Your small wellness business may be like our local Kroger grocer was. The produce (equipment) wasn’t great, but the staff was friendly. They did OK… until Wal-Mart (low cost leader gym) moves in, and charged half the price for the same tomatoes (memberships).
Our Kroger (your business) kept a few customers who didn’t mind buying expensive tomatoes (memberships) from friends. Then Whole Foods Market showed up, charged twice as much for exotic tomatoes (1:1 training, private changing rooms), and the grocer (you) got pinched again.
The health club industry is undergoing a transition. Larger general-interest health clubs will consolidate. Too many clubs targeted at the superfit already exist. They cannot fill up their excess capacity because they do not appeal to high-growth underserved populations.
Over time, many will simply go out of business because it will be cheaper for the big-box health clubs to get those customers through marketing, avoiding the risk and headaches of acquisition.
Smaller clubs must differentiate to survive. Options include a focus on “weekend warrior” athletes, inactive or older adults, or the physically challenged.
Being in a small town does not protect you from this trend. Oxford, MS (pop. 12000) has a Supercenter…and it also has Curves, a university fitness center, commercial gyms and several not-for-profit facilities.
No market is so small that it’s immune from competition.
Are you Wal-Mart, Kroger, or Whole Foods Market?
Are you focused on a niche where you can build long-term customer relationships?
If not, assess your club’s strengths and the local market and focus accordingly.
