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Sector Spotlight: Health & Fitness

Larger fitness clubs are prospering throughout South Africa, as gym companies currently report healthy financial returns.

Here we review some key facts, as well as the trends and challenges facing South African health and fitness businesses.

Facts & figures

  • The average fee for gym membership in South Africa is 500 Rand per year.
  • The market leader is Virgin Active, with 137 gym premises throughout the country and possible control over two-thirds of the market.
  • The estimated total revenue is in excess of 12.5 billion Rand per year.
  • 97% of respondents expressed a desire to adopt a lifestyle that promotes better cardiac health (Hug your Heart survey, 2018).
  • The gym industry thrives in ZA, it is vibrant and set for significant further growth (w24.co.za).
  • Virgin chain MD, Ross Farager-Thomas, agreed that the sector is buoyant, despite questioning accuracy of estimates published by journalists in The Economist (January 2017).

Overview

A Huffington Post report detailed the results of a survey illustrating how South Africans want to take better care of their hearts.

Completed in 2018, and involving approximately 1,500 participants, the reports mentioned only 36 of the 1,500 respondents thought that they did not need to feel concerned about their heart.

The survey, part of the national ‘Hug Your Heart’ initiative, was carried out by a partnership of the HAS (Heart and Stroke Foundation) and Pharma Dynamics in a focus on cardiac health.

There are found to be five main harmful habits:

  • Lack of physical activity, thereby identifying a market need
  • Being overweight, underlining the need for attractive, modern exercise facilitie 
  • Smoking tobacco
  • Not eating well 
  • Excessive alcohol consumption

As South Africans remain conscious of their health, creating a health & fitness business which has the ability to strengthen the willpower and retention rate of its members is a challenge that any new business should be willing to take – as many state, the challenge is “[sticking] to these health resolutions”.

Trends

South African gym companies enjoy the highest leisure and fitness income in the world, according to News agency 24.com.

The most significant player is the Virgin Active chain, thought to receive around 7.5 billion Rand in annual membership fees.

Challenges

Other South African gym operators include Zone Fitness with 22 gyms in Cape Town and Gauteng, in addition to Planet Fitness, which boasts a nationwide presence that extends to 32 premises.

However, both gym companies are significantly smaller than Virgin Active.

Notably, smaller operators complain about what they perceive as unfair marketing practices, whereby medical aid plans including Momentum and Discovery, offer their customers incentives and discounts on memberships of larger gym companies such as Curves, Planet Fitness and Zone Fitness.

Survey experts commented that they saw realistic, reachable goals as vital for long-term success, as well as a support network of friends, family or an online community

Regardless of the age of the person concerned, the important thing was to make a start.

Licences and permissions

Business licence requirements vary according to the area.

In Johannesburg, a licence is necessary for certain types of businesses to open and operate.

Trading without a licence is an offence; sanctions include fines of up to R2,000. 

In particular, Business Act 71 of 1991 requires a permit for businesses that supply meals, takeaway food or perishable foodstuffs – therefore this becomes applicable if you would also like to offer smoothies, protein shakes, or high protein snacks in your gym or fitness centre.

This is something required if you are also considering supplying saunas, health baths, massages and/or infrared treatments.

Essential skills

A keen interest in fitness and health is essential, as well as interpersonal skills, an interest in advising clients and motivating them towards personal exercise goals. 

In combination, these key areas will always attract new members and maintain engagement and a regular return custom.

Health and fitness businesses are rewarding yet demanding commitments that require motivation, initiative and interest.

As South Africans become more aware of their own health and fitness, the present is no better time than any to bring a new business to the market. You can also develop and take forward an existing health and fitness business for sale and get that head start.



Paulyne Antoniou

About the author

Paulyne as Head of Content has produced regular videos and editorial for many years with small businesses, franchises and industry professionals.

@Be_theboss

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