During the International Health, Racquet and Sportsclub Association (IHRSA) annual meeting on March 30, IHRSA leaders spelled out the bad and the good for the fitness industry in 2020 and elected new board leaders and members.
First, the bad news.
The cancellation of the 2020 IHRSA Convention and Trade Show due to the COVID-19 pandemic led to a $3.75 million net asset deficit in fiscal year 2020 for the trade association for commercial club operators. Total revenue for IHRSA was $5.6 million while total expenses were $12.67 million, Carrie Kepple, who serves as board chair until June 30, said in sharing the financials for IHRSA for fiscal year 2020 (ending June 30, 2020), in the association’s first virtual annual meeting.
“The pandemic and the resulting restrictions on large-scale events caused the cancellation of the March 2020 IHRSA Convention and Trade Show,” Kepple said. “This resulted in serious financial consequences for IHRSA’s last fiscal year. Starting over a year ago, significant expense cuts and other changes were undertaken to stabilize the organization.”
Joe Moore served as president and CEO of IHRSA from 2006 until August 2020 when he left. Brent Darden has been serving as interim president and CEO while the board searches for a permanent replacement.
In the United States, IHRSA is reporting $20.4 billion in lost revenue as of December 2020. That is a 58 percent decline from 2019. Seventeen percent of U.S. health clubs had permanently closed as of December 2020, which accounts for about 7,000 clubs, she said. Gyms face a higher closed rate than any other industry, according to Yelp! In addition, 1.4 million jobs were lost in the U.S. fitness industry since the beginning of the pandemic, which accounts for 44 percent of jobs in the industry.
Now, the good news.
Health club attendance in the United States was up in January 2021 compared to December 2020, even though attendance was still down in January and February 2021 compared to January and February 2020.
“We can definitely feel a comeback on the horizon,” Kepple said.
She shared that some futurists predict that pent up demand for health and fitness could be a tsunami for the fitness industry, and Kepple urged the industry to be ready for it.
“Our industry is at a critical point in history, one where we can change the narrative from only muscles to mental fitness too,” she said. “From hard bodies only to holistic health. One where we preach self-care as health care and show people that we serve all humans, not just those of a specific color or socioeconomic group. Where we teach people how to shift from fitness as a chore to fitness as an enjoyable daily lifestyle.”
She added that the industry now has a clean canvas.
“We are in the first chapter of the greatest comeback story of all time for our industry,” she said. “And we are not only living it; we are writing it. In fact, countries that are ahead of the COVID curve—like China, Australia and New Zealand—are already reporting a rapid resurgence in membership and revenue growth. Their recovery is strong, and it is happening fast as confidence returns. And that is coming this way.”
Kepple continued by saying that IHRSA has been laying the foundation for the return for the industry through some of the changes it made, such as Darden’s hiring as interim CEO, adding lobbyists, adding partnerships and adding new committees. She thanked Darden and all the board members for their work.
The current board will continue through June 30, when the new board takes over. During the meeting, IHRSA members elected the following people as new board leaders:
- Board Chair: Alan Leach, CEO, sales trainer and director of sales and marketing, West Wood Club, Dublin, Ireland
- Board Vice Chair: Chris Craytor, president and COO, acac Fitness & Wellness Centers, Charlottesville, Virginia
- Treasurer: Brad Wilkins, president, Cooper Health and Fitness, Dallas
- Secretary: Michele Melkerson-Granryd, general manager, Castle Hill Fitness 360, Austin, Texas
- Ex-Officio: Carrie Kepple, owner and managing director, Styles Studio Fitness, Peoria, Illinois
Their terms are for 2021-2022 and will begin July 1.
The new board members, elected to four-year terms that start on July 1, 2021, are:
- Luke Carlson, CEO, Discover Strength, Minneapolis, Minnesota
- Aaron Moore, director of operations, VIDA Fitness & Aura Spa, Washington, DC
- Jose Teixeira, head of customer experience, SC Fitness, Lisbon, Portugal
- Loni Wang, CEO, Catic Wellness Group Lt., Shenzhen, China
Three board members who are completing their terms on June 30 are:
- Jim Worthington, owner, president and CEO, Newtown Athletic Club, Newtown, Pennsylvania
- Steve Capaezzone, CEO, Healthtrax International, Glastonbury, Connecticut
- Anastasia Yusina, CEO, Strata Fitness Holdings and FITSPACE, Moscow, Russia
The three will stay on in advisory roles to help the board with the hiring of a permanent president and CEO, and to help the organization through IHRSA 2021, which will occur in September. The event, which normally occurs in March, was moved to September this year due to lingering COVID-19 concerns.