How to run a healthy fitness centre

Sustainability in the fitness business depends on the right business model, excellent services
and integrity with customers, leading fitness and wellness business operators said.
“In order to build and maintain a strong business, there has to be a right business model in place – good-quality products, coupled with a dedicated,  professional and experienced team
and, of course, sound partnerships to help build a strong membership base that is satisfied with our services,” said Patrick Wee, the founder and chief executive officer of True Fitness.
Not only does True Fitness provide holistic fitness and wellness offerings, the company also constantly upgrades and improves its operations and services.

Wee added that integrity and trust with members and public is also another key factor that enables True Fitness to stay strong in today’s environment. “We do not believe in ad hoc
discounts, so we offer fixed prices to maintain the integrity of membership pricing and to build trust in our sales teams,” Wee said. Mark Buchanan, managing director of Fitness First (Thailand) said: “No matter what happened in the market place – for example, while our competitors were selling cheap membership – we never went back to cutting our membership prices as we wanted to be a profitable and sustainable business.”

Buchanan added that the key element that helped Fitness First succeed for more than 11 years is its approach to the people. The company emphasises recruiting and investing in staff,
as it believes that well-trained staff can create long-term relationship with customers.
Surasak Kongpanya, director of California Wow Xperience, once a popular fitness club, accepted that long  life-membership was a factor that caused difficulties in the company’s
cost management.

Under such long-term membership contracts, members pay only a big amount for membership, entrance and administration fees. There is no need to pay monthly membership fees, but
its customers have to pay a little for annual renewal, ranging from Bt100 to Bt3,900.
Therefore, California Wow Xperience emphasises personal training as its main source of revenue. Surasak said that before they were forced to shut down seven out of 10 clubs due to business issues, revenue from personal training accounted for 60 per cent of total monthly income.

This was followed by monthly memberships at 30 per cent and the remainder   was from other services. “If our rehabilitation plan is approved by the court, the company will launch a new compact fitness club called Wow Express, and offer monthly memberships to create sustainable business.”
What about other business and revenue models? Fitness First’s head said that monthly memberships represent 70 per cent of total revenue, followed  by  25 per cent from personal training service and the rest from selling accessories and food supplement products.
True Fitness CEO said that of the total income, 50 per cent was from yoga and monthly memberships and 30 per cent from personal training, while the rest was from sales of spa and aesthetic treatment packages and services.

Though there are differences in the main sources of revenues at the three fitness operators, they agreed that rental fees and staff salary were the biggest part of operation costs. Hence,
maintaining monthly revenue is a key factor to help the fitness operators manage such fixed costs and create sustainable profits.