Niki Rein is the founder of Barrecore, one of London’s most successful boutique fitness offerings. Niki opened her 10th London studio earlier this year and the brand continues to go from strength to strength. We caught up with Niki to seek valuable insight into successfully scaling your fitness business.
Take us back to the beginning of your expansion journey? What decisions did you make in the early days?
I opened my first studio in Chelsea in 2011, and really just filled it with my pre-existing clients. Barre is a relatively inexpensive concept to set up and we were turning a profit within a few months, despite doing no marketing whatsoever. The classes quickly became over-subscribed but we looked at reconfiguring our existing space rather than finding a new or second site at that stage. I felt it was more important to create an efficient, profitable studio and blueprint model before considering expansion.
Can you remember the journey to your second site?
I wanted to find a facility in an area with a similar demographic to our Chelsea clientele so I looked in Mayfair and Notting Hill. The boutique market was still very young and I remember that it was very hard getting estate agents to take me seriously; they didn’t believe that this could be a viable business! Luckily I persevered and found our Mayfair site which opened in January 2014. Ironically, we quickly discovered that the demographic was quite different to Chelsea; much younger and more price conscious with more working professionals. Luckily, we turned what could have been a negative into a positive by tweaking our offering for this new client base. It proved to me early on that our concept appeals to several demographics and can actually work in most areas.
What criteria do you have for a new site?
We look for an area that matches our core client demographic. We have found that areas with an office and residential mix create the healthiest studios because they get traffic at all times of day and week. Street front is a bonus but it’s not essential to us. Digital marketing, social media and Google maps all make it easy for consumers to find us anywhere and we see a more hidden location as adding to the exclusivity pillar of our brand. We will compromise on the physical space but not on the experience we deliver, so if we feel that any changes required won’t affect customer experience then we’ll go for it.
When is the right time to bring in a central team?
This is a great question! I know that I should probably have done it sooner. I think you can get away with two or maybe three sites before expanding your central team but any more than that then cracks will definitely start to show. Your central team is the nucleus of your business so getting these hires right is one of the most important decisions you will ever make. My advice is to hire slowly and fire quickly!
Have you ever been in a bidding war over a new site and what advice would you give?
Yes, we have and it’s not pretty! I would say it’s important to know your value, if you have a strong track record of trading and reported profits, use this to help you secure success over a younger business. Also, know your ceiling and don’t go above it as it will put unnecessary pressure on that particular studio but also the business as a whole.
What’s the biggest lesson you’ve learned along the way?
In the early days, I was definitely guilty of cutting corners to save time or costs which wasn’t always the right decision. I remember skipping the survey on one of our new sites which turned out to have quite a bit wrong with it. The cost, frustration, cancelled classes and unhappy staff and members quickly made me learn my lesson and now we take our time to consider all the elements before jumping into a new site.
How important is a private equity backer to expansion?
For the first 5 years of trading, we were self-funded but signed a deal with equity firm Octopus Investments in 2016. I remember being really nervous about the whole process but it has been absolutely the right decision for us. The real benefit has been having board members with such a vast amount of cross-sector business experience, it has had a huge impact on driving the business forward.
Do you think there is a magic number of sites for Barrecore or indeed any boutique business?
No. I remember thinking when I started out that I might have 3 or 4 sites but obviously we have significantly surpassed that! I think if it’s working and it feels right then you keep on going. Of course, your offering has to be really clear and the business model and finances in great shape, but once you have the magic formula, just keep going! For Barrecore we have no intention of slowing down, and actually, have our sights set on Europe in the not-too distant future.