Is A California Wow Going Out Of Business?

[jayjayjayjay]

Does anyone know if there was a trading holt put on them today?

[Gaccha]

Does anyone know if there was a trading holt put on them today?

No, I don't know.

But it appears that April 5th is a key date:

http://www.set.or.th/set/companynews.do;jsessionid=0F36CADB925C6AC1313377F88878EFF2?symbol=CAWOW&language=en&country=US

[janverbeem]

Cawow is in majority owned by Major en Mcdonalds Thailand.Because it gets delisted from the stock exchange doesn't mean that it will close down.Because it makes a loss for the public share holders doesn't mean it really makes a loss.

Can you please explain how that works? If the company can't make enough to pay interest and defaults on its loans, the lenders can force CaWow to sell its assets to cover the loans. As the equity holders are subordinate to leinholders they would get nothing (the liabilities are obviously more than the assets).

So tell me, how is it that they would still be "making money"? BTW delisting doesn't help as the company still remains a PCL until it can reduce its number of shareholders.

Hypothetically speaking it could be that they are paying a lot for the space the rent from mayor. Because Major is a major shareholder it could have forced this upon Cali wow. Then it could be that if the rent was at a lower normal price profit could be made.

This is all hypothetically because i don't know the real figures. Also sometimes companies dont want the other companies they have shares from to go bust because then they have to take that loss. They don't as long as the company is still afloat. (im not saying its good practice but it happens)

You can add to that : When a company goes public it receives a lot of money for the shares it lists on the stock exchange.Like Rob said Major rents the spaces to Cawow at high prices so it makes a good profit, unrelated to the fact if Cawow makes a profit or not.

When Cawow makes a loss the shares,which initially were sold at a high price, get worth next to nothing and can be bought back on the cheap by the founding company's and the company can be taken private again.

[CanInBKK]

Cawow is in majority owned by Major en Mcdonalds Thailand.Because it gets delisted from the stock exchange doesn't mean that it will close down.Because it makes a loss for the public share holders doesn't mean it really makes a loss.

Can you please explain how that works? If the company can't make enough to pay interest and defaults on its loans, the lenders can force CaWow to sell its assets to cover the loans. As the equity holders are subordinate to leinholders they would get nothing (the liabilities are obviously more than the assets).

So tell me, how is it that they would still be "making money"? BTW delisting doesn't help as the company still remains a PCL until it can reduce its number of shareholders.

Hypothetically speaking it could be that they are paying a lot for the space the rent from mayor. Because Major is a major shareholder it could have forced this upon Cali wow. Then it could be that if the rent was at a lower normal price profit could be made.

This is all hypothetically because i don't know the real figures. Also sometimes companies dont want the other companies they have shares from to go bust because then they have to take that loss. They don't as long as the company is still afloat. (im not saying its good practice but it happens)

You can add to that : When a company goes public it receives a lot of money for the shares it lists on the stock exchange.Like Rob said Major rents the spaces to Cawow at high prices so it makes a good profit, unrelated to the fact if Cawow makes a profit or not.

When Cawow makes a loss the shares,which initially were sold at a high price, get worth next to nothing and can be bought back on the cheap by the founding company's and the company can be taken private again.

I appreciate you guys taking the time to try and explain but I have to admit I still don’t get it.  Let’s say the monthly cash flow is 100 Baht from memberships, the loan installments and salary are 90 Baht, even if Major were to charge CaWow 40 Baht, the most they could pay is 10 Baht, right?  There’s just no way to dodge loan payments and salary.  In order to be “bought back on the cheap” there are two options: CaWow declares bankruptcy and sells all its assets to pay the loans, or Major absorbs (i.e. takes over) all of CaWow’s debt obligations.  Somehow I just can’t see how Major isn’t getting the raw end of the deal.

[robblok]

Can you please explain how that works? If the company can't make enough to pay interest and defaults on its loans, the lenders can force CaWow to sell its assets to cover the loans. As the equity holders are subordinate to leinholders they would get nothing (the liabilities are obviously more than the assets).

So tell me, how is it that they would still be "making money"? BTW delisting doesn't help as the company still remains a PCL until it can reduce its number of shareholders.

Hypothetically speaking it could be that they are paying a lot for the space the rent from mayor. Because Major is a major shareholder it could have forced this upon Cali wow. Then it could be that if the rent was at a lower normal price profit could be made.

This is all hypothetically because i don't know the real figures. Also sometimes companies dont want the other companies they have shares from to go bust because then they have to take that loss. They don't as long as the company is still afloat. (im not saying its good practice but it happens)

You can add to that : When a company goes public it receives a lot of money for the shares it lists on the stock exchange.Like Rob said Major rents the spaces to Cawow at high prices so it makes a good profit, unrelated to the fact if Cawow makes a profit or not.

When Cawow makes a loss the shares,which initially were sold at a high price, get worth next to nothing and can be bought back on the cheap by the founding company's and the company can be taken private again.

I appreciate you guys taking the time to try and explain but I have to admit I still don’t get it.  Let’s say the monthly cash flow is 100 Baht from memberships, the loan installments and salary are 90 Baht, even if Major were to charge CaWow 40 Baht, the most they could pay is 10 Baht, right?  There’s just no way to dodge loan payments and salary.  In order to be “bought back on the cheap” there are two options: CaWow declares bankruptcy and sells all its assets to pay the loans, or Major absorbs (i.e. takes over) all of CaWow’s debt obligations.  Somehow I just can’t see how Major isn’t getting the raw end of the deal.

The thing is we all don't know the real figures so its all speculation. So what your saying could be right but what we are saying could be right too.

[janverbeem]

I appreciate you guys taking the time to try and explain but I have to admit I still don't get it. Let's say the monthly cash flow is 100 Baht from memberships, the loan installments and salary are 90 Baht, even if Major were to charge CaWow 40 Baht, the most they could pay is 10 Baht, right? There's just no way to dodge loan payments and salary. In order to be "bought back on the cheap" there are two options: CaWow declares bankruptcy and sells all its assets to pay the loans, or Major absorbs (i.e. takes over) all of CaWow's debt obligations. Somehow I just can't see how Major isn't getting the raw end of the deal.

Isn't there a possibility that Major and the salary's are paid first then the money that's left for the loan installements.

[ricklev]

Wonder if this is true? A Thai stock analyst who works for Kasinkorn Bank financial service who follows Major told me a couple of days ago that Major divested itself of all Cal Wow stock. Seems like something I would have heard about, but he was sure of himself.

[stevensdling]

They've been dropping the price and reducing services (and providing bad services- pushing training sessions and then pretending trainers are too busy to train people, etc.) for some time now. A lot of the trainers oversell briefly, collect their bonuses, and then quit. I figure that they're squeezing out as much profit as possible (at the owner's behest- he's doing pretty well right now, I heard)- and then they'll sell themselves to someone or go out of business and all the contracts will be bust. I figure you're lucky if you get 2-3 more years out of them, if that.

You simply can't expect excellent service and world-class material for such a cheap price. You get what you pay for!

[Gaccha]

...so there I was just looking at the company's brochure for the upcoming Annual General Meeting on 22nd April when I noticed something very very very fishy....

Mr Eric Levine claims to have a PhD from Mannin University in the UK. Except, there is no such University.

...and a monk in Singapore who also claimed to have gone to this fake 'university' was outed in the Singapore's The Straits Times.

http://www.asiaone.com/News/The%2BStraits%2BTimes/Story/A1Story20071119-37417.html

"But The Straits Times found on the Web two individuals who claimed to have graduated from Mannin University. One is the head of a group promoting human rights in the Maldives, and the other a man who runs a chain of gyms in Thailand." [the website writes]

Oh... My... God... (having said that, this news is 3 years old so presumably you all knew already...)

My predictions for the life expectancy for California Wow has now shrunk from 3 months to 2 months.

I would now say it is immoral of the staff of CalWow to attempt to sell membership to any member of the public.

And that AGM on 22nd April might be the most exciting entertainment of the day.

[kblaze]

although i loath their sales tactics, I wouldn't say it's immoral for them to sell a membership as the staff have NO IDEA about the company's health or it's sustainability.

It's basic business for a co. to leave their employees in the dark until they have to actually let them go/fire them.

[bonobo]

For the first time, someone approached me for an upsale.

She said since I have a lifetime membership which renews at 100 baht per year, why don't I upgrade to a VIP membership at 14,999 baht so I could invite a guest to join me in my workouts?

[Gaccha]

SO I renewed my lifetime membership for 100 baht, anticipating the closure of CalWow within 5 days (100 baht for 5 days is still a good deal... ), and yet...

Looking at their website they appear to have been given more cash...

They have renewed the lease agreement at Pinklao (the agreement's total is around 29 million baht over 3 years). And they intend to appoint an Independent Financial Adviser to sort out the threat of being de-listed by SET.

We won't know what happened for some time as we need to see the quarterly cash flow statement. Presumably 'Major' threw in some more money.

The whole thing is interesting. The market value of the company is now only just over twice the value of the lease of this one property.

[DavidJAdams]

<span class="Apple-style-span" style="font-family: Verdana, Tahoma, 'Bitstream Vera Sans', sans-serif; color: rgb(44, 44, 44); line-height: 17px; ">You'd have to be void of all 5 senses to miss the California Wows in Bangkok; with their bright neon lights and blaring techno music, any newcomer could mistaken them for clubs.<br><br>When you first walk into a Cawow, you're treated like the proverbial kingly customer that you are; you will be complimented, you will be engaged, and your "handler", whoever is put in charge of you, will lavish you with loads of attention and answer your every question.<br><br>The reason for this is quite simple. This act of flattery has nothing to do with customer service. It is because, like loads of things in Bangkok, you're going to have to negotiate your membership fees. I'm not encouraging anyone to come here, so let me cut to the chase; they're giving lifetime memberships for 10,000 baht, and access to all the Cawows. No matter what price you're quoted, be it 12,000 baht a year, 25,000 baht a year with renewal at 99 baht per year, DO NOT accept anything except 10,000 baht for lifetime. Trust me, the place is not worth more. And you can also forget about after sale service. They really, really don't care. <br><br>You'll be promised all sorts of things; I was told that I could have a gym bag and 2 hours of private training. I never got that gym bag, and I was persistent in asking for it. Instead, I was given a t-shirt which was not only quite ugly, but the wrong size as well.<br><br>As for the "private training", I chose Kickfit. The trainer was 15 minutes late, and then worked out with me for 10 minutes after taking another 10 to slowly wrap my hands. The rest of the time was spend trying to negotiate additional fees to pay the private trainer for future private lessons. I dared not ask to do the other hour that remained.<br><br>Now, back to the membership. You're pobably wondering how this place could maintain its facilities if they give a fairly cheap price for a lifetime membership, and the answer is: they don't. The towels smell like a sweaty gym bag, the machines do not get wiped down, and they use the same yoga mats for the whole day. A short while ago they introduced a half-hearted attempt to clean the machines by leaving towelettes and a spray bottle, but those have since disappeared. The ducts that hang just a few feet over your head are so full of dust that I thought they had been painted gray. <br><br>Now for the locker rooms. In addition to very rarely being washed, if ever, the floors are full of dirt and I even spotted a cochroach or two. The counters are filthy, and the showers... just don't touch the walls or you'll slide on the slime that has accumulated over time. They put wooden panels in the showers, and they absolutely stink. They smell like someone has done their business in them. Also, you'll want to be careful as your shower, in order to avoid the nest of insects that have made the corner their new home.<br><br>Also, you'll definitely need your stinky towels. How else will you cover yourself in a rush when they casually allow male staff to enter the women's locker room? The woman handing out the towels at the entrance has made quite a habit of having her male friend sit beside her while she's working. She also gets very annoyed when you can't understand her when she announces that a male is coming into the locker room. <br><br>Still unconvinced? Head there today for your tour, and heed my advice. Watch that sunny facial expression change when you request your flat 10,000 baht rate. And most importantly, really pay attention during your tour. You'll see what I mean.</span>

[kblaze]

<span class="Apple-style-span" style="font-family: Verdana, Tahoma, 'Bitstream Vera Sans', sans-serif; color: rgb(44, 44, 44); line-height: 17px; ">You'd have to be void of all 5 senses to miss the California Wows in Bangkok; with their bright neon lights and blaring techno music, any newcomer could mistaken them for clubs.<br><br>When you first walk into a Cawow, you're treated like the proverbial kingly customer that you are; you will be complimented, you will be engaged, and your "handler", whoever is put in charge of you, will lavish you with loads of attention and answer your every question.<br><br>The reason for this is quite simple. This act of flattery has nothing to do with customer service. It is because, like loads of things in Bangkok, you're going to have to negotiate your membership fees. I'm not encouraging anyone to come here, so let me cut to the chase; they're giving lifetime memberships for 10,000 baht, and access to all the Cawows. No matter what price you're quoted, be it 12,000 baht a year, 25,000 baht a year with renewal at 99 baht per year, DO NOT accept anything except 10,000 baht for lifetime. Trust me, the place is not worth more. And you can also forget about after sale service. They really, really don't care. <br><br>You'll be promised all sorts of things; I was told that I could have a gym bag and 2 hours of private training. I never got that gym bag, and I was persistent in asking for it. Instead, I was given a t-shirt which was not only quite ugly, but the wrong size as well.<br><br>As for the "private training", I chose Kickfit. The trainer was 15 minutes late, and then worked out with me for 10 minutes after taking another 10 to slowly wrap my hands. The rest of the time was spend trying to negotiate additional fees to pay the private trainer for future private lessons. I dared not ask to do the other hour that remained.<br><br>Now, back to the membership. You're pobably wondering how this place could maintain its facilities if they give a fairly cheap price for a lifetime membership, and the answer is: they don't. The towels smell like a sweaty gym bag, the machines do not get wiped down, and they use the same yoga mats for the whole day. A short while ago they introduced a half-hearted attempt to clean the machines by leaving towelettes and a spray bottle, but those have since disappeared. The ducts that hang just a few feet over your head are so full of dust that I thought they had been painted gray. <br><br>Now for the locker rooms. In addition to very rarely being washed, if ever, the floors are full of dirt and I even spotted a cochroach or two. The counters are filthy, and the showers... just don't touch the walls or you'll slide on the slime that has accumulated over time. They put wooden panels in the showers, and they absolutely stink. They smell like someone has done their business in them. Also, you'll want to be careful as your shower, in order to avoid the nest of insects that have made the corner their new home.<br><br>Also, you'll definitely need your stinky towels. How else will you cover yourself in a rush when they casually allow male staff to enter the women's locker room? The woman handing out the towels at the entrance has made quite a habit of having her male friend sit beside her while she's working. She also gets very annoyed when you can't understand her when she announces that a male is coming into the locker room. <br><br>Still unconvinced? Head there today for your tour, and heed my advice. Watch that sunny facial expression change when you request your flat 10,000 baht rate. And most importantly, really pay attention during your tour. You'll see what I mean.</span>

really hard to read...

[jackdawson]

the towels at paragon are all nice and new and fluffy now so they can't be going out of business , right ?

[Gaccha]

I think around June last year there were signs of new investment after a long period of cost-cutting. Almost all the machines by June 2010 were mostly rust, there was raw sewage in the showers, and nothing was getting cleaned.

But then in June some machines were bought, the new massage shops started, and a few attempts at improvements were made. But it looked desperate.

They now have enough to keep going for a quarter of a year. Let's see how things go.

[zig]

Ehh... I should have read this thread earlier - just recently signed up for one year membership with payment in advance, and the next day was approached with a proposal to upgrade to lifetime VIP membership with an option to always bring a friend or family member with me for free for just 10,000 Bt . Sounds like they are getting desperate. I hope they will last for at least one year... :-)

[doggie888888]

<span class="Apple-style-span" style="font-family: Verdana, Tahoma, 'Bitstream Vera Sans', sans-serif; color: rgb(44, 44, 44); line-height: 17px; ">You'd have to be void of all 5 senses to miss the California Wows in Bangkok; with their bright neon lights and blaring techno music, any newcomer could mistaken them for clubs.<br><br>When you first walk into a Cawow, you're treated like the proverbial kingly customer that you are; you will be complimented, you will be engaged, and your "handler", whoever is put in charge of you, will lavish you with loads of attention and answer your every question.<br><br>The reason for this is quite simple. This act of flattery has nothing to do with customer service. It is because, like loads of things in Bangkok, you're going to have to negotiate your membership fees. I'm not encouraging anyone to come here, so let me cut to the chase; they're giving lifetime memberships for 10,000 baht, and access to all the Cawows. No matter what price you're quoted, be it 12,000 baht a year, 25,000 baht a year with renewal at 99 baht per year, DO NOT accept anything except 10,000 baht for lifetime. Trust me, the place is not worth more. And you can also forget about after sale service. They really, really don't care. <br><br>You'll be promised all sorts of things; I was told that I could have a gym bag and 2 hours of private training. I never got that gym bag, and I was persistent in asking for it. Instead, I was given a t-shirt which was not only quite ugly, but the wrong size as well.<br><br>As for the "private training", I chose Kickfit. The trainer was 15 minutes late, and then worked out with me for 10 minutes after taking another 10 to slowly wrap my hands. The rest of the time was spend trying to negotiate additional fees to pay the private trainer for future private lessons. I dared not ask to do the other hour that remained.<br><br>Now, back to the membership. You're pobably wondering how this place could maintain its facilities if they give a fairly cheap price for a lifetime membership, and the answer is: they don't. The towels smell like a sweaty gym bag, the machines do not get wiped down, and they use the same yoga mats for the whole day. A short while ago they introduced a half-hearted attempt to clean the machines by leaving towelettes and a spray bottle, but those have since disappeared. The ducts that hang just a few feet over your head are so full of dust that I thought they had been painted gray. <br><br>Now for the locker rooms. In addition to very rarely being washed, if ever, the floors are full of dirt and I even spotted a cochroach or two. The counters are filthy, and the showers... just don't touch the walls or you'll slide on the slime that has accumulated over time. They put wooden panels in the showers, and they absolutely stink. They smell like someone has done their business in them. Also, you'll want to be careful as your shower, in order to avoid the nest of insects that have made the corner their new home.<br><br>Also, you'll definitely need your stinky towels. How else will you cover yourself in a rush when they casually allow male staff to enter the women's locker room? The woman handing out the towels at the entrance has made quite a habit of having her male friend sit beside her while she's working. She also gets very annoyed when you can't understand her when she announces that a male is coming into the locker room. <br><br>Still unconvinced? Head there today for your tour, and heed my advice. Watch that sunny facial expression change when you request your flat 10,000 baht rate. And most importantly, really pay attention during your tour. You'll see what I mean.</span>

In the Pattaya branch, we don't even get towels..smelly or otherwise. I have a disinfectant/freshener with me that I sometimes spray into the locker before I put my things in it...the previous user must have had really smelly feet and I doubt the lockers have been cleaned since opening day.

Many of the treadmills, bicycles, step machines are not working properly. Or they have not been callibrated properly so that you think you are doing a level 10 but in fact, it's a level 8 so a lot easier. Then the next machine is 100x more difficult eventhough you set it to a level 10. Tell the attendant and he/she/it usually can't be bothered.

An acquaintance paid the "all included" membership fee....only to find he can't attend yoga in other branches. And some new aerobic classes are now not free. I await the time when we will need to put in coins for each machine we use, rather like the laundromat or a 10baht coin for 1 minute's shower water!!!

[TheLaughingMan]

<span class="Apple-style-span" style="font-family: Verdana, Tahoma, 'Bitstream Vera Sans', sans-serif; color: rgb(44, 44, 44); line-height: 17px; ">You'd have to be void of all 5 senses to miss the California Wows in Bangkok; with their bright neon lights and blaring techno music, any newcomer could mistaken them for clubs.<br><br>When you first walk into a Cawow, you're treated like the proverbial kingly customer that you are; you will be complimented, you will be engaged, and your "handler", whoever is put in charge of you, will lavish you with loads of attention and answer your every question.<br><br>The reason for this is quite simple. This act of flattery has nothing to do with customer service. It is because, like loads of things in Bangkok, you're going to have to negotiate your membership fees. I'm not encouraging anyone to come here, so let me cut to the chase; they're giving lifetime memberships for 10,000 baht, and access to all the Cawows. No matter what price you're quoted, be it 12,000 baht a year, 25,000 baht a year with renewal at 99 baht per year, DO NOT accept anything except 10,000 baht for lifetime. Trust me, the place is not worth more. And you can also forget about after sale service. They really, really don't care. <br><br>You'll be promised all sorts of things; I was told that I could have a gym bag and 2 hours of private training. I never got that gym bag, and I was persistent in asking for it. Instead, I was given a t-shirt which was not only quite ugly, but the wrong size as well.<br><br>As for the "private training", I chose Kickfit. The trainer was 15 minutes late, and then worked out with me for 10 minutes after taking another 10 to slowly wrap my hands. The rest of the time was spend trying to negotiate additional fees to pay the private trainer for future private lessons. I dared not ask to do the other hour that remained.<br><br>Now, back to the membership. You're pobably wondering how this place could maintain its facilities if they give a fairly cheap price for a lifetime membership, and the answer is: they don't. The towels smell like a sweaty gym bag, the machines do not get wiped down, and they use the same yoga mats for the whole day. A short while ago they introduced a half-hearted attempt to clean the machines by leaving towelettes and a spray bottle, but those have since disappeared. The ducts that hang just a few feet over your head are so full of dust that I thought they had been painted gray. <br><br>Now for the locker rooms. In addition to very rarely being washed, if ever, the floors are full of dirt and I even spotted a cochroach or two. The counters are filthy, and the showers... just don't touch the walls or you'll slide on the slime that has accumulated over time. They put wooden panels in the showers, and they absolutely stink. They smell like someone has done their business in them. Also, you'll want to be careful as your shower, in order to avoid the nest of insects that have made the corner their new home.<br><br>Also, you'll definitely need your stinky towels. How else will you cover yourself in a rush when they casually allow male staff to enter the women's locker room? The woman handing out the towels at the entrance has made quite a habit of having her male friend sit beside her while she's working. She also gets very annoyed when you can't understand her when she announces that a male is coming into the locker room. <br><br>Still unconvinced? Head there today for your tour, and heed my advice. Watch that sunny facial expression change when you request your flat 10,000 baht rate. And most importantly, really pay attention during your tour. You'll see what I mean.</span>

Dude my eyes are bleeding, seriously, if you want people to read what you have to say you must make it a non painful experience or they won't even bother.

[spud1]

Why is this thread that was started in Feb 2009 still asking the same question.

[pieandmash]

Am I reading this right that you can get a lifetime membership for 10'000thb and take a friend for free ?

[Gaccha]

Why is this thread that was started in Feb 2009 still asking the same question.

...because the Chief Financial Officer just resigned on 25 April, and on 6th May the company ceased trading on the stock exchange. It is like watching car-crash TV, you just can't get enough.

[ricklev]

And there wasn't any liquid soap in any of the showers at Ekamie yesterday. They ran out of soap. No soap!

[CanInBKK]

Why is this thread that was started in Feb 2009 still asking the same question.

...because the Chief Financial Officer just resigned on 25 April, and on 6th May the company ceased trading on the stock exchange. It is like watching car-crash TV, you just can't get enough.

Delisted or suspended?

[ezzra]

Why is this thread that was started in Feb 2009 still asking the same question.

...because the Chief Financial Officer just resigned on 25 April, and on 6th May the company ceased trading on the stock exchange. It is like watching car-crash TV, you just can't get enough.

I have been working out at the Ekakami branch for a year now and thing are definitely

going down hill lately with many running machines (10) out to order for the last 6 months,

the place just barely keep up with the influx of hundreds of members particularly in the

afternoon and evening, cleanliness is just on the surface, TV feeds cut out ever 10 seconds

so you can't watch any programing without being annoyed,

first thing in the morning when you come in you see many wights and other equipments

are strewn about from last nite use, and when you drink water from the water fountain

you are not really sure what you put in your mouth and how long ago the units was serviced,

I can go on and on with few other shortcoming The point is, there is no listening to us,

i have approached the duty manger there and told her all about it and she promise

to fix it and nothing happened, ( waiting for equipment Parts to arrive fro the Singapore)

6 months later and we still waiting..

[dunkin2012]

I have been working next to california fitness on Silom Road for a number of years, and I pass by the enterance every work day at least twice. During these past 6 years the the california staff hawking thier business on the footpath have never tried to "sell" me until just 2 days ago when I was approached by a sales staff member and offered FREE membership, plus, plus etc.

I figure if I wasn't good enough to approach and be made an offer in the good times, I'm not gonna help you in the bad.

in bed? a good lookin' staff from a gym, i know her long time ago. but haven't seen her for a while....

Maybe still there....nope!! dunno.

they let you tried for free a couple of times but I 've never shown up there.....

have my own way of doing exercise. have seen some small gyms around my place.. contemplating!!! !!!! !!!!...... get more details.....

this sort of business is in the down turn.... consumers' benefit...then

[Tonto21]

California Wow going out of business………………….Shocker!

I think it was going out of business the day it was launched. The gym business or most are destined to fail because of the way they are unrealistically structured, any gym that offers a life time membership that anyone can afford is doomed, end of story! There are winners, they just aren't you.

Edited May 29, 2011 by Tonto21

[bonobo]

As a business model, selling annual memberships and lifetime memberships for less than the actual projected cost of services is a valid paradigm.

The fact of gym memberships is that depending on which study you use, anywhere from 10-25% of people who start gym memberships actually continue to work out after a year or two. So you can charge monthly membership or usage fees, but then the costs of recruitment and selling have to be recovered within a very short period of time, before the member quits, thereby driving up membership costs. By offering discounted annual or lifetime memberships, you can front-load those costs for recovery, then count on most of the new members to quit using the service after a certain period of time. This also give the people who will continue to exercise a much more reasonable cost of membership.

Then, when the facility eventually does have more and more actual, using members, you expand to another location.

For your real using members, you offer extra services for a charge. CalWow is not so good at that. They do have trainers, but many are not very competent, in my opinion. And they have a spa now at Pin Klao. But in gyms in the US, things like juice bars and supplement/vitamin sales contribute quite a bit to the bottom line.

Whether CaliWow is running its business in the best possible manner is debatable, but the concept is certainly a valid one which works worldwide.

[happyrobert]

Dear OP:

Since you started this thread 27 months ago, if it indeed shortly comes to pass, I'd like to dicuss your coming on board with my other financial consultants as a stock picker.

[ezzra]

Not sure is CAWOW is going under or not, as i have just been informed that

they are opening new branch in Khon Kean