Elite clubs come down a peg from their ivory towers

By Yogita Tahil Ramani

While all businesses are finding it tough going these days, it would be risky to make blanket assumptions about effects on those special places where we pamper ourselves and put our bodies through their paces. The following articles look at how business clubs and sports and fitness centers are holding up under pressure.

JAKARTA (JP): Step into the Mercantile Athletic Club on the penthouse floor of the World Trade Center in South Jakarta, and a more grandiose era takes over.

Numbing realities of a nation choked by a debilitating crisis seem a million lifetimes away.

Walk past the cigar room, and low voices with Oxford accents cut through the smoke from Cuban cigars. Dapper waiters bearing trays of caviar and tall glasses of orange juice file into the ballroom where a reception for 600 is taking place.

A 20-meter lap pool, 12 boardrooms, a Clarins salon complete with saunas, steam, massage and facial rooms, two tennis and squash courts and six restaurants -- Chinese, Italian, Japanese and fast food -- neatly crowd the three uppermost floors.

A trip to Bimasena, which health club representatives describe as a gem, is no different.

Located between the Darmawangsa hotel and apartments, each of its four floors on Jl. Darmawangsa Raya 39, South Jakarta, tells a different story.

From the freshly cut rose petals loosely scattered on the reception desk to the 247-square-meter fitness center replete with chair massagers and an array of imported equipment, intricacy and attention is given to innovative design.

There are private spa suites with in-room saunas, steam and whirlpool, available for half or full-day at a substantial cost, and a cognac and cigar lounge serving fine cocktails and canapes. There is also an exclusive area for members to savor vintage cognacs and malt whiskies.

The 180-square-meter boardroom is generally used for talks, such as those by former ministers Frans Seda and Emil Salim.

On the top floor, facing the indoor pool, is something those suffering from a fear of heights or heightened modesty would do well to stay clear of.

No troubles?

With a portion of its body proudly jutting out into open air, facing high-rise buildings and more than a few open windows, a restful dip in the whirlpool is just one of the several lost worlds to indulge in.

Time and troubles seem to fall away.

Well, maybe not. With the rampaging dollar resulting in staggering corporate layoffs, including expatriates, social club representatives are holding their breath.

The Financial Club Jakarta on the 27th floor of Graha Niaga building and the Mercantile Athletic Club are considered among the best of the less than a dozen such clubs here.

With 110 employees from administration to operations, the Financial Club has nine private boardrooms spaced between two floors and boasts an average growth rate of 150 to 200 members over the past two and a half years.

Its president director, Mila Mawira, said the club might lose about 100 to 150 members by the end of the year.

Mila said a number of members had stopped coming, and had stopped paying, but they were still on the member list.

"...One has to understand that companies are suffering," she said.

The club opened with 500 members in 1994, which had increased to 1,100 at the end of last year. Before the crisis hit, joining fees were US$3,000, plus a monthly fee of $90 per head.

"Currently, we have set a fixed exchange rate of Rp 4,000 for the monthly fee (Rp 396,000 including 10 percent VAT) while the joining fee is fixed at Rp 10 million," Mila said.

"A few weeks ago the exchange rate was Rp 7,000. Who is going to come and pay Rp 21 million in these times? With Rp 10 million for an individual membership, the rate is like Rp 2,900 to one U.S. dollar."

Although she said the club was in effect charging a third of what it charged previously, she believed some members would still resign. Some already have.

"When the 16 banks were liquidated, 50 of their executives were members of this club. They were just gone."

She said the club still registered a steady, if less frequent, 3,000 visitors a month.

"That's about 100 to 150 heads a day, with the average chance of average spending of Rp 30,000 on meals."

Mila said the biggest cost for most clubs was rent.

"It all depends on negotiations done with the leasors. I think we would need to hold on to 1,000 members (a year) to survive," Mila said.

General manager of the Mercantile Athletic Club, Franz V. Eichenauer, said the management had gathered ideas from all 175 employees on cost-cutting measures.

"For example, do we need to use paper underliners? We serve 500 cups of coffee every day... this means 500 underliners," Eichenauer said.

"Everything is up by 300 to 400 percent ... do we need to have the logo imprinted on the cake boxes? It's twice as expensive. Why make 20 cups of coffee and throw five away when you can make 10?"

Despite 2,700 memberships accumulated since its opening in 1992, 500 to 600 visitors a day and just 46 resignations, financial controller Sugianto said the time had come for belt- tightening.

"Our annual turnover was close to Rp 7.5 billion last year, but with bloated expenses, it's enough only for a break-even," Sugianto said. "We don't know how things will fare next year."

Eichenauer said the club used a fixed exchange rate of Rp 4,500.

"Upper management have had to convert their dollar salaries to rupiah, which is a substantial cut considering the going rate nowadays."

"There were no layoffs. Many people coming here, however, say that this is obviously just the tip of the iceberg."

Praise has been heaped Bimasena, but there have also been regrets voiced about possible bad timing of its December opening.

Bimasena, targeted exclusively for the mines and energy sectors, is now accepting workers from other sectors.

Bimasena's marketing director Ken Sukotjo said members employed in other industries were still connected in some way with the two sectors.

"We have Bank Niaga, Bank Bali and contractors who do exploration researches for mines and energy industries," Ken said.

Despite huge corporate joining fees of $150,000 -- at a negotiated exchange rate -- and a monthly fee of $7,000, the club has already secured 60 corporate memberships and claims to have not lost any.

One membership accommodates 10 people, plus their spouses and two children under 21.

"In terms of the facility usage, we are still very low right now. Most members talk of the economic situation ... or just go to the fitness and then straight home," Ken said.

It is also making a concession to the dollar exchange rate.

"Before the crisis, we went by the market rate, but now it is an average of 5,000."