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INDUSTRY INSIGHTS


Vivafit (above left) continues to expand in the Asia-Pacific region; Fresh Fitness (above right) is one of Europe’s low-cost success stories


believes hundreds of European facilities will be forced to close or change hands as a result of ongoing economic difficulties, high unemployment rates and excessive taxation on health club services. Danish entrepreneur and IHRSA


board member Rasmus Ingerslev, CEO of low-cost chain Fresh Fitness, sees the industry evolving quickly and competition intensifying. “As a result, there will likely be even more segmentation, which will create clear value propositions in the niche, low-cost, mid- and high-end markets,” he predicts. “On the positive side, I believe this will help attract more members, growing the overall market. My concern is that we’ll see bubbles in segments that grow too fast, specifically the low-cost sector, and collapses in the mid-market.”


Asia-Pacific This vast region currently serves 17 million members at more than 21,000 health clubs, generating total revenues of US$13.6bn.


50 Health Club Handbook 2014


“There’s still a wide variety of business


models being promoted in the Asia- Pacific region, some of which will not have much longevity due either to unsupportable business practices – lifetime memberships, cash flows built on joining fees rather than monthly memberships and so on – or lack of professional management,” says John Holsinger, director of IHRSA Asia-Pacific. In 2014, health and fitness clubs in


the region must face several challenges head-on, including resolving the detrimental practices mentioned above; adapting to the emergence and increasing popularity of express / 24- hour clubs, which are changing the industry landscape and challenging the mid-market; and finding ways of reaching the 97 per cent of Asians who are not currently members of health clubs. IHRSA’s Rodriguez anticipates rapid


growth in the coming years in Asia, particularly in India and China, two of the world’s largest economies. “Anytime Fitness and Snap Fitness have each expanded their franchise network overseas to encompass India,” she says. “As the second-largest global economic


power, the Chinese market is also ripe for development.” Companies such as Vivafit and Virgin Active continue to show confidence in the region through their growth plans.


Opportunities abound Collectively, the global health club industry can anticipate growth in 2014 and beyond. Although challenges may prevail in Europe, the future looks bright in the Americas. Opportunities for growth also remain in the Asia-Pacific region. Our industry is certainly not immune from economic headwinds, but it has proven to be impressively resilient.


FOR FURTHER INFORMATION


Kristen Walsh is IHRSA’s associate publisher: kwalsh@ihrsa.org


IHRSA’s full range of reports – including The IHRSA Global Report, The IHRSA European Health Club Report and The IHRSA Latin American Report – are available for purchase at www.ihrsa.org/research-reports


www.healthclubhandbook.com


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