Scope of International Operations of Bally's Total Fitness and Wal-Mart

Scope of International Operations of Bally's Total Fitness and Wal-Mart

International operations for Bally's Total Fitness and Wal-Mart are responsible for a significant amount of growth as well as profitability. Bally's is the largest, and only nationwide, commercial operator of fitness centers, with approximately four million members and nearly 430 facilities located in 29 states, Canada, Asia, Europe and the Caribbean. As of June 30, 2005, Bally's opened fitness centers in over 45 major metropolitan areas representing 63 percent of the United States population and over 16 percent of the Canadian population. The Company introduced its first international Bally's facility in Nassau, Bahamas through a franchise agreement with Doctor's Hospital, the leading for-profit medical institution in the Caribbean region. Bally's also has a joint venture agreement with China Sports Industry Co. (CSI), the largest publicly traded company related to sports and fitness in China. The joint venture includes opening Bally's in major cities such as: Beijing, Shanghai, Taiwan, Thailand, Singapore, Malaysia and the Philippines. This joint venture with CSI took place in June 2002 estimating 50 to100 Bally's to be opened in Asia over the next five years. Along with CSI, Bally's has a joint venture with Holmes Place, the leading operator of premium health and fitness clubs in Europe. This will help to expand the Bally Total Fitness name brand in Western Europe and bring the Holmes Place brand name to the United States. Korea is one of Bally's strong franchising successes. "Growing the brand through international franchising efforts is a strategy that ensures we maximize our growth while incurring no capital costs for the company," said Paul Toback, president and chief executive officer, Bally Total Fitness. "By offering high-quality, affordable fitness solutions to the ever growing health and fitness needs of the South East Asia population, Bally's can continue to solidify its position as a true global leader in fitness products and services." Bally's has international operations setup in Asia, Canada, Europe and the Caribbean. These are four major countries as far as population and economy goes. While rapid growth is a key part of the company's strategy, Bally's was intent on preserving value during the expansion process. When it comes to value, Bally's makes sure that any new store to open will contain state-of-the-art fitness equipment, as well as more than 120 group exercise classes, personal training, retail stores, rehabilitation centers, massage services and childcare centers. A problem Bally's runs into when opening up overseas is the international currency rates.