The UK health and fitness club market has increased by 58 per cent over the past six years. But in the UK and other European countries it remains small compared with the US. The underdeveloped market has led several UK health club operators to explore European expansion.
The US health and fitness club market has a value six times higher than the UK market, which in part reflects its larger population size but also its higher proportion of health club members.
In terms of private health and fitness club penetration, only the Netherlands at 6.5 per cent can compare to the US 6.7 per cent figure.
In most European nations, three to four per cent of the population are club members.
The US health and fitness market is the most developed worldwide. An estimated 11.2 per cent of its population were members of either a private or public health club in 1999.
The number of US private clubs increased by 22 per cent between 1994 and 1999. But it was not until 1998 that the number of clubs exceeded the previous peak reached in 1990, before an economy downturn resulted in many clubs closing their doors.
Although total revenue is more than six times higher than the UK, the average revenue per club is not significantly higher. This reflects the lower average cost of US club membership.
The European market is of great interest to several UK multiple club operators and some have already taken their first steps into the region.
As the UK market matures, Europe’s potential will increase significantly as operators keen to maintain strong growth rates look to expand across Europe.
According to research, conducted jointly by the German research company Verband Deutsches Fitness – und Freizeitunternehmene and the International Health, Racquet and Sportsclub Association, the largest number of European health and fitness clubs are in Germany and Italy.
Figures initially suggest German and Italian markets are ahead of the UK market in development terms, but this is not the case.
Many of these clubs, especially in Italy, are little more than body-building gymnasiums, small in size and with few facilities.
Similarly, in France, the Netherlands and Belgium the majority of clubs are small, independently-owned gyms with the modest facilities reflected in a low average membership cost.
Spain is probably nearest to the UK in terms of club size and the facilities found in these sites, particularly those clubs located in big cities such as Barcelona and Madrid.
Data shows the UK market is the most developed in Europe, with almost 1,000 members per club. This reflects the level of demand for such facilities, and the significant increase in average capacity and club size during the past five years.
Spain has the next-highest number of members per club, at almost 800. This highlights the trend towards large clubs situated in major urban areas. Membership as high as 8,000 to 10,000 for the top clubs is not uncommon.
The German figure of just over 700 reflects the number of small gyms with fewer than 500 members which affect the overall average. Clubs in France, Germany and the Benelux countries are at a broadly similar development level, while those in Italy tend to have a much smaller turnover – the average figure of 338 is almost half that of any other country.
In terms of revenue, the UK has the largest market for health and fitness clubs in Europe, ahead of Germany. No other European market exceeds E1bn (£625m). Spain is nearest, closely followed by France and Italy, with the Benelux countries the smallest markets.
In the UK, the average revenue per health and fitness club is about 60 per cent higher than in any other European country. This reflects the larger average size and member capacity of clubs, and also the high proportion of revenue. This is generated from ancillary sources such as health and beauty, food and drink and merchandise sales.
Health and fitness clubs in other European countries tend to be smaller in size and capacity. Consequently, their average revenue is much smaller, with Spanish clubs the next most developed in this respect.
Spain, has the second-highest spend per member, reflecting the sophistication of many facilities and membership capacity. The figures for both Italy and Germany are held back by the large number of small gymnasiums which do not have the facilities to command a high membership or (in the case of Italy in particular) are more focused on body-building rather than general fitness and well-being.
The European health and fitness club market is ripe for expansion.
Multiples have the opportunity to create Europe-wide chains, improving quality of services and secondary revenue streams. But there are many cultural differences across Europe, reflected in the different ways people use clubs in different countries, to take into account.