How to Setup Manager for a Gym and memberships

I was in conversation with our local gym owner and he is interested in using Manager for the business and memberships. They have approximately 500 members on contracts varying from 3 months to 24 months. There are also “casuals” who pay cash and other cash services like sauna. In addition there is the usual over the counter stuff like protein, energy drinks and bars etc.
The inventory, sales and fixed asset part of the business seems OK to align but I am not certain as to the management of the gym memberships and contracts.

Would these be handled in a way similar to what was mentioned Hired Goods - sales - #9 by lisarhook

Please let us know the best approach, may be there is someone out there already operating a Gym or similar?

The best approach for this situation would be to use Manager as the financial system but with a dedicated Membership system to manage the contracts as it would have built in date range capability - start date, period, calculated end date, renewal flagging etc - or have one built via a database or other suitable programme

There is a dedicated membership system but I am seeking guidance on the Manager financial reporting side. From what I can make out the Hired Goods - Sales question could be the answer, offering an indication of liability for contracts fully paid at some future date.
What I have done is create a Gym Memberships control account made up of Special accounts then Then from the Special Accounts tab created Gym Members and associated them with the Control Account “Gym Memberships”.

Then if the Gym Member’s invoice is generated such that is it assigned to the “Gym Memberships” control account which very nicely prompts you to select the created Gym Member special account.

Once this is accomplished the process to receive payments is simple and the invoice offers a receipt for the gym member.

I think the next step is the catch and that is the Journal entry. This needs to be done and managed say on a weekly basis and for 500 members I suppose cloning the Journal entry for each member can work at a cost of probably 5 to 6 hours effort a week.
Is this plausible or is there a better way?

What is the purpose of the transactions for which you propose using journal entries?

This would entirely depend on the information available from the dedicated membership system.

I would consider that your current setup is an overkill in that you are virtually duplicating the membership system (per member) into Manager via the member special account.

Look to see if the membership system has some form of statistical output - unexpired subscription periods, if yes, let the membership system be the detail and Manager be the global perspective.

Depending on the data available will determine how you can calculate a valuation for the unexpired subscriptions.

Base Level - Member A - 10 (days to go), Member B - 125, Member C - 67 etc, etc.
Accumulate these and multiple by a subscription factor* - therefore at any month end your Manager “Gym Memberships” liability account would equate to this valuation, and the Journal would transfer to the P&L any adjustment between two valuations of the unexpired subscriptions.

Noting that the liability account would also be receiving “additions” from new subscriptions.

At a higher level - if subscription periods were also available then this would enable the calculation of an even more accurate subscription factor - if the subscription period members were grouped (sorted) together (24 mth,12 mth) then valuations per period could be used.

Unless this dual process is really required then this to my mind is also a duplication - Sales Invoice + Receive Money. I am assuming that most subscriptions are payment up front (not on credit) therefore the Cash Sale entry should suffice along with its produced receipt. The setting up of members as Manager Customer’s is a duplication of the Membership Customer

If the membership system produces a renewal notice then use that as a pro forma invoice.

Even if you want to maintain the control account + special account structure, using the Cash Sale will also “very nicely prompt you to select the created Gym Member special account”

*Subscription Factor
The basis for this calculation will entirely depend on the statistical data available.
At the base level assuming that the different contract periods will have different monthly rates, the subscription factor would be a weighting between them.

3mth - 30/mth, 12mth - 18/mth, 24mth - 12/mth = 20/mth.
This factor is multiplied by the number of periods of unexpired subscription. Then once or twice a year do a full (member x member) valuation - just like a stocktake.

The better the statistical data available the more accurate the valuation of the unexpired subscription.

To transfer the unearned income stored in the Balance Sheet to the Profit & Loss as it becomes earned.
Exactly the same as an insurance company does with unearned premium income.

Lets assume you did not have a Membership platform managing the details, the approach would have been to create each member as a customer, post invoices for the expected amount per period into a Subscription receivable account. Meaning assuming starting from January - there will be 12 invoices per Customer effective 1st/end of the month whichever suits you. That way you run your P&L report for the current month, you can determine the accruable income.
Customers who do not renew their plan will have the reverse entry posted against their account.

Basically it means your future income will be a form of projected sales which is not yet realisable at least in the current period.

Not so sure if I got your question correctly.