Time to Define What Your Business Is

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I once heard someone describe what he thought had caused the decline of railroad companies. Many federal regulations, monopolies (or perhaps the breaking up of monopolies) and other factors played roles, but perhaps the biggest obvious external factors were growth in the use of automobiles, the interstate highway system and air travel.  

However, the biggest factor in the demise of many railroad companies may have been internal. It may have been the unwillingness of railroad company executives to broaden the mission and definition of their companies. If railroad company executives had considered themselves to be in the transportation business rather than in the railroad business, then companies such as the Chicago and Rock Island Railroad might still be around.

As the country recovers from our latest recession, the industry has learned some lessons, and one of those is that vendors must expand the definition of who they are and what they do. A growing number of vendors no longer think of themselves solely as equipment manufacturers, software providers or group program providers. Now, many see themselves as advocates of fitness and as partners with fitness facility operators.

Although vendors may not want to admit it, much of this re-evaluation likely occurred out of necessity. During the recession, many health club operators curbed their buying. That hurt vendors, so vendors had to get creative. They had to re-evaluate their businesses and how they could entice operators to spend again. Obviously, operators would only spend if they could bring in more revenue. So instead of focusing on their own success, vendors began focusing more on how to make their customers more successful.

It is not that vendors had not focused on their customers’ success in the past, but that focus intensified during the recession, leading to some new offerings. Many of the major equipment manufacturers have not only offered more entertainment programming and increased the ability of users to interact on equipment, but they also have helped club operators on the back end with asset management systems. One vendor recently introduced programming for small group training using its equipment—and also provided a public relations how-to booklet free to anyone in the industry.

More software vendors are offering business intelligence to help operators quickly see real-time metrics rather than spending hours pulling together reports about sales, attrition, new joiners and other metrics. At least one software company offers webinars that do not focus on software but instead on general industry issues.

These changes came as vendors began to look deeper at what their customers—and their customers’ customers—needed. If you as a club operator have not looked at how you define yourself and what your mission truly is, then you must do so. Are you really a health club or are you something broader? If you are something broader, then how can you meet all the needs of your customers? What are the needs of your customers? Should you broaden your view of your target market?

Re-evaluation takes research, brainstorming and input from your staff. The time you put into it could move you to a whole new track in the future.

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