A Special Thanks
December, 2024
Dear Members,
As we wrap up another Thanksgiving holiday, I want to tell you a story about something that happened about 5 years ago that made it very unlikely that I would be writing a letter like this today, something that I am very thankful for.
At the end of 2019 it was determined that we needed a new air system for our Cycling Studio and a new Heating, Ventilation and Air Conditioning (HVAC) system for Studio Y. We had made some earlier changes to the Club, which required that the Cycling Studio air system be changed to take air directly from outside the building instead of drawing fresh air up from the stairway. The Studio Y HVAC system needed to be moved. The move would be expensive. The existing system was old and might not survive the move. With that in mind, we determined that it would be a much better idea to replace the old HVAC system with a brand-new unit. To install new air systems, new duct work was needed along with construction of a new mechanical closet to house the new systems. This whole endeavor would cost the Club about $100,000.
Installing the new air systems would most likely cause each Studio to be closed while doing the work because of the extent of the changes.
We were working on planning these projects at the beginning of 2020 when COVID showed up.
On March 16, 2020, all retail businesses including health clubs were closed by law because of COVID. At first, we thought that the closure might last a few weeks or even a month, but then the realization set in that it could go on for a very long time.
With the club completely closed, it was a perfect time to get started on all these messy construction projects in hopes of having everything completed when members were allowed back into the Club.
It was at that time, a day in April of 2020, that I took a hard look at the financial situation I was in. The result of that analysis was a compelling reason to close down BHC completely and end the business.
How could I afford to pay the $100k in needed improvements without any money coming in for the foreseeable future? I would be committed to paying for this once the work got started. The next tenant could deal with this. We had some cash left in the business, but that would be drained in a number of months by paying for the employee health plan we had put in place in 2018.
Staff were currently well taken care of with the enhanced unemployment plan immediately put into place for COVID and I believed that they probably would not have a club to come back to anyway.
I had just turned 65 and I was thinking about how long (in years?) it would take to come back from this COVID disaster if ever. At this point, I would be taking funds from my retirement in a very big gamble. Would I ever see those funds again?
The equipment we had was now in high demand and selling it would probably bring in more cash for the health plan and to cover other costs of closing down the business.
The decision to close would be very sad because of all the happy memories associated with the Club, but what could people hope for? The way things looked at the time, we would never recapture what we had lost in the future anyway.
As I quietly started the plans for closing things down for good, I looked at a sales report for the period that started when we closed in March. Naturally, I did not expect much. I do remember someone asking how to give us a donation on the day we closed. We set up a way of doing that on our website, but I did not think about checking on it with everything else going on.
What I saw was something that really made me stop and think about the decision to close the Club. Remarkably, 162 different people had made donations to the club in the 30 days since we had to close the club in March.
The total donations were a fraction of what we would normally receive in membership dues, but still a significant amount and the message I received was clear. BHC was a very important place for these people.
So what could I do? I couldn’t spend the donation money if I was closing the place down. So did I need to refund their donations?, and tell these people that I was giving up on the Club? As I continued to weigh my options in the following days, more and more of these donations came in.
Then Karen Gamble, our Class Director at the time, figured out how to put 50 of our classes online. (We had 118 classes a week prior to COVID.) Our members could attend them from home and keep classes (and some membership dues) as alive as possible during COVID.
Then Adriane Ball, our Operations Manager at the time, worked out a way to run a rental program for our equipment (mainly dumbbells, of which we had several hundred) to members with the “rental” amount being the same as our membership dues.
These innovations pulled me into a positive flow and stopped me from thinking about how to close the club. From that point on, I took things one day at a time and every day got a little bit better than the day before. We completed the work on the new air systems in the first few months after the initial closure.
Since then, It has been a very slow and steady return from the dark days of COVID almost 5 years ago.
I am very happy to state that our business so far this year has been the best ever in the history of the Club. That success has allowed continued investment in the Club with new equipment and upgrades as we have all seen this year.
I give my sincere thanks to those 162 people that helped change my mind back in April of 2020 and to everyone else who continued to contribute to BHC that fateful year to keep our Club alive to survive to this day.
Happy Holidays and THANK YOU for being a member of Ballard Health Club.
Sincerely,
Pat Gilbrough
Owner, General Manager
Ballard Health Club
pat@ballardhealthclub.com