Organizations are almost always looking for creative ways to cut costs, especially during uncertain economic times. With budget constraints becoming increasingly common, decision makers are pressured to find solutions that maximize efficiency while minimizing expenses. One wellness and amenities strategy that often comes up in these discussions is insourcing on-site fitness centers. The concept is straightforward: by keeping the management of these facilities in-house, organizations believe they can save staff time, reduce equipment investments and minimize upkeep issues. It is an attractive proposition on the surface, especially when the goal is to tighten the financial belt without sacrificing employee wellness.

However, insourcing rarely leads to the savings facility managers are expecting. While the allure of controlling every aspect of the fitness center might seem appealing, the hidden costs and complexities can quickly outweigh the perceived benefits. From the ongoing maintenance of equipment to the need for specialized staff who can manage fitness programs effectively, the responsibilities can quickly become overwhelming. What starts as a cost-saving measure can easily turn into a drain on resources.

Outsourcing, on the other hand, offers a different approach. By partnering with a specialized provider, FMs can free their teams from the day-to-day operational challenges and instead focus on core responsibilities. This not only ensures that the fitness center is managed efficiently and professionally but also allows for more strategic use of resources. There are four key issues FMs face when managing an on-site fitness center and how outsourcing can help alleviate these challenges. Understanding these factors can help FMs make more informed decisions about whether insourcing or outsourcing makes the most sense.

1. Hiring & training fitness staff

Recruiting, training and retaining qualified fitness instructors, trainers and support staff requires time and dedication; and staffing issues, which pop up all the time, can slow things down and lower the quality of service. Many organizations underestimate the true cost of losing an employee, including advertising, interviewing screening, hiring, onboarding, lost productivity and impact on employee morale.

For example, the cost of replacing an individual employee can range from one-half to two times the employee’s annual salary, and US$1,500 for an hourly worker. Furthermore, 33 percent of U.S. hiring managers said turnover costs their companies an average of US$36,295 annually in lost productivity and rehiring costs. More than 20 percent said that the number climbs to US$100,000 or higher for their company.

Outsourcing can take these stressors off an FM’s plate. A fitness partner will include FMs in the interview and selection process, but will take on the burden to recruit, train and manage fitness staff. The partner usually knows the unique challenges that corporate fitness centers face and will leverage the knowledge base and experience of their book of business to offer custom solutions and strategic advice. They can also make quick changes to staffing levels, hours of operation and programs to adapt as the business grows or as employees’ needs change.

2. Equipment maintenance & upkeep

Scheduling repairs, replacements and maintenance for equipment can be time consuming — just ask any fitness center manager. This is most likely time FMs do not have. Outdated or broken equipment can cause downtime, safety risks and negative experiences for residents and employees.

By outsourcing the fitness center, FMs can turn the responsibility of upkeep and maintenance completely over to the vendor. Additionally, they will be able to offer ideas and consultation on the right equipment for the facility’s population and space and will be able to get discounts on equipment purchases.

3. Low utilization

Unfortunately, taking a “build it and they will come” approach does not work well when it comes to fitness centers. Tenants and employees are looking for a more engaging and immersive experience when it comes to their wellness and health. It can be hard to get occupants to use the fitness center regularly if they are not aware of it or motivated to use it. Low membership or participation rates can affect how well the fitness center works, too.

Outsourcing partners can ensure that the fitness center meets quality standards and provides excellent service. Service level agreements and performance metrics can also be set up to keep an eye on and evaluate the vendor’s plan and work. The partner will likely have creative ideas for how best to ensure tenants and employees utilize the fitness center. Specialty classes like rooftop yoga can draw people in, and specialty events like open houses featuring classes, educational seminars and raffles can be an effective tool to introduce people to the fitness center.

For example, a facility with an eligible population of 2,500 people has an active membership rate of 66 percent. The facility has driven this high utilization rate by offering unique amenities like an indoor golf simulator, a series of special events (including community health fairs, fun 5K run/walks and an annual climb-the-stairs event), and personal and group training programs.

4. Regulatory compliance

It is imperative that FMs follow all safety, health, accessibility and other rules when operating an on-site fitness center. If the facility does not follow the rules set by regulators, FMs could face fines, penalties and legal problems. Keeping up with these ever-changing regulations and rules can be a time-consuming mess — and definitely an area in which the FM’s time is probably best spent on other tasks.

Outsourcing allows FMs to lean on their partners when it comes to these safety, regulatory and legal obligations. The partner will also stay current on requirements and will most likely be experienced at foreseeing issues and mitigating them.

5. Fitness/wellness programs & special events

Many facilities that in-source their fitness center do not even offer programming, so this is usually a huge advantage of outsourcing. Individualized attention is usually one of the key reasons people visit on-site fitness centers. An outside partner could deliver wellness programming on a host of topics from overall well-being to lifestyle risks and behaviors. These are delivered in a variety of formats from quick 10-15-minute meetups to hour-long seminars or series classes that run for numerous weeks. For example, a “Cocktail or Mocktail” seminar would address the facts about alcohol and alternative options. A quick meet-up on the Keto diet would give participants the facts they need to make informed decisions about their eating habits.

Recreational programming is another area where an outside partner could add expertise. These partners usually have deep experience with the design, implementation and supervision of recreational programming and organized team activities like club sports, cycling clubs and racing teams, as well pickleball and cornhole tournaments. These professionals can help with everything from promotion and marketing of these leagues and clubs to scheduling and statistical reporting for leagues.

Organizations can offer fitness and wellness challenges to get people into the fitness center. More traditional challenges like “Commit to Fit” encourage participants to commit to fitness goals by making visits to the fitness center a priority. Other challenges focus on other areas of wellness, like mindfulness. A “Take 5” challenge shares five simple tasks in five minutes or less to help participants relax, recharge and refocus.

Special events are another area in which outside experts can help connect and motivate participants through shared experiences. For example, a “Swifts Spin” can offer participants a ride through “The Eras” with Taylor Swift’s biggest hits. Or a “Rooftop Yoga” class would offer participants sweeping views of the city while getting their deep stretches in for the day. Social programming like a “Running for Brews 5K Run” can provide participants with a quick run with well-earned beers at the finish line.

6. Innovation

Keeping the fitness center competitive and up to date is almost a full-time job. FMs must keep pace with changes in digital platforms, wellness trends and fitness technology. Outsourcing all of this to a fitness partner allows FMs to benefit from knowledgeable experts that do this every day for a wide variety of organizations. These professionals can use their knowledge and connections to produce new ideas to keep the user experience fresh and exciting.

Running an on-site fitness center takes a lot of hard work and resources. In many cases, for FMs, that time can be better spent running other areas of the facility where their expertise in operations and maintenance can shine. Outsourcing can free management up the FM team to spend that time doing the things they do best.