Fitness Club Management: The Definitive Guide

Tara Massouleh

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September 25, 2020

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category

minute read

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September 25, 2020

Introduction to the Health and Wellness Industry

In the past few years, the world has expressed a sustained interest in fitness as an essential part of overall health and wellness. The value of the health and wellness industry in improving quality of life has become increasingly evident.

People all over the world are making changes, both small and large, to eat healthier, exercise more, and improve their mental health. Emerging market data has proven that the trend is likely to continue.

According to the Global Wellness Institute, the global wellness economy is a $4.5 trillion market divided into 10 categories:

  1. Traditional and complementary medicine
  2. Wellness real estate
  3. Wellness tourism
  4. Personal care, beauty, and anti-aging
  5. Physical activity
  6. Spas
  7. Thermal and mineral springs
  8. Healthy eating, nutrition, and weight loss
  9. Workplace wellness
  10. Preventative, personalized medicine and public health

Of those groups, physical activity accounted for the third largest share of the $4.5 trillion market, with $828 billion spent on sports and active recreation, fitness, and mindful movement. The fitness industry in particular has been fast and furious in its growth, both in numbers and in diversity of options.

Approximately 3.7 percent of the world’s population are members of a gym or health clubs. In North America, close to 29 percent of citizens contribute to the fitness market. With so many ways to engage in physical activity, competition for participants can be fierce.

The Growth of Fitness Clubs


The growth of fitness clubs


While the fitness industry represents countless types of businesses and facilities, one of its most popular is the health club. Unlike fitness centers or gyms, health clubs provide a comprehensive approach to health and wellness for members of all ages and interests.

Health clubs are characterized by their extensive programming and facility options, as well as their penchant for fostering and serving their communities. In addition to traditional fitness offerings like cardio equipment and weights, health clubs also offer group fitness classes, sports programming, personal training, pools, cafes, spas, childcare, and more to fully address health and wellness for all.

In 2019, health clubs worldwide generated more than $96.7 billion in revenue. The strong community of clubs included 210,000 facilities serving more than 184 million members across the globe, with North America and Europe leading overall growth and revenue.

The U.S. specifically accounted for more than one-third of the industry’s revenue in 2019. Overall, data trends indicate that fitness clubs will continue to grow in terms of membership and revenue in the coming years. Between 2018 and 2019, club revenue saw an 8.3 percent increase, while membership rose by 2.8 percent.

Between 2010 and 2019, health club memberships saw a growth of 28 percent.

Fitness Club Trends


Fitness club trends


Within the fitness industry, several key trends will dictate the way clubs operate moving forward. In a worldwide survey of fitness trends conducted by the American College of Sports Medicine, findings show that many top fitness trends are compatible with health clubs. High-intensity interval training, small group training, training with free weights, and personal training all came in as top 5 trends.

Additionally, body weight training, fitness programs for older adults, health and wellness coaching, and employing certified fitness professionals rounded out the top 10. What do all of these trends have in common? They all are common to health clubs.

Due to their incredible diversity of offerings, health clubs have tremendous potential to attract and capture more customers than any other player in the fitness industry. By capitalizing on their size and immense pool of resources, clubs can frequently shift and supplement offerings to meet changing consumer demands and industry trends.

As health clubs continue to grow, it’s important that new clubs and established facilities alike keep their ears and minds open to changing consumer needs. The ability to adapt to new trends and data in the health and wellness industry is essential to long-term success in the industry.

In recent years, health clubs have witnessed an increased demand for a “frictionless” member experience. Our consumer-driven market allows customers to access virtually anything they want with a couple clicks on a computer or swipes on smart phone. Amazon and the rise of e-commerce has revolutionized the way Americans shop.

Cable TV is practically obsolete thanks to streaming services like Netflix, Hulu, Prime Video, Apple TV, and Disney+. Online banking and grocery delivery further exemplify the growing trend toward frictionless transactions and interactions across all markets and industries worldwide.

Many industries have adopted an “adapt or die” mentality when it comes to frictionless customer experience. Consumers want to be able to access what they want, when they want.

With more options for everything than ever before, companies that allow physical barriers to get in the way of purchasing will be passed over for the next option. If a customer has to wait for a store to open or sales associate to help them, it likely won’t be worth their time or effort. Transactions should be fast, easy, and customized for the consumer.

The fitness industry is not immune to the trend. Though there are many options for fully frictionless fitness from products and services like Peloton bikes and online fitness instruction subscriptions, there is still immense value and demand for in-person facilities like health clubs. For fitness enthusiasts who prefer in-person training and a physical facility, the demand for frictionless experiences is still high.

Members want to be able to manage their memberships via mobile apps and online portals, so when they walk into their health club, they can focus on what they came for.

What is Health Club Management?


health club management


As fitness clubs open everywhere, it’s more important than ever to distinguish your club from others in the marketplace. Clubs need to build a loyal membership, while bringing in a steady stream of new members to stay in the game.

The best way to do that is to deliver a combination of excellent service and a first-rate facility. One of the biggest contributors to that endeavor is effective health club management.

As a club leader, you are expected to both keep up with consumer trends and seamlessly operate your business on a day-to-day basis. In other words, you have to keep your eye on the big picture, while making sure the tiny details that keep you and your members running don’t slip.

To manage competing priorities, club leaders everywhere are looking for ways to reduce their responsibilities by streamlining managerial tasks and club operations. The rise of technology has given way to modern club management systems that have revolutionized the ways clubs operate.

Using smart technology and powerful computing, club management solutions give countless hours back to club managers by automating labor-intensive processes and offering centralized member and employee management.

With fewer operational obligations tying you up, you and other club leaders are free to focus on the business side of growing and improving your clubs. The same effect trickles down to every role within a club’s employment structure.

Front desk agents have more time to make meaningful connections with members. Personal trainers and class instructors have more time to fine-tune their programming. Sales staff members have more time to engage with qualified leads.

Offering solutions for everything from payment processing to communication, club management systems make it easier than ever for clubs to serve their members. When it comes to ensuring the overall health of your health club, revenue is important, but profit is even more important.

One of the easiest ways to increase profit is by making an initial investment in a comprehensive management solution that will save you both time and money across all areas of your club in the long run.

As clubs grow larger and more complex, management solutions that match them in scale and functionality are increasingly necessary for survival and success. A holistic approach to club management allows club leaders to make the switch from reactive to proactive when it comes to their business.

Rather than spending time reacting to problems and challenges that arise, club leaders are able to take a proactive approach to their club by creating data-driven customer experiences that will keep them ahead of the competition.

In the following sections, we’ll explore some of the areas in which comprehensive club management solutions help clubs achieve more with less effort, time, and investment.

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Financial Management


Financial management for health and fitness clubs


There are a million facets that influence financial management for your club. There’s the question of how to price your services, including not only membership tiers, but also add-on services like personal training. Then, there’s the matter of setting salaries and incentives for staff. Each purchasing decision, whether for a new treadmill or an updated sound system for group fitness studio, also affects your finances.

For many clubs, setting and tracking financial goals is a great way to measure long-term growth and success. With so much to think about, managing the finances associated with each and every aspect of your club is more than a full-time job. That’s why it’s important to get help where you can when it comes to finances. Below, we offer four tips for managing your club’s finances.

#1: Budget & Buffer

When it comes to your club’s finances, nothing should be left to chance. Experienced club leaders know that planning is key. A detailed budget set at the beginning of every year, then revised by quarter or month to reflect changes, serves as a roadmap for your club.

When purchasing decisions and budgetary requests arise over time, you can always refer to your budget to help you assess the best move for your club.

A good budget also should include a buffer. The most predictable aspect of owning a business is the existence of the unpredictable. You never know when a piece of equipment will need to be replaced or an air conditioning unit will go out. Having discretionary funds to handle unexpected challenges provides peace of mind and a safety net to ensure financial health.

#2: Track & Record

Finance is often simplified into a matter of input versus output, but in reality, there are a myriad of figures and measures that make up your club’s overall financial health. One of the easiest ways to keep track of your club’s financial health is by monitoring progress in terms of monthly revenue, average member value, and member retention rate.

These key financial metrics can easily be tracked and recorded for future use with an end-to-end club management system. With a management system providing powerful insight into your club’s finances, you’ll be able to make data-driven decisions for the future of your club.

#3: Trust a Professional

You didn’t get into the fitness industry to spend your days crunching numbers and tracking down credit card payments. Your passion for improving the health and wellness of your members should drive your schedule, meaning your constant companion should be your club community, not budget spreadsheets.

As your membership grows, so does the need for a club management solution that can unilaterally handle all aspects of the member experience, from payments and billing to customer service. When it comes to addressing billing discrepancies like fund declines and outdated credit card information, the work grows exponentially with each new member you add to your community.

With a full-service billing solution, your club benefits from a dedicated team whose sole focus is to prevent and manage member payment issues. You’ll save time, increase revenue, ensure data integrity, and maintain positive member relationships, all with one solution.

Club Automation’s full-service billing offers a proactive card updater to prevent declines before they happen, as well as a team of experienced billing professionals to take point on all billing customer service needs.

#4: Protect Your Revenue

In the world of payments, chargebacks and credit card declines are always unwanted guest. Not only do they cause loss in terms of the payment owed, but chargeback fees can add up to contribute to additional loss of revenue.

Additionally, when a business incurs too many chargebacks, they are considered at risk to experience complications that could range from delayed funding to a complete pause in payment processing. Understanding chargebacks and working to prevent them is one of the best ways to protect your revenue across multiple fronts.

Another avoidable source of lost revenue are credit card declines. While many see the immediate loss in membership revenue that a credit card decline brings, the lasting effects can be even more harmful to a club’s finances. In addition to recovering lost revenue, a club management solution like Club Automation’s Full Service Billing save money in more unexpected ways.

Full Service Billing lowers labor costs associated with hiring staff to manage credit card declines, prevents decline fees, and improves member retention by using a Proactive Card Account Updater to prevent declines. Credit card declines may be costing your club more thank you think. Since one in three members who experience a credit card decline cancel their membership, avoiding a decline altogether can pay off in huge returns for your retention rates.

Employee Management


Employee management for health and fitness clubs

A team is only as strong as its weakest member. Your staff plays a huge role in member retention and satisfaction, making them your club’s most valuable asset.

At their best, your staff works in seamless tandem to provide a positive end-to-end experience for members—but this requires the active participation of every last employee. Regardless of how much state-of-the-art equipment your club offers, if your staff is unfriendly and distant, members will likely look elsewhere for the personalized attention they crave from a health club.

Payroll is the biggest expense for most clubs, so hiring and maintaining employees that will contribute to the success of your club ensures the biggest return on your biggest investment.

Studies show that every two interactions a member has with fitness staff in a given month results in an extra visit to the facility the following month. If you want to keep your members happy, the best strategy is to keep your employees happy. When you keep employee churn low, your members have time to form lasting relationships with staff, ultimately increasing their loyalty to your club. You also avoid costs associated with hiring and training new staff.

A world-class staff starts with world-class leadership. The best leaders are also the best learners. In order to be a life learner in the fitness industry, it’s important to seek counsel, supportive networks, and mentorship. You also should be ready to learn from your staff. Constantly solicit feedback and then follow-up on the suggestions you get. By learning what your staff sees as your strengths and weaknesses, you’ll be better able to serve them in the future.

Your employees do their best work when they feel trusted, valued, and essential to your business. You can foster those feelings by taking a hands-on approach to management. Unlike micromanagers, hands-on managers clearly define the vision for their business and then leave space for employees to take ownership of their work. Clubs with hands-on management cultures ensure that their employees are encouraged, supported, and properly compensated.

At their core, health clubs are about people. The relationships formed as staff help members achieve their goals is what the fitness industry is built upon. If you want your staff to put people first, you have to do the same in creating a people-centric staff culture. Building a people-centric team by implementing a culture of recognition, communication, and coordination among your staff can set the stage for a happier, more successful club community from top to bottom.

Member Management

On the flipside of employee management is the considerably larger task of member management. Management systems have always been a necessary tool for clubs to store and track member information.

As the club market has become larger and more competitive, clubs have made the shift to utilizing modern, comprehensive management solutions, like Club Automation, that manage every aspect of the member lifecycle, from contracts and payments to class registration.

A big portion of member management is communication. With thousands of members ranging in age from 1 to 99, it’s a huge undertaking to make sure every member is engaged in your club’s community. IHRSA reports that only 18 percent of club members visit their facility regularly. That disengagement puts 72 percent of your club’s membership at risk of cancelling their membership.

With a goal to create community within your club, connection between members and staff is exceedingly important. Your staff lives for face-to-face interactions with members—those meaningful conversations that happen on the gym floor or at the front desk upon check-in. But what about members who don’t attend regularly? Those are the ones you’re struggling to bring into the community.

Without in-person interaction, you have to rely on email, phone calls, or text messaging to engage them in your club community. The reality of reaching out to and following up with thousands of members every week is impossible. Even if you dedicate one staff member solely to the purpose of reaching out to members, the job would be endless. That’s why many top clubs are turning to member engagement assistants to do the heavy lifting by automating part of the process.

Many club management solutions are partnering with intelligent systems to provide member engagement assistants as part of their service to clubs. Club Automation’s Member Engagement Assistant powered by Conversica uses artificial intelligence to provide personalized email communication with members and prospective members.

Members who have interacted with Club Automation’s Member Engagement Assistant have reported being highly satisfied with their interactions, often commenting on how polite the associate they worked with was.

Using Conversica’s 4 Ps of Sales Effectiveness technique, a Member Engagement Assistant provides communication that is prompt, personalized, persistent, and high performing, which yields better results in terms of response and action from members and prospects.

A member engagement assistant can save staff from spending countless hours drafting and sending personalized emails that may or may not be read. Staff can instead use the time saved to improve other areas of your club and build community with visiting members. Meanwhile, your membership base benefits from targeted and personalized emails that inform and foster engagement.

As mentioned, two of the biggest barriers to consistent and meaningful communication with members are physical distance and scale. In other words, there are a lot of members to account for and a lot of space between you and them when they don’t visit the club regularly. Luckily, there are many tools that make unifying and engaging club members easier.

A mobile app is a great multifunctional tool that puts member management in your members’ hands and creates an effective avenue for communication. In today’s society where instant gratification and on-demand services rule, members expect easy and immediate access to their memberships.

A mobile app allows members conveniences like direct bill pay, class registration, and package purchasing. A club-branded mobile app also increases brand awareness for your club and keeps your facility at top of mind. Push notifications and strategic messaging about club programming are sent directly to the app, reminding members of the bountiful opportunities to reach their health and fitness goals at your club.

For members who may be less comfortable operating mobile apps, offering an online member portal that features the same capabilities as your app is a great solution. This extension of communication outside the doors of your club truly connects the dots of high-quality member experience.

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Sales and Marketing Management


Sales and marketing management for health and fitness clubs


On a fundamental level, sales and marketing is the management of communication. In this way, sales and marketing management goes hand-in-hand with member management; both are focused on outcomes driven by communication with members and potential members. The goal of all sales and marketing efforts is to increase revenue by retaining, gaining, and upselling memberships. Below, see four easy ways to improve your sales and marketing efforts.

#1: Leverage Data

Knowledge is power. When it comes to attracting the right individuals for your club, it’s important to have a good understanding of what consumers are looking for when choosing a fitness facility. Market data can be a huge asset in seeing what options are available and how you can set your club apart from them.

With so much information to sift through and synthesize, often a good place to start is with data from your own club. Strong club management solutions include reporting software that offer valuable insight into your club’s overall health and success. Having a full picture of your club’s performance, measured by stats like weekly revenue, active accounts, and total check-ins, uncovers significant trends that can inform future decisions.

For example, you may notice a rise in membership in the 25-30 age range, indicating that they may be a good target audience for future membership marketing campaigns. Performance Analytics can help you go beyond the spreadsheet with data visualizations and gym reporting software designed to spotlight the most important information at a glance and even compare your club to industry benchmarks.

#2: Prioritize Member Engagement

With any sales or marketing effort, the ultimate goal is to elicit a response from a member or potential member. To truly capture their attention, it’s important to speak with not at your members. The conversation should be a two-way street where you not only share useful information about your club’s offerings and programs, but allow space for feedback from clients on what they find most interesting.

Studies show that personalized communication is most effective in reaching members, but it isn’t feasible for your staff to reach out to and converse with every member of your club. For current members, a member engagement assistant can assist in the massive task of member communication by implementing email campaigns for any aspect of your club that deserves a spotlight.

Whether to upsell members on new classes packages or to educate them on equipment sanitization requirements, a member engagement assistant can use thoughtful automation to amplify your voice and help you get your message out.

Engagement is equally important in attracting new members to your club. Nurturing new relationships takes careful dedication. Your club associate should be polite, personable, and prompt to ensure that leads don’t lose interest. To take on the colossal task of mass prospect communications, many clubs have introduced member engagement assistants to initiate contact with individuals who have expressed interest in their facility.

A member engagement assistant from a company like Conversica works seamlessly with sales associates to weeds out prospects who are not a good fit and establish relationships with qualified leads. Through this process, club sales teams are left with only qualified leads who have already been primed to make a commitment through membership.

#3: Maximize Website Impact

As the world continues its digital trend, your website is often the first impression a prospective client gets of your club. As a virtual extension of your club, every element your website contains should reflect your club, from imagery to the overall tone of your messaging. If your club features sleek design and bold pop art, your website design should match that. If you’re know for your down-to-earth, effortlessly approachable staff, the copy on your website’s home page should evoke the same welcoming feeling.

In addition to appropriate design and messaging, a few key elements can maximize the impact your website has on attracting future members. Add Google Maps to your website, and make sure your club is searchable on both Yelp and Google Maps. If a prospective member searches, “gyms near me,” being listed on Google Maps will push your facility to the top of the results.

Another easy way to make your club more visible on the Internet is to utilize Search Engine Optimization (SEO) for content and tags. With a small amount of research, you can identify keywords to include on your webpages that will improve their placement in search result lists. One final element to check for on your website are calls to action.

Every page on your website should lead browsers to advance their journey with your club. Whether that be by signing up to try a week free or requesting information from a club associate, calls for further action and communication should be plentiful on your site.

#4: Create a Social Media Strategy

Instagram has more than 1 billion users. Eighty percent of Instagram users follow businesses. 200 million users visit at least one business profile daily. The numbers prove it: There’s never been a stronger case for social media as a powerful marketing tool. And Instagram is just the tip of the iceberg.

Facebook, Twitter, and even TikTok offer endless ways for you to connect with your members and attract new ones without spending a dime. Maintaining a steady stream of organic content on each of your channels keeps your members engaged with your club any time, anywhere.

Furthermore, social media can be a wonderful tool for word-of-mouth referrals from loyal members. To encourage social participation, offer incentives for members to review your club on Facebook. These online client testimonials build public trust, as well as awareness, for your club.

Social ads represent another facet of social media that have provided valuable returns for businesses across all industries. Overall, social ad spending is expected to reach $43 billion in 2020. Twenty-seven percent of internet users say they find new products and services via social Year over year, social ad impressions are up 20%, which means social ads are providing more bang for your buck and reaching more people. In the fitness space, utilize strategic social ad placement to increase brand awareness and drive membership.

Health Club Innovation


Health club innovation


Complacency is the enemy of industry. Though often overlooked for more urgent management projects, innovation should be at the heart of your health club’s operative mission. It’s easy to get bogged down putting out day-to-day fires, but while you’re distracted with small flames, the bigger threat to your club burns strong and steady in the background. If you’re not innovating, someone else is, which puts your club at risk of falling behind competitors and potentially losing members.

Luckily, the fitness club industry invites ample opportunity for innovation. Innovation can refer to programs, class types, technology, equipment, or even facility layout. There are innumerable ways to change things up within your club to keep piquing the interest and engagement of your members. If your fitness club practices and offerings are feeling a bit stale, it may be time to shake things up. But it’s not only up to you to innovate. Use your employees as a resource to spark your next big innovation project.

They’re familiar with the ins and outs of your club. They hear from members daily. And they know exactly what their specific programs need to be taken to the next level. Innovation from your staff can look like reimagined business models, the introduction of new products or services, the exploration of strategic partnerships, or the implementation of new marketing strategies.

Whatever their ideas, it’s important to foster a collaborative and open community among your staff so employees feel comfortable brainstorming and sharing their ideas.

The biggest group that can drive innovation for your club are your members. As a club leader, your goal is to best serve your members. And what better way to serve them than by giving them exactly what they want? A club management solution that tracks data analytics can provide a wealth of information about what is and isn’t working in your club, thus providing a framework for innovation.

For example, by comparing registration rates for different types of classes, you’ll be able to better determine what types of new classes will resonate with your membership.

To fully leverage your members for innovation, pair quantitative data with qualitative feedback. Establish a system to gather member sentiment through surveys, forms, and suggestion requests. This can inspire innovation in all areas of your club. Plus, keeping a pulse on your members’ satisfaction strengthens relationships and ultimately loyalty to your club.

Read more about the benefits of innovation and learn practical steps to adopt a spirit of innovation in our blog, “Invigorate Your Health Club with an Innovation Program.”

How Can Club Automation Help?

Owning and operating a fitness club is demanding and time-consuming no matter the size of your club. The investment in an end-to-end management solution pays huge returns in terms of time and labor. A holistic management software should offer services to help with every aspect of your health club, from billing and payments to marketing and sales. Software devoted to member and employee management also is a must.

With automated services that work for staff and members, Club Automation empowers club leaders to focus on what really matters: creating one-of-a-kind member experiences that power health and wellness. For the past 13 years, Club Automation has provided management software to successful health clubs across the United States and beyond. As a software solution built by a fellow club owner, Club Automation’s team of creators and innovators have an inside track into what leaders need to help their clubs thrive. That’s why more Top 100 clubs in the U.S. use Club Automation than any other software.

Ready to see how a Club Automation’s club management software can increase your club’s efficiency and profit? Schedule a free demo today.

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Static and dynamic content editing. A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

Static and dynamic content editing

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

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A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

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A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

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Into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

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