Gym price discrimination

FWIW, contract strikes work just as well (sometimes better) on gym memberships as for any other legal agreement. If he's willing to pay the "full price", but doesn't want to deal with a cumbersome cancellation method, strike that clause and see if they will still approve the membership. That's a give and take. That's a negotiation.

Either he is deliberately feigning ignorance as fodder for a blog post (likely) or Mr. Steinberg is unaware of how modern gyms, especially ones located in dense urban environments, actually make money.

Mainly it's through un/under-utilized memberships and revenue-sharing from ancillary services (personal training, first-aid classes, childbirth classes, etc.) and seminars which can best leverage the uncommon properties of the real estate.

What's one business's "Price Discrimination" is another's "Flexible Pricing Strategy". A classic example are the near orders-of-magnitude margin differences for the same 1oz. of Coke depending on the customer (vending machine, supermarket, restaurant, stadium). Same customer, different channel, same product. For those who remember, a similar strategy was leveraged successfully (for a limited time) by AOL to manage subscriber churn.

In this specific example, I highly suspect "Dan" joined the gym during a lull point in the calendar year (low-demand) or was a so-called "charter" member (pre-paying). Though likely the same physical space and equipment when "Dan" joined, the financial profile & goals of the company which own the facility may be very different today--and, hence, reflected in their membership pricing.

That said, there's clearly a market for a "hassle-free" gym, but that business model is going to have roughly the same fixed capital costs of other gyms, but get squeezed between low/no-margin YMCAs & county/municipal facilities at the low-end and high-end "clubs" (like Crunch) where, sadly, part of the business model's revenue is the social and life-style exclusivity afforded by that membership fee. In big cities, high-end gyms are the modern equivalent of country clubs.

Personally I'm glad that I have all the stuff at home and can avoid the contracts and sleaziness of the average gym while also not having to trudge across town to one of the few decent gyms in existence.

You can also generally get better deals by trying to join just before the salespeople have to make their quota each month.

That said, all he's really asking is whether he can get exactly the same deal his friend has. Obviously they're making money off his friend so it's not like he's marched in and demanded that they lose money on the deal or something.