Five steps to sidestep a bad economy.
It took 16 cameras and a digital key tag to inflation-proof Scotts Valley Gym in Scotts Valley Calf. After that, it was pure gumption.
Today, when rising consumer prices are forcing all of us to make decisions as to how and where we spend our money, gym memberships are often first on the list. So how do you ensure your gym makes the cut?
Or, if the economy really sinks, how can you be prepared? Should you raise rates to manage increased costs or decrease overhead?
Scotts Valley Gym took the second choice. Originally one of four World Gym facilities and rebranded Scotts Valley Gym by a previous owner, the power-lifting facility was hemorrhaging cash when co-owner Mike Tyree took over.
How did he make the gym profitable?
One, Identify unnecessary expenses
In order to control the bleed, Tyree eliminated any service that did not make money.
First went 80% of the front desk staff. Then, the aerobic program and juice bar. Eventually, childcare. Immediately, his cash flow improved and he could reinvest into his core community — strength training.
Two: Take the gym 24/7.
It sounds like an oxymoron: cut staff but increase hours. However, keeping your gym open 24/7 can be the right decision when paired with great gym management software and a reliable door access system. Gym Insight’s integrated door access controller allows Tyree to monitor member entry and exit without a full-time front desk person.
The door system has been improved recently with the emergence of digital keytag access. With the upgraded keytags, members can sign-up through his website and receive their key code on their phones nearly instantaneously – allowing a customer to go from sign-up to exercise within minutes. No need to meet new members at 3 a.m. to exchange keys.
In addition, Tyree placed 16 security cameras throughout the facility. Ironically, this final investment reduced theft.
Three: Support core members not expensive outliers.
Companies such as Orangetheory and SoulCycle revolutionized fitness as they provide on-demand exercise classes led by highly trained instructors. Every one of their customers wants that experience. Yet, in a mix-use facility such as Scotts Valley, only a small percentage of members sign up for classes. In fact, most of Tyree’s member base never stepped foot in a class. Today the strength training gym offers a cardio deck, small group training, and an open floor concept but no group classes. In turn, he gave up the headache of pricey instructors, extra insurances, managing taxes, nightmare scheduling, and additional staffing needs.
Four: Adopt subscription-based memberships.
Change the membership platform to a monthly subscription. The format helps with retention and keeps members paying monthly. No need to re-sell customers every several months.
Five: Settle on an ideal price point for your gym.
Tyree expects members to leave the more expensive gyms as inflation increases. Yet, he knows many of them will still crave an in-person exercise. At about $40 per month, his gym is significantly less costly than the more exclusive class-based companies or commercial health clubs. Yet, clients still enjoy a kick-butt workout using good equipment in a positive atmosphere. That makes him an affordable, and appealing, alternative.
Worried about a Recession?
There’s no need to make fear-based decisions. With a 24/7 platform, “I’ve created an operation that can be run with a key card,” Tyree explains, “We are constantly evolving and changing …now we are spending a lot more money (on the gym) but still making money too.”
We design and sell the easiest to use fitness center software on the market. Originally, created by our owners as a way to run their own gyms more efficiently, Gym Insight has evolved into a comprehensive, affordable software solution that is always striving to improve its functionality. Insight handles sales, member management, class scheduling, payment processing, 24/7 access control, and club management. Give us a try today. Call us at 1-855-FOR-GYMS. Or email us at [email protected] to reach our sales guy Anthony Pasquale