Bally Total Fitness Bonanza Case
In your document, analyze and explain using ANY OR ALL models/material from the course:
a) What are the most important strategic issues that Bally Total Fitness is facing?
Strategic assumptions
* Health clubs would become more diverse as they catered to certain demographics or created niches for themselves. The next great bonanza has to be the kids”, baby boomers another “bonanza market” * The market will continue growing due to the concern about the health and well-being.
SWOT
Internal
Strengths
* Leading firm in 2004 in the U.S. Health Club Industry. * Boosted the accountability of club managers for profitability. * Begun to strength its internal control system (pricing and selling) * Commitment to …show more content…
Inhabitants are hard core fitness participants * 63% of the population “uninitiated believers” (prime target of growth)
Threats
Micro (Porter 5’s forces)
Opportunities
* Barrier entrance: Capital required to outfit a 40,000 square foot Health Club, USD 1.5 million with USD 500,000 in equipment alone.
Threats
* Intensified competition. Main one YMCA and Gold’s Gym, 24 hour Fitness and Curves international. Thousands of companies competed in the Health club industry. Studio-sized clubs that required minimal investment would continue to flourish. * US Securities and commission had begun to investigate Bally’s accounting procedures. * 30% of members failed to reenroll each year * Barrier entrance: Capital required to outfit a 40,000 square foot Health Club, USD 1.5 million with USD 500,000 in equipment alone. But with leasing only USD 25,000-35,000 of upfront capital. * Pay per visit was likely to become the norm at clubs. * Health clubs would become more diverse as they catered to certain demographics or created niches for themselves. The next great bonanza has to be the kids”, baby boomers another “bonanza market”
Strategic
a) What are the most important strategic issues that Bally Total Fitness is facing?
Strategic assumptions
* Health clubs would become more diverse as they catered to certain demographics or created niches for themselves. The next great bonanza has to be the kids”, baby boomers another “bonanza market” * The market will continue growing due to the concern about the health and well-being.
SWOT
Internal
Strengths
* Leading firm in 2004 in the U.S. Health Club Industry. * Boosted the accountability of club managers for profitability. * Begun to strength its internal control system (pricing and selling) * Commitment to …show more content…
Inhabitants are hard core fitness participants * 63% of the population “uninitiated believers” (prime target of growth)
Threats
Micro (Porter 5’s forces)
Opportunities
* Barrier entrance: Capital required to outfit a 40,000 square foot Health Club, USD 1.5 million with USD 500,000 in equipment alone.
Threats
* Intensified competition. Main one YMCA and Gold’s Gym, 24 hour Fitness and Curves international. Thousands of companies competed in the Health club industry. Studio-sized clubs that required minimal investment would continue to flourish. * US Securities and commission had begun to investigate Bally’s accounting procedures. * 30% of members failed to reenroll each year * Barrier entrance: Capital required to outfit a 40,000 square foot Health Club, USD 1.5 million with USD 500,000 in equipment alone. But with leasing only USD 25,000-35,000 of upfront capital. * Pay per visit was likely to become the norm at clubs. * Health clubs would become more diverse as they catered to certain demographics or created niches for themselves. The next great bonanza has to be the kids”, baby boomers another “bonanza market”
Strategic