Health, Fitness & Sports Clubs
A Look at Trends in Health, Fitness & Sports Clubs
Over the course of the economic downturn and sputtering starts of recovery, health clubs have been both quicker to see positive movement and more volatile, according to our annual Industry Report. This year's results further reflect this trend.
According to the International Health, Racquet & Sportsclub Association's "2012 IHRSA Global Report: The State of the Health Club Industry," the United States was home to 51.4 million health club members in 2011, an increase of 2.4 percent from 2010. And revenue, according to the report, increased by 5 percent to $21.4 billion.
"Led by strong performance in the Americas, the industry is well positioned for steady growth as consumers continue to place a high value on the role health clubs play in improving their health," said Jay Ablondi, IHRSA's executive vice president of global products in a press release announcing the report's release.
There was no change in the percentage of respondents who claimed to work for health, sports and fitness clubs from 2011 to 2012. Some 3.6 percent of the entire survey population works for these types of facilities, which can range from small privately owned health clubs to larger franchises, medical fitness facilities and more.
The majority of health club respondents, in contrast with most other survey respondents, work for private organizations. Nearly half (47.9 percent) said they were with private for-profit organizations, and nearly one-third (31.5 percent) worked for private nonprofit organizations.
Health club respondents were more likely to be from the West and from the South Central region than respondents from other facility types. Nearly three in 10 (29.2 percent) health club respondents were from the West vs. 20.6 percent of all respondents, and 16.7 percent of health club respondents were from the South Central states vs. 13.6 percent of all respondents. Health club respondents were less likely than the general survey population to be from the Midwest (22.2 percent vs. 28.7 percent), the South Atlantic states (18.1 percent vs. 18.8 percent) and the Northeast (13.9 percent vs. 17.8 percent).
Respondents working at health and fitness clubs were more likely than others to be from urban areas, with nearly a third (31.9 percent) of these respondents reporting in from urban communities vs. 25.3 percent of all respondents. They were slightly less likely to hail from the suburbs (40.3 percent vs. 41.2 percent), and just over a quarter (27.8 percent) were from rural areas, compared with a third (33.5 percent) of all respondents.
When it comes to the primary audience served by their facilities, health club respondents differ a great deal from the general survey population, where facilities for all ages dominate. In the case of health clubs, it is adults ages 19 to 64 who are the predominant audience, with 58.3 percent of health clubs. This compares with just 17 percent of all respondents who called adults their primary audience. And while 38.4 percent of all respondents serve all ages, less than a quarter (23.6 percent) of health club respondents said their facilities are meant for all ages. They also were far more likely than other respondents to name seniors 65 and older as their primary audience. Some 13.9 percent of health club respondents serve seniors, compared with just 2.5 percent of all respondents. Finally, a small number of health club respondents, 4.2 percent, said their primary audience was either children ages 4 to 12 or teens age 13 to 18.
The number of health club respondents who said they partner with other organizations is down from 80.3 percent in 2011 to less than three-quarters (73.6 percent) in 2012. In addition, when all facility types were asked who their most common partners were, they were least likely to name private health clubs as a partner. Just 5 percent of all respondents said they partner with health clubs. The most common partners for health clubs differ from other respondents, with the most common partners being corporate or local businesses (37.5 percent of health clubs partner with corporate or local businesses) and health care or medical facilities (36.1 percent), followed by schools, nonprofit organizations (34.7 percent each) and colleges and universities (25 percent).
Revenues & Expenditures
Respondents from health clubs had an operating budget in fiscal 2011 that was 23 percent lower than the average operating budget for all facility types. And while health club budgets grew by a smaller percentage from fiscal 2010 to fiscal 2011 than general respondents (an increase of 7.5 percent for health clubs vs. 8.8 percent for all respondents), health club respondents project more rapid growth in their operating expenditures from 2011 to 2013, with an increase of 12.7 percent compared with 5.1 percent for all respondents. Because of this, by fiscal 2013, the difference between general operating budgets and health club operating budgets will shrink to 17.4 percent.
Respondents from health clubs were more likely to report both increases and decreases in their revenues from 2010 to 2011 than the general survey population. While 37 percent of all respondents saw an increase and 20.8 percent saw a decrease in that time frame, 40.3 percent of health club respondents reported an increase and 30.6 percent reported a decrease. Over the next two years, more than half of health club respondents expect further increases in their revenues, with 54.3 percent expecting an increase in 2012 and 58.5 percent projecting an increase in 2013. At the same time, a decreasing number of health club respondents expect their revenues to fall in 2012 (14.3 percent) and 2013 (9.2 percent). (See Figure 50.)
Among health clubs, membership retention and growth is a driving force of business success, and the economic downturn brought some significant challenges in this area as household budgets tightened, forcing consumers to cut back. More than one-quarter (26.4 percent) of health club respondents in 2011 reported a decrease in the number of people using their facilities from 2009 to 2010. This year, nearly a third (30.6 percent) of health club respondents said that number had decreased again from 2010 to 2011.
However, there is substantial growth in the number of health club respondents who are seeing rising memberships, and who are projecting those increases to continue over the next couple of years. While just 41.7 percent in 2011 said the number of people using their facilities had grown from 2009 to 2010, that number rises to almost half (47.2 percent) of health respondents in 2012 reporting an increase in membership from 2010 to 2011. The number jumps to 58.8 percent projecting an increase from 2011 to 2012, and two-thirds (66.7 percent) expect to see an increase from 2012 to 2013. (See Figure 51.)
There was little change from 2011 to 2012 in the number of health club respondents who have taken action to reduce their operating expenses. In 2011, 87.7 percent had done so, and in 2012, 87.5 percent said they have acted to reduce expenses. The most common tactic employed by these respondents was improving energy efficiency. Some 58.3 percent of health club respondents had employed measures to improve energy efficiency in order to reduce operating expenditures. Substantially more health club respondents reported in 2012 that they had reduced staff, with more than half (51.4 percent) indicating they had done so, compared with just 38.4 percent in 2011. They also were more likely to report that they had increased fees (30.6 percent vs. 28.8 percent in 2011). They were less likely to report that they had put construction and renovation plans on hold (26.4 percent vs. 37 percent in 2011). Similar numbers in 2011 and 2012 said they had cut programs or services (20.8 percent in 2012 and 20.5 percent in 2011).
Reflecting the higher number of health club respondents who reported they had cut staff to reduce operating expenditures, there was a slight increase in the number of health club respondents who said they had plans to cut staff in 2012. While 1.4 percent of last year's respondents said they planned to cut staff in 2011, some 2.7 percent of respondents this year have such plans. This is still substantially down from 2010, when 9.8 percent of health club respondents planned to reduce staff.
The majority (86.3 percent) of health club respondents intend to keep staffing levels steady. Another 11 percent report that they have plans to add staff. On average, these respondents are planning to add 6.6 employees in 2012.
Health club respondents were slightly less likely in 2012 to report that they had plans for construction over the next three years. While 54.2 percent of 2011 health club respondents had such plans, this year that number dropped to 49.3 percent. For those who do have plans, renovations are the most common, with three in 10 (30.1 percent) of health club respondents indicating they have plans to renovate. There was a slight increase from last year in the number of health club respondents who plan to make additions to their existing facilities, from 15.1 percent in 2011 to 17.8 percent in 2012. And once again, 12.3 percent indicated that they have plans to build new facilities. (See Figure 52.)
The most common amenities currently included in health club respondents' facilities have not changed much year over year. They include: fitness centers with cardio and weight equipment; exercise studio rooms; locker rooms; indoor aquatic facilities; indoor sport courts for sports such as basketball, racquetball, etc.; classrooms and meeting rooms; concession areas; indoor running tracks; outdoor aquatic facilities; and outdoor sports courts for sports such as basketball, tennis, etc.
Health club respondents were the least likely among facility types to report that they had plans to add amenities or features to their facilities over the next three years. In addition, the number who have such plans fell from 2011, when 34.2 percent had such plans, to 20.5 percent. The most commonly planned additions among these respondents include:
- Splash play areas
- Indoor sports courts
- Dog parks
- Fitness centers
- Classrooms and meeting rooms
- Indoor aquatic facilities
Creative and innovative programs keep health club members interested and coming back for more. The top 10 current programs found among health club respondents' facilities include:
- Fitness programs (offered by 95.8 percent of health club respondents)
- Personal training (83.3 percent)
- Mind-body/balance programs such as yoga, Pilates, tai chi, etc. (79.2 percent)
- Nutrition/diet counseling (68.1 percent)
- Aquatic exercise programs (59.7 percent)
- Programs for active older adults (58.3 percent)
- Holiday events and other special events (55.6 percent)
- Swimming (48.6 percent)
- Educational programs (41.7 percent)
- Individual sports activities (37.5 percent)
Program areas that saw growth from 2011 to 2012 included fitness (up from 93.2 percent to 95.8 percent); personal training (from 79.5 percent to 83.3 percent); nutrition and diet counseling (from 63 percent to 68.1 percent); aquatic exercise (from 50.7 percent to 59.7 percent); holidays and special events (from 47.9 percent to 55.6 percent); swimming (from 42.5 percent to 48.6 percent); educational programs, which did not appear on the top 10 programs list in 2011; and individual sports activities (from 35.6 percent to 37.5 percent).
Health club respondents were less likely in 2012 than in 2011 to report that they had plans to add programs at their facilities over the next three years. While 38.4 percent had such plans in 2011, in 2012 that number falls to less than a quarter (23.3 percent). The most commonly planned programs include:
- Fitness programming (up from No. 2 in 2011)
- Mind-body/balance programs (up from No. 4)
- Individual sports activities (up from No. 5)
- Nutrition/diet counseling (up from No. 6)
- Personal training (did not appear in the top 10 in 2011)
- Educational programs (did not appear in top 10 in 2011)
- Teen programming (down from No. 3)
- Holiday events and other special events (did not appear in top 10 in 2011)
- Adult sports teams (no change)
- Aquatic exercise programs (down from No. 7)
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