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Issue Date: July 2009, Posted On: 7/7/2009


California man pumps up business with Gold’s Gym

After launching in India, Singh sets sights on U.S.


By Martin Desmarais

Gurvinder Singh, who grew up in California, returned to India last year to start his franchise portfolio with Gold’s Gym. He opened two locations and has two more gyms in development. Photo courtesy of Gold’s Gym

SANTA CRUZ, Calif. – Gurvinder Singh returned to his native India to get his start with Gold’s Gym last year, opening two locations, with two more in the works. Now the 23-year-old is returning to the California setting he grew up in and bringing back a little twist on the concept, which has found him success in India.

Established in Venice, Calif. in 1965, Gold's Gym is a full-service gym chain that has close to 700 locations in 43 states and 30 countries. Gold's offers the latest in exercise equipment and services, including group exercise, personal training, cardiovascular equipment, group cycling, Pilates and yoga. The concept pledges itself to helping all kinds of people achieve their individual potential through fitness and has approximately 3.5 million members.

“Our global staff of personal trainers and group exercise instructors is the best in the business – period. Whether it is a mom looking to get in shape after having a child, a marathon runner training for his or her next race or a Hollywood star training for their next action movie, we leverage over 40 years of fitness experience to create personalized fitness programs that help our members realize their potential,” the company stated.

Most Gold’s locations are franchised, with just 63 corporate gyms in the United States. The chain has over 160 international locations, with 40 in India.

In the United States, Gold’s is pretty synonymous with serious exercisers, both male and female, and is commonly viewed as a having a younger clientele that is in shape and athletic. According to Singh, Gold’s has tremendous name recognition around the world and when he looked to open up  his Indian locations he wanted to cash in on this recognition, but also felt that his best bet for success would be to capture a little bit more of the family and female markets.

Singh firmly believes that there is no real option of a gym brand in India for the whole family and he wanted to provide such an option. He places an emphasis on his Indian Gold’s as a premium, upscale, club-type gym that is very family oriented.

For Singh, this means designing gyms that look more like hotels, with golden floors and bright coloring and none of the typical black, rubber flooring that most gyms have. His Indian Gold’s also have indoor running tracks, which is not typical of the chain. Singh owns Gold’s in Punjab and Himachal Pradesh.

As a chain, Gold’s entered India in 2004. Singh opened his first location in India in January 2008 and his second in August later that year. He has signed a deal for four total in India.

“We kind of jumped into India – it is an early market so to say – we won’t see the numbers we see here in five-to-10 years, so we are well positioned for the future,” Singh said.

Born in Punjab, Singh came to the United States with his family when he was 7-years-old. He lives in Santa Cruz, Calif., and his family runs a trucking company in California, as well as owns several hotels in New Mexico.

Singh returned to India for a whole year to get his Gold’s operations off the ground. A cousin works as his general manager for Gold’s in India, allowing him to return to California to start planning for more franchises here.

He signed a deal for a Gold’s in Gilroy, Calif., a year ago, but admits to moving cautiously due to the economy and the need for a good location. He plans to mirror the family focus of his Indian facilities.

Above: Gold’s Gym, which was started in Venice, Calif., in 1965, is a gym chain that has approximately 700 locations in 43 states and 30 countries and features a variety of workout optins. Of the chain’s 160 international locations, 40 are in India. Photo courtesy of Business Wire
 
Below: Gold’s Gym locations feature a variety of exercise equipment and services, including group exercise, personal training, cardiovascular equipment, group cycling, Pilates and yoga. The chain also offers personal trainers for individual training. Photo courtesy of Gold’s Gym
“The facility here is going to be more of what we are doing in India and the success we have seen there,” said Singh. “We are more oriented to the family. The number one is kids, the second is women and everything else comes after that.”

Additional attractions he plans include: cardio cinemas, in which you can watch a video and exercise; game cycles, which allow users to play a video game while peddling; active video games such as Dance Dance Revolution; a rock climbing wall; and maybe even a kids’ summer camp.

“It all depends on location and where we are trying to position ourselves,” Singh said. “We see the potential a lot more [with families] than in the men.”

As his India plans continue to move ahead, Singh is looking to the future of his Gold’s portfolio in the United States. “My goal is to get 10 at least in the coming years,” he said.

Joel Tallman, Gold’s Gym senior vice president of franchising and operations, said the changing demographics of the chain’s franchisees are bringing a lot of new ideas for business.

“It was mainly just gym guys for year and years [as franchise owners] … In the last 10-15 years we have seen a shift and it continues today to businessmen with strong access to capital,” Tallman said.

Still, Tallman said the best franchisees realize that Gold’s provides a specific service to its customers – betterment through exercise – and believes in the value of this service.

“Somewhere in the organization people have to care about changing people’s lives,” he said. “It is a very personal endeavor.”

According to Tallman, the influx of franchise groups and larger investors into the chain has really helped its overall growth because the business acumen of these franchisees have the business acumen to secure the best locations, with favorable leasing terms, and can get credit easier. “They just have a much stronger foundation for success going forward,” he said.

Tallman pointed out this trend is really playing out in the United States. “Most of our domestic U.S. locations are owned by multi-unit owners,” he added.

Still, he said the initial single-unit owner is the chain’s bread-and-butter. “When a single operator comes in and starts to thrive that is when they become multi-unit,” he said.

Gold’s continues to grow and has 115 U.S. locations in the pipeline, with a similar amount on tap internationally, according to Tallman. “Our business has remained very robust,” he said. “We anticipate we are going to see significant growth in the third quarter.”

Typically, recessions have not had that big of an impact on the fitness business because even if people lose their jobs they do not want to give up going to the gym. “It is a country club for some people. It is where they go. It is what they do. It is their place,” Tallman said.

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