Retention = More Profit

Retention and attrition are 2 sides of the same coin. Member retention rate shows the percentage of members who stick around versus those who cancel their memberships. High retention means you’re doing things right. Low means you have an opportunity to consider some changes at the gym.

Average annual retention rate for gyms worldwide are 60% to 70%. This means 30% to 40% of members cancel their memberships every year.

The example gym (pic above) has 385 members and a 60% annual retention rate. It loses 154 members every year. With weekly fees of $50, this is $400,400 lost revenue/year. If they improve retention by 10% it generates an additional  $100,100 income every year.   

All this means is retaining an extra 3.2 members each month! 

It’s likely that you’ll know your retention rates already. If not and you want to calculate your retention rate, subtract the number of new members acquired during the period (B), from the number of members remaining at the end of the period (A).

 Next, divide that number by the total number of members at the start of the period (C). Then multiply by 100 to find your retention rate.

Are you happy with your retention rate?

If not, what needs to change to increase it?