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When competition is unhealthy

Curves, the newest gym on Gorham Road with owner Leslie Veney .

Changes are afoot in Hamilton's fitness sector with one owner pondering quitting the Island altogether, another looking for a new home and still others looking to the future in the face of increasing competition.

Rumours continue to fly about Brunswick Street's Total Fitness Centre despite the fact the company has posted a statement at its door and also addressed its members directly.

General manager Misty Looby said: "To dispel the rumour that we are closing down, we are not. We are looking for a location but we are definitely not closing down."

It is, however, true that her company was in talks with Magnum Power Force Gym, but that is true no longer.

Ms Looby said: "We were talking with them because at that time we were looking to find space for the lease that we had here, but going forward we found it would be better to stand alone."

Ron and Karen Magnum, who own Diet Centre and Magnum Power Force Gym, are however still exploring their future as owners of their Front Street gym.

Mr. Magnum said the talks with Total Fitness were about a merger or a total buyout of his gym "because we actually do want out. We want to move to another location somewhere else".

He said that he and his wife were "slowly thinking about what we want to do right now before we make a decision" because "we have a good clientele and the gym makes a lot of money every single year."

Mr Magnum said: "A lot of people just do this for a couple of years, ten years if they are lucky, 15 years if they are luckier. I've been doing this for over 35 years and I'm tired. I want to do something else. I want to possibly even move somewhere else, start all over again with another health and fitness facility."

Scott Stallard, owner of The Olympic Club, is intent on staying in the business even in the face of growing competition. He has seen many gyms enter the market over the years.

Allan Crockwell most recently opened the women's only gym Contours, but more and more exempted companies are also draining the market by opening their own private facilities.

"It is like the airline business because sooner or later people are going to go out of business because they are diluting the market too much," Mr. Stallard said.

"We have already been vastly diluted by the exempted company gyms who have taken a lot of business from the local gyms so now you are reduced to a really finite number of people here and every gym that keeps opening up, they dilute the other gym's business enough that it puts everybody at the break even point."

Mr. Stallard said that when his club lost a single company to an exempted company gym last year, it cost "probably $30,000-$35,000".

"That is you're just losing one company and so we are finding ourselves trying to compete with big exempt companies who can afford multi-million dollar gyms within their structure and that is certainly going to hurt local health clubs especially our health club which we built up to size when it was very busy," he said.

Mr Magnum also expects the gyms to be affected by the increased competition.

"I believe that if somebody was smart they would merge with another company," he said.

Joanne Bielby, operations manager of The Athletic Club, was less concerned about competition because she said there were more and more people wishing to get fit.

"Some of the exempt companies have gyms however some of the people who work at those companies still use our facility and I'm sure that is the same with the other places because of the fact that some people don't want to work out where they work because they want to get away from work. We also have corporate wellness programs with some of the companies where the company pays for the person to use the facility."

Mr. Crockwell opened Contours last summer after he had to move his Posture and Pain Clinic out of the Imperial Building which was being knocked down. The clinic's new space in Cedarparkade Centre happened to be big enough to also accommodate a small gym.

"It is not just another gym. It is a women's only gym. I don't think women needed their own gym, but there were some who didn't feel comfortable training around the male gym buffs," he said.

He agrees, however, that competition may force gyms out of business or into mergers.

"That is a strong possibility at some point in time. The amount of facilities that are offered will be more than the amount of people that are available to use them or are really into fitness," he said.

Contours prices are now the lowest in town, partly because its overhead is low because it shares the space with the clinic. As for whether added competition will lead to others to drop their rates, Mr. Crockwell thinks that given the overhead in Bermuda, gyms may instead have to bring in customers by offering improved services. "They still have their overhead, they can't afford to drop their prices," he said. "It is expensive to operate out of Hamilton. People have to charge what they do."

The Olympic Club is one that has taken steps to improve its offerings. While it also has low overhead because it owns the building, Mr. Stallard has cut out extras such as towel service to keep prices down. He has also constructed a climbing wall to attract a new type of client - those aged 6-14.

"We said let's go after that lot and give them something constructive to do that is fun and it has proven pretty worthwhile and at the same time when they come in, parents come in with them and the parents see the gym and it promotes each other. We also get lots of members from other gyms who want to come and climb so they want to joining this gym."

His is not the only gym to report new membership interest. As is the norm, all the gyms are seeing an influx of people intent on fulfilling their new year's resolutions to exercise. In fact, Ms Bielby reports that her club is so near capacity they may soon have to put a hold on offering new memberships.

"We've had a steady influx of members all throughout the year, we never had a quiet time this year so whether we're just above the competition or whether the companies are paying employees to come, I don't know," she said.

Ms Looby points out that each gym has a different niche to fill although smart consumers will be seeking the best value at the best price.

"There are 70,000 people on this island and not all of them are going to go to one gym. Not all of them are going to go to exempt company gyms and not all are going to go to larger gyms. There are still smaller gyms around and each gym, each health club, each wellness centre offers their own niche. Its up to the individual and 70,000 people account for a lot of different tastes."

As for her own gym, Ms Looby said that they still have some time under their belt to work out the move. "Total Fitness has experienced a setback with the eventual move but it shouldn't be counted for a loss, only for a good new year if anything in 2005/2006," she said.

When the move does happen, the plan is to have enough time to set the gym up and move over clientele and everything else in a "very timely fashion".