Shaping profits in fitness industry

Health and fitness Industry is growing by leaps and bounds with the changing life styles. Favourable demographics with rising disposable incomes in the hands of younger population are the key factors that is routing ahead the fitness market in the country. As per Market Research.com, the Indian fitness and slimming industry constitutes about 8 per cent of the wellness market.

Trends in the Industry

The growing health and fitness industry has attracted a large number of domestic entrants and international players. A much growing trend in the industry is expanding through the franchise route.

Significant changes in lifestyle related to lack of physical activity and increased consumption of fast food among both affluent and working class population has led to greater need for healthy lifestyles. More and more brands are planning to foray into Tier II and Tier III markets too. Rizwan Sayed, Director and Founder, Your Fitness Club says:  “YFC plans to tap India, including metropolitan and tier II cities.”

Introduction of innovative formats and training trends is also emerging as a popular option for scaling up. Well-known players are pursuing revenue maximisation through product and service diversification and are exploring new global and domestic markets.  Gold’s Gym is also eyeing Tier II and Tier III cities to tap country’s growing fitness market and plans to launch more than 30 fitness gyms by June 2014.

Why Franchising?

Expansion through franchise route is definitely the trend of the Industry. Sunil Kumar, Director Franchisee Development/Operations, Burn Gym says: “Franchising enables you to be a part of a company that has an established system and has achieved some market share and name too.” Franchising is definitely proving to be an easier route to expand a network. For Dr. Vikram, CEO, Snap Fitness India, “Fitness is a sunrise industry with a 40 per cent year on year growth. It is also recession proof.” He further adds: “We follow easy to manage single floor format with no frills, so this makes franchising much easier and hassle free. With a robust business model, above industry average ROI and backed by a dedicated team, our team is now geared up for rapid expansion in the next few years, followed with an IPO.”

The Indian fitness Industry is set to ride high.  As per reports- Wellness market in India is about INR 490 bn and wellness services account for 40 per cent of this market. Segments such as slimming products and services, fitness services, equipment and cosmetic treatments are witnessing highest growth. Istayak Ansari, CEO, Gold’s Gym says: “For a brand to grow it is very important to have like minded business partner to take it forward. The investors take a franchise, run it with the complete expertise from Gold’s Gym Head office and play a very important role in the expansion of the brand. So, franchising route is very crucial as it helps you grow at a faster pace and make it a success.”

Cherry on the cake

Operational since November 2002, Gold’s Gym started franchising in 2003. Gold’s Gym’s biggest plus point being the access to Gold’s Gym worldwide with a travel card giving you access to 14 days per centre. 1000 free workout days across the globe. The membership is transferable to another person or Gold’s Gym in India. Alternatively, Snap Fitness is a smart, no frills fitness club with state of the art equipment and infrastructure. Its small box, single floor format keeps the space requirements to the minimum and facilitates high efficiency in operations.YFC offers its customers with a value-driven concept, whereby members have the convenience and flexibility of a member-friendly policy instead of a contract.

Going Global

Most Fitness brands are going global for further expansion. Gold’s Gym plans for three overseas units by December 2013. The brand’s target markets for international expansion are Nepal, Srilanka, Bangladesh and Thailand. With an increase in stress level and number of health diseases registered every year, the fitness industry is bound to boom. People are becoming aware about the importance of fitness in their daily regime. YFC targets The Middle East for further expansion globally. Snap Fitness already has 2500+ franchise centres in countries like U.S, Canada, Mexico, India, Egypt, Australia, New Zealand, Singapore and U.K. The brand further plans to have at least 3000 centres by 2014.

Billion dollar opportunity

Gold’s Gym is looking at reaching 150+ mark in the next two years. Further, the company aims to open 15 locations in the coming three to four months in cities like Jammu, Ambala, Aurangabad, Bhopal, Bareilly, Varanasi, Bhubaneswar, Ujjain and Vijayawada etc. On the other hand, Snap Fitness carries a vision of 300 clubs across the country by 2015. To expand its network rapidly, YFC is confident to have a minimum of 150 YFC gyms in the next five years. Burn Gym took the franchise road very recently in 2011. It targets at least five franchise outlets by Dec  2013.

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