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IBISWorld shows that 24/7 budget gyms have transformed Australian fitness
Rapid growth in budget 24/7 gyms has transformed the Australian fitness industry over the past five years according to a recently released report from market analysts IBISWorld.
The recently released report, Gyms and Fitness Centres in Australia (subtitled Exercising power: Establishment numbers have bulked up due to the popularity of 24-hour gyms), shows that with companies such as Anytime Fitness, Jetts, Snap Fitness 24/7 and Plus Fitness having expanded across all states and territories, they are now beginning to consolidate their market-leading positions.
The report explains “these gyms provide their members with access at any time through individual passes (and) while the increased accessibility of 24-hour gyms is attractive to many consumers, their affordability has been the main factor driving their popularity.
“By not providing group fitness classes and only employing staff at peak times, these companies can limit wage costs and pass the savings on to consumers through lower membership prices (and these) lower prices have attracted rising membership numbers.
“The growing number of 24-hour gyms has taken market share away from traditional full-service gyms, particularly those run by Fitness First. Full-service gyms have often locked consumers into long-term, expensive contracts.
“Conversely, budget 24-hour gyms tend to offer more flexible and affordable contracts, including free cancellations, no minimum terms and the option to pay by direct debit. This competition has caused gym membership prices to fall across the industry, with full-service gyms forced to become more flexible with their contracts in line with changing consumer expectations.
“Lower membership prices for consumers, particularly for those switching from full-service to 24-hour gyms, have constrained revenue growth over the past five years. However, the low cost base of 24-hour gyms has aided profit growth and contributed to profit increasing as a share of industry revenue over the past five years.”
The report goes on to state “spending on gyms and fitness centres positively correlates with increased health awareness across the population.
“Rising health consciousness means that consumers are increasingly concerned about their health and are more likely to exercise.”
Click here for more information on IBISWorld Industry Report R9111: Gyms and Fitness Centres in Australia (Exercising power: Establishment numbers have bulked up due to the popularity of 24-hour gyms), November 2017.
Image: Snap Fitness 24/7
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