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INTERVIEW


Xercise4Less clubs typically offer 400 stations of CV and resistance equipment alongside a large studio with a full class programme “We turned a business that was breaking even


allowing us to cater for higher volumes of members. Those were the only physical changes though, as there were no wet facilities at the club. “We dropped our monthly fees from


£25 to £15 and pretty much doubled the membership in the first three months. It’s not easy changing models by any stretch of the imagination – that’s one of the reasons we’ve steered clear of all the Fitness First clubs that came onto the market – but we managed to turn a business that was breaking even into something quite profitable within 12 months. We haven’t looked back since.” The rebranded Xercise4Less


expanded at a measured pace over the next few years, focusing primarily on the north of England. However, with club number 10 set to open in Nottingham this month, terms already agreed on sites in Bristol, Swansea and Falkirk, and Tesco lining up potential sites across the country, it’s clear the business now has a broader geographical spread in its sights. The speed of the rollout is also set to


accelerate, even independently of the Tesco deal. “We’ve just completed a minority equity sale to private equity firm The Business Growth Fund: we’ve sold 17.5 per cent of the business and raised £5m, which will allow us to massively speed up our rollout. We now expect to open 100 sites in the next three years, and we have the next 30 lined up. We’ll start ramping up to opening two clubs a month by the end of this year, and then probably three a month next year and going forward. By this time next year, we think we’ll have 34 sites open.”


Low-cost, full-service So how does today’s Xercise4Less offering compare to the original remodelled site? What does ‘budget’ look like at an Xercise4Less facility, and who is the target market? “The phrase we use is: ‘The only thing


budget about us is our price’,” says Wright. “We have staffed receptions, a wide range of facilities and full studio


38 into something quite profitable within 12 months”


timetables – around 40 classes a week, mostly with live instructors, although we’re also trialling MyRide to offer some virtual classes too.” There are also add-on offerings such


as baby ballet and karate, which cost extra, with plans to launch summer camps and an Xercise4Kids programme next year. “I think we’ve taken the best elements of budget clubs and the best elements of traditional clubs and combined them,” says Wright. He continues: “The demographic we


appeal to tends to be quite young, so our facilities have a clubby vibe. There’s a female bias: around 60 per cent of our members are women thanks to the focus on group exercise, as well as our ladies-only gym areas. “And because our clubs are staffed,


they’re very friendly. We think that’s critical. We’d never go down the faceless, self-service route. That’s not what we’re about at all, and it’s particularly important when 30 per cent of our members have never belonged to a gym before.” That’s as may be, but with most


budget operations only able to deliver low prices thanks to a heavy reliance on IT over staff, how can Xercise4Less afford to employ full-time receptionists? “The profit margin we make on


secondary spend alone covers the reception costs,” says Wright. “We sell a lot of supplements, including quite a few female ranges.” He continues: “When we were in


Las Vegas for IHRSA in March, we visited a number of clubs. They all had massive retail areas at the front selling supplements. Obviously supplements are much bigger in the US, but they’re becoming much more mainstream in


Read Health Club Management online at healthclubmanagement.co.uk/digital


the UK now too. We see that as a huge growth area and will look to build bigger retail outlets in our receptions.”


Role of technology Beyond the reception staff, however, technology is as vital to Xercise4Less as it is to other budget clubs. “Everything’s web-based now – tills, CCTV, security… even our environmental controls are web-based, so we can control all our air handling and air conditioning units from head office.” The focus on the gym floor remains


on personal training: around 20 per cent of members take up PT at £25 an hour, with 10–15 PTs working in each club on a rental basis. However, technology is also used to drive high levels of member education, with an extensive library of instructional videos, tips and advice freely available on the Xercise4Less website to help members drive results. “We’re also launching downloadable programmes this month,” says Wright.


“We already have QR codes on all the equipment – just swipe your iPhone for a demo video on how to use the kit – but from this month you’ll be able to buy one of our new six-week programmes for £0.99. If you’d like, you can also buy a nutritional programme that accompanies it for £0.49. You just download them onto your iPhone. “For now, we’ve come up with about


20 starter programmes such as Get Strong, Get Fit, Get Trim. Some are more male-orientated and some female-orientated. We’ll have big boards in all our clubs with details of the programmes and corresponding QR codes, so members can just scan the one they’re interested in and download it. At the end of the six weeks, the


September 2013 © Cybertrek 2013


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