How fitness clubs are managing rising payment costs without broad price increases

Your processing costs went up again this year.

So did payroll, utilities, insurance, and maintenance. The list goes on.

But here’s what makes payment processing costs different: You have a strategic option beyond absorbing the cost or raising membership dues across the board.

We hosted a webinar with Matt Popinski (Chief Customer and Payments Officer at Daxko), Colby Watkins (Senior Director of Payments Programs), and Trey Foster (Director of Sales & Payments) to address what over 1,500 clubs have already learned about managing payment costs while maintaining member trust.

If you missed the live session, here’s what you need to know, including what happened when one club introduced a payment change just one month after 10% dues increase.

Let’s start with the numbers.

Processing costs aren’t trivial. For clubs collectively, we’re talking about $65 million annually in payment acceptance fees. For individual clubs, depending on size and card mix, these costs often rank as the number 2- or 3-line item after payroll.

And they’re rising. Not because of any single decision, but because of converging forces:

• Economic pressures and inflation
• Expanding fraud prevention infrastructure (AI-driven threats require AI-driven defenses)
• Risk mitigation systems becoming more sophisticated
• Regulatory compliance requirements

The question isn’t whether costs are rising—it’s how you respond without alienating members or eroding profitability.

When faced with rising payment costs, most businesses default to one of two strategies:

Option 1: Absorb the cost

Take it as a cost of doing business and accept the margin compression. Simple. Painful. Unsustainable at scale.

Option 2: Raise prices across the board

Increase membership dues, PT rates, locker fees, program costs—everything. This can feel like an overcorrection, especially when the actual cost driver is tied to a specific transaction type (credit cards) rather than all services.

But there’s a third way and it’s what over 1,500 clubs are already using.

Flex Fees is a checkout fee program that gives members control over whether they pay the fee or avoid it entirely.

Here’s how it works:

At checkout, when a member is paying for a service, subscription, or product, they see a line item showing the processing fee associated with their chosen payment method.

• If they’re using a credit card, they see a fee (typically up to 3%, the national cap)
• If they switch to a fee-free alternative like ACH/bank draft, the fee disappears

The member makes the choice. Every time. At every transaction.

This is fundamentally different from a price increase because:

• Members have agency — they can avoid the fee by changing payment methods
• Transparency builds trust — the fee is disclosed upfront, not hidden
• It’s targeted — only applies to transactions that incur the cost
• Revenue is trackable in real time — you see exactly how much you’re offsetting

Learn how College Park Athletic Club implemented Flex Fees to create a more sustainable billing strategy while maintaining a positive member experience.

One of the biggest concerns clubs have is: “How will our members react?”

The data and real-world experience tell a clear story.

What builds acceptance:

Lead with why — This isn’t about profit. It’s about covering operational costs so you can reinvest in programs, staff, and member experience.

Give advance notice — Card brand regulations require a minimum of 2 weeks. We recommend 30 days. It’s better for member experience and gives them time to adjust.

Offer a fee-free alternative — Make it easy to switch to ACH. Some members won’t care (they want credit card points). Others will appreciate the option.

Keep it brief and matter of fact — No long explanations. “Costs are rising. We’re covering payment processing costs. You can avoid the fee by paying with ACH.”

Display fees transparently — On every receipt, at every point of sale, in online checkout. Over-communication is trust-building.

Empower your frontline staff — Give them clear, concise talking points so they can answer questions without getting into long-winded explanations.

What Creates Friction:

Announcing it at the front desk — Nobody likes surprises at checkout. Communication needs to happen before the transaction.

“This is just another way for us to make money” — Wrong framing. This is about covering costs, not profit.

No easy opt-out — If there’s no alternative payment method, it feels like a mandatory price increase.

Overly complicated rate tables — Different percentages for different transactions confuses members. Keep it simple.

Unprepared staff — If your team doesn’t know how to explain it, members will lose confidence.

Here’s the scenario that club operators worry about most:

A club implemented Flex Fees one month after increasing membership dues by 10%. On paper, that sounds like a recipe for member backlash, cancellations, and angry emails.

What happened?

Members accepted it.

Why? Because the club followed the communication plan:

• They led with transparency
• They gave advance notice
• They offered a fee-free alternative (ACH)
• They equipped staff with clear talking points

The result: No material changes in membership. No exodus. No revolt.

And this isn’t an outlier. Across over 1,500 clubs using Flex Fees, we see no material impact on membership retention. Members are familiar with checkout fees—75% of consumers have seen them before. And 1 in 3 businesses now use some form of cost-offsetting at checkout.

Transparency builds trust. Giving members a choice builds loyalty.

Let’s look at actual numbers from a club currently using Flex Fees:

Before Flex Fees:

• Total payment processing cost: $36,000/year

After Flex Fees (3% on credit cards, $0.44 on ACH):

• Cost to add Flex Fees functionality: +$10,000
• Flex Fees revenue collected from members who chose to pay with credit card: $31,000
• Net processing cost: $15,000 (down from $36,000)

Savings: 59%

And here’s what matters: this isn’t theoretical. It’s a live club, with real members, making real payment decisions every day.

The exact savings depend on your card mix (debit vs. credit vs. ACH), transaction volume, and member preferences. That’s why individualized analysis matters because every club’s situation is different.

One of the questions we hear most: “How long does this take to implement?”

Here’s the realistic timeline we recommend:

Day 1-15: Agreement & Setup

• Sign agreement
• Determine fee structure (credit card %, ACH fee, etc.)
• Compose communication materials (email templates, signage, FAQs)
• Internal prep: staff training, software configuration

Day 16-30: Pre-Launch Communication

• Notify members (30 days advance notice recommended)
• Post signage at all points of sale
• Include in member newsletters
• Train frontline staff with talking points

Day 30-45: Final Prep & Go-Live

• Card brand notification (required minimum 2 weeks before launch)
• Final software configuration
• Staff training reinforcement
• Project manager enables fee on Day 45

Post-Launch:

• Track receipts and feedback in real time
• Monitor revenue offset vs. processing costs
• Adjust communication as needed

We’ve done this over 1,500 times. The process is refined, documented, and supported.

During the webinar, club operators asked smart, specific questions. Here are the key answers:

“Can you add a fee to ACH transactions?”

Yes. You have the option to apply a fee to ACH (typically a flat amount like $0.44). About 80-85% of clubs using Flex Fees pass along both credit card and ACH fees. However, you can also choose to absorb the ACH cost to encourage members to switch—it’s often low enough that the behavior shift alone reduces overall costs.

“What about debit cards?”

There’s explicit regulatory prohibition nationally preventing fees on debit card transactions. Credit cards and ACH are fair game; debit cards are off-limits.

“How much of the fee do you typically recover?”

It depends on your card mix. If you’re processing 90% debit cards, Flex Fees might not make sense. If you’re heavier on credit cards, the savings can be significant (like the 59% example above). This is why we run a club-specific analysis before recommending a strategy.

“Will members revolt over a $0.44 ACH fee?”

This was a common concern before launch—and it hasn’t materialized. Members are used to checkout fees in other industries. When positioned as “covering operational costs” with a fee-free alternative available, acceptance is high. Across 1,500+ clubs, there’s been no material impact on membership retention.

“Is this allowed in my state?”

Currently, 5-6 states prohibit surcharging. For the vast majority of states (including Utah, Ohio, and others), surcharging programs are permitted, capped at 3%. We verify state regulations as part of the analysis.

“Does this work if we just had a price increase?”

Yes—if done with proper communication. As the real-world example showed, one club launched Flex Fees one month after 10% dues increase with no membership impact. Timing matters, but it’s not everything. Transparency and member choice matter more.

If you’re wondering whether Flex Fees makes sense for your club, the answer starts with a club-specific financial impact analysis.

We’ll review:

• Your current payment processing costs
• Your card mix (credit, debit, ACH breakdown)
• Projected revenue offset based on member behavior
• Net savings scenarios
• Implementation timeline and communication plan

This analysis is specific to your club, not industry averages or hypothetical scenarios. You’ll see your real numbers and what the program would deliver.

Watch the full webinar recording to hear the complete discussion, see the case study details, and understand the member communication strategies that work.

Ready to see what this looks like for your club? Explore Daxko Payments to learn more about Flex Fees and request your personalized analysis.

Payment processing costs are rising. That’s not changing.

But you don’t have to absorb the hit or pass broad price increases on to every member. You can give members a choice—pay with a credit card and cover the processing cost, or switch to ACH and avoid it entirely.

Over 1,500 clubs are already doing this. They’re seeing 50-60%+ reductions in net processing costs. And they’re not seeing member backlash—because transparency, advance notice, and member choice build trust, not friction.

The question isn’t whether processing costs are a problem. It’s whether you have a plan to address them strategically.

Watch the webinar. See the numbers. Decide for yourself.