Extract from job description
You are a Finance Officer for GymFit. Your main role is to support Steven Potter, the Finance
Manager. Your tasks include the production of the annual budget, producing the monthly
management accounts and providing information to management as required. You also assist
with the preparation of the financial statements and deal with any queries regarding financial
reporting.
Company Background
GymFit, is a fast growing, leading provider of low-cost gyms and one of the pioneers of the
low-cost gym model, which is based on relatively low gym membership fees and a ‘no-frills’
service concept. It now has 102 gyms with 486,000 members based in major towns and cities
throughout Celtland, Europe. The company was founded in 2005 using finance from venture
capitalist, Land Ventures. It is currently listed in the Celtland stock exchange and uses the C$
as its home currency.
The company has grown rapidly from sales revenue of C$17.8 million in 2012 to C$73.1 million
in 2017. The number of gyms it operates has also increased during the same period from 26
gyms to 102. The rapid increase in the number of gyms has been through a mixture of organic
growth and acquisition of existing gym groups. The company is now the 2 nd largest operator
of low-cost gyms in Celtland.
GymFit’s business model offers 24/7 gym operating hours and a no-contract membership i.e.
there is no fixed membership period. The high specification gym equipment used is eco-
friendly. In order to offer low membership fees, their model is based on a no-frills concept,
meaning that facilities are restricted to the gym equipment, there are no wet facilities e.g.
saunas or pools, and no café or bars that you would expect to find in a traditional health club.
The low-cost model used by GymFit is dependent on advanced technology. Prospective
GymFit members can join using a simple online process that can be completed in minutes.
Members can also manage their accounts, view class timetables and book classes online.
The use of technology results in an efficient staffing model with, for example, no need for
dedicated in-gym sales and marketing teams.
Membership
GymFit membership is on a no-contract basis i.e. it does not involve a fixed membership
period and members are free to cancel their membership at any time without penalty. There
are three types of membership: solo gym membership, where the member is able to access
only one chosen gym; two gym membership, where the member can access two chosen gyms
and bundle membership where the member can access gyms nationwide. These types of
membership require payment of a monthly fee. In addition, it is possible to access gym
facilities on a daily basis by purchasing a day pass. Membership fees vary depending mainly
on the location of the gym. Occasional marketing campaigns are run offering discounted
membership to all new members. Student members also receive a discount.
Each member is provided with a unique personal identification number (PIN) code which is
used to provide electronic access to the gym and its facilities.
Members have access to high quality fitness equipment, work-out areas and some free fitness
classes. Other classes such as Pilates, yoga and dance fit are available on payment of an
additional fee. All new members are offered a free induction session and these are provided
by the fitness instructors. The member can also, on payment of an additional fee, arrange for
individual coaching from a fitness instructor. These additional fees are paid directly to the
instructors and are a private arrangement between the gym member and the instructor. Other
facilities offered include showers, changing areas, lockers and vending machines.
The People
Staff
The average number of employees, during 2017, was 254. A typical gym has two employees,
a manager and an assistant manager, who manage the running of the gym. The remaining
staff are employed at head office in various functions including IT, HR, Finance and Marketing.
These employees are complemented by a number of freelance fitness instructors who are
hired on a zero-hours contract where the instructors are not guaranteed to be offered work in
any one week. The fitness instructors are paid a relatively low hourly rate but are able to
supplement their income with fees from individual coaching sessions.
All fitness instructors are trained fitness experts. Their main role is to assist members with
using the equipment, run induction sessions for new members, lead some group classes, and
provide general exercise and fitness advice. They are also expected to carry out simple
preventative maintenance and testing the equipment. They can generally resolve most of the
simple problems arising with the equipment, anything they cannot deal with is referred to the
contracted maintenance company. In addition to this, they also refill vending and water
machines and, where possible, attend additional training sessions related to equipment use,
fitness or health and safety.
Gym managers are empowered to independently run their own sites, including the setting of
membership fees, with bonus targets linked to gym performance. Other employees are given
competitive remuneration including a defined contribution pension scheme and the opportunity
to share in the company’s success through share incentive plans.
The need for reception staff is eliminated due to the use of the electronic entry system and the
online membership and class booking system, other staffing needs such as cleaning, security
and non-routine machine maintenance are outsourced which means that gym staff (managers
and fitness instructors) are free to concentrate on the core activities of the gym.
The Senior Management Team
The company’s senior management team bring to the company a wide range of previous
experience mainly in the leisure and retail industries. The team is relatively young, highly
enthusiastic and engenders a ‘can do’ culture throughout the organisation.
The details of the company’s executive directors are given below:
Bertram Durand (42) Chief Executive Officer (CEO)
Bertram was appointed as CEO in 2014 and brings to the
company extensive experience in the leisure and fitness
industry.
Nicola Collette (45) Chief Financial Officer (CFO)
Nicola was appointed as Chief Financial Officer in 2015.
She is a professionally qualified accountant. She has been
with the company since it started operations in 2005 and
was responsible for the company's flotation on the Celtland
stock exchange.
Jessica Treewood (38) Marketing Director
Jessica has been with the company since 2014. She holds
a BA in Marketing from Celtland University. She previously
worked as Marketing Director for a competitor company in
the fitness club sector.
Ethan Henson (38) Operations Director
Ethan was appointed Operations Director in 2016. He has
responsibility for the running of the gyms and the HR
function. He was previously a fitness trainer and has
worked his way up through the ranks of the company to
become Operations Director.
Gerard Fischer (46) Property Director
Gerard joined the company in 2011 as Property Director.
He is responsible for the company's portfolio of properties.
He is a qualified civil engineer and has vast experience in
property management mainly gained in the hotel industry.
Gemma Schneider (36) IT Director
Gemma joined the company in 2010 as an IT technician
and was appointed IT Director in 2017. She holds a MSc in
Information Technology. She is keen to further develop
GymFit's IT systems with the assistance of her team of
innovative and highly qualified staff.
Company Operations
The Gyms
Each gym has more than 150 items of high specification equipment and free weights for
members to use. The fitness equipment is eco-friendly with around 70% of
the machines using no electricity and are
powered by the user instead. Each gym
offers a range of cardio machines including
running, cycling and step machines and
weight machines of various types to help
flex every muscle in the body.
The low-impact workout areas give
members an opportunity to warm-up or
stretch out. Equipment available includes exercise balls and yoga mats.
Each gym contains studios for use by the fitness instructors when leading fitness classes
including yoga, Pilates and Dancefit. There are also showers and changing facilities available
and vending machines selling bottled drinks and other fitness related items such as sweat
bands, protein powder and health bars.
Information Technology (IT)
The IT department runs and manages the company’s website and is responsible for website
development. The company’s operations are driven by technology and the IT department is
constantly looking for new ways to utilise IT to improve the member proposition and to achieve
cost efficiencies.
GymFit offers a simple online joining process that requires a valid email address and other
personal data. Membership and class fees can be paid by credit card, debit card and direct
debit and members can manage their accounts, view class timetables and book classes using
computer, tablet or mobile. GymFit maintains a customer database which can be used to
communicate with members.
Gyms are open 24/7 but only staffed for around 16 hours of the day. The gyms have automated
access control and CCTV which is monitored on a 24-hour basis and is enhanced by the use
of ‘panic buttons’ throughout the gym. It is the use of this technology which enables 24/7
operation of the gyms whilst keeping costs low.
The use of technology also results in an efficient staffing model, with no need for dedicated
in-gym sales and marketing teams. The staffing model means managers are freed from many
traditional health club tasks and can focus on running successful gyms and serving the needs
of members.
The extensive use of information technology brings other considerations in terms of system
failure, data security and privacy. GymFit’s membership system, data processing, account
payments, gym access, customer safety and customer marketing, are all dependent on the IT
systems. The systems hold a significant amount of confidential customer data including
emailaddress, home address and bank details. A breach of data security would constitute a
significant risk to the company’s reputation and brand.
Marketing
The marketing team’s main activities are market research; the promotion and advertising of
new and existing gyms; raising brand awareness and advising on pricing strategies. The
Marketing team works closely with the IT and Properties department. Marketing efforts are
directed at both existing members, to try to ensure member retention, and the recruitment of
new members.
The marketing team uses the website to provide members with details of classes being
operated each week and any other news or member offers. The customer database is also
used to communicate electronically with members using email and SMS.
Regular marketing campaigns ensure that the awareness of the brand is high. A recent
campaign featuring a leading Olympic athlete, Johnny Wren, resulted in a 2% increase in
member numbers.
Finance
The financial information system produces monthly management accounts and both half-
yearly and annual statutory accounts. It also generates daily and weekly sales revenue and
membership number information for management to monitor actual results against budgets.
The Finance team also carries out ad-hoc projects including investment appraisal and
investigations, along with ongoing decision support. Some areas, including all internal audit
work, are delivered by external experts.
Budgets are produced annually using incremental budgeting for sales and cost items. All
budgets are broken down into monthly periods, with the exception of the sales budget which
is broken down into weekly periods.
Properties
The company has significant experience of developing and managing properties and has been
able to use that expertise and its close relationships with suppliers to reduce its fit-out and
property management costs.
Growth of the company is dependent on being able to find suitable properties for the new
gyms. The company has plans to develop between 15 and 20 properties per year. The
properties are leased for periods of up to 15 years.
Properties need to be large enough to accommodate the fitness equipment and offer studio
space for exercise classes. The ideal property is between 1,000 and 2,000 square metres,
over a maximum of two floors. Properties need to be either located within a dense population
catchment area to ensure sufficient potential local members or in highly visible locations with
easy car parking facilities or access to major transport hubs.