More on BFT: "SmartMoney: Fit To Be Tied
1/16/1 8:0 (New York)
This story appears in the February issue of SmartMoney magazine.
By Stephanie Williams
Each year almost 1 million Americans Join Bally Total Fitness, the nation's
no. 1 health club chain. Some say they're not just getting a workout -- they're
getting worked over.
It all started last summer, when Michelle Garcia and six of her friends
decided to lose some weight. Living in San Antonio, they had plenty of gyms to
choose from, but a sales rep at one -- Bally Total Fitness -- said he had an
offer that was too good to pass up: They could join for just $30 a month and
quit with only a month's notice. "When we heard that, we were hooked," Garcia
says.
The offer, though, wouldn't last long, and the sales rep was urging them to
join right away. But when Garcia, a 29-year-old human resources manager, didn't
sign up with her friends, the rep called her office and insisted on sending an
assistant over with the paperwork.
Bally must be really desperate for business, Garcia thought. She was about to
sign the contract when she noticed that it included a $1,200 "joining fee" to
be financed over three years. She signed and sent it back, but not before
marking out the joining fee and writing "for month-to-month contract only"
beneath her signature. The sales rep called about 10 minutes later.
"What are you doing?" Garcia says he asked her. "You can't sign like that."
"Then send me a month-to-month contract," she replied.
"I can't do that," he said. "They're being printed. Until we get them, sign a
standard contract. I'm not trying to cheat you."
"Okay, I'll sign," Garcia said. "But don't screw with us. We won't be afraid
to go to court over this."
Garcia never thought it would come to that. But after the month-to-month
contracts never arrived, she began to wonder. Flustered, Garcia called Bally's
headquarters in September to end her membership. She says a service rep laughed
at her request and told her to forget it. "No matter what," Garcia says he told
her, "we're going to get that money from you."
And he wasn't kidding. At first, Garcia says, she would receive a call from
Bally once a week badgering her to pay up. But soon the calls starting coming
every evening, each one more ominous than the last. "They'd tell me that my
good credit would be ruined if I didn't pay," Garcia says. "Later, they would
say, 'We need that money and we are going to get it.'"
Once Garcia's friends heard what was happening, they wanted out too, but got
nowhere. Bally's billing reps not only insisted that they pay up, they also
began phoning the women at home and work. Sylvia Ramirez says Bally even left a
message with her nine-year-old, saying Mommy "is behind" and "needs to pay."
The little girl was so worried, she offered up her piggy bank.
Finally, Garcia and her friends hired an attorney and say they plan to sue
Bally to get the company off their backs. "I'm upset with myself and I'm also
mad at them," Garcia says. "All I wanted to do was lose some weight." (Bally
refuses to comment about Garcia and her friends' experiences specifically, but
argues that all the member complaints included in this article are "in most
cases, factually inaccurate, and in other cases, misinterpretations of fact.")
A long life and a slimmer waistline -- that's what we all want, isn't it? And
Americans are increasingly turning to Bally, the country's largest health club
chain, to get it. Already, 4 million people are on its club rosters -- more
than its six largest competitors combined -- and if Bally has its way, you'll
be next. The company, out to make itself the Starbucks of sweat, is adding some
40 facilities a year to the nearly 400 clubs it already has in 28 states and
Canada.
With that kind of expansion, Bally is a natural first stop for the 8 million
Americans who shop for health clubs each year. One visit to a Bally health club
and you'll see why so many people sign up to "spin" one of its stationary
racing bikes or soak in a hot tub. Not only are Bally's facilities furnished
with ultramodern fitness equipment, many also provide such country club
luxuries as child care and sports medicine centers. And with many metropolitan
areas boasting several facilities apiece, Bally's clubs are seldom more than a
short drive away.
But as almost 1 million people flock to Bally each year, some are coming away
with horror stories of being worked over by the fitness giant. Among their
complaints: membership contracts loaded with finance charges; egregious billing
errors; harassing early morning phone calls from surly bill collectors; threats
of ruined credit.
That's not what you bargain for when you join a health club, but many people
have no clue what they're getting into when they sign up with Bally. Despite
what some Bally salespeople may tell you, the company does not sell yearly
memberships, much less month-to-month contracts that you can walk away from.
Most people who join Bally sign its standard membership contract and are roped
into financing its $1,200 or so joining fee over three years -- at 18 percent
interest. And as Garcia and her chums discovered, the joining fees are so
crucial to Bally's financial success -- it derives much of its revenue from
them -- that the fitness chain will make you pay up even if you remain a Bally
member for just a few days.
Bally sees this setup a little differently. Dave Southern, the company's vice
president of public and investor affairs, insists that Bally's contracts are
month-to-month. "People can elect to no longer be a member at any time, and
they can elect to no longer pay monthly dues at any time," he says. "However,
if they still have a balance under their joining fee that they've financed,
they're not relieved of that responsibility unless they meet certain criteria
that are spelled out in our contract." Bally charges the joining fee, Southern
says, to give customers access to its top-notch facilities and insists that
it's nothing out of the ordinary.
Although members gripe about the joining fees -- and several other of the
company's practices, such as its hardball sales tactics -- Bally appears to
take the complaints in stride. With approximately "125 million visits to our
facilities each year, on occasion, misunderstandings, disagreements or
complaints will inevitably arise," Southern says. "We desire to resolve all
complaints quickly and to the satisfaction of our members whenever possible."
Just try to explain that to someone who has joined Bally and tried to get
out. Even if you play by its rules, you're going to have a difficult time
parting ways with the company. Michelle Bloess wrote Bally a $323 check in June
1996 to pay off her joining fee, but that following August, the fitness company
charged her credit card $308 for no apparent reason. Then, several months
later, Bloess says Bally hit her up for another $5 and then $19. Bloess, who
was then a 19-year-old college student, fired off 20 letters to the company and
finally received a partial refund a year later.
Call it wishful thinking, but Bloess believed that she had ended her dealings
with Bally. Then last year she and her husband tried to buy a house. On her
credit report was an overdue bill from Bally for $577 -- her unpaid membership
balance plus interest. The blemish ended her hopes of landing a mortgage. "I've
sent Bally letter after letter to correct this," she says. "But they keep
telling me that I'm not in their computer system. It's like I don't exist."
Some Bally members have relocated and tried to escape its grasp, with no
luck. Linda Hodges, a 26-year-old schoolteacher in Missouri, joined Bally five
years ago, and a sales rep told her she could end her membership if she moved
25 miles away from the company's nearest club. Shortly thereafter, Hodges
accepted another job and moved 160 miles away from the nearest Bally. When she
called Bally's headquarters to end her membership, a service rep told her to
send a copy of her new lease and a check for $50. But weeks later, Hodges
received a letter saying the lease wasn't enough. So she called Bally again,
and a rep told her to fax over a copy of her utility bill.
This time, Hodges heard nothing -- for years. "Then suddenly, I get letters
from a collection agency asking for $500, plus interest," she says. She called
Bally and explained that she'd gotten out of the contract.
"Read your contract," she says the rep said. "If you didn't get a
confirmation letter from us, your account wasn't canceled."
Hodges convinced the rep that the mix-up wasn't her fault, and Bally's
letters stopped, at least for a while. But Bally had sold her debt to Perimeter
Credit, a collection agency in Atlanta. Hodges says that she received letters
from Perimeter last fall telling her that she owed $500 and that her wages
would be garnished.
When Hodges tried to explain, she says, the rep cut her off. "I know your
problem," she told Hodges. "But too bad." A call to Bally also got her nowhere.
"They told me that I was no longer in their system," Hodges says. Despite all
her protests, Hodges still has a tarnished credit report that stems from her
Bally account. "After five years, I'm too worn down to keep fighting them," she
says. |
