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Health Club Management

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features

Franchise briefing

There’s no sign of the UK’s franchise fitness sector cooling down. It’s not just existing operators looking to add to their burgeoning portfolios – new operators are queueing up to enter the market. Tom Walker reports

By Tom Walker, Leisure Media | Published in Health Club Handbook 2019 issue 1
New entrant to the franchising market, Snap Fitness is pushing for 250 clubs
New entrant to the franchising market, Snap Fitness is pushing for 250 clubs
The UK fitness industry is teeming with franchised brands – over the last five years it’s been particularly driven by boutique and budget operators

The UK fitness industry is now teeming with franchised brands. Ranging in size from niche operators with a handful of sites to giants such as Anytime Fitness (150 clubs) and énergie (106 clubs), a quick count shows that there are close to 30 companies with some franchising element available for entrepreneurs.

The pace of growth has been particularly rapid over the past five years, driven by a number of boutique and budget operators entering the market with ambitious franchising plans. The new entrants include large operators such as Snap Fitness, which is now in the fourth year of an expansion push, aiming to reach 250 clubs.

As well as those with big plans, the franchising model has attracted smaller, independently-owned chains. These include Fitness Space, launched by former Olympian Tim Benjamin, which has expanded to 22 sites in five years, and fitness and social brand One Element, which has revealed plans to use franchising to take its sports-based, outdoor fitness programmes outside of London for the first time since its launch 12 years ago.

FROM OVERSEAS
Some of the biggest players to enter the market have arrived from foreign shores. Australia-based Jetts Fitness has made a solid start to life in the UK, since entering the market in September 2017.

“In just over 12 months, we will have launched seven clubs into what is a fiercely competitive market,” says Jetts Fitness UK director James Garner. Founded in 2007 by husband and wife team Brendon and Cristy Levenson, Jetts has established itself in the Australian market by expanding rapidly through a franchise model and now has more than 210 sites down under.

Another newcomer with big plans is US-based UFC Gym, which has revealed plans to open 100 fitness clubs across the UK and Ireland. The US-based chain – a brand extension of the world’s largest mixed martial arts organisation, The Ultimate Fighting Championship (UFC) – has signed a 10-year partnership with TD Lifestyle, which will operate the sites.

In March 2018, two other US-based fitness franchises entered the UK with plans to carve out a share of the market. The first was Omni Fight Club, the cardio kickboxing experience that operates under the slogan ‘Fun Tough Fitness’. The company appointed property specialist Savills to seek its first UK sites as part of the brand’s expansion into Europe.

Omni’s entry was followed by Xponential Fitness, which currently owns a number of franchised boutique brands, including Club Pilates, indoor cycling concept CycleBar, indoor rowing business Row House and StretchLab, which offers personalised stretching services. Xponential said it plans to take its portfolio of brands global through a master franchise strategy it signed with entrepreneur Oliver Chipp. Chipp expects to open at least 30 CycleBar studios in UK over the next five years, and the first studio opened in London in 2018.

There could be more on their way too. Fifteen-time boxing world champion Floyd Mayweather Jr. is in the process of setting up a chain of fitness clubs. In July 2018, his venture, Mayweather Boxing + Fitness, revealed details of a franchising and international territory rights programme, which it says will “enable it to expand the brand globally”.

“Our goal is to have Mayweather Boxing + Fitness studios in neighbourhoods all over the world, providing fitness programmes for anyone who wants to train more effectively,” Mayweather says.

IT’S NOT ALL ABOUT LONDON
While the UK market is attracting a number of new players, there is plenty of activity being undertaken by those with an established footprint. One of the biggest players in the franchise market, énergie Fitness, has a solid pipeline.

“We can comfortably grow anywhere between 30 and 50 new sites a year,” says Jan Spaticchia, énergie’s founder and executive chair.

“We will, over the next two years, get into a comfortable pace of around 45-50 new clubs per year. And we can continue to do that for our five year outlook.”

The UK’s biggest franchise operator Anytime Fitness is still growing too. “Our goal is to have more than 300 clubs by 2023,” says CEO Stuart Broster.

He adds that making “greater inroads” to north England, outside of its powerbase in London and the south of England, will be a priority for its expansion plans.

“A lot of the clubs we opened in 2018 were outside of London, so that was a huge positive,” he says. “A lot of what we do is dictated by property availability. With high street retailers feeling the pinch in this current economic climate, we have seen some great opportunities open for us in prime locations.”

Broster also reveals that the company has found securing sites outside London to be a slightly different experience to the process within the capital.

“The model and club fitout are the same, it’s just about finding the right property,” he explains. “Outside of London, amenities like free parking are more important to the consumer and franchisees. Culture also plays a part. Our ethos of creating community-led clubs has an increased significance outside of cities where people have more time. Members’ dwell time in the clubs is increased and there’s a greater focus on member engagement and owning their local community.”

One of the new entrants to have accelerated its UK growth plans in 2018 is US-based boutique operator Orangetheory. Following a somewhat slow start in the UK – it initially signed a partnership deal with David Lloyd Leisure in 2013 but only opened three sites – the brand has now signed two master deals for a total of 110 franchised sites, covering all of England.

“We are putting a lot of focus on the UK,” says Dan Adelstein, Orangetheory’s vice president of franchise development.

“We’re looking to open 70 in the southern part of England and a further 40 in the north. Out of those, six were operating by the end of 2018 and we expect to have a total of 12 operating by the end of 2019.”

One of the fastest growing franchised brands in the UK – and the world – is Australia-based F45. It currently has more than 1,300 locations worldwide and has been busy on the European market over the past 12 months. It recently opened its first sites in Switzerland, Finland, the Czech Republic, Lebanon and Israel – with plans also in place to launch in Germany.

“We are now operating in 35 countries, but the focus is very much on the US and UK markets,” says Rob Deutsch.

“In the UK and Europe, we’re aiming to sell 185 franchises during 2019, and a further 350 in 2020. In the UK, our long-term goal is to have a studio in almost every corner of the country. We’ve already expanded significantly in London over the past two years, with almost 30 studios open, and this is still very much the focus.

“Short term, we’re also focusing on innercity hubs outside of the capital.”

To drive its UK and European plans, F45 launched a UK headquarters in London in August 2018. “Opening our European headquarters in London was a very important and exciting move for us,” Deutsch adds. “London is a strategically important market for the business, as the fitness industry continues to grow in both size and value. The new HQ will play an integral role in helping to expand across new markets and countries.

“It’s also a great way of showcasing our business model to prospective investors; its central location and close proximity to existing UK and European franchisees means that we can offer more support and help them to drive business. It’s given us a local presence as we are near many of the studios, so investors can come and get a feel for the brand, visit existing F45 studios and try the classes.”

THE FUTURE LOOKS BRIGHT
So how much more growth can the UK fitness market accommodate? Lots, according to the operators.

“We definitely see an opportunity to continue to grow at our current levels”, says énergie’s Spaticchia. “We feel very lucky because we are on the cusp of two very hot markets. The budget fitness space is very hot from an investment point of view but, equally, fitness franchising has never been hotter.

“So while we have to deal with the environment getting more competitive, I think the fact that so many international franchises are heading for the UK has really shown that this is very furtive growth ground.”

Spaticchia adds that there remain plenty of areas to expand into. “Some of our clubs are in populations or towns as small as 20,000 or 25,000 people,” he explains. “For example, our Hoddesdon club is in a population of 20,000 people and yet it has 2,500 members and our franchisee makes annual profits. There are many more towns like Hoddesdon we can go into – and some haven’t got any real level of competition.”

Anytime’s Broster agrees and adds that, as well as the increasing demand from consumers, there’s also growing interest from entrepreneurs for getting involved in the fitness business. “The growth in the market is reflected by the eclectic franchisee network that we have,” he says.

“People are recognising the fitness industry as a sustainable investment and a lot of our franchisees have an existing portfolio of high-street hospitality franchises – such as Costa Coffee and Subway, for example.

“They’ve turned to fitness as it has a number of benefits, including lower staffing models, a smaller focus on attracting new customers and – as has been shown in the past few years – the fact that the industry is still growing despite the recession.”

For Orangetheory’s Adelstein, there is plenty of room for growth – especially for those with smaller-format clubs and studios. “I definitely see an increased demand for boutique fitness,” he says. “The boutique format is really taking over the big box.

“I feel that people are increasingly looking to spend less time at the gym and not ‘waste time’ – they are looking for results and looking for someone to work with them. But it also has to be reasonably priced. And that’s what we try to accomplish.”

Anytime Fitness aims to have over 300 clubs by 2023 and is prioritising plans to expand to north England
Anytime Fitness aims to have over 300 clubs by 2023 and is prioritising plans to expand to north England
Floyd Mayweather Jr. is in the process of setting up a chain of fitness clubs
Floyd Mayweather Jr. is in the process of setting up a chain of fitness clubs
énergie has a solid pipeline but can still grow up to 50 new sites a year
énergie has a solid pipeline but can still grow up to 50 new sites a year
Orangetheory has signed two master deals for a total of 110 franchised sites
Orangetheory has signed two master deals for a total of 110 franchised sites
Australia-based F45 is not only one of the fastest growing franchises in the UK, but one of the fastest worldwide
Australia-based F45 is not only one of the fastest growing franchises in the UK, but one of the fastest worldwide
http://www.leisureopportunities.com/images/imagesX/344751_843957.jpg
New operators are queuing up to enter the booming franchise market. Tom Walker reports
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features

Franchise briefing

There’s no sign of the UK’s franchise fitness sector cooling down. It’s not just existing operators looking to add to their burgeoning portfolios – new operators are queueing up to enter the market. Tom Walker reports

By Tom Walker, Leisure Media | Published in Health Club Handbook 2019 issue 1
New entrant to the franchising market, Snap Fitness is pushing for 250 clubs
New entrant to the franchising market, Snap Fitness is pushing for 250 clubs
The UK fitness industry is teeming with franchised brands – over the last five years it’s been particularly driven by boutique and budget operators

The UK fitness industry is now teeming with franchised brands. Ranging in size from niche operators with a handful of sites to giants such as Anytime Fitness (150 clubs) and énergie (106 clubs), a quick count shows that there are close to 30 companies with some franchising element available for entrepreneurs.

The pace of growth has been particularly rapid over the past five years, driven by a number of boutique and budget operators entering the market with ambitious franchising plans. The new entrants include large operators such as Snap Fitness, which is now in the fourth year of an expansion push, aiming to reach 250 clubs.

As well as those with big plans, the franchising model has attracted smaller, independently-owned chains. These include Fitness Space, launched by former Olympian Tim Benjamin, which has expanded to 22 sites in five years, and fitness and social brand One Element, which has revealed plans to use franchising to take its sports-based, outdoor fitness programmes outside of London for the first time since its launch 12 years ago.

FROM OVERSEAS
Some of the biggest players to enter the market have arrived from foreign shores. Australia-based Jetts Fitness has made a solid start to life in the UK, since entering the market in September 2017.

“In just over 12 months, we will have launched seven clubs into what is a fiercely competitive market,” says Jetts Fitness UK director James Garner. Founded in 2007 by husband and wife team Brendon and Cristy Levenson, Jetts has established itself in the Australian market by expanding rapidly through a franchise model and now has more than 210 sites down under.

Another newcomer with big plans is US-based UFC Gym, which has revealed plans to open 100 fitness clubs across the UK and Ireland. The US-based chain – a brand extension of the world’s largest mixed martial arts organisation, The Ultimate Fighting Championship (UFC) – has signed a 10-year partnership with TD Lifestyle, which will operate the sites.

In March 2018, two other US-based fitness franchises entered the UK with plans to carve out a share of the market. The first was Omni Fight Club, the cardio kickboxing experience that operates under the slogan ‘Fun Tough Fitness’. The company appointed property specialist Savills to seek its first UK sites as part of the brand’s expansion into Europe.

Omni’s entry was followed by Xponential Fitness, which currently owns a number of franchised boutique brands, including Club Pilates, indoor cycling concept CycleBar, indoor rowing business Row House and StretchLab, which offers personalised stretching services. Xponential said it plans to take its portfolio of brands global through a master franchise strategy it signed with entrepreneur Oliver Chipp. Chipp expects to open at least 30 CycleBar studios in UK over the next five years, and the first studio opened in London in 2018.

There could be more on their way too. Fifteen-time boxing world champion Floyd Mayweather Jr. is in the process of setting up a chain of fitness clubs. In July 2018, his venture, Mayweather Boxing + Fitness, revealed details of a franchising and international territory rights programme, which it says will “enable it to expand the brand globally”.

“Our goal is to have Mayweather Boxing + Fitness studios in neighbourhoods all over the world, providing fitness programmes for anyone who wants to train more effectively,” Mayweather says.

IT’S NOT ALL ABOUT LONDON
While the UK market is attracting a number of new players, there is plenty of activity being undertaken by those with an established footprint. One of the biggest players in the franchise market, énergie Fitness, has a solid pipeline.

“We can comfortably grow anywhere between 30 and 50 new sites a year,” says Jan Spaticchia, énergie’s founder and executive chair.

“We will, over the next two years, get into a comfortable pace of around 45-50 new clubs per year. And we can continue to do that for our five year outlook.”

The UK’s biggest franchise operator Anytime Fitness is still growing too. “Our goal is to have more than 300 clubs by 2023,” says CEO Stuart Broster.

He adds that making “greater inroads” to north England, outside of its powerbase in London and the south of England, will be a priority for its expansion plans.

“A lot of the clubs we opened in 2018 were outside of London, so that was a huge positive,” he says. “A lot of what we do is dictated by property availability. With high street retailers feeling the pinch in this current economic climate, we have seen some great opportunities open for us in prime locations.”

Broster also reveals that the company has found securing sites outside London to be a slightly different experience to the process within the capital.

“The model and club fitout are the same, it’s just about finding the right property,” he explains. “Outside of London, amenities like free parking are more important to the consumer and franchisees. Culture also plays a part. Our ethos of creating community-led clubs has an increased significance outside of cities where people have more time. Members’ dwell time in the clubs is increased and there’s a greater focus on member engagement and owning their local community.”

One of the new entrants to have accelerated its UK growth plans in 2018 is US-based boutique operator Orangetheory. Following a somewhat slow start in the UK – it initially signed a partnership deal with David Lloyd Leisure in 2013 but only opened three sites – the brand has now signed two master deals for a total of 110 franchised sites, covering all of England.

“We are putting a lot of focus on the UK,” says Dan Adelstein, Orangetheory’s vice president of franchise development.

“We’re looking to open 70 in the southern part of England and a further 40 in the north. Out of those, six were operating by the end of 2018 and we expect to have a total of 12 operating by the end of 2019.”

One of the fastest growing franchised brands in the UK – and the world – is Australia-based F45. It currently has more than 1,300 locations worldwide and has been busy on the European market over the past 12 months. It recently opened its first sites in Switzerland, Finland, the Czech Republic, Lebanon and Israel – with plans also in place to launch in Germany.

“We are now operating in 35 countries, but the focus is very much on the US and UK markets,” says Rob Deutsch.

“In the UK and Europe, we’re aiming to sell 185 franchises during 2019, and a further 350 in 2020. In the UK, our long-term goal is to have a studio in almost every corner of the country. We’ve already expanded significantly in London over the past two years, with almost 30 studios open, and this is still very much the focus.

“Short term, we’re also focusing on innercity hubs outside of the capital.”

To drive its UK and European plans, F45 launched a UK headquarters in London in August 2018. “Opening our European headquarters in London was a very important and exciting move for us,” Deutsch adds. “London is a strategically important market for the business, as the fitness industry continues to grow in both size and value. The new HQ will play an integral role in helping to expand across new markets and countries.

“It’s also a great way of showcasing our business model to prospective investors; its central location and close proximity to existing UK and European franchisees means that we can offer more support and help them to drive business. It’s given us a local presence as we are near many of the studios, so investors can come and get a feel for the brand, visit existing F45 studios and try the classes.”

THE FUTURE LOOKS BRIGHT
So how much more growth can the UK fitness market accommodate? Lots, according to the operators.

“We definitely see an opportunity to continue to grow at our current levels”, says énergie’s Spaticchia. “We feel very lucky because we are on the cusp of two very hot markets. The budget fitness space is very hot from an investment point of view but, equally, fitness franchising has never been hotter.

“So while we have to deal with the environment getting more competitive, I think the fact that so many international franchises are heading for the UK has really shown that this is very furtive growth ground.”

Spaticchia adds that there remain plenty of areas to expand into. “Some of our clubs are in populations or towns as small as 20,000 or 25,000 people,” he explains. “For example, our Hoddesdon club is in a population of 20,000 people and yet it has 2,500 members and our franchisee makes annual profits. There are many more towns like Hoddesdon we can go into – and some haven’t got any real level of competition.”

Anytime’s Broster agrees and adds that, as well as the increasing demand from consumers, there’s also growing interest from entrepreneurs for getting involved in the fitness business. “The growth in the market is reflected by the eclectic franchisee network that we have,” he says.

“People are recognising the fitness industry as a sustainable investment and a lot of our franchisees have an existing portfolio of high-street hospitality franchises – such as Costa Coffee and Subway, for example.

“They’ve turned to fitness as it has a number of benefits, including lower staffing models, a smaller focus on attracting new customers and – as has been shown in the past few years – the fact that the industry is still growing despite the recession.”

For Orangetheory’s Adelstein, there is plenty of room for growth – especially for those with smaller-format clubs and studios. “I definitely see an increased demand for boutique fitness,” he says. “The boutique format is really taking over the big box.

“I feel that people are increasingly looking to spend less time at the gym and not ‘waste time’ – they are looking for results and looking for someone to work with them. But it also has to be reasonably priced. And that’s what we try to accomplish.”

Anytime Fitness aims to have over 300 clubs by 2023 and is prioritising plans to expand to north England
Anytime Fitness aims to have over 300 clubs by 2023 and is prioritising plans to expand to north England
Floyd Mayweather Jr. is in the process of setting up a chain of fitness clubs
Floyd Mayweather Jr. is in the process of setting up a chain of fitness clubs
énergie has a solid pipeline but can still grow up to 50 new sites a year
énergie has a solid pipeline but can still grow up to 50 new sites a year
Orangetheory has signed two master deals for a total of 110 franchised sites
Orangetheory has signed two master deals for a total of 110 franchised sites
Australia-based F45 is not only one of the fastest growing franchises in the UK, but one of the fastest worldwide
Australia-based F45 is not only one of the fastest growing franchises in the UK, but one of the fastest worldwide
http://www.leisureopportunities.com/images/imagesX/344751_843957.jpg
New operators are queuing up to enter the booming franchise market. Tom Walker reports
Latest News
The Gym Group has confirmed plans to roll out a new small box format in ...
Latest News
Representatives from the three main political parties have backed the view that physical activity has ...
Latest News
Life Leisure is expanding its facility portfolio with the launch of an independent boutique fitness ...
Latest News
Almost half of children and young people (46.8 per cent) in England are doing the ...
Latest News
A local fitness operator with 11 clubs in Chicago, US, is looking to muscle in ...
Latest News
Fitness industry veteran Nick Coutts has been appointed chair of Danish fitness tech firm Motosumo. ...
Latest News
The improvements in health and wellbeing associated with exercise referral schemes aren’t as large as ...
Latest News
The Bannatyne Group has appointed Hugh Hanley as its new head of fitness. He joins ...
Latest News
Physical exercise can improve the health of blood vessels in the heart for people with ...
Latest News
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Job search
POST YOUR JOB
Featured supplier news
Featured supplier: Wattbike remain best-in-class performance bike for David Lloyd Leisure
David Lloyd Leisure has announced Wattbike as its performance bike of choice after a recent tender.
Featured supplier news
Featured supplier: Wattbike Studio makes lasting impact on business at Holme Pierrepont
Since installing its new Wattbike indoor cycling studio last year, Holme Pierrepont Country Park, a Serco Leisure site that’s the home of the National Water Sports Centre, has seen a significant increase in cycle studio usage.
Video Gallery
Harlands Group testimonial
Harlands Group
Harlands Group - Testimonial from 'Unity Leisure'. Read more
More videos:
Company profiles
Company profile: Pavigym
PAVIGYM is the premier innovator of flooring and interactive solutions for the global fitness industry....
Company profiles
Company profile: Eleiko
We build upon our six-decade legacy in weightlifting, fuelled by our unwavering commitment to innovation, ...
Catalogue Gallery
Click on a catalogue to view it online
Directory
Whole body cryotherapy
Zimmer MedizinSysteme GmbH / icelab: Whole body cryotherapy
Trade associations
International SPA Association - iSPA: Trade associations
Audio visual
Hutchison Technologies: Audio visual
Locking solutions
Ojmar: Locking solutions
Direct debit solutions
Debit Finance Collections: Direct debit solutions
Fitness equipment
Healthcheck Services Ltd: Fitness equipment
Spa software
SpaBooker: Spa software
Hydrotherapy / spa fragrances
Kemitron GmbH: Hydrotherapy / spa fragrances
Flooring
Total Vibration Solutions / TVS Sports Surfaces: Flooring
Lockers/interior design
Crown Sports Lockers: Lockers/interior design
Property & Tenders
Diary dates
10-12 Dec 2019
tbc, Fort Lauderdale, United States
Diary dates
21-23 Jan 2020
Harrogate Convention Centre, Harrogate, United Kingdom
Diary dates
28-30 Jan 2020
Ericsson Exhibition Hall, Ricoh Arena, Coventry, United Kingdom
Diary dates
29-30 Jan 2020
Holiday Inn San Francisco-Golden Gateway, San Francisco, United States
Diary dates
23-25 Mar 2020
Hilton, Barcelona, Spain
Diary dates
25-26 Mar 2020
Eastwood Hall, Nottingham, United Kingdom
Diary dates
04 Jun 2020
Marriott Forest of Arden Hotel & Country Club, Birmingham, United Kingdom
Diary dates
10-27 Jun 2020
tbc, Pinggu, China
Diary dates
13 Jun 2020
Worldwide, Various,
Diary dates
17-18 Jun 2020
ExCeL London, London, United Kingdom
Diary dates
21-24 Sep 2020
Loews Coronado Bay Resort, Coronado, United States
Diary dates
30-31 Oct 2020
NEC, Birmingham, United Kingdom
Diary dates
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