WASHINGTON, D.C.—Make no mistake about it. McDonald’s is our industry’s enemy, peddling fast, fattening food to Americans who need fewer french fries, more exercise. But that doesn’t mean clubs can’t learn from McDonald’s business practices.
Take Gold’s Gym International (GGI). The chain of corporately owned and licensed clubs recently copied McDonald’s by organizing approximately half of its U.S. facilities into 14 alliance groups, each consisting of approximately 15 owners.
“McDonald’s did it years ago [with its locations] and helped strengthen their franchising groups,” explained Kirk Galiani, president and CEO of GGI.
The idea may have come from McDonald’s originally, but the concept of an alliance group is not entirely new to GGI. A group of Gold’s Gyms in Atlanta had previously joined forces, and their model served as an inspiration for the other alliance groups.
“We thought it was a great thing, and we expanded on it to help create these [groups] across the country,” Galiani said.
By bringing together individual club operators from the same market areas, the alliance groups serve many purposes. For one thing, they build camaraderie. Rather than view each other as competitors, the operators can unite in an alliance group for a common cause—namely, strengthening their businesses.
“It’s not the franchisees against each other,” Galiani said. “It’s the franchisees against everyone else.”
Given this point of view, an alliance group gives Gold’s Gym owners a venue to discuss best practices. For example, one operator can share his marketing, sales and operational techniques with the other members of the group, who can implement these techniques for the betterment of their businesses.
The alliance groups can also give the members certain buying privileges that save them money. “It’s one thing for a franchisee to go out and pay for radio and TV ads,” Galiani explained, “but if they can get that split among 15 owners instead of one, it makes it a lot more cost effective.”
In addition, the alliance groups make communication and the dissemination of information easier. Thanks to the groups, GGI corporate can now e-mail a message to one alliance member, who will spread the news to others in his group. Furthermore, when GGI executives visit a city, they can meet with an alliance group instead of individual club operators.
Right now, the alliance groups are found primarily in areas where Gold’s Gym operators can interact with little effort. Certain logistics prevent some owners from participating.
“Sometimes, it’s difficult because they may be in an outlying, rural community that may be an hour and a half to two hours away from the alliance,” Galiani said.