Clubs could offer one or two products at low-cost rates, such as cheap membership for the over-50s, suggests Coutts
nick coutts fitness hut • owner
“P
remium and mid-market operators can’t compete with
the low-cost sector on price, as they have too many fixed costs. Low-cost clubs spend less per sq ft on their facilities, whereas many higher-end health clubs have areas to run which generate less revenue, such as the pools. It isn’t like retail, where an item can
be reduced: any discounts impact the existing revenue stream. What might seem like a small percentage discount can be devastating when applied across 2,000–4,000 members. The view at IHRSA Europe last year was that clubs should
redefine and reinforce their USPs – aspects that low-cost operators can’t, won’t or don’t offer, such as pools and group fitness. Also, now is the time to take a scalpel to areas that aren’t working: is the spa really adding value? Running other businesses around the core business is a distraction to management. An area that I would like to see clubs exploring is the
idea of offering one or two products at low-cost rates – for example, offering cheap memberships to the over-50s or the unemployed. This wouldn’t cause a drift of the existing database and could create a PR splash.
” june 2011 © cybertrek 2011
brian scurrah pure gym • development and operations director
in the hotels sector, launching the Tulip Inn brand for Golden Tulip. However, the fitness industry is already more mature than the hotel industry was at that point. The hotel industry has ended up being
“I
a blend of all the market segments: some people downgraded to budget
accommodation – or new generation three-star – from more serviced hotels because they didn’t make use of the services. Some upgraded from B&Bs, but some people stayed with traditional three-star hotels because they liked the quirkiness. I think there’s space in the market for several types of
operator, each appealing to different types of people. Some older clubs will have to look at their offering and might need to re-invest and refurbish, but all can sit in the marketplace. Budget gyms will attract a lot more people to the market: it
makes my day when we open a club and people say ‘thanks – I thought I could never join a health club because it was too expensive’. It’s about giving people a choice. Consumers now have the option of full-service clubs, or no service, and they are becoming more savvy about how they spend their money.
” Read Health Club Management online
healthclubmanagement.co.uk/digital 31
have previous experience of this trend toward budget operations –
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