Seasoned fitness operators share some of what they have learned about adapting to the changing fitness business.
The choices individuals make often are influenced by their experiences. The luckiest of people are those whose choices are also affected by the experiences of others. Although the fitness industry is nascent, it has its share of seasoned fitness facility owners and managers. What they have learned during their lifetimes could take those new to the industry their own lifetimes to learn. That is, unless the newcomers are made aware of the triumphs, challenges and decisions that some of the fitness industry's veterans have experienced.
Below, four industry veterans tell their tales of survival in a business that often requires innovative thinking, risk taking, perseverance and a large dose of people skills. Cliff Buchholz, owner of two Miramont Lifestyle Fitness clubs in Fort Collins, CO, has learned that the membership model may not be the best way to attract new members. Red Lerille, owner of Red Lerille's Health and Racquet Club, learned from one of the founders of fitness, Joe Gold, that continually improving is a main ingredient for success. Kevin Buck, owner of Newport Athletic Club, has adapted to a more knowledgeable member base with education and constant change. Carol Kennedy-Armbruster, who helped plan the fitness program for Indiana University's Student Recreational Sports Center and is now a lecturer in the Department of Kinesiology, shares her thoughts on student recreation centers, which have grown in size but may require more intimate spaces.
As you read their stories, the goal is that you will learn from the combined 134 years of experience that this group represents. After all, what better way to jump start your business than to learn from those who struggled before you and who continue to thrive in an increasingly competitive industry?
The industry has come a long way since Cliff Buchholz opened his first club in 1965. The former tennis pro has come a long way, too, owning several clubs in different cities and now owning two Miramont Lifestyle Fitness facilities in Fort Collins, CO.
During his career, Buchholz has seen members change (moving from just the young and fit to now include seniors, teenagers and deconditioned of all ages), staff change (employees now see fitness as a career path rather than a part-time job) and business operations change (EFT was unheard of in 1965), yet he has been able to adapt to the changes and remain successful.
One of the biggest adaptations he's made is a recent change in how to bring people into the club. For Buchholz, business isn't about selling memberships. Instead, it's about selling wellness. To that end, he talks with local business owners about offering his clubs' four nonmember wellness programs to their employees rather than offering memberships.
“We need to eliminate barriers to getting people in to exercise,” Buchholz says. “If membership is one of those barriers, then we need to eliminate that. Teach them how to exercise, how to take care of their backs, how to lose weight. Then, they might become members.”
One of the nonmember programs, the six-week, $90 Quick Start program, introduces nonmembers to exercise. The program shows them how to use equipment, introduces them to group fitness classes and requires that they meet with a personal trainer a few times a week. Once participants complete the six weeks, they have used each part of the club and all the equipment, and that often translates to a comfort level that moves them to join the club, Buchholz says.
The other nonmember programs are a weight loss program, a nutrition program and a healthy back program — all offered as a way to provide wellness to the community and instill a comfort level with exercise and the club.
Because Buchholz just started the nonmember programs a year ago, he doesn't have firm numbers on how many program participants have joined the club, but based on his personal observation, he says the join rate is high.
Despite his attention to the customer, Buchholz has learned through the years that the customer no longer comes first; instead, employees come first, he says.
“You take care of your staff, and they'll take care of the members,” he says, adding that customers come second.
The members' second place status at Miramont hasn't hurt membership. The two clubs have 12,000 members combined. One club has an 80 percent retention rate while the other club has a 68 percent-70 percent retention rate.
Perhaps the retention rate is so high because for Buchholz the real work starts after the membership has been sold, he says.
“The challenge is to get your members to use the club, especially if you have a full-service club,” he says. Retention will be high if a club can get someone in the family to use the club every day and if the members develop relationships with the staff and other members. Buchholz's goal is to see each member in the club every two days and to have 40 percent of members involved in one of the group exercise programs each day.
Members stay despite an automatic annual increase in membership dues. Few balk at the increase, Buchholz says, since a large part of the money goes back into improving the club and bringing in new equipment and programs.
“You have to determine your market and the type of club you are and then price that accordingly,” Buchholz says, adding that he doesn't want to be dependent on just pricing. People will pay more if they are getting more, he says.
However, today's market is more competitive than ever as universities, condominiums, and parks and recreation departments offer fitness facilities.
“There's still plenty of room for growth,” he says. “It just means that you have to do a better job of providing hospitality, a better job of reaching individuals who never thought they'd be a member of a club, and be better at helping them reach their fitness and wellness goals.”
Years in the Industry: 40
Education: Bachelor's from Trinity University, San Antonio, TX; law degree from Washington University, St. Louis, MO
Biggest Surprise: Recently, Buchholz has been surprised by the number of seniors at his clubs and the number of people who participate in the clubs' free Cancer Well Fit program. “I'm surprised at the number of people willing to work out as a group,” he says. “We've filled up every class we've offered. I thought it would be more difficult to market.”
Advice for Newcomers: Anyone entering the fitness business must be willing to work hard, be caring, be a self starter and enjoy what they are doing. “It's not an industry where you can have a lot of down days,” Buchholz says. “People are paying to enjoy themselves and work out. So you better smile at them when they get there, have good programs and make them feel welcome.”
Seventy-year old Red Lerille doesn't spend his days in an office or listening to voicemail. On most days, he stands at the front door greeting members or walking the floor of his health club in Lafayette, LA.
“I've known a few owners who have a back door to their offices so they don't have to walk through their club, but I stand right at the front door waving at everyone as they come in,” Lerille says.
Some club owners may feel like they're above certain tasks and responsibilities, but Lerille does whatever needs to be done, whether it's giving tours, selling memberships, cleaning the club or putting Pilates equipment together.
Throughout his years as a club owner, he's also followed one fundamental rule from his friend and mentor, Joe Gold — continually make improvements to your club to stay successful. Gold owned Ajax gym in nearby New Orleans prior to his move to California and founding of Gold's Gym, and he served as an inspiration to Lerille, who won the Mr. America and Mr. Universe competitions and opened his gym in 1963.
“As a kid, I would scrub showers and do anything I could to hang around Gold on the weekends,” he says. “I was so excited to see such a gym and hang around the bodybuilders.”
Lerille took Gold's advice to heart by gradually transforming his 3,000-square-foot gym into an 185,000-square-foot multipurpose health club spanning 20 acres. Over the years, his club has added two indoor pools, a water slide, an indoor jogging track, a basketball gym, a children's workout area, kids' locker rooms and Pilates equipment. A boxing ring is next on Lerille's list of club additions.
His facility isn't the only thing that has changed over the last four decades; the membership also has shifted from competitive bodybuilders to families. During the summer months, the children from the surrounding neighborhood flock to the club, which has a total of 8,000 memberships.
Lerille worked solo at his gym for several years before hiring staff members. The local university is the health club's largest supplier of help, but Lerille also has some full-time employees who have worked for the club for the last 20 or 30 years.
“It's a record in this industry,” he says. “No one keeps employees that long. I treat them well, and we've been through some rough times together, which helps us to bond.”
One of those rough times happened 25 years ago, when his community had an oil bust and lost 1,700 members in six weeks. All of his employees showed up on time and ready to work, which helped the club survive the downturn, he says. Every day, he arrives at the club at the crack of dawn to open the doors and work out for an hour and a half. He also encourages his employees to exercise and stay in shape to serve as an example for his members. To drive this point home, he even tried to pay his employees a few dollars to work out, but it didn't motivate them.
“You can't pay people to do this,” he says. “Somewhere, you have to have that commitment to stay in shape. It's the toughest thing you'll do in your life.”
Although you can't pay staff to work out, Lerille has been surprised that members will pay an additional fee on top of their $50 to $120 monthly club membership for personal training. His philosophy, however, is that instead of making the client dependent upon personal trainers, trainers should teach their clients how to exercise and take care of themselves for the rest of their lives without them.
Lerille plans to keep working at his club and working out for the long haul. As long as he has enough money to pay his bills, pay his help, continue improving his club and buy a few “toys” for himself (like antique airplanes and bicycles), he's satisfied.
“I started with nothing, and I'm leaving the earth with exactly the same thing,” he says. “I'm having fun and see myself living for another 30 years and working until the day I die. Why else be here?”
Years in the Industry: 43
Education: Bachelor's degree in general studies from the University of Southwest Louisiana, which is now the University of Louisiana at Lafayette
Fitness Experience: He won Mr. America while in college, and like many other winners, he started his own health club. Forty-three years later, he still works 10-hour days at his club.
Adapting to Changes: Lerille forgoes voicemail in favor of a yellow pad and pencil. His club, however, does rely on computers, which has made running his club significantly easier, he says.
Advice for Newcomers: Show up on time and ready to work. Learn the two most important words in the English language: hello and goodbye. Keep trying to educate yourself. Make a change every month. Make sure you stay in shape to inspire your members.
Kevin Buck has worked nearly every job at Newport Athletic Club in Newport, RI. He started part-time at the front desk in 1982 and now owns the 36,000-square-foot multipurpose facility, which has 2,900 members and 75 employees. He's also been floor manager, spin instructor, food and beverage director, fitness director, membership director, assistant manager and general manager among other jobs.
“Being well versed to some level in several areas of the club is very important, especially as a manager,” he says. “I'm led by the management motto that I wouldn't ask someone to do something that I wouldn't do myself.”
The knowledge he has gained in each position has served him well as members have become more aware of the benefits of fitness and exercise. Ninety percent of the people who come into his club today have worked out someplace else before joining his club. This percentage is much greater than just a decade ago, but it may be unique to his club since it is located in a market with a high number of government contractors and military personnel who are generally transitory and fitness-oriented. However, his club also has a large number of Baby Boomers, and a third of his members are older than 55.
Regardless of their background and fitness experience or knowledge, more members ask health-related questions of the staff, a trend that indicates that people see the employees as more professional today than in the past, Buck says. To adapt to these more knowledgeable members and their questions, Buck ensures that his employees get continual education and keep up their certifications. He also continually changes the club and offers new programs.
“As members become more educated as they travel and see a new program and piece of equipment, you have to keep offering new stuff,” he says.
The Newport Athletic Club certainly has changed over the years. It started as a racquetball club but integrated other parts of fitness as they became popular. The club now has an indoor/outdoor pool, spinning, group fitness classes, strength equipment and the many other amenities of a multi-purpose club.
Large clubs that are able to meet the general public's needs will draw in members, Buck says. Still, they will face competition, something that has increased in the years Buck has been in the fitness business.
“It used to be you could open a facility and people would come to you,” he says. “Now, people have a choice and have to make a decision on why go to place A or B. It's more than price. Now, it's convenience, cleanliness, amenities. There are so many factors that go into their choice.”
When less competition existed, a club could try something different to see if it worked, but now before Buck tries anything, he analyzes the cost, who the program would reach, how it would be marketed and other factors to decide if it is worth the expense and whether it would be successful.
Still, he says competition is good.
“It keeps you on your toes,” he says. “You can't get stale or rest on your laurels. You have to keep in touch with members and find out what they think you are doing right or wrong. That's where the importance of talking to members comes from. I can think an idea is great, but if I don't bounce it off members, I might be the only person in the room [when the program is implemented].”
Being alone in a room would be difficult for Buck who has an office but doesn't spend much time there. He prefers to walk the floor and talk with staff and members.
“If I had three things to tell people, it would be talk to members, talk to staff and send out thank you notes,” he says. He does all three and is pleased at the response he gets, especially from the thank you notes, which he says is a lost courtesy now with e-mail.
What's not lost on Buck is that club owners will continually face challenges. To solve these issues, they need to break down the problem, pick it apart and develop choices with possible outcomes.
“Then, you pick the best choice and move forward,” he says.
Years in the Industry: 24
Education: Bachelor's degree in physical fitness from the University of Rhode Island
Advice for Newcomers: It's important to have a passion for fitness and helping people. They have to understand that they are in the customer service business, and they have to help people and not just come in and take home a paycheck. No matter how you treat people, be fair, honest and upfront. It's important to build relationships with employees and members so you get to know them and they get to know you. If you show a genuine interest in people and go out of the way to help them, you not only have a friend but you have a customer for life.
If it's not there and you want it, create it. That's the advice of Carol Kennedy-Armbruster who has served as a fitness education coordinator, program director, group exercise instructor, writer, presenter and currently a lecturer in the Department of Kinesiology at Indiana University (IU).
“Every job I've ever been in didn't exist until I got it,” she says from the phone in her office on the IU campus in Bloomington, IN. “You can create your own position based on ideas.”
After starting and running IU's Student Recreational Sports Center (SRSC), including making programming and equipment decisions, managing more than 125 people and running the day-to-day operations of a comprehensive fitness program for eight years, Kennedy-Armbruster knows a thing or two about recreation centers and the fitness industry, and she's seen a number of changes through the years. One major change is the development and growth of recreational facilities at colleges and universities. Case in point: the SRSC, which opened in July 1995 to meet the demand for additional and improved recreational sports facilities at IU. In the 1980s and 1990s, many higher education institutions hopped on the recreation center bandwagon, she says.
“It's a recruiting tool, and parents are willing to pay for it because they want their kids to be healthy while at school,” Kennedy-Armbruster says. “Rec centers have really taken off and are now part of campus culture.”
Even though college rec centers have been growing in size, she sees a push and need for them to be more intimate, social and individualized. If she were to run the Recreational Sports Fitness/Wellness Program at the SRSC over again, she would encourage room design to be more segmented to accommodate for different needs and allow the beginning exerciser to feel more comfortable.
She's also witnessed a change in student's needs and wants. The industry is starting to focus on the aesthetics of the rec center experience as more equipment is being designed that is not only biomechanically correct but also pleasing to the eye. Many students are also turning to activities that are less structured and more time convenient. For example, IU students don't have to sign up for a group exercise class in advance; they can just come in and participate when it's convenient for them.
“The culture of the university is based on time,” she says. “You can't make the students do something extra like sign up for an activity. If you can just drop in and go, that's huge.”
She urges fitness newcomers to get as much education as possible. After running the SRSC, Kennedy-Armbruster was hired as a full-time faculty member to assist with creating a fitness specialist undergraduate degree, making IU one of the first universities in the country to offer a four-year degree in fitness.
“We need to combine business with the knowledge of fitness,” she says. “We need to study fitness a lot more because we really don't know that much about it.”
Kennedy-Armbruster practices what she preaches. She is studying fitness management and within the next five years hopes to have a Ph.D. in human performance from IU.
“I'm secure that within higher education fitness is its own entity and deserves its own degree outside of exercise science,” she says. “It's the combination of business and science that's exciting. I think you'll see more of that, and I'd like to be one of the first people to do that.”
Years in the Industry: 27
Education: Bachelor's degree in leisure studies from the University of Illinois and a master's degree in exercise and sport science from Colorado State University
Fitness Experience: She has worked in both the private and university setting as an educator/supervisor of fitness staff. She has also served on the American Council on Exercise and the American College of Sports Medicine credentialing committees and chaired the IDEA Water Fitness Committee.
Adapting to Changes: Kennedy-Armbruster helped plan the fitness program for the Student Recreational Sports Center, which opened in July 1995 to meet the demand for additional and improved recreational sports facilities at Indiana University. Since then, student expectations have only grown.
Advice for Newcomers: Approach fitness from more of a sense of purpose and health rather than just aesthetics. After the age of 25, what really becomes important is your quality of life.