Monday, December 22, 2008

When products compete...

So I of course have to wonder how all the folks who joined the original 'Golds Gym' in Amherst now ‘The Leading Edge’ (without a franchise fee) who are currently paying anywhere from $30 to $50 per month are going to like this new branch operation in Greenfield giving it away for $9.95 per month?



Not quite as large as the Amherst location but not that much smaller.

All That Glitters...

26 comments:

Anonymous said...

I don't care because I live in Amherst not Greenfield. They could give it away in the hinterlands and it wouldn't matter to me. Sounds like somebody's feeling insecure.

LarryK4 said...

Yeah, precisely; and at $9.95 per month they ARE giving it away. But that should kick the Hell out of Planet Fitness (Hey a nickel here and a nickel there...)

People who live in the People's Republic don't travel to Greenfield all that often and vice versa.

Thus saying your Golds membership, errr...I mean Leading Edge Amherst membership--at 4 or 5 times the new Greenfield operation's monthly rate--also allows you to work out there as well is not going to mean very much (especially to such a secure guy like you)

Anonymous said...

Gold's Amherst equipment is really old by now. With the workout/abuse it gets by all those Umass kids each semester, I don't know why anyone would want a membership there. At least Planet Fitness's equipment is brand new

Anonymous said...

Is Pete Earle still running the former Gold's in Amherst?

LarryK4 said...

His name was the only one listed on the incorporation papers for the Greenfield operation.

But in their email to employees a few months back (when they were still Golds) they used the term "owners" when hyping the new Greenfield branch.

Anonymous said...

Speaking of Home Depot, how long until Rocky's closes up?

Anonymous said...

Actually, Greenfield's Edge is NOT "kicking the hell out of Planet Fitness". Right now and until December 31st, Planet Fitness offers a $99.00 a year membership rate with no enrollment fee. That's $8.25 a month, folks. (Hey a $1.70 here and a $1.70 there...)This is not a "getcha in the door" special.It's available every December. Who's kicking who?

Currentley, the Hadley Planet Fitness has just over 6,400 members and growing daily.One would think you'd need a shoehorn to get through the door. But oddly enough, the manager there says only about 30 percent use the facility on a regular basis. For that reason and given the size of the place, there's always room. Sure it's crowded between 4:00 and 7:00, but you can always find a machine.

Yeah, you can say at $8.25 they are giving it away. But don't forget, more than half of the members end up "upgrading" to the $19.99 a month membership rate. This gives them free use of all other Planet Fitness locations, unlimited guest privileges, massage chairs, half price drinks, etc. Oh yeah, you can cook your skin as much as you want with the unlimited tanning privileges.

And by the way, good luck to Pete Earle and the Greenfield Edge gym. By his pricing structure, he obviously is smart enough to see that in this economy it's all about bodies in the door.

Anonymous said...

Does anybody know if Pete was able to buy out his partner Joanne DeLong? And what's the story with the Coppermine in Amherst? Is that still part of Gold's/Leading Edge, or was that sold too?

LarryK4 said...

Actually the kicking the Hell out of Planet Fitness by undercutting a wooden nickel was, you know, sarcasm.

At the moment Planet Fitness does not have a franchise in Greenfield (and now that Pistol Pete beat them to the punch they probably will not bother—although Corporate Headquarters really does not care in the least, so if some nitwit in Greenfield decides to pay their expensive franchise fee (as opposed to cheap end-user fees) they will be happy to give them an “exclusive” to the entire city of Greenfield.

Obviously almost ANYTHING in Greenfield is not competitive with businesses located in the Happy Valley. ‘The People’s Pint’ is cool but the ‘Moan and Dove’ in South Amherst has nothing to fear.

Hmmm…so the Hadley Planet Fitness, open less than a year, now has more members than the entire population of the host town?

Back when I was avidly competing in karate tournaments I noticed, when reading the write up four or five months later in the trade magazines, that promoters of events I attended would exaggerate (routinely doubling) attendance.

After all, it sounds a lot better to say this or that “championship” attracted 1,000 competitors rather than the actual 479 or so.

And when I became politically active (also a long, long time ago) I noticed that folks who staged media events for their cause also tended to exaggerate—by about the same percentage—attendance figures.

After all it sounds a lot better to say one million folks showed up for the ‘Million Man March’ than to admit only 250,000 felt like marching that day.

Five years ago the Amherst Finance Committee (with not a single business owner part of the makeup) in defending the Cherry Hill Golf Course pointed out that no other municipal recreation business in Amherst (soccer, swimming, basket weaving, etc) could generate the $250,000 the golf business took in the previous year.

Of course they forgot to mention that previous year it cost taxpayers a little over $350,000 in overhead to get those “golfing bodies in the door,” or a taxpayer subsidy of over 33%.

So yeah, if you want to “sell” $10 bills in town center for $7--you will have tremendous unit sales.

Charles Ponzi and Bernard Madoff were also pretty persuasive.

Anonymous said...

Mmm...good point, Larry. You didn't answer my question about Joanne DeLong.

I wonder if Pete ever worked out a deal with Lia and the old Price Chopper building in Noho.

LarryK4 said...

Oh thanks, you want me to mess with Joanne Delong. She was the attorney for the Amherst Redevelopment Authority for almost a decade and we actually passed up using the town attorney because my Chair described her as a “pit bull”.

Of course nobody ever described her as a fitness fanatic.

Well, the Coppermine never opened in town center in the business condo Ms. Delong owned that was formerly the infamous "Pruddy's Bar and Grill" where she was both Prudy's landlord and attorney for the firefights with the town that they eventually lost.

A mysterious fire that almost took out the entire building put a damper on the Coppermine's Grand Opening. I believe the problem was traced to “faulty wiring”.

Interestingly my licensed electrician once mentioned that his company had to step in and redo electrical work at Golds because they had used an unlicensed handy man prior to opening.

I’m not sure if she is still involved as a partner or not. As I said earlier, Pistol Pete is the only name on the legal papers for the Greenfield branch.

Obviously he never worked out anything to open in the old 'Hill and Dale Mall' in Northampton, located about 100 yards from Northampton Athletic Club, which would kick his ass.

Anonymous said...

So if they really have only 3,200 members that's only $32,000 a month. Not bad.

LarryK4 said...

NOW you're starting to get it there genius; you should be on the Amherst Finance Committee.

Their expenses are $50,000 per month! Is that math simple enough for ya?

Anonymous said...

So they're running a deficit of $18,000 a month? You really think so?

Anonymous said...

Larry,

Somehow I doubt that people who are running a big deficit each month would be opening up new clubs and paying additional franchise fees.

LarryK4 said...

And they owe it all to that Italian immigrant, Mr. Ponzi.

As the old saying goes "There's nothing new under the sun".

Or better yet: "If it sounds to good to be true..."

Anonymous said...

Yeah, I don't know how they can afford to hire a cleaning crew to clean the Edge every night. This is an expense that AAC obviously does not have. It would have been nice if the AAC was cleaned once a year. Once I did a test - I wrote a date on a scrap of paper and put it on the floor. 7 months later it was still there. I enjoy the cleaner and cheaper golds/ edge. I don't really care if they are about to go belly up any day now... any day now ...

Anonymous said...

Bob does a really good job of cleaning Gold/Edge. He's there every morning at 8. Pete "grew up" in the Boston area Gold's and learned from day 1 that cleanliness is paramount to success. The availability of treadmills, and a good variety of exercise classes. He thought about putting in a pool early on but realized the expense outweighed the profit.

Expenses at Gold's are nowhere near $50k a month. The franchise fee to Gold's was the highest expense next to payroll. If Joanne Delong is no longer with the company, then the payroll covers Pete, his wife Megan, the morning and weekend supervisors, Bob the cleaner and part-time workers. They 1099 the rest of the folks that work there.

Anonymous said...

Larry,

You've got a nice little business. Don't diminish it by being jealous of others success.

LarryK4 said...

Actually the 50-K overhead refers to Planet Fitness (rent alone is close to half that) Yeah, I just love the cleanliness talking point. I would love to follow around the anonymous nitwit and peruse his car or apartment to see just how clean he is personally. People who want Champaign service for Piels Beer prices also want cleanliness standards higher than their own personal ones.

No, I’m not jealous in the least of either Planet Fitness or Golds Gym—you know the successful ones (although they seem to have a high rate of turnover with their Corporate CEO and now have a guy with no fitness background but worked for Johnson and Johnson)—or even the little old “Leading Edge”. I guess it depends on how you define “successful”.

And I have nothing but good things to say about my real competition going on 27 years now—Hampshire Athletic Club (formerly Hampshire Fitness.)

As I said before Perry Messer is the most experienced club manager in the Valley (probably starting in the industry before Pistol Pete was born).

I meant to upload a fews days ago when the Gazette put a large photo on Page One of a scuba diver retro fitting the pool at Hampshire Athletic in time to keep it open while all the other municipal ones around now have to close. I knew a month ago that Perry would figure out a way to make it happen.

Underscores once again the BIG difference between government run “business” and the private sector.

Anonymous said...

I'll give you credit for not asking for a bail out!

Anonymous said...

I am a long time on/off YMCA member, but was attracted to the Leading Edge because of their price. I am ashamed. Everything is really old, just as someone mentioned, they have billed me wrong on numerous occasions, and for over two months I was swiping my membership card only to find out it was never even activated. I hate it, and want to be back at the YMCA!

LarryK4 said...

Yeah, and I'm sure they were slick enough to sign you up for an IRON CLAD 12 or 24 month EFT

The BIG mistake Planet Fitness in Hadley made was to make the contracts non-binding.

I've picked up a few of their members who said they were able to break the contract (although I did warn them to watch their credit card statements for the next few months.)

Anonymous said...

This summer to attract members and better compete with Planet Fitness, the "Leading Edge" dropped its membership fees to $19.99/month with no commitment. What a bargain. New members could join at that price, and existing members who requested it could be switched over (for a $199 fee! Ouch!). Now, however, the Leading Edge has realized that they can't really afford all these inexpensive membership and/or that they are not making enough money anymore. The Edge has been offering 30+ classes a month, all with the price of a member. However, they recently issued a memo indicating that effective 11/1/2009, any member taking a yoga class at the club would have to pay a $4 per class or $20 per month ($15 EFT if they sign up by 11/1/2009). The memo told members that they would actually be saving money with the new yoga fee because many long-term members have been paying more than $19.99/month and $19.99 + $15 is less than what many members have been paying currently. Sounds like some funny math to me. The Edge has 12 yoga classes a week. By starting to charge for all the yoga classes (& not just occasional specialty classes), the Edge has started down a slippery slope. How long before the club starts charging members for spinning classes or body step classes, for example?! Maybe not that long. Now that the new UMass athletic center has opened, and all UMass students can use it and take classes there for free, I can't imagine that the Leading Edge wouldn't begin losing many student members, and then look for more ways (i.e. more fees) to recoup that lost revenue. I have been an Edge member because it is convenient to where I work and live and because it offers limited childcare (which used to be better!), but I am thinking it is time for a change.

LarryK4 said...

Yeah, as this Collegian columnist pointed out recently (and he does not strike me as a Yoga type) The Leading Edge (formerly knows as Gold’s but could no longer afford to pay the franchise fee) “has always had an affinity for nickel and diming its members.”

http://massdailycollegian.com/2009/09/29/recreation-center-makes-umass-less-of-a-concrete-jungle/#comments

A few months from now they will be toast (whole wheat with no butter of course)

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