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MANAGEMENT SERIES


In a nutshell


l Budgets: Budgets are the backbone to financial stability. A balance must be struck between setting ambitious but achievable budgets, and at the same time allowing for flexibility. Crucially, budgets must be checked regularly


to ensure you’re on track. l Accountability: A finance director can maintain an overview, but every centre/gym manager must be involved in setting the targets and must be accountable


for their own budgets and P&L. l Software: A wide range of software is now available to assist staff in the financial aspects of running a club, but a commercially- focused financial team is crucial to identify human / PC-generated


glitches in data. l Forecasting: This isn’t about long-term crystal ball-gazing, but a flexible “extension of your daily and weekly checks”, with a view to keeping all stakeholders


comfortable with the business. l Collaboration: Financial control isn’t just about the figures


– it’s about the people, with communication across the whole business key to success.


or negative trends are identified and acted on early. “As with any issues, the sooner you get to them, the easier they are to solve,” he explains. To ensure smooth running of all


énergie clubs, Harding is able to access what he calls ‘fingertip information’ minute-by-minute. “énergie has built a bespoke piece of software called ORA, which tracks membership sales across the network,” says Harding. “At any given time, I can check ORA and see how the clubs are performing against their sales targets, which are obviously linked back into the budgets.” With controlling costs just as


important as selling memberships – and harder to track, as there are so many different variants – Harding also invested in software to manage the purchase order system and keep a tight rein on expenditure. Automated systems have certainly


transformed the way profit and loss are managed, but as the familiar saying


goes: ‘To err is human, but to really foul things up you need a computer.’ Health and fitness clubs therefore still need a finance director in place, supported by a commercially-focused finance team analysing and assessing progress – and staying alert to any oddities created by computer (or user) error.


Forecasting Forecasting is incredibly important to ensure the long- and short-term viability of any business. This is never more so than in the fitness sector, with its cyclical income of membership subs coming in just once a month. “People assume forecasting is long-


term crystal ball-gazing, when in fact I think it should be seen as an extension of your daily and weekly checks,” says Jefford. “Forecasting should be flexible and allow for changes that happen during the forecast period.” “Forecasting is essential to keep our shareholders and stakeholders up to


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


A strong balance sheet isn’t just about selling


memberships, but about controlling costs


speed with our future development plans,” adds Harding. “With our future growth funded through reinvestment of our profits, forecasting is key to giving stakeholders ongoing comfort in the business.”


Collaborative approach With the right tools, well-trained staff and strong leadership from the finance director, clubs have more scope to track and control their finances than ever before. However, training people properly and maintaining a flexible, open door policy between the finance department and the rest of the business are key to success and security. The days of the company accountant


being shut away and unreachable are numbered, with financial control not just about the figures. It’s about the people behind the figures, with social interaction and communication across the whole business key to bringing financial transparency and control. l


November/December 2014 © Cybertrek 2014


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