Page 10 - CIMA MCS Workbook August 2018 - Day 1 Suggested Solutions

CIMA NOVEMBER 2018 – OPERATIONAL CASE STUDY

CHAPTER FIVE – E1

1 SUMMARY OF CASE - SWOT

Strengths Weaknesses
• Gyms are located with excellent access to public • No wet facilities e.g. saunas/ pools
transport links and/or good parking • No cafes/ bars
• Wide range of high-specification, eco-friendly • Fitness instructors may be dissatisfied
gym equipment (70% use no electricity) with zero hours contracts
• 24/7 gym operating hours – attractive to • Extensive use of IT leads to associated
members risks of system failure, data security
• No-contract membership and privacy. This can impact the
• Option of pay-as-you-use basis company’s reputation and brand
• Historic growth is forecast to continue • High levels of receivables
• Simple functional structure which suits the • May be trying to grow too quickly as
company’s size/lack of diversification evidenced by a large fall in cash and
• 2 largest operator of low-cost gyms in Celtland increase in debt to finance new gyms.
nd
• One of the pioneers of the low-cost gym model
• Listed on the Celtland stock exchange
• Some free classes, free induction session
• Gyms have showers, changing areas, lockers
and vending machines
• Advanced technology
• Members can join, manage their accounts, view
class timetables and book classes online
• Simple online joining process
• Efficient staffing model, no need for
receptionists (PIN entry system), in-gym sales,
etc
• Fitness instructors are trained experts
• Experienced, highly enthusiastic senior
management team (e.g. in developing and
managing properties)
• Knowledgeable, well-trained staff
• ‘Can do’ culture throughout the organisation
• Gym managers have bonus targets linked to
gym performance
• Competitive remuneration for employees,
including pension scheme and opportunity to
take part in a share incentive plan
• Recognise the need for continued investment in
marketing
• Customer database used to communicate with
members
• CCTV, panic buttons in the gyms
• Well-used website e.g. details of weekly classes
• Regular marketing campaigns ensure high brand
awareness
• Healthy financials – revenue, profit increased.

52 KAPLAN PUBLISHING