The success of the high-volume/low-price (HVLP) model in the health club industry has been both a blessing and a curse. While it’s been a boon to larger fitness chains that can remain profitable with low member rates (from $10 to $20 per month) with limited margins, independent clubs and smaller regional chains are struggling to compete with the budget national chains. This has forced operators to find consistent revenue streams beyond monthly dues. That’s easier said than done.
Some enterprising club owners have devised strategies that have made a huge difference in creating non-dues revenue from selling personal training sessions, group training packages, and spa amenities. These operators are finding that the most effective pricing model is the bundling strategy.
On its face, bundling is a simple, commonly used merchant tactic. Bundling means combining a group of products/services together into one price that’s lower than each item would be if sold separately. Consumers will often opt for the bundle even if they have no intention of using each amenity.