Franchise Spotlight: Gyms
A health-conscious younger generation bodes well for the prospects of a post-Covid-19 rebound.
Statistics show that 30% of Australian adults have a gym or health club membership, with separate market research from Fitness Australia finding that 56% retained their memberships beyond 12 months.
Most sectors would envy such levels of repeat business, although some gym operators have comparatively flexible contracts that bring in less recurring revenue. Also, good news for the industry’s future is that young people are more health-conscious than previous generations.
However, Covid-19 restrictions in place through much of 2020 have sent a previously strong industry growth rate into reverse. The industry is usually hit relatively hard by more typical economic downturns too, since financial hardship is a common reason cited for membership cancellations.
Franchise market analysis
Franchising has powered the expansion of many big box gym chains and, more recently, boutique and budget operators.
Franchise applicants don’t generally need previous fitness industry experience – drive, entrepreneurial flair, and interpersonal skills are typically favoured – but they do usually need significant capital, given that large premises in prime locations and expensive equipment are required.
Such investment also gives them support in securing and fitting out suitable premises, recruitment, marketing, business development, and so on.
The biggest franchised gym chains in Australia include Anytime Fitness, with over 500 clubs and a 2018 International Franchisor of the Year award to its name, Jetts franchise, which offers no-lock-in contracts, Plus Fitness, which touts low-price memberships, and Snap Fitness 24-7, which sets out four foundations of fitness.
Listen To Your Body is a fast-growing alternative, giving members personalized plans and boasting a 91% retention rate and average annual spend of $1,600 per member.
CycleBar , meanwhile, offers franchisees a recurring revenue model and exceptional EBITDA margins from running a cycle studio.
Aspiring franchisees with a passion for fitness might also consider other sports and fitness franchise opportunities too.