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Or, you could assume a hypothetical based on how the gym industry actually works (outside of COVID lockdowns): Company A gyms successfully advertise that their

Or, you could assume a hypothetical based on how the gym industry actually works (outside of COVID lockdowns): Company A gyms successfully advertise that their gyms are nicer, safer, cleaner, and members pay several hundreds of dollars each month, while Company B gyms rely on being cheap and get members who are only willing to pay $10/month. I am of course talking about gyms like Equinox and David Barton, which were flourishing and adding new locations, vs gyms like Planet Fitness which were shutting down gyms because $10/month/member means you need a lot of members just to pay rent. OTOH, middle-market gyms like Golds, 24 Hour, and LA Fitness compete directly against each other and live or die based on the quality of their facilities and staff, and any reduction in a gym's quality generally boosts its nearby competitors.

gwd 6y ago
> any reduction in a gym's quality generally boosts its nearby competitors. Right, but the question is how visible that quality is to customers. If you skimp on your ventilation or equipment maintenance, your customers will notice pretty quickly. If you skimp on background checks for your cheerleading coaches, nobody's going to notice on their own until the scandal hits. The only way customers know there's a difference in the coach vetting if the gym or the cheerleading company tells them. And while it may be possible for Company A and its gyms to distinguish themselves from Company B, it may not be; it depends a lot on the particulars. If they can't, they'll be at a disadvantage.