DW Sports closure: Devastating business confession months before shutdown exposed

The gym and sports retailer confirmed its intentions to enter administration today, with all of its stores across the UK to close its doors. Founded by former Wigan Athletic football club owner Dave Whelan, the firm had around 73 gyms and a further 75 shops throughout Britain. Although the company has said it hopes to work with administrators to save as many gyms as possible, CEO Martin Long delivered a heartbreaking admission prior to the announcement on exactly how struck the business has been due to the coronavirus pandemic.

When the outbreak began to reach its initial peak in April, the likes of Mr Long were forced to face the reality that memberships for gyms had to be stopped, resulting in zero money coming into their tills.

The business went from gaining around £15million-per-month to nothing overnight.

The Government had offered loans to businesses in sectors such as leisure, yet Mr Long said accessing them was “being made too hard”.

He told the BBC: “The money isn’t coming in quickly enough.

“Ultimately, you’ve got to run a business with no income and no visibility of when the income is coming, because you don’t know when you’re going to reopen.

“And likely even when you do reopen, you will have fewer members than when you started the period.”

With no money coming into the business, the firm was forced to furlough staff to support its £3million-a-month wage bill.

At the time, leisure trade body UKActive said that half of the 189,000 people working in gyms and leisure centres throughout the UK could have no work by the time the Government’s furlough scheme ended.

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Now, the 1,700 people employed by DW Sports are facing losing their jobs, but Fitness First, which is part of the same group of companies, will not be affected.

Mr Long added today: “As a consequence of COVID-19, we found ourselves in a position where we were mandated by the Government to close down both our retail store portfolio and our gym chain in its entirety for a protracted period, leaving us with a high fixed-cost base and zero income.

“The decision to appoint administrators has not been taken lightly but will give us the best chance to protect viable parts of the business, return them to profitability, and secure as many jobs as possible.”

So far, DW Sports has reportedly closed 25 of its stores, while the remaining 50 retail units would “all be moving into closing down sales from today”.

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The business did say that since lockdown measures in the UK had eased, it had managed to reopen 59 of its gyms in England and Northern Ireland.

The remaining 14 are closed due to localised coronavirus restrictions.

DW Sports was founded in 2009 after Mr Whelan purchased 50 JJB Sports Fitness Clubs, as well as the firm’s shops, for around £83million.