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How businesses in the fitness industry can survive the pandemic situation

Written by Ben Walker on Friday, 01 May 2020. Posted in Wellbeing, People

Many sectors in Britain have taken a massive hit this year as the coronavirus surged in the UK.

How businesses in the fitness industry can survive the pandemic situation

Many sectors in Britain have taken a massive hit this year as the coronavirus surged in the UK. In a bid to contain the infection, non-essential services like leisure centers, cinemas and gyms were ordered to close as of March 2020. Since the situation has escalated, businesses in the fitness industry are scrambling to adapt to these circumstances. The situation is particularly bad for fitness clubs, because their revenue depends on customer subscriptions.

SMEs in the fitness industry simply don’t have the cash flow to compensate for cancelled subscriptions and still pay the overheads. As most people have turned to home fitness services since the pandemic, the fitness sector is coming up with new ways to survive the times.

The Situation for Fitness Businesses in the United Kingdom

Considering the impact of the pandemic on fitness businesses in the United Kingdom, the full scale of the damage is still unknown. Depending how long the crisis lasts, there is uncertainty over whether consumers will return to their old gym or continue with home services. If the latter continues, it would be a huge blow to gym chains like Fitness First and PureGym.

At the start of 2020, the future of UK’s fitness sector was looking pretty bright. Britons were more fitness-obsessed than ever. The fitness sector in the UK is valued at an impressive £5 billion. There are over 7,000 fitness centers in the United Kingdom, and around 14.2% of British adults hold a gym membership. [1] Hence, gym membership provides a steady stream of revenue for any gym, no matter how big or small.

These subscriptions are the backbone for other sources of revenue. Clinical services that also operate at clubs such physiotherapy, massage therapy, chiropractic will see their share of job losses. It isn’t just fitness managers and professionals that take the brunt.

A recent trend (before the pandemic) in the UK fitness industry has been a booming demand for low-cost gym memberships. Budget fitness chains like The Gym Group’s revenue increased by an impressive 36% in 2018 alone, thanks to new memberships. [2] However, despite the increasing revenue, it was seeing high debt as a result of expansion projects. Now that people are staying at home and there’s a loss of revenue, budget fitness chains are likely to face major debt problems as a result.

Why it is important to persuade people to keep fit at home

The pandemic will bring a seismic shift to the UK’s fitness industry. The country’s lockdown could potentially last for months. Fitness providers will need to offer home-friendly services to avoid plummeting revenue. Right now, the government is encouraging people to keep think economically and keep healthy.

Fitness providers need to encourage home fitness services for the following reasons:

  • Lower Healthcare Costs – The situation itself is going to cost the economy millions. As the job market becomes unstable, many people are left in a state of worry and distress. By keeping fit at home, we reduce the risk of heart related issues, keeping our economy and ourselves healthier and more financially stable while in recovery.
  • Stay Positive, Physically and Mentally – The situation will also impact our mental health. Right now we need everyone to remain calm, think positively and make rational decisions. Keeping fit at home will maintain this mindset and reduce feelings of cabin fever – which can lead to issue such as anxiety and depression.
  • Immunity Levels– Keeping fit and healthy increases our immunity levels to help fight against the infection. There is a shortage of healthcare professionals and hospital beds. By having larger numbers resist the need for treatment, we can allow nurses and other healthcare professionals to focus more on the task at hand. This allows our healthcare workers to work to their best abilities and look after their own health.

Medical professionals at the Centre for Perioperative Care (CPOC) in the UK recommend cardiovascular activity like jogging, cycling and brisk walking. They also recommend strength training exercises. [3]

Cycling and jogging are going to become a challenge with increasingly stricter lockdown measures, so working out at home will be a good alternative. The NHS is recommending home-friendly workouts like stair climbing and skipping to stay fit. [4]

While in social isolation, keeping fit at home is essential for tackling anxiety and depression, but there is a variety of health related reasons why this routine needs to be maintained. Spending long hours sitting around at home can lead to musculoskeletal and metabolic issues, decreasing our mobility, joint function and increasing the issue of weight gain.

Online personal training has been a great success for fitness trainers in the UK for the last few years. This has led to more personal trainers offering a different niche of virtual training programs. For example, UK-based fitness coach Joe Wicks is offering daily YouTube PE sessions for kids. By reaching their audience on social media platforms, personal trainers and coaches can benefit from monetisation and merchandising.

How small and medium sized fitness businesses can adapt and survive in the crisis

Undoubtedly, more fitness companies are stepping up to this challenge. They have become more creative and adaptable, offering more digital and virtual training programs through apps and online platforms.

Fitness company GLL, for example, has made their Better UK fitness app available to the public for free. [5] The app offers virtual fitness classes and guides. Apart from helping to keep people fit, it also improves the brand’s visibility among a wider audience. When the lockdown measures ease up in a few months, this could lead to an increase in sales as a result of better brand visibility. Much like GLL, the easiest way for small fitness businesses to ride this storm is to introduce home fitness apps.

Apart from developing fitness apps, small fitness companies and UK-based personal trainers are turning to social media platforms for fitness programs. The benefit of this is that it offers a ‘social’ angle to fitness against isolation and lockdown measures. A huge appeal for gyms is the social aspect, allowing members to feel connected to others in their fitness journey. Hence, using Facebook and Instagram is a great way to maintain this. It also significantly improves brand visibility.

But what can gyms do to recover the revenue lost from massive overheads and member subscriptions?

Gyms, rather than self employed personal trainers, will need to think more outside the box for recovering revenue. These businesses are still committed to commercial rental rates. Here are a few things that they can do:

  • Online Classes – The goal is to avoid member subscriptions defaulting. Members will want to see a bang for their buck – a service that matches the monthly rate they are paying. While in lockdown, gyms can have a designated member(s) of their team conduct online classes in a set space. A selected amount of members can tune in at the same time. The amount of participants should reflect the trainer’s ability to track each person, giving cues and feedback. Members still feel they getting quality service, while enjoying the social aspect they experience at the gym.
  • Online Personal Training – Besides member subscriptions, you may have a subsequent amount of gym goers contracted to additional services. Gyms will have to bargain with their members to find a happy medium for this service. Ideas would include switching all in person sessions to online sessions – offering a few sessions on the house, or negotiating a price that members and staff can accept. Member subscriptions could be matched for a home fitness program designed, accompanied by an online personal training session per month. There’s many ways to negotiate and persuade members why it’s vital to stay fit at home during the pandemic.
  • Promotions – Hopefully your business can stay afloat from some of these brainstormed ideas. If you need to negotiate further to keep subscriptions alive, offer promotions for when the doors open again. An idea would be to extend service time or a month of membership.
  • Collaborate with other SMEs – It is certainly a market right now for businesses who sell fitness equipment. UK sports equipment retailers like Sports Direct have seen an increase in their sales since the outbreak. They have even been speculated in the press for raising their prices by as much as 50 percent. Try and find smaller to medium size businesses to collaborate. Discuss a better deal for people to obtain equipment and do home programs or share in the commissions for keeping business profits alive. There are many ideas for collaboration in health services at this moment.

With the loss of jobs and income, customers are likely to cancel gym memberships. Hence, most fitness clubs in the UK have frozen people’s gym memberships, taking no additional payments. [7]

Gyms may be able to keep members by automatically freezing subscriptions. Having financial aid from the government will be able to recoup a moderate amount of these expenses. However, fitness is a mindset, and keeping members active from alternative options is better for business in the long run.

References:

[1]- https://www.ft.com/content/2e2e1a2f-3a8d-4a60-9116-3acc38130400

[2]- https://www.proactiveinvestors.co.uk/companies/news/212596/the-gym-group-shares-weighed-down-by-higher-debt-predictions-despite-2018-revenue-growth-212596.html

[3]- https://www.bbc.com/news/uk-52076856

[4]- https://www.nhs.uk/live-well/exercise/free-fitness-ideas/

[5]- https://www.lbhf.gov.uk/articles/news/2020/03/free-fitness-app-helps-you-stay-healthy-during-coronavirus-outbreak

[6]- https://www.theguardian.com/business/2020/mar/29/which-companies-are-coming-through-during-the-coronavirus-crisis

[7]- https://www.thesun.co.uk/news/uknews/11261387/are-gyms-closed-due-to-coronavirus-puregym-fitness-first-and-virgin-active-updates/

About the Author

Ben Walker

Ben Walker

Ben Walker is a successful entrepreneur in the fitness industry in the UK and Canada. An enthusiast about mental and physical fitness, Ben is currently the owner and fitness specialist at London Fitness.

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