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Why fitness franchising is exploding, and how you can get involved

Master Franchising

Why fitness franchising is exploding, and how you can get involved

With a health and wellness industry generating upward of $87.5bn worldwide, and an international obsession with looking and feeling good, the time is now to jump into the world of big fitness

With a health and wellness industry generating upward of $87.5bn worldwide, and an international obsession with looking and feeling good, the time is now to jump into the world of big fitness

Ever since the Greeks trained in gymnasiums to hone their skills for gladiatorial combat, our fascination with keeping fit has been on the up.

There are currently over 201,000 fitness clubs worldwide, with a combined total of more than 174 million members. In a landscape that has seen merchandise franchises fluctuate in popularity, businesses that can provide a service, such as gyms, have never lost their allure. Quite the contrary: their membership is on the up.

For franchisees, the prospect of owning a fitness centre is, unsurprisingly, appealing.

In the U.S., goliath brands like Anytime Fitness, Planet Fitness, and Crunch Fitness dominate the choices available to individuals looking to better their health and wellness. These centres align with what a general gym-goer might associate with a health club: resistance machines, weight machines, and a wide variety of ways to achieve the ideal look. But with initial investment costs climbing to $2M+, and only around 1 in 10 Planet Fitness locations being opened by a first-time franchisee, it can be a tough nut to crack.

Enter, boutique fitness providers
Offering a potentially easier inroad to fitness franchising, boutique gyms benefit from low start-up costs and a dedicated audience, who favor a focused fitness regime. The previous sedentary population has been hit with an inexorable wave of “wellness mania”, according to Chris Rondeau, CEO of Planet Fitness; a wave that franchisors and franchisees are capitalizing on as well as they can. This doesn’t just mean big returns, though, as more gyms lead to an overall uptake in healthy living – a win-win for all involved.

The popularity of boutique gyms was proven by a recent report from the IHRSA, that found while membership in traditional health clubs grew by 5 per cent between 2012-2015, members to boutique providers grew a sizeable 70 per cent in this same period – despite typical fees of $20-40 per visit. Gym-goers are customizing their fitness regime as much as they’d like, and for the right franchisee, this could spell huge success.

A worldwide phenomenon
Wellbeing obsession isn’t just limited to the U.S. In Australia, franchises like ZADI, which focuses on HIIT workouts, and 12RND, which offers a boutique boxing regime lasting 45 minutes, are thriving. Consumers need their workout to fit around a hectic schedule, but still want it to engage them and keep exercise interesting. With bespoke experiences maintaining variety, the world of fitness franchising has never been as exciting.

The U.K. is also a powerhouse for fitness progression, with hundreds of fitness providers – both large brands and niche boutiques – appealing to a growing desire for choice. In 2018, fitness titan Pure Gym became the first U.K. operator to reach 200 clubs, and one in every seven people is a member of some kind of fitness club. But David Minton, director of fitness data company LeisureDB, has made it clear that simply offering the same routine as the competition might not cut it: “they [fitness providers] must continue to provide more than just gyms; experiences are essential to hold a customer’s attention.”

Star status
Fitness franchising has also appeared on the radar of some notable Hollywood elites. Mark Wahlberg, known for his wide filmography including the likes of The Fighter and The Departed, recently bought a minority stake in F45 Training – the wildly successful boutique training programme to emerge from Sydney, Australia. The deal, roughly valued at $450M, will allow the 45-minute fitness regime to expand even faster than before. And that’s no small feat: F45 Training currently sells roughly 50 franchises a month, which the company hopes to increase to 70-80 per month by the end of 2019.

We haven’t yet touched on Asia, which boasts over 2.8 billion of the world’s population, and a vast market for boutique fitness franchises to sell to. Popular wellness figures like Manny Pacquiao mean that the Philippines is the ideal location for a boutique boxing franchise, whereas the ageing population of Japan makes it perfect for something with a more relaxed pace. Singapore is arguably saturated when it comes to the fitness business, whereas China and its 300 million middle-class consumers are a major target for bankable fitness franchises.

With Asia – and any foreign market – adapting a franchise to fit the local customs and expectations is a must. In our recent special on fitness franchises in South East Asia, Bill Edwards, CEO of Edwards Global Services, advised, “probably the number one adaptation is a focus on social media marketing, especially Facebook.” He also warned, “Asian consumers like to try new and innovative concepts but also tend to move on to newer ones when they enter a country. Beware of being considered a fad.” Boutique fitness franchises might not work as successfully in Beijing as Budapest or vice versa, but the demand for their unique take on the fitness world is a proven gateway to franchisee success.

Kieran McLoone is the deputy editor for Global Franchise magazine.

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