On the surface, the new partnership might appear to create friction between Gold's and Les Mills, especially since Les Mills last month announced a partnership with 24 Hour Fitness in which 24 Hour clubs will offer the Les Mills' BodyPump barbell class.
According to Les Mills Chief Executive Phillip Mills, however, the Auckland, New Zealand-based company is not severing its relationship with Gold's. In fact, Mills adds that more than 360 Gold's Gyms in the United States offer Les Mills programs, and Gold's franchisees also have access to Gold's/Les Mills co-branded marketing materials.
“We remain fully committed to our reputation for providing the ultimate group fitness experience to Gold's Gym owners, instructors and members,” Mills says.
In addition to Gold's and 24 Hour, Les Mills also has a partnership with Town Sports International (TSI). After a trial last fall, a limited number of TSI clubs license Les Mills programs, too.
The new Les Mills' partnerships created a dilemma for Gold's Gym International, says Joel Tallman, senior vice president of franchising and global operations for the Irving, TX-based company.
“[We're] paying for a program, and my competitor has it across the street,” he explains.
Mills says exclusive arrangements are rare in the fitness industry.
“Check the typical club's group exercise schedule, and you'll often see a range of in-house programs alongside branded programs from multiple providers,” Mills says. “This is normal and healthy, in our view. Consumers tell us that they trust and value the Les Mills name and those of our programs and actively choose to become members at gyms which offer our classes. Our preferred vendor relationship means that Gold's Gym franchisees can offer Les Mills [programming] on favorable terms.”
Sara Kooperman, CEO of Les Mills Midwest and SCW Fitness Education, Northbrook, IL, also maintains a commitment to Gold's.
“The Gold's support helped put us on the map,” Kooperman says. “We really appreciate them. You don't forget where you came from.”
In the past, Gold's Gym paid for the first three programs for royalty franchisees that chose Les Mills, but Gold's did not pay for BTS programming. Now, Gold's corporate will pay for the first three programs from either Les Mills or BTS for a franchisee with a royalty franchise agreement, Tallman adds.
“Having the Gold's Gym-branded (BTS) programming is very intriguing to some of the existing operators to add that to their programming,” Tallman says.
As for the costs, Gold's franchisees will not pay Gold's for BTS programs. If a franchisee decides to add more than three programs, they will pay a negotiated rate to BTS or another group exercise company, Tallman says. Although the decision about charging members extra fees for group exercise programs is left to franchisees, most of Gold's franchisees do not do so, Tallman adds.
BTS is under the direction of Rich Boggs, founder, president and CEO of the Marietta, GA-based company.
“Gold's Gym-branded exercise classes can be a tremendous asset to gym owners wanting to take it a step further to distinguish themselves in a highly competitive marketplace,” Boggs said in a statement. “We look forward to working with Gold's Gym to provide quality group exercise programming and customized management support.”