How to Start a New Franchise Pt II: The Fitness Industry
The health of the fitness industry is strong and getting stronger. The demand for fitness concepts is being sustained by the increasing number of people taking better care of themselves. For example, health and wellness are a top priority for millennials, now the largest consumer generation alive. Being fit is also important for baby boomers, who are becoming more health conscious as they age. More of them are working fitness into their daily routines and are expected to create a greater demand for gym memberships through 2023.
With a 33.6 percent growth in health club membership between 2008, when there were 45.6 million members, and 2017, when there were 60.9 million members, the fitness industry is a booming $87.2 billion revenue generator.
Smaller Studios Make a Big Impact
However, you will not find everyone at the traditional large gym with a plethora of equipment. Millennials, especially, want more specialized workouts, which has given rise to the surge of boutique fitness concepts. They’re frequenting smaller studios that house barre, boxing, cycling, rowing, yoga and other concepts.
Millennials prefer these smaller, niche concepts that are centered on group workouts because they offer a sense of community – also important to that generation. They’re willing to pay premium prices for the more intimate experience, too. While the average monthly membership at a traditional gym is $37 to $76, members belonging to boutique fitness studios pay between $80 and $117 a month.
More people are turning to boutique concepts because they’re seeing results quicker, too. Typically, when people go to the gym, they go alone and only push themselves as hard or fast as they want. But, when people become members at boutique studios, they feel more compelled to keep up with their workout class being led by an instructor.
Combining Fitness with Franchising
When you combine the fitness industry with the franchise industry, which is also healthy, there’s tremendous growth opportunity for an emerging fitness concept.
In 2018, the franchise industry is experiencing an eighth consecutive year of growth. The number of franchise establishments is expected to reach 759,000, an increase of 1.9 percent. Their gross domestic product is forecasted to increase by 6.1 percent to $451 billion.
To capitalize on the potential of both industries with a fitness franchise, here are four areas you’ll want to focus on as you begin franchise development:
- Keep it Simple to be Replicable
There are many boutique fitness concepts, but one thing they all have in common is simplicity. Simplicity is necessary for making your concept replicable from location to location in your franchise system. For example, boxing concepts are centered around a punching bag and fighting techniques, cycling concepts are based on stationary cycles, etc. Boutique fitness concepts don’t require you to spend money on a lot of different pieces of equipment which require maintenance or may never get used like at a big box gym. Your concept also needs to be simple enough for franchisees and their staff to easily teach it to members at each location.
- Build up Membership in Multiple Markets
Just like with any other franchise concept, you need to make sure your fitness concept will work in multiple markets. Choose markets where the demographics match your target customers – preferably where the population of millennials is high, depending on your concept. If you experience elevated membership numbers at all the locations in different markets, that’s a good sign your concept is franchise ready.
- Retain Members at all Locations
The best fitness concepts retain members after the January boom, when millions of Americans resolve to get fit in the new year – but most break their resolutions by February. The motivation they felt on Dec. 31 drops off as January marches on because they get bored, find exercise is uncomfortable, don’t know what they’re doing, have unrealistic expectations or don’t have time. Your fitness concept should resolve each of those pain points to keep members coming back throughout the year.
- Stay Aware of Industry Trends
To keep your fitness franchise concept from going stale, you will have to keep current with fitness industry trends and be willing to innovate. For example, if your concept is based on a fighting sport, you might want to introduce elements of other fighting sports that are popular to keep the membership base engaged. Having flexibility inside the four walls will be critical to sustaining a fitness concept over the long haul.
With people from all generations striving to live healthier lives and the franchise industry serving as a strong economic engine, now is the time to enter the segment as an emerging franchisor and grow your fitness concept with muscle behind it.
With 30 years of franchising experience and more than 800 franchise owners representing over 1,200 locations for five brands, Winmark Franchise Partners can help you build a strong franchise system. Contact us here or at (844) 452-4600.