Functional Fitness Group, the owners of CrossFit Oslo and 15 other gyms in Norway, has decided to de-affiliate 10 of them.
Eivind Dahl Ringard, the CEO and one of the owners of Functional Fitness Group, explained that while the decision was difficult, it’s what’s best for the business.
- “Financial factors are the primary reasons behind our decision,” Dahl Ringard, a four-time CrossFit Games team athlete and three-time medalist, told the Morning Chalk Up.
He added: “It’s super sad because CrossFit has shaped me as a person. But I own a company. We employ 200 people, and we [need to make] smart business decisions. So there’s a bigger picture I need to look after.”
- Their flagship gym, CrossFit Oslo, has been rebranded as XT Oslo. Still, Dahl Ringard said the gym will maintain its affiliation “for at least another year,” primarily to accommodate its athletes pursuing the CrossFit Games season.
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Some Background
Functional Fitness Group owns 16 gyms in Norway, 11 of which are CrossFit affiliates. The other five have never been affiliated.
The most well-known gym in its group is CrossFit Oslo, which has 800 members and has made a name for itself because of its powerhouse teams.
Last year, CrossFit Oslo had 10 teams compete in the CrossFit Open, eight in Quarterfinals, five in Semifinals, and three qualified teams for the Games.
This year, however, there’s a new rule in place limiting each affiliate to one team qualification to the CrossFit Games, so CrossFit Oslo only has a single team competing in the Open.
The Financial Details
Dahl Ringard explained that as the Functional Fitness Group has grown from five to 16 gyms in the last five years, its affiliate fees have increased by more than 100% in local currency.
- “Altogether, our affiliate fees total nearly $50,000 per year, close to 550,000 NOK,” he said. “As a [business owner], I have to evaluate whether we’re getting enough value for what we pay in affiliation fees or whether that money could be better spent on our specific needs.”
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Considering the scope of his business today, these needs include new expenses, such as legal costs, HR costs, and expenses associated with “developing our own brand identity.”
- “We now have 4,000 members, an annual turnover of 60 million NOK, 16 landlords to negotiate with, and nearly 200 coaches to manage. As our complexity grows, we must ensure our business model remains sustainable,” he added.
In addition, ensuring all 200 of his coaches have a current CrossFit Level 1 or Level 2 certification is costly and impractical. Ultimately, he explained, it makes more sense to educate his coaches internally.
- “Rather than sending 10 coaches across Norway — or even abroad — for an L1 or L2 certification, it’s far more effective for us to send an experienced coach to our gym, for example, and have them spend three days working hands-on with our team,” Dahl Ringard said. “We have to meet their specific needs based on what they see in their gym, with their members, with their equipment, and with their floor plan.”
Finally, Dahl Ringard said the CrossFit name no longer drives new people to his gyms.
- “We wouldn’t be where we are today if we didn’t have CrossFit. It [was] really beneficial…but we don’t need people to Google ‘CrossFit’ to find us [anymore],” he added.
What About Lazar?
Though the main driver was financial, Dahl Ringard said CrossFit’s handling of Lazar Đukić’s tragic death and its aftermath only made the decision to de-affiliate easier.
- “I was there, by the lake. Along with Tim Paulson, I was [one of the people] who informed CrossFit that someone was missing,” he said. “Two women ran up to me in tears, crying, saying they had seen a person go under. And then, nothing happened for 45 minutes.”
He added: “As far as I know, no real answers have been given, and CrossFit has yet to fully take responsibility for what happened.”
So, while the decision to de-affiliate 10 gyms is essentially financial, “this made it easier to leave,” he added.
The Big Picture
Dahl Ringard will forever be grateful for CrossFit, which he says has “defined me for over a decade.”
- “CrossFit transformed me. I went from being shy, socially anxious, and afraid to raise my hand in class to leading fundraisers with 200 people [and] thriving in the coaching environment,” he said.
His job as CEO of Functional Fitness Group is to care for his members, his coaches, and the business.
- “I have to consider what’s best for our future,” he said.
And it has become clear to him that the best way to do that is to de-affiliate from CrossFit.
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Featured image: @xt.loeren / Instagram
