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> Basically, the space you take up at peak time is another membership they can't sell because of potential overcrowding.

Is that really a thing? I've _never- found a gym that has said "no sorry, we can't sell you a membership because we're full"

I've canceled a gym membership because it was too crowded at the times I wanted to go.

I’ve definitely tried out a gym and not joined because it was too crowded when I wanted to go