Thursday, October 13, 2016

Health Club Management: Pricing your dues correctly

Feeling trapped when it comes to pricing?

Should you raise your health club rates or implement an annual/maintenance fee program?

Do you feel trapped when you are deciding to raise your rates?

In today’s economic environment and with the onslaught of the low-cost club, under $25.00 per month, increasing your monthly dues can be very tricky. Depending on your clubs amenities and the competition in your area, will you be able to compete better by raising your rates, or by implementing an annual/maintenance fee (AF)?

It is easier to raise rates by $x.xx or xx% per month as long as your rate structure will remain at or below  your competition’s, especially if amenities are the same or better. If your increased rates will cause you to be at the top of the rate scale and your amenities and/or services are no different than those of your competitors you may lose market share. Here is an article on Raise Your Health Club Prices and Outshine Low Priced Club Competitors. If you find yourself agreeing with this article you may want to raise your rates.

However, if you cannot compete with the amenities of your competition or your amenities are the same, keeping a lower rate and implementing an AF fee may be more conducive and easier to sell.

8 Guidelines you need to follow BEFORE you implement an annual/maintenance fee for your club:

  1. Can you legally have such a fee according to your State’s regulations that control the health & fitness industry? Will there be any State bonding issues if you implement such a fee? In many states, collecting funds in advance requires a surety bond to cover any losses to the consumer if a club closes prior to any fees being fulfilled by the club. So make sure you review your state’s regulations for your industry. You never want to get on the wrong side of a government agency. Unfortunately they believe they have to protect the consumer for all actions no matter the cost to the business that pays the taxes. (A little political jab)
  2. Consult your attorney once you have determined you can legally implement such a fee and add the necessary language to your contract. Spend a thousand dollars to do it right the first time and avoid more expensive legal fees down the road. Caution: be careful that your attorney does not get carried away with the wording. We all know they get paid by the word, just kidding, but it seems that way. This is not rocket science. Avoid all the legalese if possible. It will scare your member and only give you another objection to overcome.
  3. What is the AF going to be used for? Do not expect you can just pocket the money and buy yourself a nice new car or take a nice trip. You must reinvest in your club. Replace old equipment, add new services or renovate your club each year. You must show you are willing to invest in your members. If you do not earmark a significant percentage of the fee for such capital improvements or added services you, will lose all the goodwill you have earned over the years, and in turn lose market share.
  4. Does the AF pertain to the past year or to the upcoming year? If the fee is for the past year then you may be able to avoid any bonding issues. If the fee is for the next 12 months then bonding and/or state regulations could come into effect. The fee can be applied to current members also, but you must do the proper PR to make sure you do not lose members. If you have not raised your prices within the past couple of years this should be a very easy PR campaign.
  5. When will you debit the AF? You can debit the AF on the same date for all members, or instead schedule the debit based on the membership type, join date, or a combination of the two. If you utilize the one or two draft dates per year, one option is draft in the Fall and/or in the Spring based on the join date. For example, anyone that joins from January to June the fee will be drafted in October. If the join date is July through December the AF will be drafted in April. Always have the fee debited on a different day than the normal monthly draft date. This will avoid confusion and also help with eliminating returns. If you add the fee to the normal monthly debit you will increase your risk of returns.
  6. What is the price break for such an AF? If you were planning to raise your rates $xx per month should the AF be that amount times 12, or somewhere below? Should it be one month of your average dues? This must be carefully considered especially if you are going to include your current members. The range for the AF for our clients is $15.00 to $49.00 per year.
  7. How will I justify the AF to current members? This is a very sensitive area and may cause you to lose some members, but it may well be worth it. If you handle this correctly your members will understand, especially if you have not raised your fees in the past couple of years.  What you do not want to do is play favorites to any special membership group since most members use all the same amenities. However, the one time you can charge no AF or a different AF is if one type of membership is significantly different from the others in value and  services offered.
  8. Will I prorate the AF up to the date of the next AF? Pro-rating the fee for new members allows for a larger up front initial payment and usually does not affect the sales process. It will cause your sales staff to make some calculations based off a pro-rate “cheat sheet,” but if they are unable to handle simple math they should not be working for you. Implementing an AF program can also help in closing new sales when you run promotional campaigns. We have all run the “no money down” or “dollar down” promotions. Now these promotions will have less of an impact on the cash you collect when the member joins because you are now getting additional money from the prorated AF that will help absorb some of the enrollment discount you offer in your promotion.

The decision to add an annual/maintenance fee can provide a great boost to your club & your wallet, but do not implement the AF haphazardly.

Wednesday, September 14, 2016

8 Steps for Successful Implementation of an Annual Fee at Your Health Club

Last week we discussed the 8 guidelines you need to follow before implementing a successful annual/maintenance fee program (AF). I hope you have already started the ball rolling, at least considering all the options and surveying your current members and staff for feedback.

This week is the easier part: How to implement the AF.

 8 steps to implementing a successful annual/maintenance fee program:

1.      Clearly state the fee during the club tour

2.      Clearly mention the fee in any marketing material. The last thing you want to do is surprise a potential member with a fee they were not expecting.

3.      Clearly highlight the AF in your contract and have the member initial the section.

4.      Clearly state the terms by which the membership can be cancelled.

5.     Make clear to the member that your club’s cancellation policy must be followed; otherwise the AF will still apply even if they close their bank account to avoid any and all fees. You are making an investment in your club for your member’s future use they should give you the respect you deserve to properly cancel the account.

6.      Clearly state the annual fee is non-refundable, especially if the AF is for the next 12 months.

7.      Post signs in the club prior to the debit date of the AF to remind the members. Out of sight out of mind is not the way to go, as so many clubs do. The posting of signs is highly unlikely to cause cancellations from your active members who use the club. Non-active members may question the fee or even cancel. However, this should never happen if you are communicating with all your members, not just with those using your club. That is a topic for another discussion.

8.      Consider closing the club for X days once per year to implement any club renovations and/or add the new equipment. The best time to do this is in the summer, of course. Close the club for two days and thoroughly clean, renovate (new paint goes a long way), add new equipment, rearrange the equipment or train the staff on new services. When you re-open the members can see the difference and will greatly appreciate that you care and you are willing to re-invest in the club and their health. I have seen some clubs close over the long Labor Day weekend every year. They close Friday night and re-open Tuesday morning so they can get everything completed.

Now you have the information to make an informed decision about raising your rates or instituting an annual/maintenance fee. The tough choices are when to implement and how to include your existing members. Once you give this some dedicated thought, planning the implementation should be easy. If your current billing software or your current billing company is unable to help you with the introduction of an AF give us a call.

Tuesday, February 17, 2015

Here We Grow: A Year in the Life of

Here at, we're pretty typical pet parents. Over the years, we've personally faced some significant financial challenges due to veterinary expenses.  Like many pet owners, using 3rd party financing (such as CareCredit or CitiHealth), hasn't always been a good option for us - but for years that was the ONLY option that most veterinary practices offered if clients needed to break a large bill up into smaller, more manageable chunks.

Tony at home with our dog - wait, no our kid! - Sam
Tony at home with Sam, our dog - wait, no! Our kid!

Filling the gap in payment options at veterinary hospitals
We felt there should be a way to fill the gap created when responsible pet owners are 1) ineligible for such financing but still can and will pay in installments (only about 1/3 of applicants are approved for 3rd-party financing); or 2) are reluctant to apply for and open an additional credit line, since this can negatively impact credit scores by up to 5 points, for 6 months or more. (If you are in the process of applying for a mortgage or auto loan, you don't want another credit inquiry showing on your report, or your credit score to go down.)

Fighting against "economic euthanasia" and surrender
We spent about a year doing research on this topic, and what we found inspired us to launch an initiative to address the issue of "economic euthanasia" -- when pet owners have to put down an animal due to financial limitations, or just as bad, have to surrender their pet because they can't afford veterinary treatment. That initiative became in January 2014, under the auspices of our payment processing business, Electronic Billing & Customer Support, which Tony founded nearly 30 years ago, in 1986.

Getting the word out
The details about how was born - and what we do - were featured in an article about us in the Fall 2014 issue of Maryland Dog Magazine:

We've also been interviewed on CBS Radio in Baltimore, and have written articles on how to best manage veterinary expenses in publications such as the Maryland Pet Gazette.  By the way, we are definitely fans of pet insurance, and encourage responsible pet owners to avail themselves of all possible resources for veterinary financial assistance. See our related blog post on managing veterinary costs here.  Also visit the web site YourDogsFriend, where you can find an extensive listing of financial resources.
In September 2014, we launched our web site,, where both veterinarians and pet owners can get acquainted with the details of how our payment plans can improve pet health, as well as a veterinary practice's bottom line.

Making a difference by saving pet's lives
Our payment plans have already saved the lives of many pets who might have otherwise been euthanized due to cost constraints.  Our first success story happened just a month after our launch.  The life of 5 year old Daisy, a cocker spaniel, was saved because our payment plan made it possible for her mom to afford emergency surgery for pyometra.  The story is here:

Peggy with 5 year old Daisy, who needed emergency surgery due to pyometra.  An installment payment plan made it possible for Peggy to pay for Daisy's treatment.
Peggy with 5 year old Daisy. An installment payment plan made it possible for Peggy to pay for Daisy's emergency surgery.

Icing on the cake: increased revenue & client retention for vet practices
Our payment plan concept has been quickly embraced by pet owners, and while veterinarians have been a bit slower to warm to the idea, an ever-growing number are now offering our payment plans (in addition to 3rd-party financing.)  Those practices have realized significant increases in revenue, coupled with decreases in delinquent accounts - icing on the cake! Some practices feared increased delinquency with allowing installment payments, but the data shows the opposite.

Peggy & Daisy along with the staff at Frederick Road Veterinary Hospital, Catonsville, MD
Peggy & Daisy, with Tony and the staff at Frederick Road Veterinary Hospital, Catonsville, MD
The first three practices that began offering our payment plans saw a positive impact on revenue very quickly.  Collectively, they generated over $50,000 in additional revenue in less than a year (two of them saw a significant increase within just 3 months.)*  Other benefits included attracting more clients and strengthening client-practice bonds (enhanced loyalty.)

"Found" money: pet owners opt for more services
This is money that would have otherwise been lost by having to turn clients away.  In addition to helping clients pay for emergencies and surgeries, installment payment plans helped them say "yes" to things like dental care and cleaning, which they'd previously opted out of  due to cost.  Many pet owners consider dental treatment "elective." It really shouldn't be, of course, but pet owners can't always make sense of the connection between the value of dental care, and the out-of-pocket expense.  They are less reluctant to pay for dental care when they understand its importance, and when the cost can be broken up into smaller payments.

A gratifying mission
We're really excited about where we're going with  It is so gratifying to talk to pet owners who tell us that having an installment payment option was a "lifesaver," enabling them to have their pet treated, instead of having to bid their beloved companion a premature farewell.  We know we speak for our entire staff when we say that we're deeply honored to have the privilege to help both pet owners and vets, every single day.

A huge and hearty thanks also goes to everyone who is part of EBCS and - colleagues, co-workers, family and friends.  Thanks for your enthusiasm and support in this venture, and for your overall commitment to making our payment processing and payment recovery services the best in the financial services industry.

Bobbie Gus Jasmine
Bobbie, our Business Development rep, at home with dogs Gus & Jasmine, and Sheldon, the rabbit
You can view a short video about on YouTube here:

We hope you'll take a few minutes to watch it, so you know the faces behind the business.  We're just like you - our dogs, horses, cats, birds, etc. -  are family members, not "just pets."
Wishing you and your pets good health and happiness!

From the entire staff at, powered by
Electronic Billing & Customer Support

*Data on additional practice revenue from internal reports

Monday, August 18, 2014

A Very Personal Business:

If your pet has ever needed surgery or emergency care, chances are you felt a knot in your stomach when you saw the vet bill.  An article on the Veterinary Information Network web site noted that between 2000 and 2013, prices for veterinary services increased 91%.  As veterinary treatment becomes more sophisticated, this trend will continue.   Now that 83% of owners consider their pets to be members of the family, they expect a level of care commensurate with that perception.  The problem is, the cost of that care is often out of reach.

Tony and Suzanne with their four-legged family members:
Sam the Schnauzer and Chase the Clydesdale/Thoroughbred cross

Suzanne Cannon knows how hard it is to choose between finances and your pet’s health.  Several years ago, her dog developed a case of pancreatitis, requiring $4,000 of emergency treatment.  Despite having pet insurance, Cannon, who was then going through a divorce, still had to pay upfront and then wait for reimbursement.  Third-party financing wasn’t an option due to her personal circumstances.  “The only thing I could do was put the entire bill on a credit card.  I maxed it out, and the interest rate was nearly 21%.  I could have made monthly payments, but outside of being approved for a loan, that wasn’t an option.”

Cannon now hopes she can give more options to other pet owners.  Along with her partner, Tony Ferraro, she helped launch in 2014.  Ferraro owns Electronic Billing & Customer Support, a Timonium-based electronic payment processing firm he founded 27 years ago.  Leveraging the company’s expertise in payments and collections, Ferraro and Cannon set out to fill a gap in the veterinary industry.  Their business model allows pet owners to spread veterinary costs over time by making interest-free installment payments, while enabling vets to reliably collect those payments using Electronic Billing’s secure and sophisticated payment processing infrastructure. 

Cannon says paying for vet care is a hot topic for vets and their clients – for different reasons.  Pet owners, who find vet costs overwhelming at times, are strongly in favor of more payment options.  Vets, on the other hand, hesitate to offer payments, with good reason.  “Vets absolutely want to provide the best care for their patients.  I haven’t talked to a single vet who isn’t sensitive to the issue of cost vs. care,” says Cannon.  “But they also run a business and need to protect themselves.  They don’t want to get burned by clients who don’t pay, and they don’t want the hassle of billing.  It can be an administrative nightmare.”

Cannon and Ferraro created a system that would address the needs and concerns of both parties.  The benefit to the pet owner -- having extra time to pay an expensive bill -- reduces stress and means their pet gets treatment without cost getting in the way.  For the veterinarian, worries about getting paid are reduced because sets up automatic drafts from the client’s checking, savings or credit card account. The vet doesn’t have to invoice, track payments, or make uncomfortable collection calls. also offers a credit assessment tool to help veterinary practices determine the risk involved in offering a payment plan.  The web-based application allows the vet to enter basic client data, then instantly returns a credit grade along with recommendations for a down payment and length of plan.  According to Ferraro, “we designed the system so it executes a ‘soft’ credit pull, meaning it won’t show on the client’s credit report or affect their credit score.” won’t deny a payment plan to a client based on credit grade.  “The vet decides whether to offer a payment plan, not us,” says Ferraro.  “If a trustworthy client has fallen on hard times, and the vet wants to offer a payment plan, we won’t turn them down.  Our credit scoring system is a guideline so the vet can make an informed decision.  We won’t rule out someone who really needs a plan if the vet wants to take on that risk.”’s payment plans are offered by several veterinary clinics, including the Pet+ER, Frederick Road Veterinary Hospital, and Perry Hall Animal Hospital. Valley Veterinary Hospital in Middletown and Metropolitan Emergency Animal Clinic in Rockville, MD, offer the plans, too. 

According to Pet+ER’s Client Services Manager Mellissa Dodson, client feedback about the program has been very positive.  At Frederick Road Veterinary Hospital, owned by Drs. Dan and Lisa Zakai, clients are grateful to have a payment option that fits their budget.  “We realize that not everyone who loves their animal qualifies for a credit card, but that doesn’t mean they can’t or won’t pay,” says Dr. Lisa Zakai.  “This option allows us to be more flexible.”

For Cannon and Ferraro, who have a dog and a horse, what’s most rewarding is knowing their efforts have already made a difference.  “Our first success story came from a woman whose 5 year old dog needed emergency surgery,” shares Cannon.  “She was turned away by one vet because she didn’t qualify for financing.  She went to Frederick Road Vet, where they’d just implemented our program. They set her up on a 3 month payment plan.  Not only was her dog’s life saved, she paid off her balance early.  I have a picture of Peggy and her dog, Daisy, in my office.  It reminds me every day why we started this.  This is much more than a business  – it’s very personal to me.” 

Suzanne Cannon is Director of Marketing and Business Development for
For more information about veterinary payment plans, visit on the web or call 800-766-1918 between 10 am and 6 pm Monday – Friday.

Thursday, August 7, 2014

Another reason to secure your web site

Google to reward web sites if they use the HTTPS encryption connection.

Aside from the security issue of having your web site be HTTPS (hypertext transfer protocol secure) now you want to convert from the old HTTP so you make sure your site gets top billing with Google.

HTTPS is a communication protocol for secure communication over a network especially on the internet. It works in conjunction with SSL/TLS. The main reason you want to use HTTPS is to prevent wiretapping and man in the middle attacks. It provides bi-directional encryption between you and the server where the web site resides. Which protects against eavesdropping and tampering with the communications going back and forth.

Read more on HTTPS here.

We all know that security is the number one issue facing businesses that operate on the web. However, many businesses, especially new ones do not take the time to make sure their web developer incorporates HTTPS.

If you really care about your customers you should incorporate HTTPS. The last thing you need is for someone to hack your web site and extract sensitive information. However, now you want to make the change so you keep getting traffic to your site.

Read the entire story from PC Magazine here

Saturday, August 2, 2014

Managing Veterinary Costs: Avoiding Economic Euthanasia

According to a recent article published by USA Today (June 2014), the number of pets euthanized for economic reasons is on the rise.  As the cost of veterinary treatment has increased -- primarily due to significant advances in veterinary medicine -- the ability of pet owners to pay for veterinary care has declined.

Pet Owners Fear Cost of Treatment
USA Today spoke to both veterinarians and animal shelter workers who say that the incidence of "economic euthanasia" has increased dramatically in recent years.  At one veterinary clinic in Fredericksburg, VA, the practice owner noted that two-thirds of the pets put to sleep each week are euthanized because their owners can't afford to care for them.  In one case, a dog had to be euthanized due to a salmonella infection, because his owners waited over a week to bring him to the vet.  The reason for the delay?  Fear of the cost of treatment.

Despite Increased Spending on Pets Overall, Veterinary Costs Higher Than Expected
According to the American Pet Products Association and the Humane Society of the United States, there are 83.3 million dogs and 95.6 million cats in the United States.  Their owners spent approximately $55 billion on these pets in 2013, an increase of $2 billion dollars since 2012.  Despite the willingness to spend on our pets, who in many cases are considered family members, many of us can no longer afford the significant upfront cost of veterinary care -- particularly if it involves emergency or surgical treatment.  Even routine and preventive care has become costly.  In 2011, the Bayer/Brakke Veterinary Care Usage Study found that 53% of respondents agreed with the statement, "the cost of a routine vet visit is usually much higher than I expect."

Vet Costs a Hot Topic, Even on Primetime TV
The issue of high veterinary costs is a prevalent topic these days, so much so that it has even made its way into television prime time.  On a recent episode of FX's "Married," starring Judy Greer and Nat Faxon, the plot centered around a $5,000 vet bill -- and how to pay it.  While 76% of pet owners report that they would spend "any amount necessary" to keep their pet alive, in reality most owners aren't prepared to pay for an emergency or catastrophic illness, and are devastated -- emotionally and financially -- when hit with a vet bill for thousands of dollars.  

Pet Health Care vs. Finances: Finding a Balance
Obviously the question on the minds of both pet owners and veterinarians is "how can veterinary treatment be made more affordable?"  There is a glaring gap between the level of care that owners want for their pet, and their ability to pay for that care.  From the veterinarian's point of view, it is frustrating that providing optimal care for every pet is often hampered due to the cost barrier.

There are actually several ways to address the issue of managing veterinary costs, in order to achieve a more comfortable balance between the desired level of care and pet owner finances.  The best solution is likely to be a combined strategy, in which pet owners avail themselves of all available means for cost containment.  Here are some suggestions.

Strategies for Managing Veterinary Costs

Third-party Payment Plans
When you visit your veterinary hospital, ask about the availability of third-party payment plans -- and not just financing plans, but installment payment plans in which the cost of an expensive procedure can be spread out over time.  Installment payment plans can be a better choice if you don't want a credit inquiry showing on your credit report, and you will also avoid being hit with a high interest rate if you miss a payment, or can't pay off your balance in the specified time frame.
Pet Insurance 
Consider buying pet insurance.  There are many plans available, and a good place to start is by asking your veterinarian for some recommendations.  You should compare plans, and consider what a policy covers.  You should also assess the affordability of the deductible and premium; the process for submitting claims; and the length of time for reimbursement.  You should also note any exclusions for preexisting conditions or specific illnesses that might not be covered. 

An excellent resource for evaluating, comparing and educating yourself about types of coverage and various plans is available at Pet Insurance UniversityDo not purchase a policy before you have visited this web site!

Wellness/Preventive Care Plans
Enroll your pet in an annual wellness plan if your vet offers one. Also known as "preventive care plans," these are typically one-year contracts that cover the cost of routine preventive care.  Plans are priced differently depending on the stage of your pet's life, or the level of services provided.  The cost of the plan can be paid in full, or in some cases, in monthly installments, making it easier to work veterinary expenses into a household budget.

Financial Assistance through Charitable Organizations
Another avenue to explore is charitable organizations dedicated to veterinary financial assistance.  Some groups provide funds for owners of specific breeds, others may offer help for particular diseases, such as cancer or cardiovascular disorders.  Still others serve pet owners in certain geographic areas.  A comprehensive list of organizations that provide veterinary financial assistance can be found on the web site  Identifying which organization you might want to use, before you need it, can help give you peace of mind.

Coupons, Discounts, Promotions
Keeping up with coupons or special offers for discounts at your vet is another way to reduce costs.  Including your veterinarian's Facebook page in your newsfeed is a good way to stay informed about marketing promotions that may benefit your bank account.  Some vets write newsletters, so subscribe if you can, and watch the mail for promotional offers that come from animal health care companies.  You may be able to redeem a coupon for heartworm medication or flea and tick preventative, among other things.

It is reasonable to expect that the cost of pet health care will continue to rise, due to continuing advances in diagnostic and therapeutic options.  With that in mind, pet owners will benefit from developing a comprehensive financial plan for managing veterinary costs.  By combining available resources (pet insurance, wellness plans, charitable funds, payment plans) instead of taking a singular approach, fewer pet owners will have to face the gut-wrenching dilemma of choosing between their pet's life and their pocketbook.  

Information you can use, brought to you by #petsarefamilytoo!

USA Today, "Euthanizing pets increasing as vet costs rise,", June 2014
MSN Money, "Is pet insurance worth the cost?", June 2014
VeTeam Advisor supplement, "The Cost of Pet Health Care," J. Schori, VMD, ed. May/June 2013
JAVMAnews, "Banking on wellness:  Practices try out monthly payment plans to promote preventive care,", May 2014
VIN News Service, "Veterinary nonprofits: unfair competitors or worthy charities?,"  April 2014
VIN News Service, "Help exists for those struggling to pay veterinary bills,", May 2014
Pet Insurance University,

Tuesday, May 13, 2014

About Us: Who is EBCS, and What Can We Do For Your Business?

When people ask us, "what EXACTLY do you do?"... we can now direct them to this brief video.  Here in a nutshell is an overview of our company and its history, as well as information about the services we offer and the broad range of industries we serve.  Since 1986, we've been helping businesses improve cash flow, streamline their revenue collection process, and reduce costs.  The result?  Increased profitability, improved customer retention rates, and sales growth.  How can we help your business improve its bottom line?  Call us today at 800-766-1918, we'd love to help you!
#MoreCustomers #MoreProfits #BetterCashFlow