Simple Strategies To Exceed Your Financial Targets Year On Year

Duncan Jefford is a Regional Director with Everyone Active, a leading leisure operator managing 150 leisure facilities nationwide. Over the last decade Duncan has been instrumental in the company’s extensive growth, increasing the number of operational sites five-fold and growing turnover from £30m to £155m. We spoke to Duncan about:

– Successful budgeting and target setting
– How to make your facility more profitable
– The golden rules of generating profit


What’s your approach to budgeting and target setting? What are the most common mistakes made by operators?

You shouldn’t underestimate the value of historical data. Some operators prefer a zero-base budgeting model, particularly when taking over an existing site, but old data is packed with insight, even when a facility is underperforming. Mine your data closely and use what you learn to ensure your budgets are realistic. Setting idealist budgets is a common mistake as they lead to failure and a disengaged workforce. My approach is to set an achievable budget as well as an over-achievement budget which is incentivised to inspire success. Budgets should never be solely the realm of the financial director. It’s crucial to involve your operational team in the budgeting process to garner complete buy-in to the process. Finally, you should never rush to set budgets, I allocate six to eight weeks to ensure it’s done properly.

“Setting idealist budgets is a common mistake as they lead to failure and a disengaged workforce”



Do we need to look beyond the capabilities of the membership sales team in order to create a profitable club, and does everyone in the organisation need to be selling within their role?

Above all, everyone on the team should be contributing to the creation of the experience. Whether they are a receptionist booking a member in for a PT taster or a lifeguard answering a question about swimming lessons, everyone is contributing to driving a member towards a product or experience. Essentially, the whole team should be selling across the business but the nature of ‘selling’ will vary depending on the role. Training is key in focusing your team to consider their role in the sales process and ensuring a joined-up approach across the business. Allowing enough time for this is key; we offer 1000 days of colleague training each year.

How important is a motivated workforce in hitting targets, and what’s the best way to motivate teams to reach targets?

A motivated workforce is the most important tool a company has when it comes to hitting targets. There are various ways to incentivise your team but in my experience, financial bonuses are the most effective in motivating and retaining staff.

Typically, what areas of a health and fitness facility make least profit and how can this be addressed?

The two biggest areas of opportunity are retail and swimming and almost all operators could grow revenue here. Most retail goods offer a strong profit margin but operators tend to offer too small a range and hide it behind reception so it makes little difference to the bottom line. Many are concerned by theft but in my experience sales of well displayed merchandise significantly outweigh any loses. Attractive retail displays which allow members to touch and feel goods will see a substantial uplift in sales.

Revenue from swimming can be maximised through additional swimming lesson provision. Get your timetabling right and every facility should be able to cater for lessons for all age groups. When it comes to pool refurbishment or creating a new facility consider that 75% of swimming income is derived from shallow water.

“The two biggest areas of opportunity are retail and swimming”


If you had to write three golden rules of creating a profitable facility what would they be?

– Get the right team in place, skill set is important but they also need to fit the culture of your organisation.
– Set realistic achievable targets which everyone has bought into.
– Remember the customer is king, deliver the experience they are expecting.

Can profit come at the expense of quality and service and how do you ensure you are always striking the right balance?

To begin with any business can cut corners and still make a profit, but this gets harder to sustain as time goes on. Reputation will worsen and your member churn will increase making it harder to attract new members from the local area. A successful long term profit strategy would recognise the importance of maintaining high levels of customer experience coupled with reinvestment.

These rules apply whether you have one site or 100; continual reinvestment is critical to the futureproofing of your facility. Commercial capital expenditure should provide a direct return on investment over a four to seven year period. Items like new fitness equipment, although still cap-ex should be considered to be essential to retention and therefore budgeted for accordingly.

“A successful long term profit strategy would recognise the importance of maintaining high levels of customer experience coupled with reinvestment.”


How important is it to have multiple revenue streams? Do you need to be mindful of constantly asking members for money?

Adding new revenue streams makes business sense but first and foremost you need to look after your main income lines. We have two main lines making up 90% of our company revenue and you can’t afford to get that wrong. In terms of asking your members to commit to further spending, you have to be smart. If you can communicate in a way that’s not considered spam you can continually market additional products and services without losing their attention.

How much us brand health linked to profit?

Locally it’s crucial. The local market is more competitive than ever with 1000 new budget gyms opening in the last five years. Local authorities are also building more facilities and a town that previously had one gym may now have several. Good local awareness and reputation is essential to hitting financial targets. Nationally, I believe brand health contributes to overall business growth.


What is your view of consistency versus adaptability and their role in profit?

We set budgets based on existing market factors. Whilst it’s important to maintain a consistent approach, if those market factors change then you must be able to react. Contingency budgets are crucial to an agile response. If a new facility opens in your catchment area for example, then a strong response is needed to ensure it doesn’t affect your targets. Having marketing budget available will allow you to avoid a price war.

How important is retaining up to date market knowledge in maintaining a profitable business?

Market research should be a continual activity within any business. Locally we mystery shop competitors at regular intervals, and update latent demand and socioeconomic data every two years. Many operators will do this once but it needs to be an ongoing process. Nationally we ensure we have colleagues at all the key events, talking with all suppliers, so we understand market direction and innovation and are able to make the right decisions when it comes to reinvestment.

“Market research should be a continual activity within any business.”


Posted in Gyms & Clubs, Interviews, Most Popular Interviews, The Fitness Network.