Salons and retailers can resume operations — with precautions — at the end of this month and the beginning of May, with Gov. Jared Polis’ safer-at-home phase, the next step in a statewide COVID-19 response. For Boulder Valley gym and fitness studios, hardships continue, and doors remain closed.
It’s been a month since Polis’ statewide shelter-in-place mandate went into effect on March 26. For an industry that thrives off of group activity and community, 30-plus days of no physical customers is a blow.
Boulder-native Emma Straight, owner of Kondition Fitness, opened her Boulder boutique fitness studio nearly two years ago. The gym has a heavy focus on group fitness for its barre, boxing, dance, spin, yoga and high intensity interval training classes.
“Our whole model is based on group fitness and being around other people, and the connections you make not only in person, but also touch, is really important, and having the instructor make corrections physically to your body or to your form,” Straight said. “My business model is based on a certain amount of people per class per day, and if I can’t do that, I don’t know how to survive.”
In the first week of closure, 40% of Kondition’s members cancelled their monthly subscriptions. Only 20% of pre-pandemic customers are paying their memberships, Straight said.
With doors closed, class drop-ins stopped and the Kondition retail shop ceased operations, adding salt to the financial wound. Drop-ins and retail dominate the studio’s revenue stream at 60%.
With a young business, Straight has yet to take a paycheck from her company. Now with mandatory closures, many of her employees are going without pay, too.
There’s only one full-time employee on the payroll and nine part-time employees. Kondition has 27 independent contractors instructing the various classes.
Kondition got approved for the Paycheck Protection Program, a part of the loan programs rolled out through the federal Coronavirus Aid Relief and Economic Security Act. The PPP program is administered through U.S. Small Business Administration-approved banks and lenders. It provides forgivable loans if businesses use the funds for payroll costs, mortgage interest, rent, and utilities payments over the eight weeks after getting the loan. Employers must retain their full-time staff at normal rates and have until June 30 to rehire any workers previously laid off.
Though both businesses and independent contractors, or 1099 employees, can apply for PPP, they are filed separately. Because most of Straight’s workers are 1099 employees, her loan amount reflects only her small staff.
“Because I have very few full-time staff, the whole amount is very little, so I don’t have enough to even pay my triple net on my commercial lease for one month,” Straight said.
Gerry and Nicole Weinhart, founders of The Yoga Pod Inc. franchise and owners of the Boulder studio, also rely on contractors to teach classes. At the Boulder Yoga Pod, their 71 contractors eclipse the 11 staff members. They have yet to learn if their PPP application will be approved, but Gerry Weinhart said any loan amount offered won’t cover all of Yoga Pod’s overhead.
“So many fitness-type businesses employ 1099 independent contractors. So that is, you know, clearly 90% of our workforce,” he said.
Yoga Pod lost about 200 members, with an additional 116 accounts placing payments on hold. Though it won’t recoup the revenue lost from the studio’s closure, Yoga Pod is retaining four of its staff members and 35 contractors by moving classes online. Instructors are paid the same rate per class as they were before the closure.
Virtual yoga classes began streaming on March 13 after an investment of $27,000 for cameras, software and other filming equipment for its studio rooms. At least 70 yoga classes are streamed through Zoom every week and available to members. Online drop-ins start at $12 per class, and a 10-class pass is priced at $100. A free public class is available on Wednesday afternoons. Classes are free of charge to Boulder Community Health front-line workers.
Yoga Pod made the film-equipment investment with intentions of continuing livestreaming after the dust settles. Though Nicole and Gerry Weinhart are positive customers will return, the future of group exercise is unclear.
“Not knowing what’s going to happen on the other side is unsettling and also not knowing exactly when we will be able to open,” Nicole said. “It’s very difficult to practice social distancing. So to be able to open our doors and expect our students to be 6 feet apart from each other is next to impossible.”
Tapping into an online market is a silver lining for Mountains’ Edge Fitness LLC owner Shannon Derby. The Boulder gym is made up of three part-time employees and six contractors who serve as personal trainers and class instructors.
“As we transition into the future, if we continue to host classes even if we have them in the studio, we could broadcast them live,” Derby said. “There’s a whole potential revenue stream that I personally had not considered before.”
Mountains’ Edge’s contractors began hosting livestream classes last month for free but not for the gym. Derby is working out a for-pay Zoom class schedule for the trainers and instructors. Around 25 monthly memberships have been cancelled since March. However, a handful of news clients signed up after tuning into virtual workouts, Derby said.
Kondition also moved workouts online with classes free to continuing members and $15 for drop-ins. Around 10 contractors are taping from their homes. Straight also rented out the gym’s 20 cycling machines for $200 a bike.
Studios and gyms are finding creative ways to generate revenue, it’s but a drop in the bucket of the money lost. For Straight, regaining the same level of customers when Kondition reopens is just as daunting.
“I’ve already lost so many members, and so many members have also already emailed saying, ‘I can’t foresee a time when I feel comfortable coming back ever so I need to terminate my membership for good,’” Straight said. “For me, and I think for a lot of fitness owners, I think the scariest part of it is that we don’t know what the fitness industry will look like after all of this.”
With gyms shuttered, Boulder Valley residents are turning to outdoor recreation for exercise and to cure their cabin fever.
“Largely, open space parks are some of the very few places for people to go to so right now we are seeing increased visitation,” said Phil Yates, spokesperson for Boulder Open Space and Mountain Parks.
He noted it’s difficult to compare visitation numbers to March and April 2019 due to various weather conditions and trail closures from muddy terrain. The largest visitation count since early March reached 30,077 inbound visitors to Boulder trailheads and paths April 4-10.
OSMP is encouraging residents to avoid unnecessary travel and visiting the closest location to their homes. Ranger enforcement increased at the Flagstaff Trailhead after parking lots overcrowded and incidents of illegal parking.
The department also is asking visitors to keep 6 feet from others and wear masks. Stepping off trail should be avoided as usual, but if an individual must go off-trail to avoid a passerby they should step on rocks and empty patches to not harm vegetation, Yates said.
OSMP manages a 154-mile trail system with 37 trailheads and 54 miles of multi-use paths.
On March 13, the Boulder temporarily ceased Parks and Recreation services, and on March 15 closed city buildings and facilities to the public and non-essential employees. This resulted in a furlough of 487 positions, majorly seasonal and temp jobs, said Denise White, communication specialist for Boulder Parks and Recreation. A loss of $175,000 in revenue a week from the Recreation Activity Fund is projected for an eight-week shutdown. A 48% decrease in March and a 95% decrease in April is predicted. Parks and Recreation processed $256,964 in refunds for those classes, programs or passes.
Amenities such as basketball courts, golf courses, playgrounds and skate parks are closed.
“People should not be using those, but our parks do stay open for people to get out and recreate. We recognize that physical and mental health and well being is really important and getting outdoors and getting fresh air allows people to do that,” White said.