How One Mature Health Club Smashes Sales Records After 19 Years in Business

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After nearly two decades of existence, White Rock Athletic Club, with the assistance of Fitness Management & Consulting, is breaking all-time sales records. Two years ago, employee turned entrepreneur, Corey Butcher, purchased the club. The combination of a passionate new owner and a veteran outside consultant synergize in a winning formula.

After years of working his way up the management ladder at White Rock Athletic Club, Corey Butcher was finally in a position to buy this 17-year-old entrenched club in Northeast Dallas. Hemorrhaging almost $10,000 a month in losses, Butcher knew turning this ship around was going to be a daunting task but went ahead and assumed the challenge of business ownership.

After draining his own bag of tricks, but getting the club out of the red, Butcher understood that he exhausted his extent of club business knowledge and sought the perspective of an experienced outsider to get the club to the next level.

So, he called in veteran Jim Thomas of Fitness Management & Consulting, who has over 25 years of health club experience in all aspects of business. Today, Butcher, buoyed with Thomas' depth and breadth of experience, is breaking all-time sales records, is improving profitability, and skyrocketing the resale value of his business.

The Path to Becoming a Health Club Owner

After observing the insidious effects of obesity on members of his own family, Butcher started on his quest to spread health and fitness. After receiving a degree in physical therapy from SMU, and acquiring a host of personal training certifications, he landed his first job at a Gold's Gym. His reputation and abilities were soon widely known and he was lured to work at the White Rock Athletic Club.

At White Rock, after working his way up the management ladder, Butcher's hard work and success put him in a position to purchase the club. "I was involved with White Rock for three years. After about 2 1/2 years, I inquired with the owner if he was interested in selling it, after about six months of negotiations, White Rock was finally mine, and the rest is history," said Butcher.

Now he was experiencing the stake of owning a substantial 30,000 ft2 operation complete with employees, cash demands, and day-to-day headaches. He knew he would have to act swiftly and decisively to turn a club around that had just lost $100,000!

Butcher recalled, "When you're sitting there in that box, as an owner, with that overhead, trying to make it work, it's a whole different thing. There's a lot more involvement than just being a department manager. "

The Quick Fix

Being a fast study and quite savvy in business, Butcher set out to slash unnecessary costs and improve sales and actually got the club to initial profitability. But in three months time, he realized he had topped off in his knowledge of the health club business.

Butcher explained, "To grow the club to its full potential, I needed an expert. I bought the club in October, 2004, by the following February, I noticed I was topping out of what my knowledge was in the industry -- I really only had about five years of industry knowledge. I said I need someone in here that is an expert at everything. That's when I got Jim Thomas."

A Hired Gun To Get To The Next Level

Not allowing his ego to get in the way, Butcher takes pride in surrounding himself with the best talent available. One owner cannot know it all.

He knew of Thomas' stellar reputation and called him in to focus on the number one thing for the most impact: membership sales. Afterwards, they looked to improve operations. "Then I started to ask him to attend a managers meeting once a week where he trained our staff on how to manage their staff".

Knowing that most consultants have egos of their own and canned agendas, Butcher was impressed by Thomas' easy-going style and roll up the sleeves approach. Thomas doesn't insist on doing things his way "or it's the highway", but through intelligent consultation can imbue club operators to new approaches that are grounded in decades of successful experience.

According to Thomas, "Our philosophy is we're not going to change anything that does not have to be changed. No change for change sake. It's much more palatable to that club owner. "

Geof Eng is the owner of The Grand Health and Racquet Club in Tulsa Oklahoma, a very large health club and tennis operation spanning eight acres. He's known Thomas for nine years, dating back to the Ranch Health Club in Dallas where Thomas orchestrated a turnaround. Eng then brought Thomas in when he launched his own club in 2000 to assure he got off on the right foot.

According to Eng, "Jim is really great with the mom and pop fitness facilities…owner-operator clubs like mine and like White Rock. Jim succeeds in turning around these operations because he understands the cash flow and the budget challenges and the critical need to bring in members. I've witnessed him coming into several club operations, turning them around, and maximizing the profits."

A Former Successful Owner Operator Makes an Ideal Consultant

Butcher also witnessed Thomas in action, "The thing I noticed about Jim, was not only that he has a lot of success as a consultant, he had a tremendous amount of success as an owner, and that's something where a lot of consultants that are out there in the health club business can't do. They can consult to you on how to run a business and stuff like that, but a lot of them have never been owners", said Butcher.

He added, "When I researched Jim, he was an expert in all of this. So that's why I brought him in. I think it's always better to have an outside person looking in, they don't have a bias and they can look from the outside in and say this is what we need to do."

"This is one thing I can truly say about Jim," Butcher went on, "There is not any part of the health club that Jim is not an expert at. But he doesn't have that dominating, egotistical personality, that he's going to go and invoke his will, he's going to walk his client through exactly what the client is asking for."

Record Breaking Sales

After a year and a half of Thomas' influence, the improvements have been truly extraordinary, especially in the context of a 19-year-old business.

"In 2005, we achieved a gross revenue growth rate of 11%. When a club that is 19 years old goes through an 11% growth, that's a pretty good portion. This year, we are on pace for 10% growth," said Butcher, "Previously, the highest revenue of the club was $1.5 million. In our first year, we were at $1.8 million, and now our second year, it will be about $2.15 million."

Butcher added, "Also in 2005, in 10 out of the 12 months, we had record breaking months, we set all-time records in the club as far as units in revenue, again pretty remarkable for a club of that age. "

Expertise For Any Difficult Situation

Geof Eng summed up Jim Thomas' ability to help an array of health clubs, "Jim is one of the few people in our industry that you can really trust. He has some really good time tested techniques, as far as sales. What I admire about Jim is that he's very consistent about his philosophy, time tested systems, we know that they work, I've seen them work at the Ranch, I saw them work at White Rock, and I saw them work at my own club. All three of those clubs where totally different types of clubs. "

About Fitness Management & Consulting

Fitness Management & Consulting is a consulting firm specializing in business consulting, turnarounds and sales training for health clubs. Areas of practice include management training and procedures, sales and marketing systems and training, and operations. It’s founder, Jim Thomas, has more than 25 years of experience in all aspects of club ownership and management. For further information call (800) 929-2898 You can also visit http://www.fmconsulting.net.

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