Mon, January 7, 2013 at 14:35 | IHRSA Open 24/7: that is the question
The idea probably has crossed the mind of the majority of health club owners and managers. Is it worthwhile to open the facility 24 hours a day?
It seems like a logical move: you get the added memberships from second- and third-shifters. However, extra security, staffing and more are factors one has to consider.
Mark Miller, Gary Klencheski and Steve Krum all have experience in this area and chime in for this week's Ask an Industry Leader.
"What are the pros and cons of keeping the club open for 24 hours, and what other factors do I need to consider if we do change the hours?"
A: The number one factor to consider when deciding if your club should be open 24/7 is cost. You must determine if there is enough demand to justify the added expenses that you will incur due to staffing the facility, utility costs and any extra costs due to towels and supplies. I would not do this unless this move allows you to gain enough new members so that your increase in revenue doubles your cost.
Gary Klencheski
President & CEO
Fitcorp
gklencheski@fitcorp.com
A: Whether to operate 24 hours or not? That is the question. Just the fact that you are asking this question shows that you are doing the correct due diligence. Don't do it just because the competition is open 24 hours.
We recommend a cost-benefit analysis in which you study the demand of your market, and obviously the direct costs associated with a 24-hour operation. In particular you will measure the variable costs of payroll, utilities, supplies, and even check insurance costs that maybe relative to a 24 hour operation.
The other cost as you have alluded to in the question, is the lost opportunity cost of not being open all night. These "intangible costs" can only come from your experience of the customer demographics you are serving. You must determine if your market includes a significant number of customers demanding to work out around the clock or not. This will be somewhat of a "gut feeling" based upon your knowledge of the area. In addition, a survey and some research of the competition in your area that is open 24 hours per day. How many people are actually taking advantage?
The "dilution factor" is also a real concern and as we all know, sometimes "less is more" and trying to be all things to all people is not the right path.
Steve Krum
General Manager
Spectrum Clubs
SKrum@SpectrumClubs.com
A: Each club is different and their individual needs vary. The decision on whether the club will be a staffed model or un-manned club is a difficult decision as many variables must be considered. Whichever model you implement, it needs to be well thought out. A few key areas to consider are, ensuring that your club management software can help with securing doors through a mag loc system and checking in members remotely. Make sure you have proper cameras and coverage as well as safety features within club, i.e. 911 phone, panic buttons, emergency wall. Check with your insurance company on any regulations they may have on their side. Make sure you can secure pro shop items, front desk accessories, cash doors, nightly deposits, etc.
Having done this to several of our clubs and running both styles, we feel the biggest factor is your comfort and preference. You have to feel comfortable and secure in the decision you make. Talk with other club operators and ask them for advice. Going 24/7 lends itself several large benefits in my opinion and yet there are areas that need to be addressed to ensure safety and security for all. Best of luck.
Mark Miller
Vice President
Merritt Athletic Clubs
mmiller@merrittclubs.com
One of the most frequently consulted sections of IHRSA’s Website, ihrsa.org, is “Ask an Industry Leader,” which features answers from industry experts to a wide range of thought-provoking questions. Beginning this month, we’ll highlight some of them in this new CBI column.
Visit ihrsa.org/industryleader to read responses to more than 100 questions such as these or to submit a question of your own to be answered.
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