Interview with Royce Pulliam, CEO of Lexington, KY-based Global Fitness Holdings and its 30 Urban Active clubs
Royce Pulliam and his team have their sights set on big growth ahead, with no plans to stop despite the economic downturn.
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Much of that increase in revenue will come from the new clubs, but personal training is adding a lot of ancillary revenue, too, he says.
"Personal training is a huge piece of our business," Pulliam says. "It's a big piece of the membership and how we retain members. We feel like our retention is fairly strong because a lot of our people buy training, and they're successful with their training."
Group training hasn't made a big splash at Urban Active yet. Pulliam says that 99 percent of the company's training business is still one-on-one. Rather than making training more affordable by offering group training, Urban Active is offering 30-minute personal training sessions.
Pulliam says another key to growth for his company is the addition of a three-story club model, the first of which opened in December in Columbus, OH. The three-story design allows Urban Active to go into densely populated areas where land is scarce without sacrificing any of its amenities, Pulliam says.
"If there's only 3 1/2 acres, we didn't want to have to cut out the track, basketball, the pool," he says. "We wanted to be able to provide what we do, but be able to fit it in an area where there's only X amount of property available."
Despite the growth that Pulliam has planned and his background as a franchisee with Gold's Gym and World Gym prior to that, Pulliam insists that he will not franchise Urban Active.
"You lose control of the product, the quality of service [if you franchise]," he says. "It gets so fragmented that you end up losing control of what you've built up."
However, Pulliam says he might partner with experienced operators who share his vision and carve out territories with them for some Urban Active clubs.
Pulliam also initially dismissed the idea of going public some day, saying that the Pauls own many businesses and few are publicly traded. However, he then added that he couldn't predict the future.
"Our mission is to keep our head down and continue to do what we do and not deviate from our business model at all and operate business as we know it," he says. "Whatever happens, happens."
Pulliam doesn't have an exit strategy from his company like some club operators have. He just wants to exit the business "before he dies."
"People do have exit strategies and exit plans, but 90 percent of those exit plans never come to fruition," he says. "No one can read that crystal ball, and we just haven't tried to."
For interviews with other executives in the fitness industry, visit the Executive Insights section of the Web site.
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