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Recession sends health clubs into a slump as customers cut back instead of pump up.


Profits have gone flaccid flaccid /flac·cid/ (flak´sid) (flas´id)
1. weak, lax, and soft.

2. atonic.


flac·cid
adj.
Lacking firmness, resilience, or muscle tone.
 at Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850.  health clubs in the past 18 months in part because members, particularly downtown executives and attorneys, have been laid off or transferred due to the lingering recession.

After a 1980s boom, some clubs have gone out of business and some have closed branches. Others, though revenue declined at some locations, are expanding in hopes the economy will soon recover and Los Angeles residents once again will spend anywhere from $15 to $300 per month to keep in shape.

"Every sports club A sports club, athletics club or sports association is an eclectic institution oriented to multiple sports, which fields many teams and has varied sports departments in several sports, working under the same umbrella organization.  and gym I know of has been affected by the recession," said David Geyer, membership and marketing communications Marketing communications (or marcom) are messages and related media used to communicate with a market. Those who practice advertising, branding, direct marketing, graphic design, marketing, packaging, promotion, publicity, sponsorship, public relations, sales, sales  director for the Los Angeles Athletic Club Los Angeles Athletic Club (LAAC) is an athletic club in Los Angeles, California, USA. It awards the John R. Wooden Award to the outstanding men's and women's college basketball player of each year. .

Membership at the Los Angeles Athletic Club, which traditionally had operated at near-capacity, started slumping in mid-1991 because of layoffs throughout the business community, members moving out of town and a general reluctance to spend hundreds of dollars a year to belong to a health club. The club waived the customary $450 initiation fee from Nov. 15, 1991, to Jan. 15, 1992. The club now has grown to over 5,000 members.

The 110-year-old Los Angeles Athletic Club, owned by Los Angeles-based LAACO LAACO Los Angeles Aircraft Certification Office (US FAA)  Ltd. that also owns the California Yacht Club, is frequented by downtown attorneys and businesspeople. Aside from 72 guest rooms and four restaurants, its 12-story building, 431 W. Seventh St. offers an indoor Olympic-sized pool, traditional resistance machines and free weights. The club has a staff of trainers, exercise physiologists and fitness instructors.

Nearby, the Los Angeles YMCA YMCA
 in full Young Men's Christian Association

Nonsectarian, nonpolitical Christian lay movement that aims to develop high standards of Christian character among its members.
 also has many upper-level managers and attorneys as members of its downtown health club at the intersection of Fourth and Hope streets. But gym membership has dropped to about 4,775 now from 5,375 in 1990. With gym fees tabbed at $550 per year, the exodus took away about $330,000 in revenue, said Los Angeles YMCA Executive Director Mark Young.

"Sixty to 75 percent of the members who left were transferred. The rest said they couldn't afford to keep up their memberships or that they didn't have time to work out," he said.

Unlike other workout facilities, the YMCA offers a financial assistance plan to members who can't afford to pay the full membership price, Young said.

Bucking the downtrend downtrend

A series of price declines in a security or the general market. Many analysts feel that investors should avoid securities in a downtrend until the pattern is broken. Compare uptrend.
, he said, the YMCA has started to develop programs with downtown building owners and businesses to bring exercise classes into the work place.

"We are providing on-site stress management programs that include light exercise classes as well as weight management," Young said. IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) , Maguire Thomas (which owns many downtown office buildings) and First Interstate Bank are using the YMCA programs, he said.

Membership also has declined at Beverly Hills-based Beverly Hills Beverly Hills, city (1990 pop. 31,971), Los Angeles co., S Calif., completely surrounded by the city of Los Angeles; inc. 1914. The largely residential city is home to many motion-picture and television personalities.  Health and Fitness Center, especially in the past nine months, said Michelle DiGiulio, an administrative assistant for the seven-year-old health club.

To counteract that the club has decreased the monthly membership from $29 to $25 and have reduced the annual renewal rate from $99 to $49.99, DiGiulio said.

Los Angeles-based Sports Club Co. Inc. operates clubs such as the Sports Club Los Angeles for members who want a full-service atmosphere, the Spectrum Clubs, a slightly less opulent setting, and the more plentiful Sports Connections, which attracts a more cost-conscious crowd, said Nick Taylor, regional general manager for the Sports Connections.

"Because of the diversity offered by our different types of clubs, we tend to tell ourselves we're recession proof," Taylor said.
COPYRIGHT 1992 CBJ, L.P.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:Special Report: Health Care
Author:Hathcock, Jim
Publication:Los Angeles Business Journal
Article Type:Industry Overview
Date:May 11, 1992
Words:569
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