Considering the fitness market and its numerous offers, one will quickly realize that in the past decade, the industry has rarely changed as fast-paced and extreme as is the case right now. New competitors with new concepts such as functional training, various micro studios, High 5, online fitness portals and larger and better discounters are finding their way onto the market. Greater expectations from clients and a new boom in the health sector are causing radical changes.
In view of this, good planning and a well thought-out, long-term strategy is essential for gym owners. After all, a good entrepreneur/ manager is never clueless. S/he always has a plan; s/he knows what s/he is doing. And not just tomorrow, but in the long term.
But what does “long term” mean? And what planning and management is required in a fitness club?
Let’s begin with a focus on the concept of “strategy” and its origins. It is inferred from the Greek word ‘protostrategos’, which means ‘military leader’ and ‘skilful battle planning’.
Business administration has taken over the term of strategy and defined it as the doctrine of long-term planning over 5-10 years. Therefore, good corporate strategy/planning is a key factor for success and provides the framework for all objectives and decisions.
But before you, as an entrepreneur, start your planning, two important steps should be performed in advance.
Step 1: Self-Analysis
First of all, analyze your current situation. Where do you even stand right now? What is your current condition? Consider each individual area of planning individually: from positioning to marketing and finally controlling.
A business and marketing analysis or a SWOT (strength, weakness, opportunities & threats) analysis will provide you with a detailed overview of your current situation.
Take a look at the past year. What went well? What could have been better? Which internal and external actions yielded good results and can be repeated? What are members wishing for?
Keep these points in mind and analyze them carefully: it’s time worth investing. By doing this, you can form the basis for the following points.
After you have analyzed all divisions, you can proceed to the second step: the objective.
Step 2: Goal Setting
Your vision, or your mission, turns into a strategic objective. Ask yourself what is your personal vision, the big picture, on which everything else is based. Where should the journey for you and your business be headed in the future?
For this, it does not suffice to just to write down your objective. You need to internalize it, feel and always keep it in mind. All targets must be based on your vision. Possible targets could be:
- expanding market share/ market leadership
- address new markets and add new offerings to your portfolio
- increase profitability
- qualitative objectives.
Your detailed goals are the defined by your higher objectives. What exactly are you trying to achieve? What results do you want to get? Clearly distinguish between quantitative and qualitative targets in your detailed goals.
Possible quantitative objectives:
- annual turnover
- membership at the end of the year
- fluctuation (in %)
- personnel costs as percentage of turnover
- return on sales (in %)
- higher cash reserves.
Possible qualitative objectives:
- improve customer service
- improve image
- create better working conditions
- increase social commitment
- promote development of team.
Now, the question is of course: How do you get from your current state to the desired state? What resources do you need for this? Your will and your motivation provide the necessary fuel for this jump. It is important that these goals are for you and, above all, achievable.
Do not lose sight of your personal goals in respect of this, such as family and partnership, your friends and even your health. Factors that should also have a decisive influence and always be in line with your professional goals. This brings us to a very important factor of strategic corporate planning.
You, the entrepreneur, are at the centre of the entire planning. You decide which
ideas, concepts and projects are adopted and implemented in the system. Without you as entrepreneur, operator, manager, there is no planning, there are no goals, and hence no results.
You are the decisive controller and the melting pot for ideas, concepts, and the whole enterprise. You filter, decide and pass your instructions or decisions to the next level. In doing so, you decide in favour of the objective, day by day!
The mere creation of the corporate planning means that you are preparing your future decisions. This planning is your management tool.
You hold the individual strings, which steer your business in the respective direction: motivation of employees, improving the internal work processes and the quality, to name only a few examples.
There will be no development without your decisions. And making no decision is always the wrong decision!
At the same time, think of the implementation and about getting support/ advice on the side, if you’re not able to implement things on your own. Acting according to one’s own strengths is extremely important! Now let’s move on to several points of the corporate planning in detail.
We are talking about the sum of all the companies that serve the same market/ sector. The first thing you decided was in what market you want to build your company or position. This planning point is subject to continuous improvement and change.
As an entrepreneur, you have no influence on factors such as the number of competitors, the quality of supply, the supply itself and the respective prices. However, you can get an overview of the current status quo with tools, such as a comprehensive market analysis, an image and reputation analysis and competitor analysis, explore your own market potential, to then optimally plan in these areas and fine-tune accordingly.
This will then result in the next key point in your planning: your positioning. Think especially about the following topics:
- What does my company stand for?
- Where is my company particularly strong?
- Where does my company enjoy a unique position?
- What is my studio better at than my competitors?
- Does a market position exist, which I can/ should give up, since I can’t win against the competition?
- Does the company have a sufficient profile to stand out in the community of competition?
It is especially important for you, as an entrepreneur, to not completely reinvent
yourself every year. The market and the customers must always know what you and your club stand for. However, you should consider the market and its development and respond accordingly.
Here, a good balance and dexterity are needed. Positioning yourself correctly means knowing the strengths and weaknesses: yours and those of competitors. Instead of battling with ruinous price wars, it is better to highlight your strengths and leave those divisions to the competitors, which you can’t adequately service.
Skilfully excel on the market as an expert in your field. Observe the current trends and question whether they may have an influence on your positioning.
The pricing policy is the greatest lever when it comes to your sales! That’s why you must always optimally adjust your prices to the market, the competition, your positioning, your target audience, your equipment and your offering.
As an entrepreneur, you should constantly think about your price policy and work on it. After all, it determines what you’re left with in the end.
Regularly review your down times, your discounts, your additional services and consider alternate contribution systems. According to Mr. Andre Kostollani, a stock exchange and financial expert, “It is more beneficial to spend one day thinking about money, than to spend an entire month working for it.”
Advertising & Marketing
The next point in your business planning should also have a high priority. Be aware: advertising is the fuel of your enterprise! No company will achieve the optimum flight level, if it does not properly go full throttle in this area.
Some club owners are still working according to the credo: “As little as possible to spend on advertising and marketing”. A misconception!
Because good marketing, from a uniform and harmonious CD/CI to individual campaigns and promotional activities, is a major cornerstone in the make-up of your club.
A structured plan will also help you achieve success in this area. Prepare a detailed annual marketing plan for your club and your goals. Because only if you continuously sow, will you reap enough in the end.
Highly important in this context are brand recognition and a contemporary design. If neither is present, you should think about a possible rebranding of your club and the creation of a design guide. This will ensure you always have clear guidelines for the design of your advertising at hand and create a recognizable brand in the minds of your customers and prospects, which will make them immediately think of your club when they see the adverts.
But do not limit your thinking to traditional forms of advertising. In this digital age, it is no longer sufficient to just advertise with flyers, press adverts, or large-format ads; you need to have a sophisticated multi-channel marketing strategy including a good Internet presence, social media channels and structured online marketing.
This last point is still, somewhat unjustly, neglected by many studio operators. This is mainly due to a lack of the necessary experience in this field, which is quite complex nowadays, yet completely indispensable to achieve good marketing.
In our modern times, a structured consultation with a professional, external marketing company is mandatory for any future planning. Sustainable marketing and attention-grabbing advertising creates a suction effect for your long-term success.
Satisfied employees have a corresponding effect on your success – not only in the field of customer management, but also with regard to your external image as an employer.
How would you like to be seen by the market? Are you appreciated as an attractive employer? Regular employee evaluations and surveys, clear human resources planning, training and coaching, as well as employee policies and job descriptions, provide the necessary structure.
Also keep in mind your employees’ appreciation for their work and create a good team ethos. Because only people who feel happy will perform willingly and succeed.
Other possible points of business planning are:
- sales & phone marketing
- customer service/ management
- supply and equipment.
Good planning is only worth anything if it is implemented. Therefore, monitoring and controlling are essential parts of planning. As an entrepreneur, you are in the role of the captain. You determine and decide!
But based on what? Without monitoring, you lack the necessary overview and things can go very wrong. Management in the form of a quick look at the bank account and acting based on emotions is absolutely not conducive to achieving your business objectives.
A comprehensive overview allows you to continually adjust and correct your course, should you ever drift off. As the captain, you should always have the right tools at hand and know how to utilize them.
A structured business plan consists of several puzzle pieces, which fit together perfectly, thanks to the right planning and fine adjustment to ensure the correct flow in your company. This planning makes up the basis of a detailed annual plan. And annual planning in turn is a guide for your daily work.
The combination of the long-term business planning and implementation-oriented annual planning lays the foundation for the success of your company.
This will allow you to meet the aforementioned challenges in the future and make your goals become a reality.
– Harry Stoimenos (L) and Uwe Schoch (R)
The writers are co-partners and director of the national and international consulting business of Greinwalder & Partners, Germany. Both have over 20 years of operational experience and have been advising companies in the fitness and health industry for more than a decade with great success. Greinwalder & Partners assists companies with strategic corporate planning, strategic realignment, marketing and advertising planning and many other topics. (www.greinwalder.com).