AusLeisure

Following the arrival of Genesis Fitness Clubs in the Sydney market, recently appointed group Chief Executive David Lowe, spoke with Australasian Leisure Management.

The former Debitsuccess Chief Executive moved to Genesis Fitness after close to eight years with the billing company, taking up the opportunity to, as he explains “look at fitness from a different angle.”

Tasked by Genesis owner and Belgravia Group Chairman Geoff Lord “with making Genesis the best fitness club operator and the biggest player in the Australasian markets” Lowe has targets for Genesis to operate more than 100 with enough clubs to achieve this target.

The group’s arrival in Sydney marks one of the first steps in reaching this goal. In the last two months, Genesis has taken over the running of three former Definition Health Clubs in the Sydney suburbs of Blacktown, Casula and St Leonards.

With Genesis’ growth has been facilitated by a management model which encompasses three different ownership structures (owned and operated clubs; joint venture clubs; and fully franchised clubs), the Group’s arrival in Sydney has been undertaken with franchisee Steve Coulter.

Coulter, otherwise known for his swim school operations, became the sole proprietor of the three Sydney clubs after the personal bankruptcy of former partners. As Coulter states, “my operation of the clubs didn’t work with Definition, which is why I sought to work with Genesis based on the support they offered.”

Genesis’ rebranding of each of the clubs has included redecoration and the installation of new management systems (coincidentally, Genesis use Debitsuccess’ Clubware software), with new equipment to follow. Being part of the Belgravia Group of companies, which also includes fitness equipment supplier The Fitness Generation, requires Genesis to purchase from its sister company unless identical products can be sourced at a cheaper price.

Lowe explains that Genesis offers a heavily supported franchise and that the Group has never had a franchisee fail.

Beyond its three initial clubs, Genesis wants to establish a strong presence in the harbour city, adding that “we generally prefer news sites for our clubs, but the opportunity to work with Steve was very timely.”

As for future expansion in Sydney, Lowe explains “we wouldn’t rule out acquiring or partnering existing businesses but our preference is green field sites. From a ‘shell’ of a building to an operating club can take as little as five months, which is not a severe lead-in time.”

While, Genesis’ arrival in the Sydney market has made the headlines, it is how Lowe plans for Genesis clubs to operate that is likely to create the biggest long term impact on the industry.

“I am passionate about the fitness industry” Lowe explains, a passion that is seeing him undertake PhD research at Melbourne’s Deakin University.

Lowe’s doctoral study is ground breaking research on the factors that attract membership and retention in the Australian fitness industry.

In the initial phases of his study, Lowe has found minimal academic research on the industry and, as he laments, “the most recent study is 13 years old and comes from the USA … and even industry research focusses on the USA and not Australia.”

This concerns Lowe, who doesn’t go along with the industry paradigm that what happens in USA will happen here. As he states “most Australian fitness businesses run on paradigm that what happens in USA will occur in Australia, and we just can’t assume that USA trends will be followed in this country.

“My research to date shows this doesn’t hold true and that there are unique attributes to the Australian market. For example, I’ve found that service and staff are three times more important than any other factor in being the strongest motivators in membership retention which is not the case overseas.

“For that reason I see that 24/7 gyms, which might work in USA, are probably a fad and will not be sustatainable in Australia. Australian gym members want service and staff, more than in other parts of the world.”

For that reason, Lowe plans that Genesis clubs “will raise the bar in service standards in fitness which we will achieve by looking at traditional club structures and offering a new approach to club membership focussing on the attraction phase of membership and then their retention.

“In the attraction phase my research shows that most club managers don’t understand what members are looking for. In the retention phase clubs do understand what influences retention but not the weighting that applies to them, particularly in regard to service and staff.

“The notion of treating a member ‘like a number’ just doesn’t work, in the same way as running a unstaffed facility won’t work in the long term.”

Here Lowe sees that “24/7 gyms will have a real problem with retention”, which will benefit ‘full service’ clubs.

For more information on Genesis Fitness Clubs go to www.genesisfitness.com.au

27th July 2010 - GENESIS FITNESS CLUBS TO OPEN THREE SITES IN SYDNEY 

20th July 2009 - LORD TO ADDRESS FOOTBALL BUSINESS EVENT

Support our industry news service
We hope that you value the news that we publish so while you're here can we ask for your support?

As an independent publisher, we need reader support for our industry news gathering so ask that - if you don't already do so - you back us by subscribing to the printed Australasian Leisure Management magazine and/or our online news.