The 'Issue' Is Profit Centers

The 'solution' is to identify those areas with the greatest profit potential, and create programs that align with your members' needs.

According to research conducted by the International Health, Racquet & Sportsclub Association (IHRSA), Boston, Mass., 25 percent of all fitness facilities' revenue comes from ancillary sources. What do we mean by ancillary revenue? Anything that brings in revenue other than member dues. Over the past decade, the push to grow ancillary revenue in fitness facilities has been fueled by the need to generate income to supplement dues revenue that has not grown as much as would be preferred. Does that mean membership dues are priced too low? "I'm not sure membership dues are low, because it depends on where clubs price themselves," says Rick Caro, president of Management Vision, New York, N.Y., a health/fitness facility management consulting firm. "But, I think the price increases on membership dues have not been as grand as they have in the past." Therefore, there's pressure on facility operators to generate more revenue from members.

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