Published on 30/11/2015 by Punchmedia

The Biggest Loser Fuels Gym Industry Growth

An increase in health consciousness, supported by pervasive social media coverage and TV programs like The Biggest Loser, have driven the gym and fitness centres industry to impressive growth over the past five years. Revenue growth is forecast to increase at a compound annual rate of 3.5% over the five years through 2015-16, to total $1.4 billion.

Industry Participation

The increase in the number of 24-hour gyms has driven substantial growth in the number of establishments operating within the industry, which is forecast to rise at a compound annual rate of 6.4% over the five years through 2015-16. Gyms are typically becoming smaller and more affordable, with new franchise owners scoping out areas of high foot traffic such as shopping centres, shopping strips and CBDs.

Demand Trends

The industry has recovered strongly over the past five years, particularly following the major downturn that occurred during the global financial crisis. Demand for industry services is dependent on discretionary spending. While most health-related expenditure is non-discretionary, gym memberships are largely considered discretionary items because consumers are able to exercise outside of gyms. Discretionary income has increased over the past five years, providing consumers with more funds to spend on discretionary items like gym memberships, and ultimately contributing to revenue growth.

24-Hour Gym Boom

The Gyms and Fitness Centres industry has been transformed over the past five years by the rapid growth in budget 24-hour gyms. Companies like Anytime Fitness, Jetts Fitness and Snap Fitness have expanded heavily across all states and territories and are beginning to consolidate their market-leading positions. These gyms provide their members with access at any time by using an individual pass. While the increased accessibility of 24-hour gyms is attractive to many consumers, it is their affordability that has driven their popularity. By not providing group fitness classes and only employing staff at peak times, wage costs are limited and the savings are passed on to consumers through lower membership prices. Lower prices have attracted rising membership numbers.

Health Trends

Health consciousness has grown over the past five years, boosting industry revenue growth. Consumers are increasingly understanding the benefits of healthy living through a balanced diet and regular exercise. These lifestyle choices are reinforced through popular TV programs like The Biggest Loser and the proliferation of social media fitness personalities. The Biggest Loser has provided consumers with examples of regular people losing weight and improving their health through exercise, which can be done at gyms and fitness centres. Coupled with rising obesity levels, growth in health consciousness has benefited gyms as the number of people going to the gym to improve their health and transform their bodies is increasing.

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Curtis is a leading expert in the business-for-sale industry, serving as a senior content creator at anybusiness.com.au.

With a career spanning over fifteen years, Curtis has accumulated extensive knowledge in the domain of business sales, acquisitions, and valuations. His deep understanding of market dynamics and his ability to translate complex industry jargon into accessible insights make him a trusted resource for entrepreneurs and business owners looking to buy or sell businesses.

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