Magazine Article | August 13, 2015

ISV Attracts Big Business With Consolidated Cloud Applications

By Matt Pillar, chief editor

By consolidating several business applications into one subscription-based software package, this integrator is cornering the market in its vertical.

Thirteen years ago, long before the cloud was considered cool, Larry King wrote a Web-based scheduling pro gram tailored to fitness training facilities. Shortly after selling a subscription service to his first client, a personal training center, King says the concept began to snowball. Today, he’s the founder and CEO of ShapeNet Club Management Software. He employs 16 professionals and counts more than 400 fitness centers among his customers.

The key to his company’s success, he says, is the consolidation of several applications deemed mission-critical by fitness centers on a single platform. “Many gyms are running one software system for scheduling, another for billing and payments, and in some cases, several other applications to support sales and marketing,” he says. ShapeNet combines all those features in a SaaS-based package, and it also offers POS hardware.

The complete club management solution the company offers today wasn’t always as comprehensive. King says the package evolved with demand. “We started out with a simple system to help personal trainers manage their schedules,” says King. “Somewhere along the way, a client asked us if we handled EFT [electronic funds transfer]. I looked into that and soon built billing and payment acceptance into the solution.” Similarly, the evolution of the personal trainer management features in the ShapeNet system are a product of clients’ requests. Today, it features automated email and text reminders to gym customers, automatic calculation of trainer payroll based on session tracking, and controls that prohibit gym customers from scheduling sessions if their payments are delinquent. Gym members can also use the ShapeNet-developed member portal to manage their accounts, view available classes, schedule appointments, and purchase memberships.

Single-Platform Management System Earns Gold’s
It’s ShapeNet’s multi-application platform that attracted one of its marquis customers, Gold’s Gym. The iconic 50-year-old fitness franchise runs ShapeNet’s membership management, personal training, and billing applications, and several of its locations run POS hardware installed and serviced by ShapeNet. The ISV is part of the gym’s Preferred Vendor program. For a large franchise like Gold’s, King says his billing and collections service is a key value proposition. “Many of the Gold’s Gym facilities we serve bill hundreds of thousands of dollars per month,” says King. “When a gym charges 2,000 cards and gets 200 declines, Subscribe to Business Solutions magazinemanaging those exceptions can eat considerably into the business’ profitability.”

That’s where ShapeNet’s partnership with OpenEdge comes into play. “OpenEdge offers a DeclineMinimizer feature that automatically updates expired and outdated card information every day,” says King. The feature thwarts lost payments for the retailer, and it minimizes the collections effort that ShapeNet built into its billing services offering. “Batch operations are easier with OpenEdge,” says King. “A batch of 2,000 bills can be automatically streamed to processors. In the old process, batches had to be created manually and uploaded, so the daily process is much more efficient for our end users.”

King says payment security is also a growing concern among his customers, especially large gyms. Because recurring payments are a mainstay for membership-based gyms, both ShapeNet and its customers’ facilities must pay close attention to PCI regulations pertaining to card-on-file payment acceptance. “OpenEdge uses point-to-point encryption and tokenization, so PCI liability is minimized for ShapeNet and our customers because we don’t have card data on our servers,” says King.

Gold’s Gym and the hundreds of other fitness facilities ShapeNet serves — from as far away as Europe and Australia — are benefitting from King’s consolidated approach to membership management. “The legacy approach, which involves three or four different pieces of software, creates operational inefficiencies that can really hurt the center’s business,” says King. “If a member cancels, that cancellation has to be iterated across multiple platforms. In many cases, those former patrons continue to use the facilities for months on end without paying because the systems aren’t in sync.” King says ShapeNet’s single database architecture, which supports membership management, personal training, member retention, and sales, eliminates that scenario.