ABC Fitness Solutions Unveils ABC IGNITE, Next Generation Club Management Solution

Revenue-cycle Management within the Health Club and Gym Space

By: Bill McBride

From: April 19, 2021 on LinkedIn 

The original use and description of Revenue-cycle Management (RCM) has been in the healthcare space, yet the same principles are so critical in our space – fitness facility management.

I view our space as a continuum of Healthcare: Fitness + Wellness + Medical Integration. A holistic approach that includes Mental Wellness, Recovery, Surgery Preparation, Post Clinical Rehabilitation, Hydration, Sleep, Weight Management/Nutrition, Nutraceuticals, and Happiness.

Revenue-cycle Management is the process to track the revenue from patients, clients, members, and customers from their initial appointment or encounter with the organization to their final payment of the balance or the end of their relationship with the organization/business.

In Healthcare, the cycle can be defined as, “all administrative and clinical functions that contribute to the capture, management, and collection of patient service revenue.”[1] It is a cycle that describes and explains the life cycle of a patient (and subsequent revenue and payments) through a typical healthcare encounter from admission (registration) to final payment (or adjustment off of accounts receivables). This is achieved by a combination of technology, services that supplement both your process and staff.

In our world, one might also refer to this as managing The Lifetime Value of Membership or the Complete Member Journey. Typically, in our world, this falls short of administrative costs, marketing costs, and costs of delivery or costs of goods/sales (COGs). We also use the metric of Revenue Per Member and Revenue Per Square Foot, both of which I believe strongly in as future success indicators and equalizers among sites.

When you take your business to the next level in professional financial management and member experience management; you will have to look at your true Revenue-cycle Management approach. What are you willing to pay for retaining the existing members you have versus acquiring new members?

For example, as part of the Revenue-cycle Management, certain companies will provide delinquency remediation services to salvage potential cancelations and extend the member’s lifetime value. Proven omnichannel member communication and support will help reduce your member churn rate. Assistance with collection will help recover potential lost revenue.

What does it mean for your business when you start Revenue-cycle Management to improve revenue collected per member and extend their average lifetime value?

Many of us Entrepreneurs have always shot from the hip on reviewing the basics of our Financial Profit & Loss Statements (P&Ls). P&Ls are rear-view observations, usually better for investors and bankers. Operators can gain a lot from analyzing P&Ls, albeit a rear-view metric with limited operational insight. The key is real-time dashboards and understanding real-time metrics. When you do this, you will be able to make a profound business decision. So, what are the real-time metrics that matter and that you should be tracking progress against?

  • Attendance – Participation by day & time (use of the facility if possible)
  • Unique Attendance – Unique Users
  • Revenue per Member
  • Revenue per Square Foot
  • Average Dues per Member
  • Attrition Rate
  • Lifetime Value of Membership (LTV)
  • Ancillary Services Penetration Rates (booking percentage)
  • Demographics of Consumer Base and “best” Customers
  • Projected to Bill
  • Collection Percentage
  • Membership Tenure Based on Services (dues only or those who use PT)
  • Past Due Analysis
  • Daily Revenue and Reconciliation, broken out by:
    • Profit center
    • Pay mode
    • Deposits
  • Net Promoter Score
  • Likelihood to Join Within 6 Months
  • Likelihood to Refer
  • At Risk Members (based on declining usage from normal pattern)
  • Ability to target and segment all of the above by:
    • Non-users
    • Lite Users
    • Non-PT Clients
    • Medical Wellness programming prospects
    • Camp Prospects
    • Youth Prospects
    • Birthday Party Prospects
    • Specialty Program Prospects
    • Any other segment you can imagine based on your program offering

The point being, we need to slice & dice our data to share our programs and services with our members and prospects. And once our prospects become members, we need to onboard them towards a successful member journey.

I’ve been at this for many years. I am saddened that we still only have about 20% of the market using our facilities. I constantly look for ways to get to the other 80%. The strategic thought on this is how do you move “Non-Consumption” (those not using Fitness & Activity in any way) and “Substitute Behavior” (those using alternative methods for fitness & activity).

There are certain products available to us in our industry that allow us to maximize the dashboards and reporting we need that also utilize API integrations to pull data from the products and modules we have become familiar with and like.

If you are interested in upgrading your Revenue-cycle Management approach, here are two companies with four products I recommend everyone check out:

I recommend MXM on everything to do with return on investment with measuring and operationalizing the consumer journey. The Data is amazing, actionable and with the “Member Referral” and “Review Rating” new functionality, it is a major sales & marketing profit center. MXM easily connects through API to ABC Fitness Solutions Club Management Suite as well as other Member Management Systems. This product increase retention, sales, referrals, online reputation ratings, and operational excellence.

Medallia is the leader in Customer Experience Management in the Hospitality and Fitness Sectors. MXMetrics delivers the Medallia Platform for our industry.

I also recommend ABC Fitness Solutions in this arena because it provides us with real-time data through their CRS (club reporting system) which gives operators the ability to make thoughtful business decisions based on what is happening within their facilities daily. This, in addition to our normal P&Ls, gives us a full picture to act on more quickly. One of the core benefits of ABC is its Revenue-cycle Management that combines billing & payment processing with full-service delinquency remediation. Their proven process and expert team are known to improve 5% more in revenue collected as soon as 90 days as well as extend the average lifetime value of a member by 3 months. So, the three ABC products in their suite are DataTrak for Club Operations, Billing & Financial Revenue-cycle Management; Customer Relationship Management (CRM) with GymSales and Digital Fitness Delivery and Fitness Management with Trainerize.

The top Electronic Medical Records and Medical Practice Management System in the US is Epic (Epic Systems Corporation) with a 28.1% market share. ABC Fitness Solutions is the “Epic” in the Club Management Suite / Member Management Space for our Industry hands down. History, Stability, Customer Service, Culture, Innovation, and commitment to our end users, our Members.

I endorse these two companies based on a lot of research and operational experience. We are all looking for fewer vendors to do more – but do what they do in a best-in-class fashion so we don’t need as many bolt-ons. These two companies do that.


Credits: Healthcare Financial Management Association (HFMA).