305 Fitness works out pandemic woes while pumping up employee health

New York-based 305 Fitness bills itself as “a dance cardio workout with a live DJ. It’s fun, wild, and hard AF.”

As COVID-19 took hold earlier this year, leaders of 305 Fitness faced a workout of their own that was hard AF — and gravely serious. With indoor dance studios featuring black lights, lots of neon and Miami club scene-inspired music, 305 Fitness was forced to close its brick-and-mortar locations in New York, Washington, D.C., and Boston, as well as pop-up studios in Chicago, San Francisco and Los Angeles. Revenues immediately plummeted by 90 percent, said 305 Fitness Chief Operating Officer Sam Karshenboym.

There were difficult conversations with landlords regarding rent abatement in the short term. They also made as many cuts as possible to keep the business afloat, Karshenboym said.

“The bulk of the cuts came down to really, really difficult decisions we had to make in HR and staffing,” he said. “We reduced our full-time team from 28 to 10. And we had to furlough all of our 250 part-time employees across six cities. All remaining full-timers on the team took a very significant pay cut.”

Health care for fitness staff

Stories of such drastic cuts sadly are all too frequent in a pandemic-ravaged business world. Like other fitness centers and health clubs nationwide, remaining open to the public as the pandemic set in was not an option. But in a business climate where every dollar counts, 305 Fitness executives opted to retain its health coverage for remaining employees.

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“We wanted to offer access to health care,” Karshenboym said. “It’s one way that we can support our team in a way that made it easy for them and also works for us financially.”

305 Fitness retained its partnership with concierge health provider Eden Health. Concierge health — a subscription-based, membership medicine business model — is one health care alternative that’s become more attractive for smaller companies wanting to provide employees with 24-hour digital care, same-day in-person primary care, and behavioral health services. 

The fitness company initially contracted three years ago with Eden Health, which in August announced an infusion of $25 million in Series B funding, bringing its total to $39 million in venture capital raised. Eden Health is known for its direct-to-employer health care delivery model, “bringing in-person and virtual health care together to deliver an exceptional patient experience to the employees of mid-market companies,” according to an August press statement announcing the funding.

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“We received a lot of feedback from our team about how grateful they were that they got to use Eden Health during quarantine,” Karshenboym said. The 305 Fitness staff is primarily in their 20s and 30s, he added, and depending on the role, they are paid hourly or per class.

“It’s great during the pandemic for obvious reasons. It’s virtual care in a time when all you can do are virtual things. I worked closely with our director of HR to unveil it some time ago, and it’s been a really great experience.”

Protecting employee safety

Karshenboym said some staff members have used the pop-up clinics, and in October they will provide flu shots to 305 Fitness staff at an Eden Health clinic.

“While we weren’t able to offer health insurance for our part-timers, we were excited to offer Eden Health as a great health-related perk,” he said.

As fitness studios nationwide were shut down in March, 305 Fitness faced many unknowns at the time, primarily around asymptomatic carriers potentially spreading COVID-19. There also was the daunting task of transitioning to a virtual working world with a pared down staff.

“The bulk of what we’re doing is still virtual,” he said. “What is in person is our outdoor classes, where we are requiring 6 feet social distancing before and after class; 15 feet during class; and masks before and after class.”

Transparency and supporting the team

To help supplement its revenues 305 Fitness offers digital certification for instructors living outside its studio markets to teach 305 techniques locally. They have certified over 300 people since March who are teaching either virtually or outdoors in their communities, Karshenboym said.

“It’s been a challenging year for all of us, at 305 and outside of 305,” he said. “I know we’re not unique in that way. It’s really just about how we as a company support our team members and our community as best as we can. The free daily workouts offered on YouTube have been a primary way we’ve been able to stay connected to our community on a daily basis. We really try to have them be fun and carefree and high energy and silly and a sort of momentary outlet to de-stress and disconnect from reality.”

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 Despite the cutbacks Karshenboym said they aren’t hiding anything from their staff. Transparency has been key to engaging their employees, he said.

The fitness company hosts free daily morning meditations for employees and its client base, as well as free workshops around self-care, resilience, confidence, and staying productive through Eden Health. Earlier this summer, 305 Fitness offered over $40,000 in creative grants to furloughed staff to support them in their creative pursuits and projects, he said.

“We’ve been offering as much transparency as we can as a leadership team through town halls, regular emails, check-ins, whatever we can do to offer the team more information into what we’re doing, why we’re doing it, how we plan to get through the pandemic and survive this,” he said. “There’s so much unknown in the world, and if we can make things known, at least within the world of 305, that makes it a little bit easier for our team to navigate this time.”

See wage costs in real-time and adjust staffing levels and assignments to drive profitability with Workforce.com’s Live Wage Tracker.