I warned people on January 15, well before coronavirus, that 24hr Fitness would be going out of business for the three clear reasons I outline in that article:
- Steep discounts on long term memberships is always an indication of a gym about to go out of business and their 2year memberships sold at Costco were a sign.
- Their bonds became nearly worthless as investors realized the deep financial trouble they were in. Their bonds traded at 44 cents on the dollar.
- Gym maintenance stopped years ago.
Coronavirus is NOT the reason that 24hr Fitness went bankrupt, its a convenient excuse. The slimy 24hr Fitness management has a habit of lying just as they did when they claimed they were eliminating towel service to “save the planet”. All their financial problems existed before the epidemic and they were all problems caused by managements greed and bad business decisions. Coronavirus had nothing to do with them declaring Chapter 11 bankruptcy, they would have anyway. It takes a lot of nerve to take millions of dollars of the CARES Act funds to line the CEO’s pockets THEN turn around and declare bankruptcy.
When I did my video about their Chapter 11 filing I got a good laugh at the number of people who minimized what had happened at 24hr Fitness making it sound like something that all businesses did using such euphemisms as “re-structuring” and “reclassification of assets” – no, it was corporate greed and mis-management long before the virus.
Classic corporate greed and mis-management at 24hr Fitness
What 24hr Fitness did was a classic example of corporate greed. They made bad and risky business decisions to try to get really rich, really fast … and lost. They are not going to suffer, their creditors and members will. A hundred of their gyms have closed and many of those people have no other local 24hr Fitness gym where they can use their multi-year memberships so they paid good money and now have no gym to use. All the companies owed money by this poorly run gym will be out of luck and will only get a fraction of what they are owed from the bank to the locally owned HVAC company who did not get paid for replacing their air conditioner.
Yes, some of the 24hr Fitness gyms will remain open. The thing is, if they did not maintain them before what do you think the chances are they will improve now that they are tightening their belts? Zero. They are poorly managed and will continue to be after the restructuring. They will continue to rot and reduce benefits. They already took towel service away “to help save the planet” which is really funny because they still require members to bring towels so just as much washing is taking place. Whats next, closing the pools and steam rooms to “conserve water”?
Best gym workout options
Home workouts are what I prefer and have been promoting since 2005 but they are not for everyone. If you need a gym, please find a locally owned gym. Often these local gyms are owned by powerlifters or bodybuilders and they have a great community vibe. They might cost more than the big box gyms but they are loyal to their members. During the epidemic, I know of several gyms that allowed members to borrow equipment for home use and others that set the equipment up outside in the parking lot so that members could still workout. Just remember, you get what you pay for! The best gym I have ever been to is Das Gym in Vienna Austria and it is owned by two brothers, one is a bodybuilder and one a powerlifter. It used to be that the Golds gym in Venice was the mecca of bodybuilding, now is Das Gym in Vienna.
If you must join a big box gym in America, please follow these rules:
- Never, ever pay for more than one month in advance because if they offer this, its a sign they are poorly run and at risk of bankruptcy. No year memberships. No “lifetime”memberships. Month-to-month or nothing.
- Do not sign any contract that commits you to more than a month. Some gyms are month to month but insist you sign a year contract. F-that.
- Do NOT pay any up front fees. Dont pay “initiation” fees, or “processing” fees. When you walk into the gym that charges $20/mo then $20 is all you should pay for the first month.
The reason for these rules is because this corporations only care about quarterly profits. If they can make more money by declaring Chapter 11 like 24hr Fitness did, they will do it in an instant and screw you over. By making sure you never have paid more than 30 days in advance, you virtually eliminate the chance they can screw you over. If you follow these rules, the most they will ever bilk from you is 29 days of gym time.