Member-owner relationships are a bit like marriages. You work hard to cultivate strong, long-lasting bonds. You do all you can to show you care and provide what your member needs. Despite that effort, you can still find yourself dealing with absences, arguments, and painful breakups caused by disagreements about money. Among married couples, financial disputes are the second leading cause of divorce. Likewise, uncomfortable conversations about missed payments can make members feel like your gym is not the right place for them. To avoid losing members, put a plan in place to prevent financial disputes and strengthen your relationships.
At Member Solutions, we have over 25 years of experience providing billing services and collecting member payments. Think of us as a financial counselor who wants to help alleviate some the strains money puts on your member relationships.
Follow these 5 tips to avoid financial disputes and keep your billing practices running smoothly:
Clear billing policies allow you and your members to stay on the same page. Put yourself in your members’ shoes. Would you enjoy surprise charges to your credit card? While surprises can be fun, financial surprises can damage your relationships.
Create a membership welcome packet that clearly details what your members can expect financially. Address the when and how of payment processing, late fees, cancellation policies, payments dates, and how members will be notified if fees change.
Eventually, one of your members will show up to your gym after months of racking up an unpaid balance and overdue fees. They’ll say they had no idea it was happening. They’ll ask you why you didn’t remind them and possibly tell you they can’t afford to pay.
While it’s important to enforce your policies, sometimes it’s important to find a middle ground. Ask yourself, “What’s best for my long term relationship with this member?”
Sometimes it’s in your best interest to give a member a break. You may decide to waive fees or set up a payment plan to get a member caught up. When you make an exception, let them know that you’re doing it because they are a valued, long-term member. Explain that your policies are in place because newer members—who don’t have strong relationships like yours—might try to avoid paying.
This method has a variety of benefits:
Every gym owner is unique and has different opinions on this situation. All we recommend is that you consider the value of each customer on an individual basis.
Automated billing services virtually take you out of the dues collection process at your gym. All you have to do is set up client accounts, due dates, and payment amounts. Voilà! Your clients’ accounts will be billed automatically.
What does this mean for you? It means that you no longer have to directly collect member payments. This saves time on administrative tasks and reduces strain on relationships with your members.
The convenience of online payments has obvious appeal for both businesses and members. However, when it comes to online payments, choosing a service with maximum security is critical. The last thing you want is for your or your members’ financial information to be compromised.
Choose a Level 1 PCI compliant provider to protect your business. Providers that follow these data security standards offer the highest level of protection against credit card fraud.
In addition to damaging relationships, tracking down member payments is confusing and time-consuming. Pursuing missing payments can take up to 10 hours every week. That’s time you could spend with your members, growing your business, or relaxing with friends and family.
Outsourcing to an affordable managed billing service that specializes in tracking down delinquent accounts can reduce stress and help preserve relationships. Billing professionals have an in-depth understanding of the payment processing business and are better able to troubleshoot issues with failed credit card payments or delinquency. In fact, members are more likely to settle monetary issues with a billing company than a gym owner.
If you decide to collaborate with a third-party billing provider, choose a team that will uphold your policies while still offering flexibility to your members. A good billing company will be able to advise you on when to make exceptions for members who are having trouble paying.
Financial disputes are one of the main reasons relationships end—whether it’s between spouses, business partners, or band members who pursue disappointing solo careers. To beat the odds, you need to be proactive. Talk to your members about your expectations regarding payments. Be open to a financial partnership with your members. If you decide to partner with a billing company, choose a team with the same commitment to customer service and fairness that you do.
How do you manage the financial aspects of your member relationships? Share your comments below.