I interviewed my friend Warren Ogden, who started the first full service health club and wellness center, PURE, here in Granada, Nicaragua (www.purenica.com). PURE has become a truly transforming presence in this community. Residents and tourists alike are extremely grateful to Warren for providing spa services, a fully equipped gym, and a large variety of classes: yoga, Pilates, aerobics, dance. Warren himself is an experienced yoga teacher and personal trainer, and an excellent role model for healthy living.
Can you talk about the process of starting PURE?
I’m not a retiree so I did need some way to make a living. And this is what I’m most interested in: health, yoga, nutrition and fitness. It’s what I really like to do. We started in the front room of my house with one-on-one personal training and healthy meals to-go. I happened to already own a decrepit, large old building so I started fixing it up over the course of a year. So the business evolved slowly, which was a positive factor in our success, as key decisions and plans could be well thought-out.
Did you do any marketing research beforehand?
I had already lived here for a while and the need was obvious, just from talking to people. A full service wellness center would be a brand-new business here with no competition to speak of. I did a survey with interested friends, mainly residents, to determine price-points as we deal with a wide variety of demographics here. Our first clients were fairly well-off expats as they had the knowledge, education and desire for these services, as well as the means. Now, we also service middle class Nicaraguan locals (poor by our standards) who might only pay $5/month for a limited package. Tourists pay the most as they are here only for a short period of time, so aren’t doing memberships or discount packages.
What services does PURE currently offer?
We have classes in yoga, Pilates, aerobics, dance, and kickboxing; one-on-one training with qualified personal trainers; spa services such as massage, shiatsu, pedicures, manicures; juices and snacks; and a fully equipped gym with weights and machines.
What are the benefits of opening a health club/wellness center in a developing country, compared to North America?
The cost of establishing and running this type of business is only a fraction of what it would cost in the U.S. So the risk is far less. And, in the US, you’re competing with big franchises like Bally and other 24-hour clubs who can offer very cheap prices based on their volume. So unless your niche is very specialized and different you really can’t compete. Also, in Nicaragua, big capital layouts and chains just don’t exist – foreigners are less likely to invest here.
What are some of the challenges you’ve faced?
Finding and building gym equipment was a challenge. This is also related to the challenge of finding competent trades people and professionals. Standards are much lower than what we are accustomed to, and there is no standardized education, training, or certification in most trades. Also, there is no quality control or oversight for any trade. The process is very much trial and error. Since very few complex machines are produced here, building good weightlifting machines was difficult. For electrical equipment like elliptical machines, we had to import from abroad. Even yoga mats are non-existent so I’ve had to lug down hundreds of pounds of mat material from the U.S.
How does Nicaragua compare to Costa Rica in this type of industry (health clubs, wellness center, yoga, etc.)?
Pilates, yoga, meditation, etc, here are mainly for foreigners. There has been a big transition in Costa Rica over the last 20 years or so, and they are about 15 years ahead of Nicaragua in every respect. Here, it’s all new.
What marketing and promotion do you use?
We have a website and lots of promo around town. We have a very good presence in all the upscale hotels with fliers in reception areas and every room, and we offer gym services to their guests for free. These guests always end up buying other services such as massages, classes, health drinks. We are listed in the Lonely Planet guide and are in contact with Moon and Footprint for their next editions.
What about profit margins and return on investment?
I estimate it will be four years before I break even and pay off all starting costs. Also, I’m continually investing more in new services and equipment. There has definitely been a positive cash flow over the course of each year. This is not, however, a way for someone to make loads of money.
Any advice to would-be entrepreneurs who want to go into this business?
• Learn the language of course
• Budget 10-20% more for unforeseen snafus. There’s not as much information here as at home, and there are bound to be a lot more surprises.
• Notice what locals do and do that. If they sit out in front of their houses every day from 5-7, you do it, too. You’ll be better received and more in touch with the community. Relationships with neighbors are important and you’ll adjust more quickly to the pace of life here. Your life will be more sustainable and pleasant if you can adapt. And, if you can’t adapt then go home.
• Realize that in Nicaragua, and probably some other developing countries, there is sometimes an attitude of entitlement and expectation that you as the “rich gringo” should simply subsidize the poor. In any project, or as an employer, make sure you are empowering and educating people to stand on their own and do their own work rather than just giving something for nothing.
See www.purenica.com for more information.
Do you have similar stories to share about getting a business started abroad? We’d love to hear from you.
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