Bally total fitness

Bally total fitness

Introduction

The purpose of this paper is to expand the boundaries of our knowledge by exploring some relevant facts and figures related to SWOT analysis of “Bally total fitness” Co. The company provides services like health clubs, athletics, wellness education, physical therapy, nutrition and spa services. The company also delivers certified professionals, comprehensive services and destinations to its members. The company's team is thoroughly trained on designed programs and certifications. The company focuses on providing clean, friendly and inviting environment for its members and also offers health and fitness education and entertainment services. Bally total Fitness's comprehensive set of fitness and health services enables it to cater to a wide variety of consumer preferences that in turn enhances its competitive advantage (Bally, 2003). In the next section, the author will conduct SWOT analysis of “Bally total fitness” company.

Synopsis

SWOT Analysis

Strength

Robust financial performance ensures strong financial stability

Strong economic model attracts large membership base

Comprehensive programs and services strengthens its market position

Weaknesses

Concentrated business operations

Employee turnover

Decreasing revenue

Opportunities

Expansion through opening of new centers likely to boost the top line growth

Favorable outlook of the global leisure facilities sector augers well for the company

Threats

Intense competition may affect the company's market position

Extensive regulations may affect the company's revenues and operations

Analysis of forces and trend

Robust financial performance ensures strong financial stability

BTF has reported a robust financial performance in the recent times. The company's revenues increased from $511.9 million in FY2005 to $912.8 million in FY2009, representing a compounded annual growth rate (CAGR) of 15.6% for the period spanning FY2006-10. Similarly, the company has also witnessed a significant increase in its operating and net profits during the same period. Its operating profit increased to $160.8 million in FY2009 from $100.5 million in FY2006 at a CAGR increase of 12.5% (Hill, 2010). During the same period, the net profit of the company increased to $80.7 million from $50.6 million at a CAGR increase of 12.4%. A robust financial performance enhances shareholder values apart from providing strong financial stability to BTF which could be leveraged to seek potential growth avenues in the future.

Strong economic model and high value services attains larger customers base

The company's economic model is dependent on appealing large membership base and as well as retaining these members (Wells, 2005). For FY2010, this economic model generated revenues of $912.8 million, a rise of 9.1%; operating profit of $254.2 million, a rise of 5.5% and operating profit margin of 27.9%; and net income of $80.7 million, a rise of 11.5%. BTF provides a distinct competitive advantage over its peers. For instance, the company's monthly individual membership fees range in between $50 to $80 (Hill, 2010).

The company's plans can be easily cancelled by its members by giving 60 days notice to the company, which clearly proves that BTF is more focused on providing better value services to its members (John, 2002).

The company's strong economic model offering different types of amenities, programs and services with a strong member focused approach helps it to enhance its membership loyalty, which results in strong ...