Fitness with a trim bottom line

The swimming pool, gym and squash courts at London's Docklands boast the latest in sports equipment technology. Were this a members-only health club, it would cost around pounds 700 a year. But this one is free to employees at the Reuters building. The take-up rate among staff is nearly 80 per cent. "The company believes in preventative medicine and we want to make employees aware of the benefits of being healthy," says Julia Clarke, the centre's manager.

The desire to keep fit has spawned a British industry worth pounds 780m, according to Mintel. By encouraging exercise in the workplace, companies can monitor the health of their employees directly. Fitness for Industry (FFI), which is owned by Granada, manages the Reuters club and gives employees health and lifestyle assessments before they use the facilities.

"We will look at the general health of the employee and can offer individual programmes relating to smoking, weight or stress," says Peter Nixon, marketing manager at FFI, which operates 42 corporate health clubs.

While Reuters is prepared to offer the club as a staff benefit, other companies wish to remain healthy - on the bottom line. Rover Group opened its health club last month at no cost to itself. In an innovative deal, a consortium of companies has invested pounds 500,000 in a sports complex at Rover's Longbridge plant for the 15,000 employees. Rover has supplied the site and the consortium, including Powersport (part of Hawtin, the sports and textiles group), refurbished and kitted out the club. Powersport subcontracted the running to FFI. The club charges commercial rates to staff to recover investment and running costs. The fees are pounds 30 to join and pounds 16 monthly.

Rob Ball, general manager for learning and development at Rover, says: "We are not experts in this field and by handing over the project it need not be part of our corporate responsibility."

According to Philip Dovey, group managing director at Hawtin, "Companies need to make a large capital outlay to start up a fitness centre. We can do a turnkey facility for an employer, design the centre, supply the equipment and run it."

Rover wanted to tie in the club to its medical facilities, which include a dentist, an acupuncturist and five physiotherapists. "We approach health from every point of view," says Ian Felix, head of physiotherapy at Longbridge. "We deal with acute injuries and want to offer the best care. We can now offer rehabilitation on-site." Employees referred to the club for medical reasons do not pay fees.

Within weeks of opening, the centre has more than 500 members and is operating at capacity at peak times. And paying fees for what was once a perk does not seem to have been a deterrent. .

American Express has just handed over the commercial running of its fitness centre at its Brighton headquarters to an outside company. Initially, American Express equipped and ran the facility. It then handed over the running to FFI, to whom it paid a fee, but kept the pounds 8 monthly subscription. This month, FFI takes over the financial side, too. Extra equipment has been bought, fees have risen to pounds 11 and are now payable to FFI. "It's more cost-effective for us and we still see it as a staff benefit," says an Amex spokeswoman.

FFI now manages a variety of deals, ranging from the standard corporate contract where a company pays FFI to run the club and offers it free to employees, to semi-commercial clubs where the company pays for the equipment but FFI runs the club and collects the fees. "We have to be more and more flexible as companies want to cover their costs," says Peter Nixon.

At Lincoln City Council one of the first such deals involving the public sector has been agreed. This month the council opens a state-of-the-art health centre to the public for a minimal outlay. Lincoln City Council provided the site under the new stand at the city's football ground. A Hawtin subsidiary, Meridian Leisure Development, has refurbished the centre and will run it. The council will pay the rates, heating and lighting bills of about pounds 10,000 a year.

Robin Rushton, head of recreation, leisure and tourism in Lincoln, says: "We were initially worried that the club would not be accessible to everyone." However, Meridian agreed to offer sessions at pounds 1.75 to disadvantaged groups, such as the unemployed. Fees for the general public will be around pounds 300 a year, much less than for a private club.