STEPPING UP THEIR GAME

After more than a decade on the scene, the future is looking bright for Stepz Fitness.

By Nick Hall

The home-grown health chain has built its reputation on 24/7 operation, but these days, quick and convenient is the name of the game.

With the explosion of functional fitness taking hold of the health and wellness space, more consumers are forgoing the big box gym in search of something more bespoke. For traditional 24/7 fitness chains, the reality is simple: adapt or innovate. “When I took over the franchise in 2017, I saw that there was a real need for functional, group training,” Stepz Fitness franchisor Sam Waller says.

“In the past, we just couldn’t deliver the volume of high results that we knew we were capable of in group training. This was a way that we could offer members stronger results, while creating a more highvalue environment.”

But unlike other chains that had been tackling functional fitness giants F45 and Barry’s, Waller knew he had to get the balance right. It wasn’t enough to just add a bolt-on to Stepz Fitness’s existing framework; the new model had to appeal to a high-value customer while simultaneously providing a profitable operation for franchisees.

What followed was nearly two years of extensive research and development, taking into account costs, format and most importantly customer demands.

HYBRID MODEL

To combat the evolving challenges of the fitness industry, Stepz introduced a hybrid format, offering functional and group training, alongside the brand’s established 24/7 model. “It just makes sense from a business perspective,” Waller says.

“The low-cost, high-volume of membership that has come along with increased competition in the 24/7 space was always going to be a challenge, so the new concept was a way to boost business performance from a high-yield perspective. We aren’t racing for the most number of members, it’s about providing a competitive, value-driven member offer, which is something the market really needs.”

While introducing a format that appealed to members was one challenge, making sure the new initiative was franchisee-friendly was another. Rather than have existing franchisees on the hunt for alternative locations or sites, Stepz redesigned the studio set-up, controlling costs and diverting space where needed.

“Existing gyms started their redesign this year, but going forward, the footprint will still be at around 350 square metres,” he says. “As opposed to getting a bigger site, we’ve redesigned the space, utilising 100 square metres for group training, where we only need around 220 square metres for the 24/7 model. This way, we run six classes a day, with the two models running as a hybrid. We’ve gone all in on group training.”

And while franchisees understand the need to innovate and adapt, transitioning an existing network of gym owners to a new format is never easy, or cheap.

Waller says the key to getting the network on-side was illustrating the benefits.

“It’s important to remember that we did this for the customer. As franchisors, we talk a lot about the business, but any good business should be driven by what the customers want. We understand that higher rates of interest and engagement on their behalf relate to higher rates of franchisee success.”

Launching an initial trial site at Penrith, in Sydney, Waller set the wheels in motion, performing a detailed assessment of how the venture was progressing. Once he knew the hybrid format could work, he brought it back to the network, figures and all.

“We worked alongside the franchisees to make sure that the redesign meets their budget and that they are ready for it,” he says. “At the end of the day, this was something that would benefit them; I showed them the numbers from Penrith to really get across how great the response from customers had been.”

In fact, in the months since Penrith launched, the response was so strong Waller found himself struggling to keep up. “What we’ve seen from a customer and new franchise perspective, is a far greater rate of interest and rate of adaption than we initially predicted,” he reveals.

“For example, the Dapto studio, which

launched in December, had pre-sales exceeding 100 members, the majority of which were through group training. The interest has been huge and I’m just trying to keep up with it all.”

It’s a hefty load to carry, but not one to shy away from change, Waller’s full-format revamp is just one element of a wider network restructure rolled out by the Stepz franchisor.

REBRAND

Waller reveals that once he started work on revitalising the offering, he realised just how much needed to be done on the brand itself.

“The 24/7 industry is extremely competitive, so for me, ever since I took over NSW I’ve been focused on creating a long-term outlook for the business,” he explains.

“The Stepz Fitness brand, like all brands, needed to be updated and now we have a branding that is more in line with who we are now and what our franchisees want.” But just like the new hybrid format implementation, the network rebrand needed to have merit among the existing network. Waller and the Stepz team embarked on an extensive in-house consultation where franchisees could voice their concerns, opinions, thoughts and feedback.

“I really wanted to create a branding that attracted people, attracted members and attracted more enquiries naturally, as opposed to a bland 24/7 box gym,” he says. “It’s really important to note that the new branding is based on the current group’s feedback. We did a big survey where we asked all our franchisees where they wanted to sit in the market, how they felt about group training and what they didn’t like about 24/7. We wanted to update and look at who we are, how we speak to our customers and make sure that we are offering a product that is in line with our values.”

The experience paid off. Aside from helping to more clearly identify the goals and objectives of the franchise network, the consultation provided a boom in franchisee buy-in. It’s a level of engagement and dialogue Waller has since encouraged, with somewhat surprising results.

GIVING BACK

When disaster struck the east coast of Australia in November, a number of communities found themselves in the warpath. Hundreds of bushfires blazed across the country, with homes and lives

under threat. However, as it often does, out of the tragedy came hope.

“When the fires hit, I saw something that I’d never seen in 10 years in the fitness industry,” Waller reveals.

Stepz Penrith franchisee had signed up to run a boot-camp fundraiser for local firefighters, but it wasn’t until Waller arrived that he understood the magnitude of the effort. Personal trainers and fitness professionals from across the area came together as one, regardless of brand or business, to help tackle the issue.

“Seeing all those brands come together for a good cause was amazing. It really sparked my interest to do our bit,” Waller says.

“We really want to be communityfocused and it’s our responsibility to help those in need, so it was amazing to have one of our franchisees join that cause all of their own accord. That’s something that we are really proud of.”

Following their lead, the franchisor jumped into gear, offering free memberships and programs for firefighters in the affected areas.

“We always encourage our franchisees to be active in the local community and stand up for the things that are important to them, but then to reach out and see if the franchisor team can support.

“There’s so many community-minded things that we can do, we want our franchisees to lead the charge.”

With a new brand and format under their belt, that’s precisely what Stepz’s existing and incoming franchisees plan to do.

FUTURE STEPZ

Under Sam’s watchful eye, all existing studios are set to be rebranded and reformatted to help increase franchisee profitability and cater to the emerging group training audience.

“For us it’s very important over the next year to have all of the support systems in place for our franchisees,” Waller says. “The new brand is just one small element of that, it really comes down to having a solid local area marketing and franchise marketing strategy established.” It’s full steam ahead for the Aussie success story, with Waller revealing expansion across the Gold Coast is the next step. But at the moment, the franchisor admits he might need a little help getting the ambitious goal under control.

“I’m in the process of adding new staff members and getting new people on board, because there are just so many enquiries,” he says.

“I really believe the new brand speaks to who are and who we want to be as a business moving forward.”n