Back to fitness: Hard-hit athletic clubs, gyms trying to bounce back amid pandemic
The clang of weight stacks. The hum of treadmills. The sharp inhales and exhales. The energetic beat of hip-hop music. It’s a Wednesday afternoon in mid-June inside Sports West Athletic Club in Reno’s midtown and this cacophony of fitness sounds is music to owner Denise “Dee Dee” Desiderio-Schula’s ears — after all, SWAC and all other fitness centers, gyms and health clubs across Nevada were forced to pause their business for more than two months to help slow the spread of the coronavirus outbreak.
“People are happy to see other people and be back in the gym,” Desiderio-Schula said. “Our first day back was crazy.”
On June 1, the day SWAC reopened after being closed since March 17, the longtime athletic club saw 30 people sign up for memberships, an “unusual” number of new members in one day, Desiderio-Schula said.
“Last year, we averaged about six memberships a day,” she continued. “It’s slowed down now, but the first week (back) we were doing almost 10 a day.
“We’re having some of our best sales numbers because people want to get in shape, even though this is our slow time because in the summer most people are outside hiking and biking and swimming.”
During Phase 2 of the state’s reopening plan, larger gyms like SWAC are capped at 50% capacity, and must close all locker rooms, showers, steam rooms or communal facilities, all while keeping equipment and individuals six feet apart.
Staying within the occupancy limits, Desiderio-Schula said, will not be inhibiting for her club, which includes a 36,500-square-foot fitness center and 3,500-square-foot day spa. Upon reopening, Desiderio-Schula projected SWAC would see only 20% of its daily check-in numbers prior to the pandemic. So far, though, the club is seeing about 50% of its pre-COVID check-in numbers, Desiderio-Schula said.
It’s an encouraging sign for SWAC, which lost roughly 12% of its membership base amid the coronavirus pandemic.
“That’s about $17,000 a month that I’m losing because of COVID,” Desiderio-Schula said.
While many people are itching to get back into the gym, the global public health crisis has drastically shifted consumer spending over the past three months.
All told, while more than 38,000 fitness clubs and studios were closed nationwide, an influx of people invested in at-home fitness options — from Peloton to Blowflex — at the expense of the $94 billion fitness industry. As a result, $10 billion could leave the fitness club sector, according a research report by Harrison Co., a consumer-focused investment bank.
Specifically, the report showed that 34% of gym consumers — equaling more than 20 million memberships — have or plan to cancel their gym memberships due to the COVID crisis.
Brandon Borden, owner of four Anytime Fitness locations in Reno-Sparks, said his gyms have lost about $500,000 in revenue while being closed for more than two months during the pandemic.
Borden’s gyms have lost about 5% of its membership base, a number he projects to jump to 10% over the summer.
“It’s impacted us tremendously,” he said in a phone interview with the NNBW. “The scary thing was not having a timeline as to when we could reopen. We didn’t know if this was a two-week, four-week, 12-week thing or longer. So, we couldn’t prepare, financially, for how long we were going to need to be shut down.”
Borden said his clubs’ members did not have to pay their fees in April and May while the gyms were closed. Moreover, he said any members who paid from March 17, the day gyms were forced to close, to March 31 were credited that time to the back-end of their membership.
“That was a no-brainer for us,” Borden said. “It was like, man, if we can’t provide you a place to work out, then you’re not going to be paying for it.”
Desiderio-Schula said SWAC suspended billing for its members in May. She said members were still charged in April because she was hopeful the club could reopen that month. However, she noted that all members are receiving gift certificates equal to the amount of their April fees.
Since reopening his Anytime Fitness gyms on May 29, Borden said maintaining a 50% capacity has not been an issue. His 6,650-square-foot gym in downtown Reno, he said, has a capacity of 99 people and never saw 50 people at one time “even in our busiest months” prior to COVID.
Borden noted that until the capacity limits are lifted by the governor, his Anytime Fitness gyms are not allowing people to use the facility for trial passes or day passes — meaning, for now, his Anytime Fitness clubs are truly members only.
“We don’t want to overrun our workout floor with non-members, because we have these members that have been waiting two and a half months to come back and work out,” he explained. “So, we wanted to make sure that they got first crack at it.”
To adapt to the shutdown, Borden and his staff launched a virtual personal training program, using Zoom, for its members at a cost of $10 a week.
The program brought in a total of $2,000 in revenue — “a very, very small chunk, but it paid some bills,” he said.
During the shutdown, Desiderio-Schula, whose business received a PPP loan, was able to keep about 40% of her full-time staff employed. Her employees overhauled the club to be COVID compliant, remodeled all of the floors, cleaned and drained the pool, regrouted the steam rooms, repainted the hot tub, and more.
“Everybody pitched in, cleaned the club top to bottom,” she said. “We just took the opportunity to go in to each area, look at it, and improve it.”
In all, SWAC has brought back roughly 56 of the 68 people it had on staff before the pandemic, she added.
Borden said he had to lay off his staff of 17 before getting approved for a PPP loan. Since, he’s brought everyone back on full-time, except for a 63-year-old employee who decided to retire.
“I know a lot of companies have had problems getting their employees to come back, but we didn’t really face that,” he said.
Though the fitness industry is back up and running, gym owners are not only focused on operating the business in the present, but also trying to gauge what the future of the fitness businesses will look like.
Desiderio-Schula feels that an increased emphasis on having a healthy immune system in the age of COVID will drive more and more people to fitness clubs and gyms. To that end, she sees the industry possibly implementing more educational programs for its members.
“I think people realized the value of being healthy, and it comes from having a strong cardiovascular system and strength,” she said. “I think a positive will come out of this is that people will value their health and realize that we need to say strong.”
Borden — albeit with cautious optimism — agrees.
“As long as there’s not a second surge and they don’t shut us down again, I think things are looking up,” he said. “Granted, there are people on the opposite end of the spectrum that just don’t want to leave their house. But, we have a lot of people, I feel, that have realized how much they miss and took the gym for granted.”
Months into the pandemic, many states and regions are in stages of recovery, some slower than others — and Reno-Sparks is in a much better position than most, says Sacramento financial analyst Sanjay Varshney.