BIG JIM'S Gym

 

BIG JIM’S Gym  Gym  PROBLEM STATEMENT The number of memberships has dropped from 500 to about 300 in the last six months, and profits have dropped proportionately. SWOT ANALYSIS Strengths:

  Low turnover of employees; loyal and committed employees despite their

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salaries being slightly more than minimum wage   Full utilized capacity of the gym   Established name/reputation considering that Big Jim, the owner, has been in the body-building business for many years   Has separate facilities to cater to both men and women

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Weaknesses: 

      

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Spartan atmosphere Uniform/inflexible approach/introductory course for all customers Uniform/inflexible Lack of expert employees such as beauty consultants, masseuses and trainers Lack of diverse and sophisticated equipment/facilities

Opportunities:   Win back lost customers   Attract new customers 

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Threats:   Existing competitors such as Glendale Athletic Club with several more advanced equipment/facilities and certified/expert trainers and beauty consultants 

ALTERNATIVE COURSES OF ACTION 1. Increase Membership Fees Pros: -  Increase in membership fee revenues will compensate for the lost profits. -  Increase in fees may be used to purchase equipment or hire certified trainers to improve quality of services. Cons: -  Due to the increase, current customers might be discouraged to renew membership and eventually transfer to the other competitors with better

 

equipment/facilities and more certified trainers/consultants. These charge fees at par with Big Jim’s gym.  gym.   -  Increased membership fees will not be attractive to new customers considering the competition. 2. Invest in equipment/facilities and trainers/consultants Pros: -  Diverse and better equipment/facilities and certified trainers will not only help bring back lost customers but will also attract new ones o nes especially females. -  These will aid Big Jim’s Gym to be at par with its competitors in terms of services. -  These may justify increase in membership fees (premium) in case Big Jim’s Gym decides to raise fees in the future. Cons: -  Costly as it is capital-intensive -  Certified trainers or beauty consultants may demand and be granted withabove average rates and as a result thereof, current employees, earning slightly higher than minimum wage, may become demotivated and eventually resign .