Operating loss of approximately 5.8 billion yen! Hair Removal, Nails…Rapidly expanding business “Chocozap” has over 1 million members, but challenges and the future

The training facilities are a bit lacking for those who dare to be “hardcore”…

Everyone knows that a moderate exercise routine is important, but going to the gym can be a hassle.

RIZAP’s “chocoZAP” is a convenience store gym for beginners that is said to be suitable for those who do not have a regular exercise routine or who are not comfortable in the gym.

For about 3,000 yen/month, you can use the entire facility 24 hours a day, 365 days a year, and you do not have to change your clothes or shoes. This is a big step forward for me, who used to do nothing but trampoline at home in the midst of the COVID-19 crisis.

What is worrisome is that the company’s announcement of its financial results for the second quarter of the fiscal year ending March 31, 2012, which included the following two items: “membership exceeded 1 million” and “1,160 stores (as of November 14, 2012), opening new stores in 40 prefectures,” which sounded like a good sign, and the company’s operating loss of 5,791 million yen (compared to a profit of 230 million yen in the same period last year) due to its rapid expansion, which was reported in the same period last year. The other is a deficit of 5,791 million yen (compared to a profit of 230 million yen in the same period of the previous year) due to rapid expansion.

Because of the convenience of using RIZ, we are concerned that the rapid expansion may lead to a rapid decline. When we asked the RIZAP Group for an interview, Kazuki Murahashi, who is in charge of the “chocoZAP” business, responded.

The first stores were completely different from what they are now.

What I think chocoZAP “invented” is that it eliminated all the hassles that come with gyms – changing clothes, shoes, showers, and dealing with people. It seems like a service that is well aware of the negative mindset of people who don’t like to exercise or hang out with others, but where did the idea come from? When I first asked this question, Murahashi replied, “Actually, it was originally called chocoZAP.

Actually, it was not originally called chocoZAP, but we had been developing several services under different trade names. We honestly didn’t know what kind of ratio would make our customers happy, in terms of fee structure, machines, and so on.

30 We started two years ago and have continued to test various store patterns to see how we could make the most of the limited space of 30 tsubo (860 square meters).

The first chocoZAP store was completely different from the current one, he said with a laugh.

For 10 years, RIZAP’s method was to help people lose weight through exercise and proper nutrition, with a focus on muscle training.

But while there was a huge line for the treadmills and aerobics, the other machines were skimpy. When I saw that, I felt that this was not what the customers wanted, so I decided to try something different next time.

30 I would adjust the space according to the customer utilization rate and other factors, such as whether it would be better to have more machines or more beauty-related products in a 3.5 square meter space, or whether new services would please customers.

In fact, as they proceeded, they discovered what beginners enjoyed as well as what they struggled with. One example of a discovery that defied expectations was the “multi-machine,” a single machine that can be used to train various parts of the body, such as the chest and shoulders.

We introduced the “multi-machine” because we thought people would be happier if they could do a variety of workouts on one machine,” he said. But beginners don’t know how to use it at a glance.

In the end, one thing I discovered was that they were more pleased with machines that were easy to understand: chest for chest, shoulders for shoulders, one separate machine for each, with the weight determined by simply inserting a pin, and only moving in one direction.”

I don’t want to be laughed at for using the machine incorrectly,” he said, “and I’m afraid I’m making noises like ‘ugh.'”

He has interviewed a huge number of customers, including those on the Web, and while repeating trial and error, what has always been important to him has been “the voices of people who are new to the gym or who are not interested in the gym in the first place.

We tried as much as possible not to use the name “gym,” because many people think that just hearing the word “gym” in the first place makes them think it is something that has nothing to do with them.

Also, many people say, “I don’t want to be laughed at if I use it incorrectly” or “I’m afraid of making noises like ‘ugh'” if there are people who are too hardcore, so we have made the training facilities a little insufficient for such hardcore people. We have been working to make our gym a service that beginners can choose.

Many people say that they don’t like the fact that the average gym is a place where people can only stay for one or two hours, and that the lockers and other facilities are a hangout spot for people like Don. But now at chocoZAP, there is basically no concept of sitting in lockers. Many people have told us that they feel comfortable training as soon as they drop off their belongings.

In fact, while the fitness population in the U.S. is about 20%, the fitness population in Japan is about 3%. Until now, competitors in the same industry have been competing for that small piece of the pie, he said.

In fact, the first store we opened without much consideration for beginners had an overwhelmingly high percentage of men. People who were going to other companies’ 24-hour gyms for 8,000 yen would pay less if they could go for 3,000 yen, so we were only competing for 3% of the market.

If we listen to the voices of the 3%, for example, they will say, “I want dumbbells,” but we cannot aim for 20% unless we encourage those who are not interested in gyms, those who are interested but have never been to a gym, and those who have no interest in gyms to take the first step. That is the purpose and goal of the chocoZAP business.”

Hair removal, nail care, whitening… one out of four male members uses beauty-related machines.

Currently, there are about 11 types of training machines, including treadmills (running machines), aerobikes, and chest and back training machines. Other services include private esthetic clinics, hair removal, nail care, whitening, golf, massage chairs, and “Choko Cafe,” a free drink service that requires an app-based reservation.

One in four of our male members actually use beauty machines. Some members look up how to use the machines on the app beforehand, but there are also pop-ups in the private rooms that show how to use the machines, so they can do it by following the instructions, and many try it just by watching and imitating.

Currently, about 70% of the users are in their 20s to 40s, and about 30% are in their 50s or older. In terms of the ratio of men to women, while men are said to account for about 80% of regular gym users, chocoZAP has 52% women.

We have a lot of people who come here for the beauty equipment or for the first time. I feel that a cycle has been created whereby beginners invite beginners, not because they are not serious, but because they feel at ease knowing that there are people similar to themselves.

Loss-making” has already been factored in.

By the way, the number of stores is expanding rapidly, and new machines are being added all the time, but can these prices pay for themselves?

In the past, it was not so difficult to start a new menu when there were only a few dozen stores, but now we are expanding to 1,000 stores, so honestly speaking, it is a challenge for us.

We are often asked why we are expanding so rapidly. We want to make exercise a part of people’s lives through chocoZAP, but in order to achieve this, we need to have stores everywhere along the lifeline, just like a real convenience store. That is why we are currently working toward our goal of opening 2,000 stores by the fiscal year ending March 31, 2014.

We have reached 1,000 stores and now that the foundation has been laid, we are confident that we will be able to recoup our losses.

We have reached 1,000 stores, and now that the foundation has been laid, we expect to be able to recoup our investment. If we can create an environment that satisfies our 1,000,000 members, we will be able to recoup our investment from the next fiscal year onward, and we will use the money to invest in improving our services, and then deliver new services to our customers. We will use the money to invest in improving our services, and then deliver new services to our members. We hope to create a cycle in which customers are happy with our services, they continue to use them, and new members join us in the next fiscal year and beyond.

While there is the ease of the impersonal type, there are difficulties unique to the impersonal type, such as people occupying one machine for long periods of time, possible problems between customers, and machine breakdowns and malfunctions. ……

For example, right now we have RIZAP trainers all over the country who are also closely involved with the chocoZAP operation and go to resolve any machine malfunctions.

We also have AI cameras, and if someone is behaving in a way that disturbs other customers or is acting suspiciously, the management center in the back is notified with an alert. We will catch up with them, and those who break some of the rules will be contacted individually and may be penalized or otherwise cautioned.

We also do this by having customers notify us via an inquiry form or by tagging machines at each of our locations to let us know if there is a malfunction. We use a variety of methods to resolve breakdowns and problems in a comprehensive manner.

What are the challenges? When asked, “What are the challenges?

We need to maintain a satisfactory store environment so that existing customers will want to continue using our services. We launch advertisements at the timing of every campaign, but what is more important is to provide a service that satisfies the current one million customers.

In fact, through our efforts to brush up our services and encourage customers to use our services, the withdrawal rate is gradually decreasing. We would like to focus more on this area to increase the customer retention rate.

The task before us is to steadily clear up points that need to be improved, such as machine breakdowns and cleaning conditions. We also have many services that we are still preparing under the surface. We need to keep adjusting through constant trial and error, and our goal is still a long way off.

Click here for the chocoZAP website