As 2023 enters midyear, recession chatter is building. The stock markets are tilting sideways. OPEC just announced a hold on production. Inflation is still high and, for the first time in years, job openings are declining.
What does this mean for your gym? How can you take advantage of an economic downturn?
Well, let’s remember three years ago, the world shut down. And despite the 2020 pandemic eliminating thousands of mom-and-pop gyms, your company made it. Many gyms, indeed, thrived once doors reopened.
Here are five ways to take advantage of a recession:
1. Watch for market openings.
As the fitness space becomes constricted — that is, competitors go under – “white space” begins to emerge. These are pockets of need now going unserved. Keep an eye on which fitness centers are closing down or cutting back. Their core customer base still needs services your gym might be capable of offering.
2. Snap up local talent
The last several years have been defined by a tight labor market. Employees held the upper hand and, for employers, it’s been competitive and expensive. As a recession takes hold, larger gyms driven by corporate decisionmakers will naturally adjust to declining membership sales. This leaves talented staff, including instructors, membership sales specialists, and maintenance crews, searching for new jobs.
3. Negotiate better contracts.
You’re not the only one wondering how to survive the next downturn. Reach out to vendors, leaseholders, credit card companies and others to negotiate better terms, lower rates, more flexible agreements. A proactive approach can signal loyalty that could help your business weather the rockiest months.
4. Integrate cost-savings features into your everyday business structure.
Many Gym Insight customers have reduced or eliminated the need for front-desk employees by moving to a 24/7 schedule supported by digital keytags. These fully digital door-access systems allow members to both sign up through a gym’s website and enter the gym without contacting an employee.
- Investing in well-maintained used gym equipment
- Re-evaluating subscription fees for services, such as music and gym software
- Consolidating high-interest credit card debt
- Scrutinizing everyday expenses for spikes in cost
But if times turn rough, how can you maintain a successful business?
Stay nimble. Business experts suggest developing a flexible mindset and business strategy that can adapt to consumer fears. This may mean designing promotions that assure members they are not “stuck” in the deal. If times turn hard for them, they can feel comfortable that their gym won’t stick them with a bill that might lead to a dinged credit score.
Go for the jugular. It’s not an easy tack, but undercutting the competition’s pricing is a tried-and-true method for luring in new customers and bringing back former ones.
Create value. Be so good, you’re the last expense a member wants to cut. During COVID, The Source Fitness Center gym owner Justin Green revamped his entire facility. He eliminated an accident-prone CrossFit training center and reestablished a “flow” within the facility. Today, when a member walks in, they know exactly where they belong, as the cardio, selectorized strength machines, and free weights are all carefully arranged to both maximize a member’s time and increase their comfort level. Who would want to cut that type of gym from their budget?
Develop grit. It is said that bad times don’t make character, they reveal it. So now is the time to show the world just how tough you really are. And give us a call. We’d love to feature your recession ride on our next Gym Owner’s Podcast.
At Gym Insight, we develop gym management software that is not only easy to use and affordable, it changes gym owners’ lives. With software so effective and comprehensive, gyms nearly “run themselves,” leaving our gym owners time to pursue their financial goals and grow their businesses, secure in the knowledge they have the tools necessary to succeed. No matter where you want to take your gym, bring Gym Insight along and our crackerjack team of sales and customer service reps will ensure you get where you want to go.
Thank you to the following articles for inspiration and information: