Cashing In on Beverage Bars

Remember the days of parking a wobbly cart and a Slurpy machine in your lobby, then hoping for the best? Thankfully, those days are long gone. Now, fitness centers are boosting profits with high-end, well-managed beverage bars that offer everything from juice to smoothies to granola bars, and members are buying into the beverage bar revolution. If you're concerned that your old-fashioned juice bar is drowning, worry no longer. Four fitness facility owners/managers share their tips and tricks on how to make a beverage bar the toast of your facility.

Meet the experts

Paul Upchurch, chief operating officer, Midtown Athletic Clubs Mike Saldivar, general manager, Midtown Athletic Club/Palatine Midtown Athletic Clubs/Palatine, Palatine, Ill.

• A juice bar was added to the facility in 1997, but renovations to construct the new, upscale M Cafe will begin shortly.

Terry Benko, owner Los Osos Fitness, Los Osos, Calif.

• Los Osos Fitness opened The Blender in July 2000, and its menu focuses on smoothies.

Rob Petillo, operations manager The Fitness Edge, Myrtle Beach, S.C.

• The Juice Bar opened in December 2002, and sells 30 to 40 shakes a day.

Shirlee Bates, general manager The Personal Health Approach, Rochester, N.Y.

• The Cafe and Juice Bar opened in February 2003, and sells energy bars, juice, shakes, coffee, tea and a spicy hot chocolate concoction it calls "Loco Coco."

Tip: Keep your eyes open

Beverage bars can be operated by a lessee or managed by the facility itself. Of the four experts interviewed, only Midtown leases its beverage bar. Midtown entered into a lease agreement with one company in 1997, when the facility opened its juice bar. However, outsourcing the day-to-day operation doesn't mean you can forget about it altogether. "Securing consistent service levels, along with consistency with product quality to meet our brand standards, was always a struggle," admits Saldivar. Los Osos Fitness ran into trouble with a similar arrangement, as well. "At first we had a license with a company that underestimated calories and fat content in their smoothies," says Benko. "We dropped that company and re-did all our recipes and logo." Now, The Blender boasts an extensive drink menu created and controlled by the facility, instead of an outside company. "Our blends really meet the needs of both our members and the public," says Benko.

Tip: Give 'em what they want

Your juice bar will be most successful if it gives members what they want. The M Cafe was designed specifically to be in line with where members would go outside the fitness center. "It's a contemporary, high-quality concept that is very much in keeping with where our members are eating outside the club," explains Saldivar. "It fits their lifestyle well." That's one reason Midtown is upgrading its juice bar to the upscale M Cafe. "Our clubs are full-service sports resorts where the restaurant experience is expected," explains Upchurch. "Our clubs are dedicated to creating an experience that keeps members engaged, and creating a healthy lifestyle. Our restaurant is important in achieving those goals." For a 30-minute circuit club, a coffee cart may be what on-the-go members expect from the in-and-out workout experience. A family fitness center should offer healthy, kid-friendly options that can be consumed (mess-free) on the way home in car seats, like yogurt packets, smoothies in small plastic cups or granola bars. Customers believe juices are a healthy beverage choice, so be sure to deliver. "Have drinks that are healthy, and in a caloric range that serves the members' fitness goals," says Benko.

Tip: Take notice of tastes

Pay attention to what kind of beverage or snack members carry into the facility for clues about the kinds of products they buy. Then, make sure your own beverage bar mimics the quality and style of those products. "Keep the look and product competitive with the look and feel of ... [stores] your members regularly use," advises Upchurch. Trick: Get taste testers. You may think you've copied Jamba Juice's Razzmatazz recipe perfectly, but don't forget whose taste buds really matter. Ask members about their favorites, and get their opinions on drinks they've tried and hated. Track which drinks are ordered most and which are left alone. "Feedback is a huge part of making your juice bar work," says Petillo. "You may think your shakes taste good, but the members may not."

Tip: Put it by the door

Situating your beverage bar near the front entrance of your facility increases the opportunity for sales. Members see it when they come in for their workout. Hopefully, they'll think about it while they exercise, and plan to get their favorite blend as a reward after, or a liquid breakfast before work. Even if they get distracted in the locker room, they can't miss it on their way out. "Pick the right location in the ... club, and design it as a place where members can gather and socialize," says Upchurch. Trick: Sell to the public. Capitalize on your beverage bar's front-and-center location by tapping into a different market: non-members. Not only will profits increase, but so will opportunities to showcase your fitness center to the thirsty masses. The Blender opened its doors to non-members to capitalize on its prime location within the community. "[Los Osos Fitness] gets a lot of walk-by traffic," Benko explains. "It's a great way to get new members." Trick: Assign double-duty. The Blender is near the door and open to the public, but it's got something else tipping the scales in its favor. "We have member services and the juice bar together, so we can chat about our fitness facility while the public comes in for a smoothie," Benko explains. Another double-duty approach is to combine the selling power of two profit centers. Fitness Edge put its Juice Bar by the facility entrance, but inside its pro shop, so customers can shop while waiting for their beverage.

Tip: Create a social environment

Many industry experts have asserted that one way to increase member retention is to encourage social connections between members and between members and the facility. With careful management, your club's beverage bar can be that all-important hub for members. "The social experience is greatly enhanced when you create a facility where members can gather and eat/snack together," says Upchurch. For Midtown Athletic Club/Palatine, the M Cafe is a vital aspect of keeping members connected - to each other and the club. "It's a critical part of keeping our members socially involved in the club," says Upchurch. "It is an important place for members to gather and connect with other members." To achieve this effect, consider investing in some attractive, comfortable seating so members feel welcome to take a breather. "Have quality bar stools and a clean setting for all to enjoy," says Benko. Trick: Reward repeaters. A beverage bar's long-term success relies on repeat business, and the best way to encourage people to come back is to give it value. Discount cards are the most popular way to do that. Los Osos Fitness hands out 10- and five-punch cards for smoothie discounts, and buy-10-get-one-free cards to increase repeat business. The Fitness Edge offers buy-six-get-one-free shake cards.

Tip: Get the word out

"The key is your marketing," says Petillo. "Make sure your menu is big, colorful and bright so it catches the members' eye." The Fitness Edge posts signs throughout the fitness center advertising the Juice Bar, and writes about it in the club newsletter. Petillo also suggests setting aside a day to offer a free shake promotion. "[The Personal Health Approach] offers a free protein shake with every new membership," adds Bates. Midtown Athletic Club/Palatine has posters and pictures hung throughout the facility, and posts them on its website to advertise The M Cafe. Los Osos Fitness markets The Blender with sandwich signs outside of the facility. Trick: Cast a wide net. Los Osos Fitness doesn't stop at luring local foot traffic inside to sample its smoothies. The facility also donates coupon cards for 10 percent off smoothies to various local groups, then announces the offer in the newspaper and Chamber of Commerce newsletter. Trick: Turn members into salespeople. Bates says The Personal Health Approach uses a trip to its beverage bar as a reward for referrals. "Each member gets a free drink for every referral they bring in to the club," she explains. Also, remember that satisfied customers are your greatest marketing assets. "Word of mouth is the most effective way to attract members," says Upchurch.

Tip: Build excitement

"When you get your juice bar going, make sure you build some excitement about it," says Petillo. To achieve this with its new M Cafe, Midtown held a series of member events to increase the restaurant's exposure. Trick: Sell to staff first. Your fitness staff are walking advertisements for every aspect of your fitness center - even your beverage bar. If a facility employee is sipping a smoothie (and smiling, of course), members will want to try one, too. "Get your employees fired up about it, as well as yourself and your members," says Petillo. This may mean offering an employee discount on your juice blends, or using free beverages as a method of rewarding employees for good work. No matter what, "your front desk staff have to have great sales skills (offer sales workshops, if needed) to sell the products in the cafe," Bates says.

Tip: Track profits

"Our juice bar is one of our most profitable profit centers," says Benko. One reason is because Los Osos Fitness keeps a close watch on what works and what doesn't. "[We] constantly track costs for profitability," she says. The key is balancing quality with cost-effectiveness, says Upchurch. "Stress quality in whatever you do, but be conscious of designing a facility that can be operated in a cost-effective way," he explains. Trick: Order wisely. To keep profits from draining away, Petillo warns against getting stuck with too much stock. "The biggest challenge is making sure your products don't expire or go bad before you use them," he says. "Once you figure out an ordering strategy, you should never have to throw away unused product." Bates agrees: "Keeping track of inventory" is the hardest part of running a beverage bar.

Think outside the straw

Beverage bars can be a robust profit center for your facility if you tailor it to what your members want. Whether it's coffee and bran muffins to go, or a full-fledged, sit-down eatery with gourmet wraps and exotic teas, there are no limits on what it can offer your members. Use the tips and tricks above to help streamline your current operation or design the beverage bar of your dreams. "It brings in new members and keeps us healthy," says Benko. "What could be a better addition to a fitness center?"