Gym operators optimistic of growth

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Fitness First Malaysia managing director Kurt Stocks showing how it’s done, even with tie and suit!

By Zhen M

Are Malaysians getting more health and fitness conscious? The gym operators are banking on it.

Celebrity Fitness Malaysia Vice President Trevor Brennan notes that Malaysian consumers are becoming increasingly health and fitness conscious, more so with the easy availability of information through online and social media, making them more willing to invest in their fitness and wellness. “They’re no longer merely contented with a ‘cookie cutter’ fitness experience. They actively seek a fitness experience that is exceptional and are becoming more discerning… so instead of going after ‘the best deal in town’, they appreciate that investing in a suitable fitness membership is pivotal to the long-term benefits to their health and wellness,” says Brennan.

The increased awareness on the importance of staying fit and healthy has led to a growing fitness industry in Malaysia, echoes Fitness First Malaysia managing director Kurt Stocks.

Newcomer Anytime Fitness (AF) is so confident of the growth opportunities in Malaysia that it declared an ambitious target of opening at least 40 outlets within 12 months. Rapid growth upon entering a new market is the usual modus operandi of the 24-hour community gym and the world’s fastest-growing franchise. It opened its first club in Malaysia on May 28. Globally, it has 2,501 clubs and more than 2 million members.

Celebrity Fitness, currently the fastest-growing gym brand in South East Asia with 50 clubs in total, expects to open at least five new clubs annually in Malaysia “for the foreseeable future”, says Brennan. “Within five years, we expect to have clubs located in all key Malaysian cities, as well as clubs within driving distance of most Kuala Lumpur and Klang Valley neighbourhoods”. It currently has 16 clubs in Malaysia.

Fitness First is opening its 14th outlet in Malaysia at The Gardens, Kuala Lumpur in November and has plans to open another five by 2018. In addition, it has allocated up to RM2 million to upgrade each of its existing 13 clubs. The upgrades, expected to be completed by 2015, are part of a global transformation initiative which include the shedding of its blue logo for a more angular red one.  Fitness First is the world’s largest privately-owned gym chain with over 1 million members in more than 377 clubs across 16 countries.

Celebrity Fitness and Fitness First welcome the competition from Anytime Fitness.

“We see it as an impetus for us to constantly and continuously review ourselves so that we’re always evolving and giving our members the fitness experience they deserve,” Brennan (pic) adds.

“There’s always room for everyone to have some pie!” he adds, especially given that the gym penetration rate in Malaysia is only at 1-2%, compared to 5% in Singapore and 12-17% in the US, UK and Australia, implying room aplenty for growth.

As expected, the players stress on being different.

AF vice president of international development John Kersh says: “We have a system to make this 24-hour concept work flawlessly. So while there are companies that have created a similar business model, they don’t quite come close to us.”

“Our unique blend of fitness and entertainment makes our brand stand out, particularly our classes like our trademarked Floating Yoga, dance fitness signature Dance N’ Attitude (DNA) and Tour de France inspired indoor cycling class Peloton,” says Brennan.

“Through our global transformation initiative, we’ve redesigned our gyms and services around the principles of behavioural psychology – to motivate members,” says Stocks of the initiative by the Fitness First Group that has been underway since 2012 following a joint behavioural psychology study conducted by Fitness First and its psychologist partner Professor Stuart Biddle in the UK. The study revealed that the motivation to exercise is not underpinned by willpower but by three specific psychological needs that have to be fulfilled before exercise resolutions become habits through increased motivation – personal growth, autonomy and a sense of belonging.

Will there be demand for 24-hour gyms in Malaysia?

“24-hour gyms have been in the global market for a number of years. Their appeal spiked in the more mature fitness markets due to the increasing number of adults with busy schedules who want to keep fit at their convenience. We have explored longer operating hours with some of our members and found that the demand was not there,” says Stocks.

“Evidence from other countries like the US and UK, and our own findings indicate that it is a niche market – for shift workers seeking night-time workouts. Our own clubs operate from 6am to midnight and we constantly review feedback and club usage data to adapt to the consumer’s changing preferences,” says Brennan.

While these big players are gungho with their expansion plans, one has to wonder about the smaller boys. There is a plethora of small gym operators and the word on the street is that many, if not most of them, are not making money. There had been numerous cases of these businesses folding up due to lack of members. According to one gym equipment supplier, some of the mid-sized chains are also unable to cover costs from membership fees alone, relying instead on pricey personal training sessions.

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