NEW YORK, Aug. 14 (Xinhua) -- Blink Fitness, a major low-price gym chain in the United States with monthly memberships ranging from 15 to 45 U.S. dollars, has just filed for bankruptcy and said it may close an unspecified number of its 101 clubs.
Blink is owned by luxury gym chain Equinox Group and is located primarily in cities and suburban areas in New York, New Jersey, California, and Texas. It has more than 400,000 members.
"Blink's bankruptcy shows the lingering impact of the pandemic on the fitness industry," said CNN about the company's decision announced earlier this week. During the height of the pandemic in 2020, Blink temporarily closed all of its clubs, leaving it without revenue to fund operations.
Blink said in its bankruptcy filing that it was still financially constrained by rent payments it had put off and was still trying to catch up from the pandemic. An undisclosed number of its clubs are also unprofitable.
"It's a sign that this is an industry still going through growing pains post-COVID," Rick Caro, the president of fitness industry consulting firm Management Vision, was quoted as saying.
"Over the last several months, we have been focused on strengthening Blink's financial foundation and positioning the business for long-term success," Guy Harkless, CEO and president of Blink Fitness, said in a statement. "After evaluating our options, the Board and management team determined that using the court-supervised process to optimize the Company's footprint and effectuate a sale of the business is the best path forward."
"This is not the first move by Equinox Group to improve the company's finances. Luxury fitness center Equinox, which falls in the group's holdings alongside brands such as SoulCycle and PURE Yoga, completed a 1.8 billion dollars funding round in March, in part to refinance its 1.2 billion dollars of debt," said CNBC in its report about the move.
Around 25 percent of U.S. gyms and studios permanently closed during the COVID-19 pandemic, or roughly 10,000 facilities, according to the Health & Fitness Association, an industry trade group. Several major chains, including 24 Hour Fitness and Gold's Gym, filed for bankruptcy.
A CNBC and Generation Lab Youth and Money Poll surveyed 1,034 people aged 18 to 34 in the United States in August and showed that roughly one-third of Americans in that age range spend between 1 and 50 dollars a month on exercise and fitness, while 47 percent report spending "nothing at all."
Some people turned to exercise at home instead of at gyms during the pandemic, with chains working since then to woo members back. Some chains in the industry have also been contending with high costs. ■