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Gyms reap benefits of growth

By Dominic Musgrave
THE UK fitness industry has grown by eight per cent in a year – and independent clubs are reaping the benefits.
A study shows the private clubs sector is enjoying stronger revenue growth than centres run by local authorities, mainly due to higher pricing.
Annual levels of growth slowed during 2004 and 2005, which largely reflected increased competition in the market, leading to a reduction in membership fees in the private sector.
Market analyst Lyndsey Hogg from Market and Business Development – who carried out the report – said: “We expected to see a stronger growth in 2007 than in previous years as many of the leading operators within the industry consolidated meaning there weren’t as many mergers as in the years before.
“High demand has meant independent gyms can charge members higher prices, and they are appealing to a different demographic of people by offering a wider range of classes such as dance or bodyjam which they can charge a higher fee for.”
The report predicts an increase year-on-year over the next five years, reaching a peak of £4.9b in 2012. Annual levels of growth are expected to remain between two per cent and three per cent.
It also predicts that the factors that have hindered stronger market development in recent years, such as increased competition, market saturation and declining membership fees, are likely to continue to impact the market.
“We see the market increasing over the next few years as everyone is concerned with looking their best and being healthy, but in the short term the growth may not be as noticeable due to the amount of disposable income a person may have and the level of interest rate.”
But the media and goverment’s focus on the ever increasing ‘obesity crisis’ has led to increased publicity of healthy lifestyles and physical exercise. Anticipated increases in obesity levels and projected growth in GP exercise referrals are likely to provide growth opportunities.
Lyndsey added:“Obesity is a massive issue at the moment. The government is being very pro-active when it comes to tackling the issue and is encouraging a healthy lifestyle and exercise – which will increase gym memberships.”

Go backPosted on 3rd March 2008