Young people and baby boomers will aim to stay fit, supporting demand for gyms
Los Angeles, CA (PRWEB) October 30, 2012
The Gym, Health and Fitness Clubs industry has benefited from the array of marketing campaigns and ensuing consumer trends for fighting obesity and improving health. According to IBISWorld analyst Dale Schmidt, “Gym membership numbers have increased considerably over the past 10 years, rising from 36.3 million in 2002 to more than 43.6 million by 2012.” This trend is the result of soaring demand for fitness activities, and industry operators have capitalized on this growth by expanding establishments in both size and number. In addition, the industry has diversified some with the rise of small-scale gyms and female-oriented gyms, which have expanded its customer base.
However, the industry has not been recession-proof. In 2008 and 2009, demand for gyms and health clubs weakened as consumers cut back on discretionary spending. Still, compared with other industries, the Gym, Health and Fitness Clubs industry has remained remarkably resilient, as increased leisure time and boosts in health and morale from exercise have kept the industry highly competitive. “Gyms and health clubs have broadened their markets in a bid to retain membership numbers throughout the recession's aftermath, says Schmidt.” Due to their lower cost, the downturn has also favored the growth of small-budget gyms with fewer amenities over more expensive, all-inclusive clubs. In fact, many smaller operators have expanded over the past two years despite the economic climate. Overall, industry revenue is expected to grow at an annualized rate of 0.9% to $25.3 billion over the five years to 2012, including growth of 2.0% in 2012.
This industry has a low level of market share concentration, with the top four firms in this industry accounting for just over 10.0% of industry revenue. The concentration remains low because of the large number of centers that only employ one person or are nonemploying establishments. In 2012, about 36.0% of all establishments will be nonemploying, and these establishments are expected to generate only 11.9% of industry revenue. The percentage of nonemployers is substantial because the industry's low barriers to entry, making it an attractive industry to enter. The larger players in this industry have numerous locations throughout the United States, while small players are generally independently owned and operate in one or two states. The industry is highly fragmented, with the majority of employing establishments employing fewer than 20 people. However, over the past five years, the proportion of businesses that employs 20 people or more has increased, indicating that concentration is rising. Increasing concentration is a result of larger firms continuing to expand operations to improve economies of scale and enter new markets.
Over the next five years, the industry will benefit from increased youth and baby-boomer memberships. IBISWorld forecasts that revenue will increase at a steady rate over the five years to 2017. Firms will profit from the public's growing interest in staying fit as well as the rising obesity rate, and membership growth will continue to outpace population growth. As consumers' income grows in line with the recovering economy, the industry will transition back toward larger and all-inclusive clubs. With total health club memberships expected to reach 48.3 million in 2017, players will capitalize on this growth and provide members with additional services in a bid to increase registration and retention rates.
For more information, visit IBISWorld’s Gym, Health & Fitness Clubs in the US industry report page.
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IBISWorld industry Report Key Topics
This industry operates fitness and recreational sports facilities that feature exercise and other active physical fitness conditioning or recreational sports activities, such as swimming, skating or racquet sports. Firms are also involved in facilities management and fitness instruction.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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