NYC’s Fitness Industry Still Struggling, Trying New Business Models

By Benyamin Davidsons

Gyms and fitness centers are still struggling to match membership levels from 2019. The COVID-19 pandemic, which shuttered their studios for well-over a year, is still keeping members wary of rejoining in-person sessions and workouts. Many gyms and fitness studios closed their doors permanently, and the remaining ones have needed to find new revenue sources in order to stay afloat— including virtual and outdoor workouts.

As reported by Crain’s NY, during the pandemic’s shutdown Swerve Fitness had rented out its bikes and hosted classes on Zoom. But revenue for the Flatiron District cycling studio was still down roughly 70 percent. “We had to get creative,” said Swerve co-founder Eric Posner. “It’s evolve or die.” After witnessing the boom in virtual fitness and zoom sessions during the pandemic, the studio’s founders spent a year converting their business from a brick-and-mortar fitness boutique into a business-to-business company which provides live cycling videos to other gyms. Swerve has partnered with Crunch Fitness, offering its live cycling videos to the gym’s Union Square and 34th Street locations. Posner said he expects to partner with gyms nationwide, and is optimistic based on consumer feedback. “We remain very positive and bullish,” Posner said. “The shift in business model has created a more efficient business that has reduced our overhead.”

Similarly, Fhitting Room, a Manhattan-based fitness studio, began accommodating corporate clients. Studio owner Kari Saitowitz formed a sales team to provide wellness services to businesses with virtual live classes and on-demand videos. Still, she says revenue is down. “We’re at about 50% of our pre-pandemic revenues,” Saitowitz said. “That’s really based on the number of clients coming through the doors.”

Also, 305 Fitness, a dance cardio studio with two Manhattan locations and one in Washington D.C., launched a virtual platform. It now has 3,000 subscribers and a certification program which trained more than 1,000 instructors across the country. Nevertheless, Sadie Kurzban, the brand’s owner, says the business has only recovered about 30% to 50% of its 2019 customer base.

Since the pandemic hit, roughly 31 percent of fitness clubs in the state have permanently closed, as per a report by the association this past July. According to ClassPass data, in New York City about 17 percent of studios have been shuttered. “Fitness is a habit,” said Charles Cassara, president of the U.S. Fitness Coalition. “What we did by closing for 18 months is we took people out of their habit and we gave them a new one.”