Scaling: A Hard Lesson for Applied Fitness Solutions

Let’s talk about scaling up. This decision sounds great in theory, but in our case, it turned out to be one of the hardest lessons we’ve learned our business. If there’s one thing I know now, it’s that scaling a business isn’t just about taking what works in one place and replicating it in another.

For those who don’t know me, my name is Kemper Sosa and I’m the co-owner with Michael Stack of Applied Fitness Solutions (AFS), a health and fitness studio with a mission to deliver personalized health & fitness coaching and create meaningful change in people’s lives. We’re not a place that only hangs our hats on delivering great workouts. We’re interested in creating sustainable & impactful health change, the kind that stays with you when you’re not “in the gym”. Over the years, we’ve built something special here in Ann Arbor and are always striving to create a new standard in the fitness industry.

We started AFS in 2007 with our Ann Arbor location. Things were clicking—we had a strong base, an incredible community, and we felt like we’d cracked the code on what made our model work. So, we decided, “Let’s take this to other cities!” We opened our Plymouth location in 2016, thinking the magic formula we’d built in Ann Arbor would work anywhere. When things seemed steady there, we decided to double down, launching our Rochester Hills location in 2018, again assuming the Ann Arbor model was the golden ticket. Thinking ahead, we built those facilities to be even bigger than our home base, in an attempt to capitalize on the rapid growth we had experienced in Ann Arbor.

Here’s where things got tough. As excited as we were about expanding into new communities, all of it came to a grinding halt when financials became stagnant sooner than we anticipated. Unfortunately, our Plymouth and Rochester Hills locations had to be closed.

Once the emotional pain subsided, we did the post-mortem analysis to answer the question “What did we miss?”. Both Plymouth and Rochester Hills were built too big—built for growth that simply didn’t match the local market’s needs. We didn’t ask ourselves enough questions about how Plymouth or Rochester Hills might be different than Ann Arbor. We overlooked some critical nuances, like the growth strategies that would have been better suited to those areas.

Another major miss? We didn’t look closely enough at what was happening in the industry. Fitness trends were shifting fast, with the boutique boom saturating the market at a pace we hadn’t anticipated. All of a sudden, every corner seemed to have its own spin studio, small-group training gym, or niche fitness experience. This left us competing in a much more crowded space than we’d planned for.

Since then, we’ve re-grouped, capitalizing on the learning lessons I mentioned above. While we endured a painful few years, the learning we underwent was invaluable. Our Ann Arbor location was impacted by Covid19 (alongside many other small businesses). With that said, it granted us to opportunity to revisit how we would navigate moving forward. We bounced back to success by revamping our core purpose, reorganizing the org chart to put the right people in the right seats, tracking specific KPI’s, and most importantly, evaluating every strategic decision against our vision and purpose.

I won’t lie—these lessons were painful, and our missteps in scaling have been humbling. That’s why I’m genuinely excited about the upcoming LeadersConnect event on November 22nd. We’ll be diving deep into the principles of scaling, specifically the if, how, and why of growth decisions. I can’t help but think how valuable this type of discussion would have been for us back when we were expanding.

The panelists delivering such valuable insights are:

If you’re at a point in your journey where you’re considering growth, I encourage you to join us. Learn from our experiences, and maybe avoid some of the mistakes we made. Scaling can be a powerful tool, but only if done with the right strategy and foresight. We’re looking forward to seeing you there and sharing what we’ve learned—both the highs and the lows.