Health Club Operators Tighten Their Fiscal Belts with Cost-Cutting Measures

While club members work to get in better physical shape, today's economy is requiring many fitness facility operators to watch their costs and tighten their financial belts. Perhaps the most obvious areas for cost-cutting are the biggest expense items—rent or lease payments on land or buildings, payroll and equipment costs—but savvy club owners and managers are looking beyond the "big-ticket" expense items to discover other ways to trim expenses.

"It is back to the basics, with the economy continuing to be soft," says Steve Spearman, CFO of the Laguna Niguel Racquet Club in Laguna Niguel, CA.

Spearman watches managerial spending closely and has charged all managers with looking for ways to cut expenses wherever possible.

"We shop everything really hard," Spearman says. "You watch the little things and get multiple quotes. Do that, and soon you are watching pennies become dollars."

One of the first places Spearman looked for savings was with his suppliers. Earlier this year, he saved 30 percent by finding a lower-cost vendor of cleaning supplies.

"We had a long-term janitorial supply company that was just soaking us," he says.

Across the country in Bethel, CT, Tom Pear, general manager and owner of Sportsplex, found a new paper towel vendor who cut his cost on a case of paper towels by more than 25 percent, he says.

"We go through a lot of paper towels," he adds. "It all adds up."

Telecommunications can be a source of even further savings. Spearman pocketed savings by bundling Internet access, telecom and cable television service throughout the club with a single cable provider.