8 Undeniable Truths of Health Club Ownership | Athletic Business

8 Undeniable Truths of Health Club Ownership

I've been a club owner for more than 20 years. In that time, I've met a lot of people who want to own their own club, and they sometimes ask me what it's like. Here are eight truths that anyone interested — or already entrenched — in this profession should always keep in mind:

1. A health club is a business.
Almost every future club owner I speak with talks about how much they want to help people, how much they want to change people's lives. In order to do that, you have to keep the doors open, and that means paying the bills. You will need a basic understanding of accounting. You need to know how payroll works, how to balance your checkbook, how to manage the process of billing your members. You may have help with some of these things (a bookkeeper or an accountant), but you will still need to understand them. Take an accounting class.

2. There is a problem EVERY DAY.
If your club is open seven days a week, then you will work — or at least be on call — seven days a week. At home Sunday with the family? You will get a call from the club, "I messed up the alarm code when I opened, and now I can't shut off the alarm." Just wrapped up a 12-hour workday? Your cell phone will ring before you even make it home, "There is a guy here who says he knows you and claims you were going to give him a discount on the enrollment fee." The more your club grows, the more members you have, the more problems you will face. Problem solving is your job. Get used to it.

3. No, you don't get to help people with their workouts all the time.
You will have 1,000 things to do each month. Writing workouts is last on the list. What's first? Keeping your eye on the bottom line. Is your marketing plan done for the next three or six months? Did you analyze the return on your last marketing campaign? Is your staff trained to handle the upcoming promotion? Has your front desk staff retrained on how to handle small problems so they don't turn into big problems? Did you call back the new vendor who claims he can save you a few hundred dollars next month?

4. You NEVER get to be in a bad mood.
If you walk into the club in a bad mood, then your staff will think it's okay for them to be in a bad mood. You already know the expression, "It starts at the top," and this is never truer than when it comes to the atmosphere of your club. If you're happy, you can make those around you happy — or at least communicate to them to fake it while they are at work. That's what we do in this business — we make people happy. The club is sometimes the best part of our customers' day. They come here to take a break, reduce stress and feel healthier. Don't jeopardize that.

5. There are more taxes and regulations than you could ever imagine.
Every two weeks, I process payroll and then I log onto the federal and state websites to pay the withholding taxes. Every quarter I go online and pay our taxes: 941 and 940 (federal), PA W-3 and PA UC2 (state) and LST and EIT (Local). At the end of the year, my accountant will generate the W-2 forms for all my employees and file the forms that tell the federal, state and local governments that all the other forms we filed previously this year were, in fact, filed. At the end of the year, I also pay the accountant to file our annual tax returns for the business.

We have a pool at our club, and we use liquid chlorine as an oxidizer as required by the state. Liquid chlorine is a regulated pesticide, so I have to be certified with a pesticide license that also requires continuing education credits. Even though we use an automated system to control chlorine and pH, we still have to test the water manually twice a day and keep written records of all tests. Oh, and we have to pay an independent lab to test our pool water every week.

No one who works for you will ever care as much about your club as you do. They aren't going to give you any sympathy when you are struggling. That's not how this works.

6. You're going to be lonely.
I once had another club owner tell me that he's never met a club owner who wasn't divorced. Owning a business can become all-consuming, and you can neglect the other parts of your life. But that's not what I'm talking about here. No one who works for you will ever care as much about your club as you do. No one will clean a piece of equipment the way you will do it. You can't discuss certain things with your employees, and they aren't going to give you any sympathy when you are struggling. That's not how this works.

They can't understand the pressures you will face. Care to guess when you get paid? Last — after everyone else. You know who lies awake at night wondering if you'll make enough money to pay the rent on time? You do.

7. Your vendors can be your best friends.
You're going to come to depend on your vendors: equipment sellers, drink providers, electrical suppliers, repairmen, insurance agents. Don't choose the cheapest ones, and do maintain relationships wherever possible.

Your equipment supplier should be someone you trust, someone who stops by to see you even if you haven't bought anything in a while. A few years back, a salesman for a national brand stopped in to see if we wanted to buy his company's newest product. I asked him why I would spend $5,000 with someone I've never met before.

I had the chance last year to save a little money on our insurance. I discussed it with a friend, and he pointed out to me how hard our current agent had worked for us a few years prior when we experienced a burst sprinkler pipe. So, I stuck with my local agent. A few months later, he was instrumental in rewriting the bond we need to sell memberships in our state.

8. It can be incredibly rewarding.
As I said earlier, you will have a problem to solve every day — and sometimes people will yell at you. But maybe once every other month or so, someone will tell you that they love your club. They will tell you it's not like other clubs — that they feel welcome here, and that we make things better for them.

They might even tell you that your club changed their life. They might have overcome a medical problem, or they might have been better able to withstand the problems and stresses that come into their own lives because a few times a week they can come here and feel better.

And in those rare moments, you can sit back and think of all that is involved in owning a club — the regulations and relationships, the overhead and the problem solving with a smile — and realize that it's all worth it.

This article originally appeared in the May 2018 issue of Athletic Business with the title "8 Undeniable truths of club ownership." Athletic Business is a free magazine for professionals in the athletic, fitness and recreation industry. Click here to subscribe.


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