It’s a busy time of year for fitness franchises.
January is when Americans collectively migrate from the shopping mall and bottomless eggnog bowl to the gym. Not surprisingly, fitness clubs win at least a third of all new memberships in the first three months of the year.
While many of those new recruits will eventually slack off over the course of the year, membership in fitness clubs overall has been on a steady incline. Between 2002 and 2011 gym memberships rose to 42.8 million from 36.3 million, and are expected to grow another 11 percent to 47.5 million by 2016, according to Los Angeles research firm IBISWorld.
In fact, the fitness industry has held up despite job losses and belt tightening – or possibly because of it. “People have kept up their gym memberships even as they’ve struggled with job loss,” says Mary Nanfelt, fitness club analyst for IBISWorld. “Exercise is a way to reduce stress and stay in a routine.”
That’s not to say the industry hasn’t had to make some adjustments. The most successful franchise concepts in recent years, notes Nanfelt, have tended to be scaled-down clubs that don’t have large staffs – Anytime Fitness, Snap Fitness and Planet Fitness, to name a few. Exercise studios that offer hands-on group exercise and don’t require a big investment in real estate or equipment have also captured a growing share of fitness dollars. “Even in places where the market is pretty saturated there is still opportunity for specialized gyms,” she says. “It’s not unlike restaurants.”
Long-term trends, meanwhile, bode well for fitness franchises. More leisure time and health consciousness among baby boomers should continue to sustain these clubs, while the coming of age of their children – who grew up exercising and are comfortable trying different kinds of exercise – should give the industry an additional boost. A recovering economy, no doubt, is also good news for premium services, such as personal training or specialized classes.
But there are risks: Namely, that today’s hot concept could be tomorrow’s step aerobics. While fitness franchises as a whole are here to stay, would-be franchisees still need to understand what concepts will work best in their markets and discern between short-term fads and lasting trends in fitness, says Rob Bond, president of World Franchising Network, an Oakland Calif.-based directory of franchises.
At last count, there were more than 40 franchises in his database, from anti-gravity yoga to power lifting. “You want to make sure the franchise has some unique competitive advantage and is involved with what’s going on in the industry,” he says. Also look for strong marketing, both regionally and nationally; a track record of gaining and retaining new members; competitive royalty and franchise fees; the potential for add-on services; and, finally, the flexibility to adapt with the industry.