The Matrix Connection Vol 2 Issue 1

430 South CP Avenue - PO Box 740 - Lake Mills, WI 53551 - Toll Free:(866) 693-4863 - F: (920) 648-6101

www.matrixfitness.com Volume 2, Issue 1 January 27, 2006

MATRIX FEELS THE MOMENTUM BUILDING

Additionally, in 2005, Matrix started construction on a new 216,000 square-foot building, slated to cost $10.5 million, which will reside on 14.7 acres in the Cottage Grove Commerce Park.

With this completion, three subsidiaries of Johnson Health Tech (JHT) will reside in the new facility – Matrix Fitness Systems, Horizon Fitness Systems, and Johnson Health Tech North America (JHTNA).

Construction is under way and should be completed in August 2006.

H5x Hybrid Cycle - An Industry Innovation Available at IHRSA!

Matrix Fitness successfully implemented numerous changes over the past year that resulted in significant sales growth in 2005. Matrix reported a global sales increase of 35% over 2004 sales. "While we are pleased with our 2005 global sales growth for the Matrix brand, we are planning for even greater growth in 2006," said Matrix President, Nathan Pyles.

The highest growth rate in 2005 came from Europe, followed by North America. "The European growth can be attributed to the success of Johnson Health Tech's subsidiary offices," Pyles says. "We now have sound commercials sales and operation teams in Germany, U.K., France, Spain, and Italy. Several of these offices are just getting started with plenty of growth opportunities ahead of them."

A 2005 highlight for Matrix was the successful launch of the new Hybrid Cycle that was shown as a concept product at the 2005 Club Industry trade show in Chicago. Many post show reviews named the Matrix Hybrid Cycle the “buzz of the show.” This is the first in a stream of new products that will launch over the next two years.

The Matrix Sales team expanded in 2005, with the addition of industry experienced staff that will help take Matrix Fitness to the next level. These industry veterans include Mark Theisen, Scott Reeves, Rich Fonbuena and Steve Berghs. Matrix is projecting rapid growth in 2006 in North America. Vice President of Sales, Kent Stevens says, "We now have a solid, high performing sales team in North America. For 2006 we will be doubling our outside sales force. This expansion will allow us to cover markets we previously have not seen."

Continuing into 2006, Matrix is launching it's industry leading Customer Advantage Program™ (CAP). Watch for next month's Matrix Connection E-newsletter for information on the CAP program.

WELLNESS PROGRAMS PART II: IMPACT ON HEALTH CLUBS TODAY!

by Tiffany Hoeye, Marketing

As you may have read in the last issue of The Matrix Connection, wellness programs are on the rise. Corporations are not the only ones benefiting from implementing wellness programs. Health clubs are evolving from their historical focus on sports and exercise and expanding into new directions.

According to S.J. Archer’s American Fitness article, members who participate in a wellness program exhibit 22% higher retention rates. As previously mentioned, the term “wellness” can apply to any program offering intended to help alleviate current health problems and prevent future problems. So in a world where it’s just as important to bring them in the door as it is to keep them coming back, offering a wellness program that compliments existing health club exercise programs can make them more effective.

Another popular reason for extending into wellness programs is the increased revenue generated from program membership dues. The American Marketing Association published an article, Healthy Returns, where 68 out of 105 respondents indicated that they would be “likely” or “very likely” to spend an additional $40 per month on a wellness program that contained components that are important to them. However, as previously noted there is a growing presence of corporate sponsored/subsidized wellness programs either through direct reimbursements or discounted health insurance. Health clubs may be able to tap into this profit stream as a secondary source for corporate programs.

Cost investment? Most health clubs are likely to already have the equipment necessary to handle the exercise component of a wellness program. Transitioning into wellness should not entail a large investment; the certification to be a qualified provider only costs a few hundred dollars and has shown to have a positive impact on the health club’s core business.

Although health clubs seem well-suited to offer a wellness program, a health club’s ability to succeed in the wellness market may be hit or miss. So how do you decide if a wellness program is right for your facility? Before diving in, you may want to do a bit of research to find out how your members will react to a wellness program and what programs would be most beneficial. Once you know what is right for you and your members, you will be able to make a more logical decision.

Please contact us if you’ve implemented a wellness program in your facility! We’d love to share your success!

AROUND THE WORLD WITH MATRIX

NORTH AMERICA

Garrett Community Center Garrett, IN

Square Footage: 26,000 square feet

The Garrett Community Center is the fourth site that is operated by the YMCA of DeKalb County. Housed in the Garrett Center is a high school sized gym with a walking area around it, day care classes, kitchen, meeting rooms, fitness center and locker rooms. The Center offers everything from sports to child care to senior citizen programs.

The Garrett Community Center chose Matrix because it looks sharp and their high regard for their sales and service representative, Dale Hansen. "It's great having Hansen Fitness less than 15 miles from our site and knowing that they are maintaining our equipment offers a real peace of mind," states Terry Rayle, Executive Director.

ASIA

Chungmu Land Gym C&R, Korea

Square Footage: 5,380 square feet

Established in 2004, the Chungmu Land Gym has been attracting new members with its spacious floor plan and natural lighting. Chungmu offers outstanding facilities and innovative fitness and spa systems, with nutrition consultants on hand to encourage independent fitness goals. Other amenities includes an aerobic classroom, group exercise studio, spa/salon and massage services.

"I'll be purchasing more equipment in the future due to the positive experience I've had with Matrix overall," said Chungmu's owner.

EUROPE

Place Foz Club Porto, Portugal

Square Footage: Approximately 16,145 square feet

Place Foz Club is one of the biggest chains of health clubs in Portugal. The spacious and elegant facility has a wide variety of fitness options. According to the owner, design, quality and the ability to integrate entertainment were the deciding factors in choosing equipment. Other amenities include an aerobic classroom, group exercise studio, strength training area and swimming pool.