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Contract warning to owners

Exclusive by Louise Cordell
INDEPENDENT gym owners have been advised to start locking members into long term contracts amid fears that budget chains could put them out of business.
Dave Wright, managing director of Creative Fitness Marketing, has been working in the UK fitness industry for 20 years and says the emergence of budget gyms could present the independents with their biggest-ever challenge.
Dave, who owns four gyms, has already started tying members into three-year contracts to ensure he is ready for the budget chains’ arrival.
He said: “Gyms need to start preparing themselves and really the only way they can do it is by getting members on longer contracts, of up to three years, as soon as possible.
“Currently the only way a lot of the independents can compete with the big chains is on price, and budget gyms will lose them this advantage.
“I have seen it first hand when working with businesses in America and predict that within the next two years there will be at least 50 budget gyms in the UK. Businesses need to know that when these rival facilities open they will have guaranteed cash flow.”
However, others in the industry disagree that the emergence of the chains warrants such a drastic response.
Ian Wakefield, ISRM business development manager, said: “I don’t believe that the budget gym model will be sustainable over a long period and believe that it would be unethical for gyms to tie members in to extremely long contracts on that basis – I don’t think it is the way the industry should be conducting itself.
“Most people are prepared to pay for quality and good service and gyms should be competing on these grounds rather than price. The lower end of the market may be affected for a while but if the gyms are busy enough to sustain themselves then service is likely to suffer and attending will not be an enjoyable experience.” Full story, Page 4
n What do you think? Write to Louise Cordell at 47 Church Street, Barnsley, South Yorkshire, S70 2AS or email lcordell@whpl.net

Go backPosted on 7th February 2008