What Coronavirus Could Cost Your Affiliate

Mar 13, 2020 by

The global Coronavirus pandemic is forcing the temporary closure of hundreds of affiliates worldwide with owners facing a large financial hit in the wake of the health crisis.

To prevent the increasing spread of COVID-19, a growing number of governments worldwide are enforcing unprecedented quarantine periods mandating the closure of schools, universities and businesses.

Here’s where worldwide affiliates have been heavily impacted:

In Italy, business owners who break the quarantine could face jail time.

  • CrossFit Varese owner Carlo Strati said the situation remains unchanged since we last spoke, memberships are on hold with the business taking a financial hit: “They are not paying. We are losing money,” he said.

In Norway, all gyms are banned from operating until further notice.  

  • CrossFit Sogndal took to social media to advise members that due to government advice, the box will be closed from March 12 to March 26: “If the situation changes, we will update as soon as we know something more. Meanwhile, the gym will be thoroughly washed and disinfected.”

In California, the governor has called for any unnecessary gatherings of 250 people or more to be canceled. 

  • Many states and territories — including Australia — have received similar advice.
  • Businesses can handle the advice at their discretion but in the wake of the rapidly changing situation, CrossFit Currahee is one location choosing to close the gym for at least the weekend to ensure the facility is thoroughly cleaned.

What others are saying around the world — discussion amongst affiliate owners online is in overdrive with talks centering around how each business is affected and how each individual box is troubleshooting. Their biggest issue right now is a  surge of people cancelling or putting memberships on hold.

  • Sam Karoll, who owns Shadow CrossFit in Illinois said: “The best thing you can do is be PROACTIVE rather than REACTIVE — even if you think you won’t be affected.”
  • John Manser owns CrossFit Dynamo in Georgia: “Things have escalated more quickly than expected in my area…I expect business closings mandated by the end of next week, if not sooner.”
  • He’s planning on not only programming at-home WODs but his members will be coach-led via web conferencing.

Almost 60 million people remain under an unprecedented month-long lockdown in China’s Hubei province where the outbreak began.

  • We’ve been monitoring the situation in China since late January.
  • Several gyms worldwide have begun following the lead of CrossFit Tianfu, which continues to program workouts members can do outside the affiliate.

But Peter Joseph Kuhn who owns CrossFit Aftershock in Changsha, China has felt the aftershocks of the pandemic and is now relying on donations from friends to survive, they’ve even started a GoFundMe page “to keep a roof over my head.”

  • “A couple of months later things are getting better, except financially. Because we haven’t been able to operate we have not had any income,” he told the Morning Chalk Up.
  • “I hope that no other box will have to go through what we went through.”
  • Classes at CrossFit Aftershock are now capped at 6 people: “Every person that walks through the door must be sanitized, sprayed and a temperature check as well as hands being sanitized.”
  • “We will now have to find a way to increase our income and stay alive. The virus really hit us hard financially, however luckily none of our members got the virus,” he added.

HQ is helping out where they can:

  • HQ is clearly aware of the financial burden is out of the control of box owners.
  • In a statement, staff at HQ said: “CrossFit is monitoring the situation in areas where nationwide government suspension of training activities is affecting CrossFit affiliates.
  • Affiliate payments in those areas will be put on hold for the period they are barred from opening.

Affiliation costs $3,000 USD annually, but that’s just the tip of the iceberg when it comes to operational costs

  • Rent: Crystal Johnson owns CrossFit Puyallup in Washington and wrote to her landlord asking to have lease payments waived if the effects of Coronavirus continue to be felt on the business’s finances.  
  • “We do not plan to close … However, in the event that people are too scared to come in and cancel their membership or we are forced to close ..” she asked at the very least, her landlord consider a payment plan.
  • We spoke with one affiliate owner in Australia who pays more than $2,000 USD in rent a month but feared an even bigger cost would be losing members who each pay around $140 USD a month.

Other expenses to think about include:

  • Insurance is likely to be more than $1,000 USD a year.
  • Ongoing gym software subscriptions like beyond the whiteboard, Zen Planner and Wodify (just to name a few), even programming services — it all adds up.
  • Many boxes face expenses you wouldn’t even think about like Spotify, FIT Radio, or Apple Music, which, added together can come to a couple of hundred dollars a month. Most require an ongoing subscription which will continue whether or not members are showing up.

Health and safety remain the priority:

No doubt you’ve received advice from your local affiliate about its individual approach to the constantly changing situation.

  • San Francisco CrossFit wrote to members: “…it turns out that being healthy and fit is the best way to boost one’s immune system and counter stress. So we encourage you to keep moving, get plenty of rest, and do some deep breathing exercises during these chaotic times.”

Most affiliates, acting on the advice of the World Health Organization (WHO) have told members, in as many words to:

  • Stay home if you’re sick
  • Wipe down all of your equipment
  • Wash your hands, often!
  • Keep human contact — think high-fives and fist bumps — to a minimum.

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