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Archive for Wednesday, November 3, 2004

Athletic club to close south center

Owner blames marketing rules, new KU offering

November 3, 2004

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Lawrence Athletic Club is closing its south location Dec. 1.

Owner Rick Sells said he was making the move to stop financial bloodletting brought on by restrictive marketing rules, rising rental expenses and the loss of Kansas University students to a campus recreation center.

"It's kinda like you find out you have a disease in your finger, and you cut the finger off to save the rest of the body," Sells said. "I could keep it open, but a year or two from now I could be in a financial situation where I'd have to close all my clubs, and I definitely don't want to do that."

The south location's 500 members started learning of the impending closure Monday, as they showed up at 2108 W. 27th St. for aerobics, weight training or other workouts.

In a written letter to members, Sells is promising to honor south memberships at the club's other two locations: the north club at 3201 Mesa Way, and the 3-year-old east club at 1202 E. 23rd St.

The south location needed about 750 members to break even, Sells said, and maintaining that level became increasingly difficult in the face of three obstacles:

  • Implementation of the federal "no-call" list put an end to the club's pervasive telephone marketing campaigns for new members. "Now, if we call the wrong person, it's an $11,000 fine," Sells said. "We went from calling 300 to 500 people a day to calling no one. Now, all of a sudden, our name's not getting out there to anybody."
  • Rising expenses for the 10,000-square-foot space in the Park Plaza Shopping Center at 27th and Iowa streets squeezed the bottom line even more. The south location opened five years ago, and maintenance expenses increased $33,000 during the past three.
  • John Lammli, a Kansas University senior from Lawrence, works out at
the Lawrence Athletic Club's south location, 2108 W. 27th St. Rick
Sells, the club's owner, said he plans to close the center on Dec.
1.

    John Lammli, a Kansas University senior from Lawrence, works out at the Lawrence Athletic Club's south location, 2108 W. 27th St. Rick Sells, the club's owner, said he plans to close the center on Dec. 1.

  • Kansas University's Student Recreation Fitness Center opened in fall 2003 and drained 800 students from the club's member rolls. About 300 students have come back, Sells said, but not enough to save the south location.

In all, the club has about 5,000 members.

"The reason we opened up the south club and we opened up the east club was to make money if we could, but as long as they pulled their own weight, we didn't care," Sells said. "But when you start pulling money out of your other clubs to make one run, that's not a good thing."

Sells said between five and 10 jobs would be cut as part of the closure, all of them desk workers. Sales and training employees will be transferred to other locations.

Sells already has arranged to sell the south location's treadmills, stair machines, stationary bicycles, elliptical walkers, free weights, saunas, lockers, mirrors and floor coverings to a buyer looking to open up a club by the end of the year in North Topeka.

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