| IHRSA Report | Club Advisor
Making the Best Of Member Cancellations
By Patricia Amend
It’s a fact of life: some members, at some point, will want to cancel their membership for one of a variety of reasons, some of which are under your control and some of which aren’t. What should your cancellation terms be, and how can you best communicate them to members? How can you ensure that the process is as smooth and fair as possi- ble? Or, better yet, how can you hold onto that member?
Consult your state laws. When you’re creating your membership contract, be sure to research the laws in your state that govern health club memberships, advises Helen Durkin, IHRSA’s executive vice president of public policy. “Most states that regulate health club contracts have exact provisions regarding cancellations. Often, the law specifies the cancellation language and, even, the point size of the type required in contracts. The law may also spell out the ways members can legally notify you of a cancellation. So while no one likes to have members drop out, it’s important to understand the law to avoid having trouble with your state’s consumer protection department when you do lose one.” To access the rules for their state, IHRSA members
can log on to
www.ihrsa.org and click, first, on the “Legal & Legislative” button and, then, on the link for “State Activity.”
Point out your rules clearly. “Most people are so thrilled to join that they don’t think about what might happen when they want to leave,” notes Arlen Zwickler, the general manager of the Athletic and Swim Club at the Equitable Center, in New York City. “So, we make sure that our policies are spelled out in several places in our membership agreement, as well as in an addendum. And, in the member’s best interest, we have them check and initial those sec- tions, as well as sign the bottom. We also explain the cancellation process clearly in our member handbook. Otherwise, people, when they cancel, may think that they weren’t informed and feel that their rights have been violated.”
Insist on written cancellations. Sometimes, clubs with month-to-month memberships erroneously believe that they have no contracts, says Rick Caro, the presi- dent of Management Vision, Inc., an industry consulting firm based in New York City. “However, what they have, in fact, is an open-ended contract—not a closed- end contract. In any case, you can’t deduct money for a membership from a bank account or charge it to a credit card without an underlying legal agreement. And the only way to amend such an agreement is in writing. Members who call the club to cancel, or cancel the credit card they’re using, are still obliged to pay— until the cancellation is in writing.” “On our membership application, we make it clear
that the monthly debit from the member’s account is taken on the 25th of the month, and members must cancel by the 10th to prevent the transaction,” explains Gary Klencheski, the president and CEO of Fitcorp, the Boston-based chain. “Our membership representatives circle that section on the agreement so the member sees it. To put that cancellation in writing, the member can fill out a termination form in person or by fax.”
Save the member, if you can. “We try to stop members from leaving before they cancel,” says Bill McBride, the chief operating officer of Club One, Inc., the San Fran- cisco-based chain. “We do that by monitoring club usage carefully. As soon as it falls for a member, we find out why. We may reach out and offer a free service, like a fit check, to reengage them. If they’ve lost their job, we may reduce their dues for three to six months. We try to provide a specific solution in each case.” —|
– Patricia Amend,
pamend@aol.com
www.
ihrsa.org | OCTOBER 2010 | Club Business Internat ional 103
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