Georgia Gwinnett College
Technology & Anytime Fitness Management Information Systems
Dawn Clayton 11/17/2011
Introduction: While thinking about what type of technology to write about, I began thinking of the enormous risks that Anytime Fitness was willing to try when they developed their business model. Because the company embraced technology, Anytime Fitness has become the fastest growing fitness club franchise (in the world). I would like to explain their set-up and cover the benefits of what they have chosen. Technology Definition: For the most part every Anytime Fitness is equipped utilizing the same format regardless of where it is located. They have the installed Radio Frequency Identification (RFID) keys for club members, instant alert buttons and other security monitoring hardware, and electronics on pieces of equipment to assist in tracking training goals and entertainment during the workout. The FRID is a special magnetized passkey, similar to the ones used in the hospitality industry. These individual cards are issued to every member and allow only one person to enter the building at a time. This is because they are directly tied to the participant’s club membership. The instant alert buttons are similar to the ones currently advertised in the senior marketing target niche. The primary difference is that one hardwired system is connected to multiple necklaces that may be chosen upon entry to the facility. They are connected directly to the 911 dispatch center and have been endorsed by all of the law enforcement entities across the country as a great means for combating false alarms. The other security monitoring hardware they have is a “tailgating” sensor that prevents the door from allowing more than one person to enter for one RFID key. There are also strategically placed cameras that automatically capture specific areas (doors, etc) which also help prevent incidents. The technology that the Anytime Fitness machines are using is fairly simple—considering the capabilities out on the market. They use only a few electronic monitoring devices on the treadmills and elliptical (generally 4 each), but they also have several cable provided televisions and a couple of stereo systems. Business Usage: During assembly of the business plan, Michelle and Ryan Craig decided to find a solution to the workout problem they were suffering from. Every time they tried to use the traditional local facilities, they would get started “late in the day” only to get told after a few minutes that it was time to close. This prompted them to investigate ways of delivering a facility that could be accessed at any time, but still be secure while offering a variety of free standing equipment and a skeleton staff. Most facilities are found close to work, school, or home in approximately 4,000 sq ft buildings. They are staffed only during selected hours, so if you want extra assistance in building a workout, it is best to investigate the schedule because every location has different hours. The first thing that had to be addressed was how they were going to control access to the location, while making it profitable by not requiring personnel to be present every minute of every day. They partnered with Fastlane Door Detective and the RFID key system to allow access to entitled club members. They also made reliable safety a priority by installing the automatic 911 buttons. At this point the equipment choices came down to the best fit for floor
space, safe use while utilized, and most economically beneficial to the company. The cabled televisions and stereo systems were added for those fitness participants that need to be distracted while working out.
Capital Requirements—provided by Anytime Fitness The following is an example of average upfront costs:
“THESE FIGURES ARE ESTIMATES OF THE COMPLETE INVESTMENTS IN SETTING UP AN ANYTIME FITNESS CENTER AND OPERATING IT FOR 3 MONTHS. IT IS POSSIBLE TO SIGNIFICANTLY EXCEED COSTS IN ANY OF THE AREAS ABOVE.”
“Some costs will vary in relation to the physical size of the fitness center. A lower cost center is one that would require fewer leasehold improvements and fewer equipment expenditures. Moderate and higher cost fitness centers may require extensive interior renovations and additional equipment. The above figures do not include extensive exterior renovations.” “The total estimated investment for each Anytime Fitness ranges from $44,074-$300,074 USD, including an initial franchise fee ranging from $46,299-321,899 USD. Based on your budget and cash flow, your upfront costs can be minimized by leasing equipment and spreading your buildout costs into your monthly lease (although this may increase your rent).” Product Misc TVs Cable/Satellite Total Entertainment
Amount 4 1 system
Price $500 – 600 $720
Total Cost $2,000 – 2,400 $720 $2,720 – 3,120
Add these totals to the ones provided by Anytime Fitness and an investor is faced with a minimum start up cost of $50,000. To combat this burden, Anytime Fitness has enjoyed remarkable public relations within the business community (local and global) and has impressive statistical results on membership and growth. Conclusion: Anytime Fitness is doing something right—especially since they are expanding, even in Europe where most economies are struggling right now. The use of technology, especially the RFID and the Fastlane Door Detector, has allowed Anytime Fitness to exploit the market failure in exercise facilities and turn it into a vastly profitable enterprise. Not only are they able to drastically reduce their overhead costs (I believe that one of the company pages states 36% reduction in this area), they are also endorsed by local law enforcement agencies as a business that has provided the best solutions to the security needs of its members. If I am able to amass the capital, I will make an effort to open one—but I would choose to do it in an emerging market(s), such as Europe, Australia, New Zealand, etc. The only detractor that I see is in providing the tanning beds—I feel like this is a potential liability due to all of the negative publicity connect to this activity. Works Cited http://www.anytimefitness.com/en-us/membership http://www.anytimefitness.com/en-us/corporate/about http://www.anytimefitness.com/en-us/opportunities/investment http://www.bestbuy.com Mark Daly, National Media Director, Anytime Fitness, LLC. mark.daly@anytimefitness.com