16
ISSUES: Fitness & Health
Chapter 1: About fitness
Fitness sector primed for substantial growth:
ukactive report
Consumer thirst for fitness will see gym sector become ‘shining star’ of post-
Brexit economy.
T
he value of the UK gym sector
is set to increase by £1.1 billion
in 2016, driven by a hive of
investment activity amid growing
consumer appetite for fitness, according
to a new financial report from non-profit
health body ukactive.
Released today (18 October),
The Rise of
the Activity Sector
report spotlights the
UK’s fast-changing fitness landscape
and predicts it to grow by 17 per cent
in 2016. Valuation specialist Mazars and
sponsorship experts Nielsen Sports
conducted analyses for the report, which
estimates the gym sector will be worth
£7.7 billion by the end of 2016 (up from
£6.6 billion last year) as investors are
enticed by the sector’s strong growth
prospects.
Low-cost giant The Gym Group floated
on the London Stock Exchange last year,
while the UK’s largest fitness chain Pure
Gym has recently sought to follow suit,
with several other operators expected
to go public in the mid-term as they seek
financial backing to fuel rapid expansion.
Despite Pure Gym opting to pull back
last week from its planned flotation due
to current volatility in the IPO market,
the ukactive report underlines the latent
potential in the fitness market and points
to strong consumer demand as evidence
that the sector won’t be thrown off
course by the choppy waters of Brexit.
Britain’s growing gym market is already
the largest in Europe and the report
tips the sector to be among the ‘shining
stars’ of the UK’s post-Brexit economy.
British firms accounted for six of the 19
mergers and acquisitions to take place in
the European fitness market last year and
the UK’s position as a hub of investment
activity has continued with the recent
acquisition of Fitness First UK by Dave
Whelan’s DW Fitness.
Market segmentation
With 14.3 per cent of UK adults now
owning gym memberships – a figure
whichhas increasedeveryyear since2008
– the report sheds light on the growing
appeal of exercise. New concepts have
opened the market to a broader range
of consumers and there are now 6,435
gyms across the private, public and third
sectors, serving 9.2 million members.
Official figures show that going to the
gym has been a consistent driver of
activity participation, with the most
recent Sport England statistics showing a
seven per cent increase over the last year.
The report charts the rise of the low-
cost sector, led by Pure Gym and The
Gym Group, who have been credited
with ‘democratising fitness’. Offering
lower prices, 24-hour access and shorter-
term contracts, low-cost gyms have
played a key role in removing many
of the traditional barriers to owning
memberships.
At the other end of the spectrum,
premium operators such as David Lloyd
Leisure, Nuffield Health and Virgin
Active have refined their propositions
by investing in family friendly full-
service offerings. The ukactive report
also examines the growing prominence
of boutique fitness studios such as
Heartcore and Barry’s Bootcamp, which
offer high-end fitness experiences on a
pay-as-you-play basis.
Growth opportunities
In an ageing society where the NHS
is being stretched to its limits by
preventable lifestyle-related conditions
such as heart disease and type 2
diabetes, the report explores how the
sector’s growth prospects will be further
enhancedby theneed for practical health
policies focused on prevention over cure.
Physical inactivity currently costs the
UK £20 billion and the Government has
started to place greater emphasis on the
importance of getting Britons moving
more through its recent Sport and
Childhood Obesity strategies.
Another focus for the new Government
is driving productivity and the report tips
the growth of workplace health and well
being programmes – key to reducing
absenteeism and boosting bottom line
– as a major opportunity for the gym
sector moving forward.
Technology drivers
The ukactive report notes howone of the
bigdrivers of gymsector growth in recent
