From Fitness Frenzy to Financial Failure: A Deep Dive into the Global Health Club Industry

The fitness industry has undergone a significant transformation in recent years, with health clubs and gyms being impacted by changing consumer preferences, technological advancements, and economic trends. This article will take a detailed look at the state of the health club and gym industry in the USA, Australia, Great Britain, and other countries, highlighting the financial facts and franchise information of the major brands while also examining the failures and club closures that have occurred in the past five years.

According to the International Health, Racquet & Sportsclub Association (IHRSA), the health club industry in the USA generated $32.3 billion in revenue in 2022. The top four health club companies in the USA, based on revenue, are LA Fitness, 24 Hour Fitness, Gold’s Gym, and Life Time Fitness. However, the industry has not been immune to the economic effects of the COVID-19 pandemic, with many gyms and health clubs closing permanently due to the pandemic-related shutdowns. For example, in August 2022, 24 Hour Fitness filed for bankruptcy and closed more than 130 locations.

In Australia, the fitness industry generated $2.6 billion in revenue in 2019, with the top four health club companies being Anytime Fitness, Goodlife Health Clubs, Fernwood Fitness, and Fitness First. The industry has also experienced challenges, with several gyms and health clubs closing permanently. For instance, in 2021, Plus Fitness went into voluntary administration and closed some locations.

In Great Britain, the health club industry generated £2.8 billion in revenue in 2022, with the top four companies being PureGym, The Gym Group, David Lloyd Leisure, and Nuffield Health. The industry has also experienced closures and bankruptcies, with the pandemic having a significant impact. For example, in 2020, Fitness First UK went into administration, resulting in the closure of several locations.

The industry’s franchising model has been a key driver of growth for many health club brands. In the USA, Anytime Fitness is the largest franchise-based gym chain, with over 4,000 locations worldwide. In Australia, Anytime Fitness and Jetts Fitness are the two largest franchised gym chains, with over 500 locations combined. In Great Britain, PureGym is the largest franchised gym chain, with over 290 locations.

However, franchising has not been without its challenges, as demonstrated by the closure of several franchise locations. In 2022, Gold’s Gym closed more than 30 franchise locations in the USA, while in Australia, a number of Jetts Fitness locations went into voluntary administration. In Great Britain, the franchised gym chain Energie Fitness entered into a company voluntary arrangement in 2022 to avoid bankruptcy.

In conclusion, the health club and gym industry has experienced significant challenges in recent years due to changing consumer preferences, economic trends, and the COVID-19 pandemic. While the industry has shown resilience and continued to grow, many gyms and health clubs have closed permanently. The franchising model has been a key growth driver for many major health club brands, but it has also faced challenges, with franchise locations closing or going into bankruptcy. As the industry continues to evolve, it will be interesting to see how health club brands adapt to the changing landscape and consumer preferences.

Sources:

“Industry Research,” IHRSA, https://www.ihrsa.org/research/.

“24 Hour Fitness files for bankruptcy, closes more than 130 locations,” NBC News, August 2020, https://www.nbcnews.com/business/business-news/24-hour-fitness-files-bankruptcy-closes-more-130-locations-n1237561.

“Australian fitness industry revenue 2019,” Statista, https://www.statista.com/statistics/