Summer arrives and gyms turn into post-apocalyptic movie sets. Cardio machines sit empty. Weights lie unclaimed. Yet, the monthly fee still arrives punctually in your bank account. Why doesn't this industry adjust prices when demand plummets? We analyze the reasons behind this seasonal phenomenon. 🌞
The business model that doesn't understand seasons 💸
The key lies in lock-in contracts and fixed cost structures. Gyms sign annual leases, pay staff year-round, and maintain equipment that depreciates. With 70% of their costs being fixed, they need stable revenue. Additionally, many users forget to cancel or don't want to pay penalties. The recurring billing system, designed to maximize income, doesn't distinguish between January and August. It's a rigid subscription model where those on vacation pay for the air conditioning of those who stay.
The myth of the low-cost membership for your personal clothes dryer 🏋️
The funny thing is, you pay religiously so that four anonymous heroes keep the place alive. In July, those loyal members have the gym all to themselves. They go, sweat buckets, and return home thinking they've outsmarted the system. But the real business lies with the absentees. While you're drying off in the sun at the beach, your fee is paying the air conditioning bill that cools that small group of brave souls. A kind of involuntary crowdfunding for summer fitness.