Health Club
Question 2 What is driving the health club phenomenon? What are the basic economics of the health club industry? What value is created? What does it cost to deliver that value? How do these costs behave? Selected Answer:
The driving points of health club phenomenon are: Growing awareness about health related issues and concern about obesity and its effects among Americans is one of the key elements of the health club phenomena. Increasing desire to maintain and control weight, get in shape, meet people and reduce stress has also got people going to the health clubs regularly. Several health clubs identified the new needs of consumers and built facilities that are one-stop centers for most of their health and fitness needs. Consumers get the benefits of various work-outs regimes and can also hire a personal trainer-all under one roof. Customized training regimes to meet each member’s personal needs also enabled them to choose the work-out best suited to them.
Economics of Health Club industry The health club industry consisted of 26,000 health clubs in the U.S. However fifty largest firms acquired 33% of industry revenue and 38% of clubs was not-for-profit which had Young Men’s Christian Association as the key player. The for-profit industry was divided into 4 main formats: Owner-Operated clubs: Comprised of the majority of all health clubs. Over the years they built chains of clubs in various parts of the country and maintained centralized procurement, program design, marketing, finance, accounting, and collections. Franchised clubs: A successful health club concept was franchised to buyers who agreed to pay a fee to operate a club and in return received professional advice and advertising. Design and management companies and Health Spas also are a vital part of the health industry.
Most health clubs charge customers for a one-time enrollment fee and then a monthly subscription fee. Minimum subscription period in most health clubs was 1 year but Bally’s
The driving points of health club phenomenon are: Growing awareness about health related issues and concern about obesity and its effects among Americans is one of the key elements of the health club phenomena. Increasing desire to maintain and control weight, get in shape, meet people and reduce stress has also got people going to the health clubs regularly. Several health clubs identified the new needs of consumers and built facilities that are one-stop centers for most of their health and fitness needs. Consumers get the benefits of various work-outs regimes and can also hire a personal trainer-all under one roof. Customized training regimes to meet each member’s personal needs also enabled them to choose the work-out best suited to them.
Economics of Health Club industry The health club industry consisted of 26,000 health clubs in the U.S. However fifty largest firms acquired 33% of industry revenue and 38% of clubs was not-for-profit which had Young Men’s Christian Association as the key player. The for-profit industry was divided into 4 main formats: Owner-Operated clubs: Comprised of the majority of all health clubs. Over the years they built chains of clubs in various parts of the country and maintained centralized procurement, program design, marketing, finance, accounting, and collections. Franchised clubs: A successful health club concept was franchised to buyers who agreed to pay a fee to operate a club and in return received professional advice and advertising. Design and management companies and Health Spas also are a vital part of the health industry.
Most health clubs charge customers for a one-time enrollment fee and then a monthly subscription fee. Minimum subscription period in most health clubs was 1 year but Bally’s