Covid almost killed gyms — Sweat Cycle’s founder explains why they need $30 billion to come backView transcript
Nearly half of the people working at gyms in the U.S. lost jobs because of the pandemic, and revenue for the industry plummeted by $20 billion. Now that the economy is shaking off the effects of coronavirus, gym owners are still trying to dig out of a hole.
With so many other industries, like theaters, restaurants and bars receiving specialized Covid relief funds, gym owners are looking for help, too. The Global Health & Fitness Association, an industry group for gyms, has been pushing for a federal aid package. The GYMS Act, a bipartisan bill under consideration in Congress, would dedicate $30 billion to affected businesses.
Mimi Benz, a certified Pilates and cycling instructor, and founder of the Los Angeles-based Sweat Cycle, is one person who has been advocating for the bill. Although her business is hanging on, she’s faced considerable challenges as she has tried to stay on top of public health concerns in the pandemic.
First, she moved her stationary bikes outdoors, even while forest fires were burning in the background. Then she introduced hour-long cleaning breaks. But the cleaning regimes cut into her revenue, by forcing Sweat Cycle to hold smaller and fewer classes. Expenses also rose because of the extra cleaning and the effort to ensure compliance with masking and vaccine requirements.
Wide variation in requirements in different markets made the job even harder. Sweat Cycle also has a location in Atlanta, where the rules were less rigorous than in California. The gym has struggled to find a consistent policy that kept clients happy in both locations, while also appeasing local regulators.
Benz spoke to our creative content producer Joel Lindenfeld about the obstacles her firm has faced over the last two years, the lessons she’s learned from them, and why gyms need immediate financial support.
This interview has been edited and condensed for clarity.
Founding Sweat Cycle; impact of the pandemic; struggles of the fitness industry; the GYM Act00:00:00
So tell me a little bit about Sweat Cycle, like how everything came about, but most importantly, the Sweat Cycle community.
I founded the company in 2011. We started in a very small space. The idea of heated spin came to me in 2010. And at the time, nobody was doing any heated workouts except for yoga studios. So it was sort of like a scary idea to a degree. So when we opened we started with half non-heated, half heated. But by the end of year two, we phased out all non-heated classes because of demand, the demand for the heated classes was intense.
So we rebranded ourselves as a heated cycling studio. By 2015, we outgrew our space and moved to a larger facility, added two more locations in 2018, and started drafting up franchising plans. As far as the community goes, I feel like that’s what I’m most proud of. When it comes to the business, I feel like we’re very rooted in community, and I think that’s what really connects people to the business, just the vibe of the place and just the philosophy, and the importance of community. We are all here to support one another by achieving our goals.
So how has the community itself as a whole been impacted by the pandemic and the regulations?
In a very big way. We shut down in March of 2020. And, you know, we weren't able to open up indoors again for a year. So we had to get creative. We had to use outdoor space. We pitched a tent in the parking lot. And we started doing classes outside. We did some pop ups at different venues outdoors. We did the digital thing. We launched our online streaming platform, 10 days into the shutdown. So we did everything we could to keep our community engaged.
More than anything, what was important to me at the time was to keep people engaged and active and moving, regardless of revenue stream, whether we were profitable or not. I didn't want to lose touch with our people. I wanted to keep our trainers in front of people as much as I could, because you know it was very abrupt as everyone remembers.
And everybody kept saying, “Oh, it's just gonna be two weeks, oh, a couple more months. And I’m just glad that we took charge right away, because we literally didn't stop. Even though our studios were shut down, we kept the engagement going in some form or another.
“My whole thing was like, 'If people show up, we're gonna show up, too.'”
We kept things going however we could. I mean we were outside with the fires. Remember, when the fires were happening, and the sky was like orange for days, and there was ash in the air? We were trying to make it work. Even under those kinds of conditions. We had crazy winds destroy our tents a couple times. I mean, there were a couple times where the tent was, like, lifting off between classes or whatever. But people showed up. My whole thing was like, “If people show up, we're gonna show up, too.”
So tell me about numbers. Did you see a decrease in membership and attendance?
In the first reopening, to put it that way, it was “oh you’re outside.” I think we could only put 20 or 30 bikes outside under the tent, spaced out with six feet. I think we even did eight feet of distance and we never really filled the bikes. I want to say there were a few classes here and there where we filled the bikes. I think the revenue dipped down like 70% for us.
Before the pandemic, we had classes filled with a waitlist ongoing week to week. We had a very strong, steady growth pattern of 30% year-to-year. Our plan was to franchise. We had everything in line to do that. So you know we were really successful and very busy and the future looked really bright for us.
That’s crazy. What is the state of the gym industry, the health and fitness industry, nationally?
Nationally, gyms are suffering on a massive scale. Gym closures, we’re at 30% nationwide permanent gym closures, and I think California is probably the hardest state when it comes to fitness and the restrictions that they've put in place. I think ultimately, it just comes down to aid. Our industry as a whole has not received any dedicated relief. We had access to the PPP program, but no grants, and if you’re fully shuttered, PPP isn’t really useful because you don’t have a lot of payroll to account for. And the appeal of the program is that you get forgiven, because you can prove you spent all that money on your payroll. But if you’re fully shuttered and not operating, the PPP is somewhat useless to those businesses. So I think if you’re based in California, Los Angeles, specifically, you’re in a jam, in hot water for sure.
So okay, so, since you mentioned it, tell me a little bit about what's going on with the Global Health & Fitness Association and the GYMS Act.
Yeah, so [the organization] has put a lot of efforts behind advocating for fitness and lobbying efforts and whatnot to try to get Congress to step up and carve out the budget to give fitness studios that dedicated aid. We’ve had something called the GYMS Act on the floor, but they didn't pass it. So now is our our last-ditch effort to get something carved out in this next budget planning that they have scheduled. We're all holding our breath for this. They’ve really overlooked fitness in a big way. I mean, restaurants got two rounds of federal grants. Theaters and live performance venues, those industries also got grants. Fitness has not. And we were forced to remain closed the longest of any industry.
“They’ve really overlooked fitness in a big way. I mean, restaurants got two rounds of federal grants.”
So what do hope will happen in the legislature?
Regardless of whether or not they vote in favor of supporting gyms and giving that dedicated aid, everybody should be pressuring or putting awareness around this with their local representatives. IHRSA has done a great job of creating one-click campaigns. You can go to their website, click the button and it literally figures out who your representative is, and drafts a letter for you on your behalf. And you just click to send.
And so we need as many people doing that as possible, even after the vote because it's in their face constantly.
You brought in the mental health aspect. You’re in an industry that has been proven to be very closely tied with mental health and the benefits of working out and fitness in general, with depression. So it's kind of weird that there hasn’t been more of an emphasis on helping this industry.
Yes. I don't want to get sucked into the conspiracy theory world, but it really is hard not to go there. When you're like, “wait a minute, the statistics show and prove that fitness is a solution to so many things.” Here, we're talking about depression, and we're talking even in relation to Covid and keeping your immune system strong and intact. It’s vital to lessen the impact of Covid if you contract it. So, it is a little dumbfounding to me to think about it from that perspective. Like, you know, we're keeping people locked inside, with no access to sunlight, vitamin D.
I think most people by this point in time are pretty burnt out on trying to work out at home, on a screen. So it's just, I don't I don't understand it myself, I would think that there's more risks doing other things besides working out and like around other people, you know, going grocery shopping or, you know, there's there's lots of places we could go to where there's like high touch areas, you don't see someone spraying down the surface every two seconds or every box or can on the shelf. And yet, we as studio owners were, we are diligent. I mean, we've spaced out our classes to a degree where we have a full hour to clean in between classes.
“I think most people by this point in time are pretty burnt out on trying to work out at home, on a screen.”
That takes half of the day, half of the possible classes away. And it increases your staffing costs, so your overhead expenses are going up. And you know, the amount of money you're spending on cleaning supplies and disinfectants and you know, masks and sanitizers and UV, I mean, we even have UV light machines to clean the rooms and stuff. So, yeah, it's just, it's wild, for sure.
So, you just mentioned that you've had to increase the cleaning staff, but have you had to cut trainers?
It's interesting, because I think from the trainers perspective, the challenge that I've faced personally, is that we've lost a few people. They moved out of state, they left California so I've lost people to that. Then there's a psychology, and there's burnout. That’s the ongoing theme. They don't really want to work as much. They don't want to teach as many classes, and they don't want to work that many hours. So that's been so the challenge for me is just to get people to want to work. You know, because people are in a funk.
[Covid regulations have also imposed many challenges on Sweat Cycle]. It’s a weird time. I never thought in a million years that I would have to collect and save someone's medical documents in order for them to come and take a class. You know, they're not asking for that in grocery stores. But it's like as a gym or fitness studio, there's so much we have to do now. And it's upsetting to a lot of people. It’s hard to navigate. And then when people are disgruntled, they come at us. So it's a really tough, tough place to put a small business owner in. And on top of that you’re dealing with the massive amount, amount of rent debt and all the stress that you carry, that you've been carrying through Covid.
Okay, so how did you get involved with Save Our Gyms? And what is the plan going forward with the campaign?
I got introduced to all of this through, I think early in Covid, during the shutdown. There were a couple fitness studio owners that I knew that connected me with this group of owners that were having monthly meetings to just sort of collaborate and discuss the issues at hand. And it was really great.
“What we've all learned the hard way is that you have to pay to play in government...If you don't have a strong lobby in place, it's so much harder, and there's so much more work involved with getting a bill passed or advocating for a certain industry.”
It was an interesting shift for me, because the fitness world is so competitive that, you know, we never really reach out to one another to get to know each other. But this has brought people together in such a profound way. So we all just sort of got together and met monthly. So I'm going to continue to stay involved.
What we've all learned the hard way is that you have to pay to play in government. And, you know, if you don't have a strong lobby in place, it's so much harder, and there's so much more work involved with getting a bill passed or advocating for a certain industry. So, you know, I think that if the energy now is very much focused on ensuring that in the event, God forbid, this ever happens, again, we have a place at the table, and our voices will be heard and recognized.