ME in Europe.
  • Hire the best ‘direct marketing’ copywriter you can afford...or hire ME.
  • Have a HIGH joining fee. You can offer BIGGER discounts.
  • Print all your trial memberships as plastic credit cards.
  • Include money-back guarantees, and expiry dates on EVERYTHING.
  • Allow people to sign up online.
  • Include FREE pt sessions with trial memberships.
  • Your market is a 12-minute radius. Every day, target them .
  • Get all staff involved in looking after guests. Show trial memberships the amazing service they will get.
  • My favourite: Use a ‘personalised’ cheque for your discount.

What months are the best to run ‘specials’?

  1. Big ‘direct mail’ campaigns in January, September.
  2. Referral ‘direct mail’ campaigns in March, April, October, November.
  3. Use trial memberships every day outside the busy months.
  4. Have 1-Day/2-Day Sales in the Summer months.
  5. 12-Days Of Fitness passes are fantastic for December. Include 2 free personal training sessions.

Mr. Alan Leach, Area Managerr
West Wood Leopardstown
alan.leach@westwood.ie
www.westwood.ie

Monday
Oct122009

Save Money By Letting Personal Trainer Sell

This week, experts Chris Gallo, Sam Berry, and Michele Melkerson-Granryd discuss personal trainers playing the role of sales-people as a cost-cutting method:

Q: “We're looking for ways to save money by having our personal trainers give club tours when prospects come into the club. What are the pros/ cons of having trainers double up as sales people? What are some easy way to train them to make sales?”

...your customers would prefer to be toured by fitness professionals versus club managers or salespersons by a margin north of 2 to 1. A: Absolutely! As far as selling what I consider “solutions” there are no better staff-persons to do that than your club’s expert trainers. They usually display passion, execute with verbal mastery and in the meantime are completely believable. This culminates into the perfect scenario in creating an excellent “service sales” culture at your club while also leaving the prospect with a great first impression of your facility. Even if the customer does not buy on that initial club visit, there is a good chance that if the trainer listened to the customer and offered unique and customized solutions based on the client’s needs that the customer will leave with a very positive impression of the club and will at least return for a follow up appointment. [+ Expand]

  • Train these fitness experts on the art of creating urgency and setting appointments
  • Make sure all of the trainers involved are given credit for their efforts and have monthly goals in which they strive to achieve.
  • Track each person’s productivity based on appointments set, show rates for appointments, and of course client conversion ratios (no matter who makes the final presentation).
  • Create a team culture based less on how gets credit for the final sale – but more on the process metrics (appointments, trial memberships, consultations, etc) that drive the end goal of making the final close.
  • Manage this system tightly – no club can ever afford to lose a legitimate lead.
  • Once again, train everyone on the verbal mastery of selling “service” and “solutions” not just club features…practice makes perfect.



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Chris Gallo, President
Health Club Development Company
704/840-7306
chris@healthclubdevelopment.com
www.healthclubdevelopment.com

A: This is certainly a great way to save money, and for that matter help increase non-membership revenue at the same time! The way that it helps increase revenue is by having the trainers that sold the prospect on membership to sign that person up for personal training services at the point of sale. The initial PT session may not be a paying session; however the likelihood of it being a client is much higher than just having a traditional sales person signing the person up for membership. By doing so, members that invest in personal training average a much lower attrition rate than members that do not meet or work with a trainer on a regular basis. The only cons that I can imagine from having a trainer double as a sales person is their intrinsic motivation to get the member to work solely with them, and not one of the other trainers at the gym that may be better suited to work with that individual or having an inconsistent schedule for giving tours due to their training schedule.

Great educators and resources for teaching trainers how to sell are people like Bob Esquerre and Thomas Plummer. They’re sales systems and expertise in the fitness industry are second to none!

Sam Berry, Personal Trainer Director
Fitcorp
281-732-9757
sberry@FITCORP.com

A: As I see it there are two primary benefits, payroll savings – not having to schedule a sales person during all operating hours just in case a guest comes in to tour or join; and the relationship that begins between the prospect and your staff, an interaction with someone who can actually help get them integrated into activity, that should lead to enhanced comfort in your facility for that new member or guest.

The cons are many: Personal Trainers often don’t think of themselves as salespeople (a topic that deserves attention on its own) so they may be resistant and uninterested in the tour/sale process and therefore be terrible at it; a lack of follow up with prospects who don’t join right away; a lack of follow up with new members – so that they don’t get integrated into the club activities; the trainers’ discomfort with up-selling other products that might be appropriate; and your guest may feel awkward if you are scrambling to find a trainer available to give a tour.

If you decide that the benefits outweigh the cons - good tour and sales training is imperative so that the trainer feels comfortable and competent with the process. And trainer must believe that there is a benefit too. For example, they should share in the commission their prospect becomes a member (within a reasonable amount of time) and they should be aware of the potential benefit of exposure to new clients. The best training for this purpose utilizes observation of actual tours and paperwork processing as well as role playing (they should have access to script that gives them all the right words to convey your message consistently.)

At BodyBusiness our sales process has gone through an evolution over the past 3 years and we currently use a combination of one Member Services Consultant with our Trainers on Duty (TODs are scheduled during all hours of operation), in conjunction with our front desk staff. Our Member Services Consultant is scheduled to be available during the hours when we experience peak guest traffic and is responsible for conducting follow up with new members and prospects who have visited/toured the club.

Michele Melkerson-Granryd, M.Ed., Executive Director
Texas Health, Racquet & Sportsclub Association
michele_m@bodybusiness.com
www.bodybusiness.com

Monday
Oct052009

How To Hire The Best Candidates

This week, experts Bill McBride, Diogo Angelino, Donna Russell, and Lisa Gorsline discuss hiring practices and how to eliminate unqualified candidates:

Q: "Due to the high unemployment rate, we're getting more resumes than ever for each job posting we put out. However, that makes it more difficult to spot the best candidate. What is the best way to weed out the undesirable candidates and find the best?"

A: Just as during “normal” times, you will get a lot of resumes that don’t appear to be ideal. I find that the cover letter can be a huge indicator on those to pursue.

For example if someone highlights a personal story about health, fitness, injury recovery, disease recovery, weight loss, personal fitness triumph, etc… they are usually worth a second look. These types of people, regardless of background truly believe and are passionate about our product.

Many in these challenging times are deciding to forgo their backgrounds and follow their passion and dreams. Be careful not to “throw out” those that may be strong brand ambassadors. Also be careful not to hire those who are desperate.

I find that the cover letter can be a huge indicator on those to pursue. Another approach on those you are unsure of, but don’t want to commit too much initial time interviewing is to send them a follow up question… “Why did you chose to apply to our company?” This will let you know if they are serious and have done their homework or if they are just blasting resumes out.

Bill McBride, Chief Operating Officer
Club One, Inc.
bill.mcbride@clubone.com
www.clubone.com

A: Look for candidates that take the time to write a compelling cover letter. Why would this person want to work for your company. What do they have to offer? As you look through the resumes, focus on your job requirements and the applicants’ qualifications. Look for people who have preferably worked in your industry. Once you have narrowed down your prospects, prioritize the 1’s and 2’s. The 1’s seem qualified, the 2’s have some but not all of the qualifications.

At the interview, look for people who are respectful, energetic, articulate, and focused. Did these candidates do their research on the company before their interviews? Really interested good candidates do the research. Were they dressed professionally? Did they ask questions about the company? Does the applicant fit into your company culture?

Sorting through resumes is a time consuming project. I have not found a short cut yet!

Donna Russell, Director of Human Resources
Fitcorp Corporate Office
drussell@FITCORP.com
www.fitcorp.com

A: Great question! At our club we have a system that “eliminates” the unqualified employee candidates early in the interview stage. We have a 7 step interview process (you can eliminate some of the steps depending on the size of your club), but the following is our system:

  • Review Applications/Resumes
  • Choose qualified candidates on paper
  • Call the candidates and set up a telephone interview (set a future time and date)

Conduct the telephone Interview

  • Listen to slang words
  • Listen to their tone of voice
  • Is there background noise?
  • Were they punctual for the phone interview
  • Do they speak proper English?

At step 2, we eliminate so many of our candidates, and we never see them in person! What a great way to speed up the interview process and at the same time “weed” out the unqualified candidates.

The next five steps to the process are three in person interviews, a background check stage, and job offer stage.

I hope this helps you in your hiring practice, please feel free to contact me if you need more information on this matter. Good luck with the hiring!!!

Lisa Gorsline, President / General Manager
Corpus Christi Athletic Club
lgorsline@ccathleticclub.com
www.ccathleticclub.com

A: Hiring the right staff for the right position can at times be a challenging task. An organization is defined by its people. Here are a few ideas on how you can maximize your search for the perfect staff member:

  • Get Help - Staff hunters - One of the secrets to succeed is to have some of your most important staff members involved inside of institutions like, Universities, Les Mills, companies that provide formation to gym’s staff, etc. This will allow you to search and find some potential talents before they get recruited by other competitor; Know Your Needs – Know what you are looking for, Know the positions that need to be filled immediately and most important, make sure that the candidates will fill in the Vision, Mission and Values of your club; Hire for the skills you can’t train...and mentor your new hire for the rest
  • Be slow to hire, quick to fire - Take your time hiring and make sure you get the right person. It’s critical to the success of your organization to get the right people in the right spots. Be patient;
  • Get the right people on the bus – Take the best of which person by getting them to work where they a good at, and do what's needed to keep them. Good staff is an asset!
  • Look for Values - Hire for the skills you can’t train (like passion, commitment, attitude, etc.) and mentor your new hire for the rest;

In case of doubt don’t recruit, keep looking. Remember, if you choose an undesirable staff and you find out that it’s time to let someone go, be brave and do it as quickly as you can!

Diogo Angelino, Assistant Director
Solplay - Family Health Club
diogo.angelino@solplay.pt
www.solplay.pt