As the COVID-19 virus spread across the country in the last few months, nearly every state and local government issued social distancing guidelines and stay-at-home orders. This resulted in closures of all non-essential businesses, including health and fitness centers.
All of us are trying to navigate through this uncertain time, from our personal schedules and interactions to our financial stability. While owners and employees in any industry deal with the harsh reality of having their business closed, they also face the troubling unknown of how long this period will continue.
This is a time that requires strong leadership from franchise owners of health and fitness centers. Employees, customers and vendors are all looking to them for answers. There is no manual for how to deal with a business closure due to a worldwide pandemic. Owners need to make difficult decisions very quickly during an unknown time.
Here are some key factors they should consider in guiding their business during this challenging period.
The very first thing a franchise owner should do is develop a plan and communicate it with everyone. This needs to be done early and with clarity. Uncertainty leads people to be fearful of the worst-case scenarios. It is important to quickly establish a plan, communicate with others how it will take place and let them know how you will be there for them.
Employees will want to know if and how they will be financially supported. If they are not able to continue working, they will need to know about some of the current programs that can provide them with an opportunity to make nearly as much money through unemployment benefits. Customers need to know the plan for the fitness center and how it effects their membership. Franchisees need to communicate with the franchisor that the business is closed and what their plan will be in the interim.
A good franchisor will stay in constant contact with their franchisees and help support them during this time. The best thing a franchisor can do is to work closely with their franchisees, share experiences and help with the government initiatives such as the Paycheck Protection Program and the Economic Injury Disaster Loan program. They can also set up conference calls and virtual meetings to provide guidance on how to retain employees and customers.
Stop the Bleeding
It is obviously a jarring experience to go from normal operations to being shut down and making no money in a matter of days. Some of the first steps require contacting legal counsel, banks, insurance providers and landlords about business interruption claims and rent payments. Money will surely be lost during this time, but they should take the necessary steps to minimize the damage as much as possible.
The number one goal in the fitness industry is to retain customers and that rule still applies. Stay connected with the most loyal customers and give them the option to continue to pay their monthly fee if they would like. I am a member of two clubs and will continue my membership because I know it is going to help them. Some people will feel the same way while others will want to stop.
Fitness center owners may want to consider other temporary options such as discounted membership costs, incentive plans or deferred rent payments. Even if it is for a short period of time, whatever can be done to reduce carrying cost for the business to the smallest amount possible will give franchise owners the best chance to come out on the other end with some financial strength and stability.
Although social distancing guidelines require gyms to close their doors, it doesn’t mean the business needs to stop. There have been some innovative ideas in the fitness industry that continue to engage customers. Some fitness concepts have instructors conduct training sessions outside or in a public park by spacing people apart. It gives customers a continued routine and ability to connect with others (at a safe distance).
Another popular trend recently offered by fitness centers are virtual group workouts and personal training through video calls via Zoom, Skype or Facetime. Some franchises are doing this for free or reduced prices or are offering proprietary access to their website or app free of charge.
Technology is one thing we have on our side during this current crisis and it is in the best interest of fitness center owners to take advantage of it. This can be a great opportunity, albeit in an unconventional circumstance, to further engage current members and reach a new audience.
The re-opening of fitness centers may be slow even as the curve flattens, precautions are lifted a sense of normalcy returns. Although many facilities take proper safety measures for hygiene and cleanliness by disinfecting equipment, people may still initially resist going back to the gym. There is no escaping the fact these centers have many high-touch surfaces shared by others in an environment with sweat, germs and moisture.
Once this period passes, however, I believe there will be a desire among many people to return to their routine of exercising at a facility with the best resources. Whether it be to access premium equipment or the ability to work out with others, people will prefer to go to a fitness center over exercising in their living room.
This current period gives fitness center franchisees the opportunity to be creative and try new innovations to expand their customer base. They should also use this time to develop a strong marketing game plan for when their business opens again. It will give them an advantage over their competitors and be able to attract customers as soon as possible.
Rick Bisio is the Amazon-bestselling author of The Educated Franchisee, a leading franchise coach with FranChoice, the co-host of Rick Bisio’s Franchise Focus, and the creator of the FDD Exchange and the Franchise Glossary. Since becoming a franchise coach in 2002, Bisio has assisted thousands of aspiring entrepreneurs nationwide explore the dream of business ownership. Prior to joining FranChoice, he was the director of international development at AFC Enterprises, the parent company of Popeye’s Chicken, Church’s Chicken, Seattle’s Best Coffee and Cinnabon, establishing locations in more than 30 countries