24 Hour Fitness, San Ramon, California, went through a reduction in its workforce last week, eliminating an undisclosed number of positions and people.
Club Industry reached out to 24 Hour Fitness for details, including the number of people let go, whether the terminations were at the corporate or club level, whether operations at any clubs were impacted, whether any clubs were closed, and the reasons for the reduction.
In response, 24 Hour Fitness sent Club Industry the following statement from CEO Karl Sanft: “Like many businesses, 24 Hour Fitness has to adapt to the challenges of the current macroeconomic climate. What cannot change is our mission to provide maximum value for our members. While difficult, this decision allows us to best serve our members now and for the future.”
The company declined to share other details at this time.
Club Industry reached out to a few people who had been let go, but none would comment. LinkedIn posts of those who were let go showed that many served at corporate as well as at the regional and district level.
24 Hour specifically called the terminations a reduction in force (RIF), not layoffs. An RIF involves eliminating positions, which means a permanent cut in employees, while layoffs leave open the possibility for positions to be refilled, according to SHRM.
24 Hour Fitness filed for Chapter 11 bankruptcy in June 2020, emerging on Dec. 31, 2020 with an optimized cost structure and leaner balance sheet after eliminating $1.2 billion of funded debt.
Sanft served as interim CEO starting in December 2021 when Tony Ueber left the company. Sanft then was appointed CEO in June 2022.
Club Industry spoke with Sanft at the time of his appointment about his plans for the company. At that time, he spoke about moves to create a more holistic offering for members. In October, the company announced its Strength In 24 initiative to offer a more holistic approach to fitness.
The Strength In 24 initiative was created by creative consultancy InGoodTaste. Since the RIF, InGoodTaste has been tasked with media communications for 24 Hour Fitness.
At the time of the Strength In 24 announcement, 24 Hour Fitness Senior Vice President of Marketing Jill Rankin told Club Industry that one of the lessons of the COVID-19 pandemic was that people wanted a balanced approach to fitness that included mental health.
“We are on a long journey and will be evolving our idea of fitness for a long time to come, but for now we want to highlight 24 Hour Fitness’ member community and demonstrate that we understand what people want to get out of a fitness experience,” Rankin said. “We know, from listening to 24 Hour Fitness members, that managing anxiety and stress are as important as getting deeper into that yoga pose or spending some time with a personal trainer.”
To build a more holistic experience, 24 Hour began partnering with other companies, including a partnership that offered members and staff a complimentary three-month subscription to Headspace, a digital mental health platform. 24 Hour partnered with Special Strong to allow Special Strong franchise owners to use 24 Hour locations instead of opening their own clubs, to serve their clients, many of whom have mental, physical and cognitive challenges. 24 Hour also expanded its partnership with Nutrishop to add 50 Nutrishop franchised stores in clubs nationwide over the next four years, and it partnered with recovery program creator iCryo to offer cryotherapy.
Members also have access to MODUS mind/body small group training program as well as P.A.S.E. Factor, a HIIT+mindfulness program. Through a partnership with 9Round, members can take kickboxing classes offered within 24 Hour clubs.
24 Hour began refreshing its existing clubs with a new look and feel to reflect the Strength In 24 initiative and to make room for the new services to be offered, the company shared in 2022.
In his interview with Club Industry in June 2022, Sanft spoke about a change in 24 Hour’s pricing structure that kept the company as a mid-priced brand while offering a lower-priced membership for those wanting access to just cardio and weights at one club. That Silver membership runs $9.99 in Colorado, Florida and Texas, and it runs $19.99 in New Jersey, New York and Oregon, according to its website. The website does not show the Silver membership is offered in any of the other five states in which 24 Hour Fitness operates.
Rates for the company's National, Platinum and Gold membership levels vary depending on club location. Those memberships allow use of clubs regionally or nationally, and they include group exercise while the Platinum membership includes two buddy passes.
The company had cut hours at many of its clubs during COVID-19 restrictions, but in March 2022, it announced that 100 of its clubs would return to 24/7 operations.