GoodLife Fitness Clubs

Name: Simarpreet Singh

Course Code:
Teachers Name: Rubinoff
Due Date: Tuesday June 12, 2007
Page 1: Introduction
Page 2: Table of Contents
Page 3: Strategy Model
Page 4: Goal Structure
Page 5: Porter’s Five Forces Model
Page 6: Porter’s Five Forces Model
Page 7: Leadership Style
Page 8: Organizational Health
Page 9: Case Study
Page 10: Case Study
Page 11: Case Study
Page 12: Case Study
Page 13: Case Study
Page 14: Financial Analysis
Strategy Model:
Goal: They are planning to focus on services rather than sales. Company is
trying their best to increase the retention rate. Krista and others employees
are more into the improving of GoodLife services so customers can stick to
GoodLife Fitness for long run. GoodLife Fitness operation is trying to
improve their professional approach in managing.
Product Market Focus: From the beginning, the company did well into
providing the best in equipment, facilities, and service, with a well-trained
staff. GoodLife Staff was to offer high-quality service with education and
training. Now, GoodLife is only hiring individuals with right attitude (i.e.
customer focused). GoodLife spend 40% of their revenues into advertising
program in each season.
Core Activities: GoodLife have core activities like Fit Fix training and the
PUNCH program. They raised $500 000 through Core activities. GoodLife
have four sales associates (full time) are responsible for getting new
members. Personal trainers work with individual club members. Service
employees introduce new members to the club and its philosophy through a
series of programs on fitness and equipment use.
Value Proposition: GoodLife got larger to 30000 square feet and had an
open concept design with an extensive range of equipment and programs.
Each week GoodLife has staff meeting where they discuss a number of
issues, including how to improve the club. Krista wants the front desk
employees to focus into customer in the way of socializing and treat them
nicely. GoodLife has new employees and trainer to focus more in services to
keep the members for long-terms. If any member brings more members to
GoodLife then both members both will get discount.
Goal Structure:
Hard Goals: GoodLife’s Hard Goals are to improve the retention rate and
financial rate. Currently GoodLife’s Retention rate is 60% and Krista is
trying her best to keep members stick to GoodLife for long term. By
improving your club’s retention rates from 60 to 65 percent, based on last
year’s figures gross revenues would increase by over $35,000. Krista is
being flexible to the employees. GoodLife’s long-term goal is to raise the
sales percentage. They are doing survey on through what people are joining
the club so they can focus more in the specific advertising so they can get
more customers.
Soft Goals: GoodLife is planning to reduce money in the advertising.
Presently they are spending 6% of their revenue into the advertising. They
are focusing specifically into the work. They are hiring right employee for
the right spot. They placed two staff members in the front desk to remember
customers name and to socialize with them so they can feel relaxing in the
club. GoodLife is looking also on members’ complaints so they can improve
their service and offer the best to their customers. Krista is also teaching new
employee how to take care of members and how to be friendly to them. She
also increased employee’s wages so they can stick to GoodLife for long.
Porter's Five Forces Model:
Industry Competitors:
In the area of Kitchener and Waterloo, there is 15 fitness clubs. But
GoodLife has four majors’ competitors. Four majors competitors are
two YMCSs, The International Family Fitness Centre and Popeye's
Gym. Compare to competitors of GoodLife, GoodLife is doing much
better than their competitors. GoodLife offered cheap price for good
service and for more equipment. Krista is taking care of all problem
that arise in GoodLife such as a particular staff member was not
friendly and Krista dealt with the complaints right a way. Krista has
hired two special employees to take care of in the front desk just to
greet customer nicely. It could be because of those reasons GoodLife
is better than their competitors. GoodLife position is between top four
fitness clubs. GoodLife is better than their competitors because they
are lacking some kind of their goods in some parts like not treating
customer nicely or by not giving them good training. The fitness
market is growing at approximately 6 percent a year. GoodLife can be
at number one among their competitor by expanding their fitness club
and by hiring more employees for good services.
Potential Threats:
Potentially they want new software systems that can specifically tell
how many members had not visited the club for particular period. So
staff could contact members who had not visited for a specific period.
With this software retention rate might improve. There are other
available approaches to potentially such as any activities that built a
greater sense of "community" would increase interaction between
members and a sense of "belonging." Another Target that Krista
wanted to improve that was to make "motivation" to the front desk
associates. Krista was thinking of to "swiping machine" to be used in
the front desk to collect members data.
Buyers:
GoodLife buyers mostly are older than 18. Mostly people who are
involved with GoodLife service are people who are not in good form
or people who wants to stay in form. GoodLife’s buyers are more
females than males because they want to look fit, after having baby,
etc. GoodLife buyers’ retention percentage is 60%, 40% people are
who are not familiar with employee or people who have barely time to
come to GoodLife. Ten to fifteen percent of GoodLife’s buyers do not
renew their membership after months or years because they don’t
find fitness club interesting anymore.
Substitutes: People can eat healthy food and go for walk or cycling
after eating. Some people play sport thrice a week for an hour to stay
healthy. Some people work physically such as a labour work or
factory work to stay in good shape. Some people visit doctor to stay
aware of nutrients. Peoples often take care of their self by not eating
a lot of fast food.
Suppliers: American company supplies mostly GoodLife
equipments. Fitness like GoodLife buys equipment in big amount so
they can get equipment in low price. American company supplies
same equipment to all the fitness maybe that’s why all the fitness has
same equipment but different quantity.
Leadership Style:
Directive Style: GoodLife’s senior (Krista) is more directive most of
the time because she is responsible for the fitness club. Mostly, she
has to take a quick and efficient decision for the goods of the club.
She has to be directive because if revenue goes up and down it’s
because of her leadership style. I would say the 60% retention rate is
still 60% because of her. She can do better by asking for opinion to
others or by following some kind of pattern set by operations. She
have no other choice than be directive because she do not any other
co-worker to help her out in her position and she is the only one have
to handle all the clubs activities. Before taking any decision it is
always good to evaluate them by enquiring the good influence and
bad influence of the directive decision.
Participative Style: At some point of view she should ask for opinion
to other how clubs can improve or what’s good for the fitness. That
ways others employees will feel that they belong to GoodLife. That
might improve retention rate and some employees might not quit the
job. Krista is also participative person because when she hired some
new employees, she trained them and also gave them good salaries.
Most of the employees left before because they didn’t felt any interest
in the job and they were no particular training for them. But now
things are changing in good ways. Retention rate might increase later
on because Krista is trying different good things. It’s better if Krista
ask employees of other clubs to visit GoodLife and see how things
can improve. Any member or any employee could feel free to consult
the improvement of the club.
Organizational Health:
Enthusiasm: Krista has great enthusiasm for the work. Somehow,
her motive is to improve GoodLife’s retention rates. She is always
busy in member’s services and with employees. She should be more
enthusiastic of employees because they are the one who take care of
customers.
Boundaries: GoodLife’s employees work more individually because
Krista has given single and different task to all employees. They are
few employees who work in groups like front-desk, etc. The retention
rate is 60%, which shows they are loyal to GoodLife. Retention rate of
60% is not that bad. They can do better by getting more involved in
GoodLife. Krista has increased they salaries and because of that they
should do more than just what they are doing now. Krista is not really
cooperative. She is independent person. She won’t really ask for
opinion to others employees.
Problem Solving: GoodLife does not much problem in their club
except for main issues like retention rate and improving GoodLife’s
service. Their problem solving style is directive. Employees do
whatever is given to them by Krista. Employees are mostly never
asked to give their opinion while a problem is occurred. Employees
should take the opportunity to handle the problem by their self.
Learning and Sustainability: Some new employees learn from
Krista how to manage customer’s services. Mostly customers are
trained by their self and by their mistakes. Krista has set one good
example for everyone that how she reaches to the position where she
is today. That example could be given to the employees to inspire
them to work hard.
Case Study Method:

Identify the Problem: The problem GoodLife is having that their

service is not as good as their customer expect. GoodLife's
employees do not have confidence and they work, as they do not
belong to GoodLife. Krista cannot handle GoodLife by it self, she
need someone as same level as her to help her with her position.
GoodLife advertisement system isn’t good and neither GoodLife
fitness club. GoodLife suffer with future plans.

•Invest money in specific (news, radio, etc.) advertisement

•Full training should be given to employees
•Good outlook and in look of GoodLife
•Advance future planning
•Availability of new equipment
•High level wages
•More programs and activities
•More Co-worker
•Knowledgeable trainers
•Improvement in services
•Training should be available in different language
Invest money in specific advertisement: GoodLife should be focus
on specific advertisement such as television commercial. Mostly
people like to watch television. In coming year, television channels
are allowed to advertise two times more than today. So that can make
people to watch GoodLife commercial two time or more. Advertising
on radio is sort of wasting time. Mostly people listen radio in car
during they doesn’t have anything else to listen. So it’s kind of
useless to advertise on radio unless you offer some price that take
attention of listeners. Television advertisement could be more
expensive then radio, yellow book and other advertisement. But its
worth to spend money on television and rather than spending money
on all different kind of advertisement. Unfit people stay home and
watch television and by looking at GoodLife advertise they might join
fitness. They should show how people got into fit form by GoodLife in
the commercial.
Full Training should be given to employees: I think people will go
to the fitness where they can find trainable people to take care of
them. Someone who is working there for long or by someone should
be hired to train new employees. New employees with experience
given can make GoodLife look good to customers. Confidence is big
thing on new work and employees can have confidence if they are
trained properly and only if they feel safe. Hiring some to train new
employees might cost $3000 to $4000. But it worth because
someone is specially there to take care of new employees rather than
Krista take care of them and waste her time.
Good outlook and in look of GoodLife: GoodLife is a big and
professional fitness club. GoodLife must look brand-new and some
entertainment club to exercise. It should look huge fitness from
outside and from inside. They should have pool inside, private
washroom, free towel services, proteins pills and cafeteria with
healthy foods.
Advance future planning: GoodLife’s should have better future
planning and advance equipment to do better than their competitors.
GoodLife’s should be informed about how their competitors are doing.
That will attract more people to GoodLife.
Availability of new equipment: GoodLife should pay good tip to
their supplier to get availabity of new equipments as soon as it’s
available in the market. They should advertise their new available
equipment in the television commercial or on their flyer.
High-level wages: New employees should get good wages, good
benefits and race of $0.25 par 6 months. That will stick them to stay
with GoodLife for long-term. So, Krista doesn’t have waste her time
and money on new employees to train them.
More programs and activities: GoodLife should have different
program and activities each month. More different activities will bring
interest to the customers. Some activities should be for kids to keep
them busy.
More Co-workers: Krista and other employees need co-worker to
help them in work and try to welcome more customers. Especially
Krista need co-worker to because she is always in her work and has
no time to look on all the activities. If she get co-worker that will make
her work easier and it will give her more time to look on employees
and spend time with customers.
Recommendation: I would recommend strongly to GoodLife fitness
club to have more people in the operation. That will make a lot easier
for Krista to handle GoodLife. I think she is lacking her attention to
some area of service because she does not have enough time to go
through all. By having more people in operation might create positive
outcome. By having someone, the same rank as herself, to cooperate
with her at work she might improve the GoodLife. The only way
GoodLife can make its money is if it offers a respectable service to its
customers. Customers will love that if any member from the operation
take care of them and treat them nicely. Also, I would recommend
Krista to look at certain kind of service area. She should look for new
things to offer more services to customers. She should come up with
new with things such as having pool in the fitness club and
entertainment games to keep kids busy so they parents can enjoy
fitness. These sorts of things may get better retention rate. That can
happen only if someone helps her out. Or else she focus to different
services every day and that will make her keep latest of each single
task. By going through task once a while will let her inform what is
missing around or what is not going well. I recommend Krista to be
updated about GoodLife’s competitors. She should know what the
good things other fitness has are but GoodLife does not. That way
might bring some customer to GoodLife. People always goes to place
where they have more option and good prices. There is Jane to in the
operation can help Krista to make little easier for her or Jane can be
partner of Krista and take more responsibilities. That can happen only
if someone helps Krista in her work so she can have time to pay
attention to other responsibilities. Krista should have link with seniors
of other fitness club to for get help in tasks or what’s new with others
fitness. There is another way to get help to improve the retention rate
is by asking to senior about how GoodLife can do better. GoodLife is
huge fitness club and only one person is responsible for all activities
happen there. I would say there should be more people in operation.
The retention rate is 60% maybe because it is too much stress for
one person to handle. I think so much stress is not letting her focus
on her work properly. The way she reaches to top spot I think she can
do better and come up with new things if she does not have a too
much stress. There is so many ways to approach improvement of
retention if she looks outside of fitness club.

Implementation:

Short run: Krista should give more tasks to all the employees and
make them responsible. By doing that, she will have more free time to
spend with customer and try to find what is their needs. She should
try to spend more time outside of her office.

Medium run: Krista should look for useless expenses and try to
reduce them so revenue can increase. If revenue increases then
Krista salaries will increase to. She should talk to other fitness
employees to find out what can improve GoodLife. She should
look for student to help GoodLife in exchange giving them 40
hours. She should be more focused on how GoodLife can make
money through small different activities.
 Long run: She should look for evaluate some of the employees
for promotion. She should evaluate him or her by giving them
different tasks each week and see how good they are with
members. She should also give them bonus or race to motive
them to work more hard for GoodLife. Their long-term goal should
be to increase retention rate 60% to 65%. She should try different
things to improve it such as raise money for charity, etc.

Financial Analysis: After reviewing, the retention rate shows

decreasing value because member’s amount is increasing. Day a day
members are joining fitness which mean club is doing well.
GoodLife’s revenues are much higher than expense. On exhibit its
shows that GoodLife business sales are increasing. Their expenses
are 80 percent close to revenues (100%). GoodLife’s membership
revenue has increased pretty good. She should invite some kind of
hilarious people to entertain them while they members are exercising.
Hilarious person could one of her friend or her relatives. She should
try to find someone from outside that might cost her $200 to 300$ par
days. She can ask to top dog for co-worker or if she is allowing hiring
people for help her.