Posted January 25, 2021

How Does The Fitness Industry Move Forward

2020 was a tough year for the fitness industry. With the initial shut downs, massive regional differences in access to financial aid, and a wary membership base, many gyms are either permanently closed or on the brink of closure. Independent studios are in similar boats, and many independent contract trainers are seeing significant shifts in their core offerings and reductions in their active clients across the board.

When restrictions from the first wave were finally removed, less than 1/3 of commercial gym members returned. It’s believed close to 25% of gyms and private studios would be out of business by the end of 2020. In 2021 with the hopes of vaccinations and easing restrictions that would allow businesses to return to relatively normal operations, many of the gyms that are still open will face a challenging time regaining their lost members, attracting new members, and regaining any kind of financial stability again.

That being said, there will be a lot of opportunity in the coming year for those positioning themselves to take advantage of it. The closures of many gyms means there will be a massive influx of commercial real estate available, dropping potential prices, and in some cases giving a new business the chance to move in, avoid construction costs, or the need to purchase equipment, and start from a relatively strong equity position on day one.

In terms of gym offerings, it is very likely that the landscape will be altered in terms of what the market is accepting. I’d be willing to venture that the only places a commercial gym could make their business survive is to provide either very low cost access, or very high end prestige offerings. The middle ground will be hollowed out very quickly. People who have been struggling to get by financially will likely not pay more for gym access than necessary, and if measuring features like equipment, locations, etc, the lower cost will likely win out. If I want to buy a bottle of Diet Coke and 3 different stores in the same area sell it, I’ll either buy from the cheapest one, or the one that gives me the best experience as a customer. The product is the same in each location.

Those who have some financial stability and crave getting out of the house will likely pay for a higher end experience, similar to a resort or spa. Additionally, there will be a massive market for specialized training facilities that cater to either a specific sport or approach to training, like a hockey academy, powerlifting gym, or other means, further undercutting the need for a middle ground commercial gym market.

The shift to virtual training for many will give personal trainers a much wider net to cast in order to provide service to their clients, with many likely continuing to offer at least some virtual when in person training is available again. With the massive volume of free or low cost at home workouts, having personalized attention and a customized plan will be a big draw. A skilled trainer who can help clients solve problems, give specific advice and offer real time coaching for improving their lifting competence and seeing the results they’re after will always have a value for many.

I don’t see group fitness coming back as it existed before, at least not until large scale events like sporting events and concerts are back in action. Most group fitness will likely continue as virtual classes, spaced outdoor bootcamp style workouts, or an expansion of competitors with Peleton and their spin class in your own home concept. Many of the surviving commercial gym chains are already offering their own apps to provide group classes to their members, so the investment is likely to continue being used, even when classes can occur safely again.

So what could be the biggest opportunities for success going forward? Surprisingly, I think it’s going to be one of the best times to open a gym or private studio than any time before. Lower cost leases, equipment in foreclosure or at auction that can be purchased for pennies on the dollar, and business incentives from governments will make it easier to start than ever before. Creating a unique concept will be easier than retrofitting an existing business plan and over leveraging yourself to make that happen. So if you’re in a good financial position or want to make a career change, this could be the best time.

A training environment that can be seen by members as safe, while offering the best experience possible, will likely thrive more than general fitness at a struggling commercial gym. If you’ve been thinking of moving out on your own, now could be the best time to do that and find an environment that suits what you’re looking to offer while giving clients the best experience possible.

In closing, change brings a lot of stress, but also a ton of opportunities. The market will reward those who overdo the delivery of an awesome experience that meets clients where they’re at, while eliminating those who don’t adapt or grow into the world that is forming in front if them.