EFM Health Clubs needed a recurring processing solution that would give autonomy to franchise owners, while streamlining operations across the company. They chose Ezypay for their hands-on approach to business, and the versatility of their recurring payment processing system.
The result? EFM cut their payment processing time from 22 hours to 2 hours per month by automating payment processing across their franchises. They increased their cash flow through reduced declined payments. And following their onboarding with Ezypay, they were included on the BRW Fast Franchises list three years in a row.
About EFM Health Clubs
EFM Health Clubs are a fitness franchise that commenced in 1991, and now have 60 clubs across five states in Australia. EFM combines the affordability of a typical gym membership with the highly tailored nature of a personal training program. Currently, they service about 7,500 customers.
EFM Health Clubs specialises in running health clubs in hospitals and schools. They operate over 25 clubs located in hospitals throughout Australia providing a health and fitness program for doctors, nurses, and other hospital staff.
With an additional 30 or so clubs located onsite at schools, EFM runs fitness programs for the school community with the objective of keeping staff fit and healthy. The company is dedicated to fighting childhood obesity through student “Fit 2 Play” sessions.
The majority of clubs located onsite at schools and hospitals are also open for the local community to attend.
“So, when I started, we only did credit card,” says Fiona Lindblom, Financial Controller and Systems Training Manager at EFM Health Clubs. “We didn't have direct debit. The billing would be done at our level, the corporate level. Franchisees would send us their client list on a spreadsheet, and I would use a little EFTPOS machine and manually type in every single member's credit card details to process their payments.”
“That ended up taking me 22 hours straight to process a month's billing, every month,” says Lindblom. “If there was an error, if I mistyped something, I'd have to do it again. You had to wait for each payment to be processed and approved before starting the next. It was extremely time consuming to say the least.”
In addition, manual processing also led to a nearly 15% rate of decline on payments.
When a payment was declined, the franchisee would be responsible for collecting the payment themselves. If that payment was done using a card, it would be processed by corporate. But if they paid in cash, the payment was more difficult to track. With no coherent payment monthly billing and fortnightly payments piling up, things got complicated fast. “I think at some point I did do a mid-month billing,” says Lindblom.
Searching for the Right Partner
Finding the right partner to take over payment processing involved a lot of stakeholder input. Under the old system, franchise owners weren’t billed for the 22 hours corporate billing time, so getting them on board to pay for processing services required some convincing. EFM needed a payment processor who could add value for their franchisees, while also keeping costs low.
Most of the big banks that they approached couldn’t offer a seamless solution that suited their needs while others charged above-market rates for that kind of service.
In addition, EFM needed a recurring payment processing partner who could automate credit card processing with bank direct debit capability too. They wanted a processor who could bring recurring payment system experience to the table as well. In addition, EFM wanted to facilitate payment tracking and processing for individual franchise owners with little or no oversight from corporate. Most of the big banks that they approached couldn’t offer a seamless solution that suited their needs. Others charged above-market rates for that kind of service.
After reviewing several potential partners, they went with Ezypay. Here’s why:
Getting Stakeholders on Board
The first step in the process wasn’t technical so much as it was personal. Ezypay took a highly personal approach to solving the problem.
Ezypay came to EFM with experience setting up recurring payment processing systems for similar subscription-based businesses.
Ezypay came to EFM with experience setting up recurring payment processing systems for similar subscription-based businesses. That helped Ezypay run an onsite trial for EFM corporate in Adelaide using a selection of their real accounts to show them how easy it could be.
For the trial, EFM selected franchises who would push back the hardest against the additional costs associated with the new solution. Using Ezypay, EFM processed payments easily and automatically for these select franchises.
The trial also demonstrated the extensive value of the solution, including electronic Direct Debit Requests (DDR), which enabled EFM Health Clubs to load members and process payments via Ezypay’s secure merchant website, as well as consolidated reporting for corporate.
In the trial, the decline rate dropped from near 15% down to a low 3%.
With that data in hand, management effectively made the case that Ezypay would deliver more consistent revenue flow with less time spent chasing outstanding payments.
Designing the Right Solution
With the franchisees on board, Ezypay got to work putting together a seamless payment system that would meet the needs of customers, franchises, and corporate alike. The first thing Ezypay did that EFM couldn’t do on their own is secure guaranteed payment from participating banks.
According to Lindblom, “for some people, we would have this statement saying declined every single month. But with Ezypay — and with their agreement with the bank — if it's a regular direct debit and if someone is in good standing, then the banks will let that payment go through.” As a result of Ezypay’s banking relationships and card expiry exemptions, EFM was no longer responsible for following up with people who let their debit cards expire either.
Ezypay took implementation out of EFM’s hands, making for a smooth onboarding process. “I provided them all the spreadsheets, and they entered every one onto their system,”
Fiona Lindblom, Financial Controller and Systems Training Manager at EFM Health Clubs
With Ezypay, payment processing was done automatically by each individual franchise using the same recurring payment processing system. Each franchisee was given the tools to manage the software to automatically collect fees using the recurring debit system. With these tools, they could sign up new members, cancel subscriptions, and follow up on unpaid dues, all without oversight from the corporate office.
Ezypay took implementation out of EFM’s hands, making for a smooth on-boarding process. “I provided them all the spreadsheets, and they entered every one onto their system,” says Lindblom. “So that process was actually a lot smoother than we thought it possibly could be. We didn't really have any hiccups at all.”
payment processing time saving per month
reduction in payment decline rate
Over 60 franchises rolled out with Ezypay
Right out of the gates, Ezypay cut EFM’s payment processing down from 22 hours to 2 hours per month.
With time to train franchisees on best practices, EFM both streamlined their books and unified the way processing was done company-wide. In addition, the 15% decline rate that EFM faced doing manual payment processing dropped to just 3%, resulting in increased cash flow.
This played a big part in EFM becoming one of the fastest growing franchise companies in Australia. Their growth and their partnership with Ezypay continues today.
“We had three years in a row where we had extreme growth. We were just opening clubs everywhere.”
“Ezypay cut EFM’s payment processing down from 22 hours to 2 hours per month”
Fiona Lindblom, Financial Controller and Systems Training Manager at EFM Health Clubs
EFM Health Clubs needed a flexible payment processing partner who could guarantee both franchisee freedom, and build a payment system that would streamline processes throughout the company. Ezypay was the only payment processor who was up to the task.
By choosing Ezypay, EFM automated their recurring payment processing, unified their franchisees under one protocol, and sparked incredible growth.
Ezypay is a multi-award winning fintech company and one of Australia’s leading subscription payment providers. They are committed to making it easy for Australian, New Zealand and international businesses to settle complex financial scenarios and generate revenue with a single solution.
Ezypay’s cloud-based payment platform offers a suite of easy-to-use subscription management services including generation and automation of flexible subscription plans, customer sign-ups, invoicing, reporting and global capabilities. This makes Ezypay a best in class solution for businesses in the health and fitness sector looking for direct debit collection at any scale - be it for a number of franchised gyms or health clubs like EFM, or for a personal training business run by a sole proprietor.