Fitness First Cheats

[greedyalgorithm]

Some Fitness First staff are cheating its current members by asking them to re-join membership.

Here is the story.

Last year I paid a lump sum cash for registration fee plus administration fee plus twelve-month membership. That was a huge amount of advance payment, comparable to a monthly salary. I contacted a reception staff to renew my membership. She asked me to wait for a sales people.

I told them that I would like to change my payment method from cash to credit card. There was a still commitment of twelve months (to be eligible for a special rate).

Sales people said a lot of things, like monthly membership fees recently rose a bit, and I needed to pay for administration fee. However, the registration fee was waived. They explained that cash payment was not open-end membership. My membership was expired after a period of twelve months. On the contrary, credit card payment is an open-end membership: payment can recur forever.

That is, I had to pay for a new rate of monthly membership fee plus administration fee (one-time).

They tried a lot to persuade me to pay that stupid admin fee. I ended up with a hint to join their competitor - California Wow.

What I did was that I visited another branch of Fitness First. This branch did not ask me to pay that bullshit administration fee or the new rate of monthly fee at all. I am still eligible for the old monthly fee - I just signed something to change my payment method from cash to credit card. This saved me 1,500 baht of admin fee plus 100 baht of monthly fee (times 12 months). A total of approximately 54 euro!

I listed some detections of their tricks:

1) In the brochure, it wrote that the admin fee was for those who joined membership. I did NOT join. I renewed.

2) On my member card, it contained a word "open-end" but I did not notice that until I arrived home.

3) Credit card payment is not a forever recurring payment. A credit card can be expired or cancelled at any time.

4) A saleman at the first branch said that if a credit card is cancelled before membership is paid for its 12th month, the credit card company must be responsible for Fitness First's missing revenue. This is not true. My credit card will be charged 15 days prior to a service month, for a period of 12 months. How could a credit card company be responsible for a prepaid service?

5) The most clear picture is that, two branches in Bangkok charge their member significantly differently for exactly the same thing.

From my business background and consulting experience, I can tell that this is not price discrimination. This is a cheat of sales people to earn commission revenue.

I do still recommend Fitness First as a good club (good classes and quite clean facilities), but be aware of its unethical business practise. This could be well-explained by the agency theory (google for more info): sales reps pursue their own interests in earning commission revenues at a cost of shareholder value. Specifically, sales rep cheats could possibly boost short-term profits for Fitness First but as soon as customers learn out, they are losing customer lifetime values.

Edited June 12, 2007 by greedyalgorithm

[Neeranam]

Never use Fitness First. I offered to pay 20,000 up front in cash but they refused, saying I needed to pay by credit card. I realise why - they ripped of 3 of my colleagues credit cards!