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FreeMotion Fitness
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UNITING THE WORLD OF FITNESS
Health Club Management

Health Club Management

News

IHRSA 2014: Health clubs under threat from march of microgyms, says Ray Algar

Traditional health clubs offering a broad selection of activities at a mid-range price are at serious risk of having their business ‘salami-sliced’ away by specialised competitors.

That was the view of respected industry analyst Ray Algar during his address at the IHRSA Europe Congress in Amsterdam yesterday afternoon (17 October).

He said activity providers must decide whether they wish to pursue the path of low-cost self-service gyms, which have been a big success story in recent years, or go-down the path of offering a high-quality support structure for their clients - as found in the new wave of microgyms - if they are to thrive in a changing marketplace.

The mid-market gyms charging an average of £42 a month in the UK may find that small chunks of their members will be lost to low-cost competitors and microgyms specialising in the activities they most prefer - such as yoga, functional training or group cycling - until the business is no longer viable, Algar added. Approximately 120 private gyms are closing in the UK every year as their business model becomes no longer feasible, he lamented.

The new price points which are forming, Algar said, are approximately £16 per month maximum for a low-cost operator (slightly more in London), while microgyms are able to charge between £20-30 per hour session for the unique experience that they offer. He stated that the talented trainers are a key part of the high price point for microgyms, describing them as ‘rockstars’ who are vital to building loyal communities around new aspirational brands, such as Psycle and Soul Cycle, in a way mid-market gyms haven’t managed.

He highlighted this by citing a quote from Fitness First CEO Andrew Cosslett, who on joining the company from the hospitality industry noted: “The gym industry might be great at fitness, but it has never been very good at connecting with customers.”

In response to these new competitors, traditional mid market giants such as Fitness First and David Lloyd are piloting their own microgym brands, while some industry observers believe that embedding these boutique concepts within existing health clubs could preserve their status as the traditional centre of active lifestyles.

Algar pointed out that, as with the initial wave of microgyms, many of the entrepreneurs behind boutique clubs are arriving from outside the health and fitness industry, bringing new ways of thinking. Whichever path traditional gyms choose to take, he concluded, they will need to be clear in their approach and embrace innovation if they are to succeed.

The focus on the emergence of microgyms served as an apt precursor to Algar’s forthcoming report on the sector - which is expected to be released in December.

Health Club Management will be in attendance for the duration of the event and (WiFi permitting) will be live reporting on key developments via the HCM website.

A preview of the event can be found in the September edition of HCM magazine on pp.26-27.

Traditional health clubs offering a broad selection of activities at a mid-range price are at serious risk of having their business ‘salami-sliced’ away by specialised competitors.
HAF,FIT,IND,EVT,PHR
934328_953695.jpg
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News

IHRSA 2014: Health clubs under threat from march of microgyms, says Ray Algar

Traditional health clubs offering a broad selection of activities at a mid-range price are at serious risk of having their business ‘salami-sliced’ away by specialised competitors.

That was the view of respected industry analyst Ray Algar during his address at the IHRSA Europe Congress in Amsterdam yesterday afternoon (17 October).

He said activity providers must decide whether they wish to pursue the path of low-cost self-service gyms, which have been a big success story in recent years, or go-down the path of offering a high-quality support structure for their clients - as found in the new wave of microgyms - if they are to thrive in a changing marketplace.

The mid-market gyms charging an average of £42 a month in the UK may find that small chunks of their members will be lost to low-cost competitors and microgyms specialising in the activities they most prefer - such as yoga, functional training or group cycling - until the business is no longer viable, Algar added. Approximately 120 private gyms are closing in the UK every year as their business model becomes no longer feasible, he lamented.

The new price points which are forming, Algar said, are approximately £16 per month maximum for a low-cost operator (slightly more in London), while microgyms are able to charge between £20-30 per hour session for the unique experience that they offer. He stated that the talented trainers are a key part of the high price point for microgyms, describing them as ‘rockstars’ who are vital to building loyal communities around new aspirational brands, such as Psycle and Soul Cycle, in a way mid-market gyms haven’t managed.

He highlighted this by citing a quote from Fitness First CEO Andrew Cosslett, who on joining the company from the hospitality industry noted: “The gym industry might be great at fitness, but it has never been very good at connecting with customers.”

In response to these new competitors, traditional mid market giants such as Fitness First and David Lloyd are piloting their own microgym brands, while some industry observers believe that embedding these boutique concepts within existing health clubs could preserve their status as the traditional centre of active lifestyles.

Algar pointed out that, as with the initial wave of microgyms, many of the entrepreneurs behind boutique clubs are arriving from outside the health and fitness industry, bringing new ways of thinking. Whichever path traditional gyms choose to take, he concluded, they will need to be clear in their approach and embrace innovation if they are to succeed.

The focus on the emergence of microgyms served as an apt precursor to Algar’s forthcoming report on the sector - which is expected to be released in December.

Health Club Management will be in attendance for the duration of the event and (WiFi permitting) will be live reporting on key developments via the HCM website.

A preview of the event can be found in the September edition of HCM magazine on pp.26-27.

Traditional health clubs offering a broad selection of activities at a mid-range price are at serious risk of having their business ‘salami-sliced’ away by specialised competitors.
HAF,FIT,IND,EVT,PHR
934328_953695.jpg

News

Basic-Fit lost 10 per cent of its members during Q1 2021, as 94 per cent
A bid to engage politicians in exercise has inspired the launch of a new global
The International Health, Racquet & Sportsclub Association (IHRSA) has moved its Annual International Convention &
Undertaking regular physical activity could cut the risk of dying from infectious diseases – such
PureGym saw its group-wide revenue decline by £177m during 2020, as it lost 37 per
Outdoor workouts have become increasingly popular over the past year, as pandemic lockdowns – and
Miha Bodytec GmbH
Miha Bodytec GmbH
L&R Kältetechnik has launched a new division, named artofcryo.com, after 30 years’ experience with -110
Wyre Council in Lancashire has revealed plans to begin charging PTs and fitness instructors for
Health clubs and gyms will be able to open their doors to individual training sessions
As health clubs and gyms reopen following lockdowns, it is "absolutely crucial" operators take a
IHRSA and Fitness Brasil say they have signed a partnership agreement that will see the
EuropeActive has joined the All Policies for a Healthy Europe (APHE) initiative, as part of
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Katie Lewis and Lindsey Simpson co-founded Workplace Mental Wealth to drive workforce change in the health and fitness industry. Liz Terry talks to Lewis about their first research study – the Fitness and Active Leisure Workforce State of Mind Survey – and the launch of The Good Work Pledge
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Tad Chapman from Active IQ argues that operators should take a fresh look at apprenticeships and their power to drive recovery
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Policing the rules, even if it means losing members, will be crucial to building trust as health clubs reopen, Paul Roberts tells Kath Hudson
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Fuel the debate about issues and opportunities across the industry. We’d love to hear from you – [email protected]
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Featured supplier news
Featured supplier news: Engaging smart technology helps gyms and fitness professionals get their leading role back
Safety, quality of service, and member engagement are key in order to offer a unique fitness experience that will boost the re-start.
Featured supplier news
Featured supplier news: Cryotherapy specialists, L&R Kältetechnik, launch new artofcryo.com division
L&R Kältetechnik has launched a new division, named artofcryo.com, after 30 years’ experience with -110 °C electrical solutions.
Company profiles
Company profile: TVS Group
The TVS Group supply and install sports and fitness flooring to a wide range of ...
Company profiles
Company profile: Fitronics (CoursePro and TRP)
Fitronics is the company behind The Retention People (TRP) and CoursePro. We truly understand our ...
Supplier Showcases
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Catalogue Gallery
Click on a catalogue to view it online
Directory
Trade associations
International SPA Association - iSPA: Trade associations
Red Light Therapy
 Red Light Rising: Red Light Therapy
Hydrotherapy / spa fragrances
Kemitron GmbH: Hydrotherapy / spa fragrances
Exercise equipment
Pendex Fisio S.L.: Exercise equipment
Spa software
SpaBooker: Spa software
Independent service & maintenance
Servicesport UK Limited: Independent service & maintenance
Lockers/interior design
Safe Space Lockers Ltd: Lockers/interior design
Uniforms
Service Sport: Uniforms
Flooring
Total Vibration Solutions / TVS Sports Surfaces: Flooring
Architects/designers
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Diary dates
12 Jun 2021
Worldwide, Various,
Diary dates
13-14 Jun 2021
Online,
Diary dates
16-17 Jun 2021
ExCeL London, London, United Kingdom
Diary dates
01-04 Jul 2021
Expo Centre & Riviera di Rimini, Italy
Diary dates
18-19 Sep 2021
Locations worldwide,
Diary dates
21-24 Sep 2021
Messe Stuttgart, Germany
Diary dates
04-07 Nov 2021
Exhibition Centre , Cologne, Germany
Diary dates
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tbc, Dunedin, New Zealand
Diary dates
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FreeMotion Fitness
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