how the low-cost gym sector will transform the uk health and fitness industry

How the low-cost gym sector will

transform the UK health &

fitness industry

Presentation to sporta

LIW 2010, Ray Algar

www.oxygen-blog.blogspot.com

MY DEFINITION OF A LOW-COST GYM

MINIMUM OF 50% LOWER

THAN INDUSTRY

PRICE

HEAVY TECHNOLOGY AND WEB USE

GYM-ONLY PROPOSITION

ABILITY TO OPERATE CLUB WITH A SINGLE

PERSON

SCOPE TO OPERATE 24

HOURS

MARKET

DRIVERS

SIMPLICITY

AFFORDABILITY

CONSUMER SENTIMENT

TOWARDS CLUBS

SPORADICATTENDANCE

CONSUMERS ARECHANGING

SUPPORTING INFRA-

STRUCTURE

MARKET

DRIVERS

SIMPLICITY

AFFORDABILITY

CONSUMER SENTIMENT

TOWARDS CLUBS

SPORADICATTENDANCE

CONSUMERS ARECHANGING

SUPPORTING INFRA-

STRUCTURE

I CareI CareI CareI Care

Consumers now have

considerable experience

of low-cost services

11

“Fly for the price

of a pair of jeans”

12

Spend a little, live a lot

13

14

Look good, pay less

Think of a sector…you will

find low-cost

300 million units

annually by

2013

MARKET

DRIVERS

SIMPLICITY

AFFORDABILITY

CONSUMER SENTIMENT

TOWARDS CLUBS

SPORADICATTENDANCE

CONSUMERS ARECHANGING

SUPPORTING INFRA-

STRUCTURE

MARKET

DRIVERS

SIMPLICITY

AFFORDABILITY

CONSUMER SENTIMENT

TOWARDS CLUBS

SPORADICATTENDANCE

CONSUMERS ARECHANGING

SUPPORTING INFRA-

STRUCTURE

“I can join online – no pushy

sales staff to deal with!”

MARKET

DRIVERS

SIMPLICITY

AFFORDABILITY

CONSUMER SENTIMENT

TOWARDS CLUBS

SPORADICATTENDANCE

CONSUMERS ARECHANGING

SUPPORTING INFRA-

STRUCTURE

MARKET

DRIVERS

SIMPLICITY

AFFORDABILITY

CONSUMER SENTIMENT

TOWARDS CLUBS

SPORADICATTENDANCE

CONSUMERS ARECHANGING

SUPPORTING INFRA-

STRUCTURE

36

Word of mouth

on steroids

MARKET

DRIVERS

SIMPLICITY

AFFORDABILITY

CONSUMER SENTIMENT

TOWARDS CLUBS

SPORADICATTENDANCE

CONSUMERS ARECHANGING

INFRA-STRUCTURE

“Why am I paying

for a club I

occasionally use ?”

“Why am I paying

£50 just to use

a treadmill?”

What do low-cost gym

consumers say?

“It is almost free”

“I have never been to a

gym that is £15 before. I

thought I would walk in

and find a lot of

broken equipment”

49

50

51

52

53

56

McFit Financials 2007

Euros

(millions)

% turnover

Turnover 86

Staff costs 3.4 3%

EBITDA 28 32%

Interest charge 0.1 -

Net assets 34

Clubs 88

budgetgymresearch.ning.com

oxygen-blog.blogspot.com

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