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BUSINESS PLAN
Last Updated
Insert Date
TABLE OF CONTENTS
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EXECUTIVE SUMMARY
COMPANY VALUES
COMPANY SERVICES`
COMPANY OPERATIONS
TARGET MARKET/MARKET ANALYSIS
MARKET SEGMENTATION
MARKETING STRATEGY
MANAGEMENT PLAN
PERSONNEL PLAN
COMPETITORS
PROJECTED LOCATIONS
PROJECT START UP EXPENSES/FINANCIAL NEEDS
SWOT ANALYSIS
PRICING STRATEGY
SHORT/LONG TERM GOALS
ASSUMPTIONS
FINANCIAL PROJECTIONS
MARKET RESEARCH
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4
5
8
10
12
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14
15
16
18
22
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23
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28
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EXECUTIVE SUMMARY
Organized recently as a start-up company by founder <<INSERT NAME>>, Box1 Sports Center was
established with the vision of becoming a full-service, state-of-the-art, multi-sport complex. Situated in the
Killeen/Harker Heights area near Fort Hood, the Box1 Sports Center is uniquely positioned to capture an
underserved marketplace for athletic facilities in the central Texas region. Once established, the Box1 Sports
Center will be recognized as a pillar that promotes social and economic development within the city and
surrounding communities.
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According to research obtained from IBIS World, over the next five years, the Gym, Health and Fitness Clubs
industry will lift itself to success, benefiting from the revitalization in consumers discretionary spending. As
consumers disposable income rises, more individuals will purchase gym memberships that include a plethora
of amenities, compared with low-cost memberships with few amenities that have fared well over the previous
period. Moreover, while many individuals will be time-strapped over the period, which may constrain demand
for gym memberships, this trend will be offset by growing demand for results-driven gyms that can help
individuals achieve fitness goals in shorter time increments.
For example, personal and group trainers, as well as fitness classes, will be popular. In the five years to 2019,
revenue is forecast to grow at an annualized rate of 2.8% to $30.5 billion due to more consumers purchasing
high-cost industry services, such as cohesive, individualized health plans that include trainers and nutritional
guidance. Profit is also expected to slightly rise from 8.6% of industry revenue in 2014 to 8.9% in 2019, as
many gyms offer more high-margin services, such as group personal training sessions, to strengthen their
product portfolio and bolster member retention rates.
MISSION STATEMENT
VISION STATEMENT
Our Vision Is To Be
Friendly Environment To
Region.
Page 3
COMPANY VALUES
Below is an overview of the companys values that guide the way we conduct our business operations:
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CORE VALUES
Professionalism: Providing services and support that are in line with acceptable standards and metrics
Quality: Maintaining facilities, equipment and ammenities in such a way that exceeds our customers
expectations
Integrity: Conducting business in an ethical manner that is above reproach
Customer-Oriented: Going above and beyond to satisfy our customers requests.
Page 4
COMPANY SERVICES
Overview
The vision is for the Box1 Sports Center to be a multisport complex that provides its clients with various
services. A first class fitness and lifestyle center, one full-size basketball court that can also accommodate
many other sports (i.e. volleyball, indoor soccer, etc.), a nutritional food and beverage/lounge area, a lobby,
and other amenities such as an administrative office, male/female restrooms, and a childcare center will all be
available in the facility. Along with these amenities, Box1 Sports Center will provide its clients with qualified
and knowledgeable staff to make sure all of their sport and fitness needs are met satisfactory.
Interior
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The interior of the Box1 Sports Center shall include the following:
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Supervised childcare for members and non-members while working out; providing a wealth
of activities for children under ten.
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Food and beverage snack area for patrons to refuel and re-energize before and after
their intense workout sessions. Open from 8:00am to 8:00pm
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Hours of Operation
Box1 Sports Center will remain open 24 7 except for federally recognized holidays.
Other Key Items
Company Operations
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One full-sized basketball/Indoor Volleyball courts will highlight the main floor of Box1 Sports Center. Along
with these two sports, the floors will be able to accommodate badminton, indoor soccer, dodgeball, touch
football, gymnastics, dance, aerobics, and more. These hardwood courts will be manufactured and installed by
the industry leader, Robbins Sport Surfaces, and will be the premier sports floors in all of Central Texas. With
the added attraction of world class portable basketball systems from JustBasketballGoals or Schelde North
America, Box1 Sports Center will quickly become known as the place to be for leagues, camps, or pick-up
games.
With his/her education and vast experience in this area, the scheduling of events and activities on these floors
will be conducted by one of the fitness center managers of Box1 Sports Center. The development of sports
leagues, camps, and clinics, along with other various day-to-day operations of the facility will also be the
managers responsibility.
Box1 Sports Center will house a large fitness and lifestyle center that will match or exceed any other in the
city. This fitness and lifestyle center will include top-of-the-line equipment in free weights, machine weights,
and aerobic machines. This aspect of the facility will be run by a certified strength and conditioning specialist
(CSCS) who will hire and train his/her staff to meet the demands of the members. This person will report to
and work directly with the general partner of Box1 Sports Center and his/her duties will include, but will not
Page 8
be limited to, general supervision, personalized training for members, program development for camps and
clinics, and aiding in the marketing and promotional aspects of the facility.
On the lower level surrounding the courts there will be a food and beverage area where clients of the facility
can replenish their bodies. This area has been placed on the lower level so the clients may have an up-andclose view of the activities on the courts while enjoying their favorite nutritional beverage and/or snack.
Included in this area will be various big screen TVs that will show either sporting events, sports news, or realtime on-court activities that clients can enjoy. This aspect of the facility will be crucial in providing the
desired atmosphere Box1 Sports Center hopes to create.
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A qualified, experienced person will be hired to run this aspect of the facility. He/she will have the
responsibility to meet necessary standards and to report to, and work directly with the general partners of Box1
Sports Center to make sure the needs of the clients in this area are met satisfactory. If additional staff are
required, this person will hire and train those people in accordance with Box1 Sports Center policies.
Other features and services Box1 Sports Center will have include:
1. Full-service restrooms for both men and women. Large benches and sinks facilities will all be included
as well.
2. A childcare area that will allow members and non-members to access the facility at their convenience.
The childcare will be on the first level of the complex and have a large play area that will be
continuously monitored by our certified childcare staff. The staff will be responsible for the care and
well-being of the children they are watching, along with providing a fun and interesting environment
for the children. This service will be offered facility members and non-members for a very minimal
fee.
3. An administrative area housing various offices and a conference room will be located on the main floor
of the facility.
4. A pro shop will be strategically placed in Box1 Sports Center to attract impulsive buyers. Clients will
pass through the pro shop upon entering and exiting the facility. The pro shop will sell our own line of
products and eventually sports shoes and apparel that will be available exclusively at Box1 Sports
Center. The manager will be in charge of inventory for the pro shop, and general staff will be involved
in the daily sales and service.
Box1 Sports Center
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Bell County
Texas
NA
326,843
310,235
NA
5.4%
310,235
8.8%
27.8%
9.5%
50.0%
26,956,958
26,505,637
25,146,104
7.2%
5.4%
25,145,561
7.3%
26.6%
11.2%
50.3%
68.2%
22.4%
1.1%
3.2%
0.8%
80.3%
12.4%
1.0%
4.3%
0.1%
4.3%
23.2%
48.9%
1.8%
38.4%
44.0%
76.9%
7.7%
17.4%
82.8%
16.3%
34.7%
89.5%
81.2%
21.7%
26.7%
43,424
1,583,272
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18.9
25.0
131,394
56.7%
25.9%
$122,600
104,049
2.95
$22,857
10,255,642
63.3%
24.2%
$128,900
8,886,471
2.82
$26,019
$50,060
$51,900
15.3%
17.6%
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MARKET SEGMENTATION
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Over the past decade, the industry has experienced substantial growth in demand, and as a result, the
breakdown of the industrys markets have also changed. The aging population has encouraged health and
fitness clubs to widen their target demographic beyond the traditional market of 18- to 35-year-olds. Industry
operators are increasingly expanding their target market to include 35- to 54-year-olds and individuals aged
under 18. The majority of gym and health club members are female, which account for about 57.0% of all
gym, health and fitness club memberships and have increased in recent years.
Page 12
Consumers aged 18 to 34
This age category accounts for the industrys largest market segment, with an estimated 5.0% market share.
Despite its size, this segment has shown little growth over the past decade, compared with other age categories.
While this demographic is expected to include 10.5 million individuals, this market segment has experienced
slow growth during the past five years. Slow growth can be attributed to this market segments strong, yet
stable, demand for fitness options. Furthermore, other fitness activities, such as team sports, have cut into this
market segments demand for gym memberships.
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MARKETING STRATEGY
Below is an overview of the Box1 Sports Centers Marketing Plan:
Step 1: Our company shall develop a website to establish a presence on the internet to attract customers.
Step 2: Our company shall establish a profile across various social media platforms to attract and market to
potential customers (facebook, twitter, etc.)
Step 3: Our company shall place ads in various publications (newspapers, magazines, print media, etc.)
Step 4: Our Company will join and participate in networking events, chambers of commerce, and trade
organizations in an effort to build relationships.
Step 5: Our company shall advertise through the purchase of media (radio spots, TV commercials, etc.)
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MANAGEMENT PLAN
The following diagram highlights the companys proposed management structure:
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ORGANIZATIONAL STRUCTURE
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PERSONNEL PLAN*
Below is a summary of the companys initial projected personnel plan:
Title
CEO
Food Service Mgr
Food Service Support Staff
Fitness Center Mgr
Fitness Center Support Staff
# of
Employees
1
1
3
1
8
Annual Salary
Total Salary
$50,000
$40,000
$20,000
$40,000
$30,000
$50,000
$40,000
$60,000
$40,000
$240,000
COMPETITORS
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Below are a list of potential competitors that are currently located within 15 miles of our projected location:
COMPETITOR ANALYSIS
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Key Competitors
1) Anytime Fitness: http://www.anytimefitness.com/gyms/3424/Copperas-Cove-TX-76522
Description: Anytime Fitness of Copperas Cove , TX, is the fitness center that fits your on-the-go
lifestyle. At our Copperas Cove, TX, health club, patrons you can exercise any time using their own
security-access key 24 hours a day, 7 days a week, 365 days a year. Amenities include private showers,
personal trainers, HD TVs, and scheduled workout classes.
Address: 3010 E U.S. 190 Copperas Cove, TX 76522 United States
2) Cove Fitness: http://www.covefitnesscenter.com/
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Description: Cove Fitness is a full service health club that combines a full range of fitness and
exercise equipment and facilities with professional trainers, personally tailored programs, and group
exercise classes. Open from 5:00am to 10:00pm, Cove Fitness has a 20,000 square foot facility and
offers the following amenities top of the line equipment, saunas, whirlpools, tanning beds, and a juice
bar.
Address: 1013 W Hwy 190 Copperas Cove, TX 76522 United States
3) Golds Gym: http://www.goldsgym.com/killeentx/
Descrption: Golds Gym Killeen in Killeen, TX stocks the very latest cardio equipment, such as
elliptical machines, stair climbers, rowers, treadmills and stationary bikes as well as a full sets of free
weights and high tech strength training equipment. They offer options for every fitness level, from
beginning exercisers to elite athletes looking to sharpen their speed, agility, power and endurance. They
offer a number of workout classes and group training sessions for patrons on a daily basis.
Address: 902 W Central Texas Expy Killeen, TX 76541 United States
4) Family Recreation Center - Lions Club Park: http://www.killeentexas.gov/index.php?section=64
Descrption: City owned and operated community center featuring a fitness center, fitness classes,
family activities, etc (not 24 hours operated).
Address: 1700 E Stan Schlueter Loop, Killeen, TX 76542
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PROJECTED LOCATIONS
Below are a list of possible locations for our facility in the Killeen TX area consisting of approximately 2-3
acres of available land:
$195,000
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1.20 AC | Land
Description
Great location for retail, automotive, or special use. Concrete parking lot on the front.
Located West of Hwy 195, Ft. Hood St., between the South access road and Pershing Dr. The lot is behind the
Vet Clinic on Pershing Dr.
Box1 Sports Center
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$254,390
1.46 AC | Land
Description
Property is on the corner of Stan Schlueter Loop and Bridgewood Drive. The site has been filled. Cross access
across the corner lot-planned Dollar General on the corner.
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The site is located on the corner of Stan Schlueter Loop and Bridgewood Drive in Killeen, Texas.
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Projected Need
$250,000
$1,050,000
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$450,000
$10,000
$107,500
$7,000
$20,000
$20,000
$3,000
$3,000
$5,000
$5,000
$1,500
$1,932,000
$96,600
$2,028,600
SWOT ANALYSIS
STRENGHTS
Premier Fitness Center Amenities
State of the Art Equipment/Facilities
Multiple Activities Housed Under One Roof
OPPORTUNITIES
WEAKNESSES
Lack of Brand Recognition
Limited Capital
Limited Market Share
THREATS
Increased Competition From Cheaper
Alternatives
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PRICING STRATEGY
Below is a proposed listing of our companys pricing:
Annual Membership Fee
Family
$1,440 ($120/month)
Adult
$840 ($70/month)
Senior (55&up)
$600 ($50/month)
Youth
$300 ($25/month)
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$130
$80
$60
$35
Family
Adult
Senior (55&up)
Youth
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ADDITIONAL SERVICES
Financing:
Revenue:
Profit:
Retained Earnings:
Staff:
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Revenue:
Profit:
Retained Earnings:
Staff:
FINANCIAL PROJECTIONS
Below is a list of our financial projections for the next three years:
ASSUMPTIONS
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YEAR 1 PROJECTIONS
Jan-17
$72,000
$9,000
$5,000
$86,000
$26,000
$9,000
$5,000
$40,000
$40,000
$13,500
$9,750
$63,250
$40,000
$13,500
$9,750
$63,250
$40,000
$13,500
$9,750
$63,250
$30,000
$11,000
$7,500
$48,500
$30,000
$11,000
$7,500
$48,500
$26,000
$9,000
$5,000
$40,000
$35,800
$2,925
$35,800
$2,925
$35,800
$2,250
$35,800
$2,250
$48,700 $2,700
$4,450
$24,525
$24,525
$10,450
$10,450
$2,700
$2,700
SUBTOTAL
Loan/Investment principal payment
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$21,700
$2,825
$21,700
$2,825
$21,700 $21,700
-$11,250 -$11,250
$30,000
$11,000
$7,500
$48,500
$30,000
$11,000
$7,500
$48,500
$26,000
$9,000
$5,000
$40,000
$416,000
$129,500
$86,750
$632,250
$176,625
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
$2,000
$500
$500
$7,000
$500
$2,500
$200
$2,000
$4,296
$15,200
$6,500
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$26,000
$9,000
$7,500
$42,500
$24,000
$6,000
$6,000
$84,000
$6,000
$30,000
$2,400
$24,000
$51,552
$182,400
$78,000
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YEAR 2 PROJECTIONS
CASH RECEIPTS
Membership Dues
Amenity/Training/League Sales
Food/Beverage Sales
Subtotal
COST OF GOODS SOLD
Direct Wages
Food/Beverage Inventory
$29,000
$9,500
$5,500
$44,000
$29,000
$9,500
$8,000
$46,500
$35,000
$11,500
$8,000
$54,500
$35,000
$11,500
$8,000
$54,500
$47,000
$14,000
$10,500
$71,500
$47,000
$14,000
$10,500
$71,500
$47,000
$14,000
$10,500
$71,500
$35,000
$11,500
$8,000
$54,500
$35,000
$11,500
$8,000
$54,500
$36,000 $36,000 $36,000 $36,000 $36,000 $36,000 $36,000 $36,000 $36,000 $36,000
$1,650 $1,650 $2,400 $2,400 $2,400 $3,150 $3,150 $3,150 $2,400 $2,400
$8,100
SUBTOTAL
Loan/Investment principal payment
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$23,100 $23,100 $23,100 $23,100 $23,100 $23,100 $23,100 $23,100 $23,100 $23,100
$39,250 -$16,750 -$15,000 -$7,000 -$7,000 $9,250 $9,250 $9,250 -$7,000 -$7,000
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$62,350 $6,350
$29,000
$9,500
$5,500
$44,000
$29,000
$9,500
$500
$39,000
$482,000
$135,500
$88,500
$706,000
$2,850
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$247,450
$85,000
$9,500
$5,500
$100,000
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Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18
Nov-18 Dec-18 Total
-64,775 -25,525 -42,275 -57,275 -64,275 -71,275 -62,025 -52,775 -43,525 -50,525 -57,525 -74,275
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$2,500
$550
$600
$7,000
$500
$2,750
$200
$2,500
$4,320
$16,600
$6,500
$30,000
$6,600
$7,200
$84,000
$6,000
$33,000
$2,400
$30,000
$51,840
$199,200
$78,000
Page 24
YEAR 3 PROJECTIONS
$100,000
$11,000
$7,000
$118,000
$33,500
$11,000
$7,000
$51,500
$33,500
$11,000
$7,000
$51,500
$42,000
$14,500
$9,500
$66,000
$42,000
$14,500
$9,500
$66,000
$55,500
$16,000
$12,000
$83,500
$55,500
$16,000
$12,000
$83,500
$55,500
$16,000
$12,000
$83,500
$42,000
$14,500
$9,500
$66,000
$42,000
$14,500
$9,500
$66,000
$38,000 $38,000 $38,000 $38,000 $38,000 $38,000 $38,000 $38,000 $38,000 $38,000
$2,100 $2,100 $2,100 $2,850 $2,850 $3,600 $3,600 $3,600 $2,850 $2,850
$33,500
$11,000
$7,000
$51,500
$33,500
$11,000
$7,000
$51,500
$568,500
$161,000
$109,000
$838,500
$77,900 $11,400 $11,400 $25,150 $25,150 $41,900 $41,900 $41,900 $25,150 $25,150
$11,400 $11,400
SUBTOTAL
Loan/Investment principal payment
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$24,000 $24,000 $24,000 $24,000 $24,000 $24,000 $24,000 $24,000 $24,000 $24,000
$53,900 -$12,600 -$12,600 $1,150 $1,150 $17,900 $17,900 $17,900 $1,150 $1,150
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CASH RECEIPTS
Membership Dues
Amenity/Training/League Sales
Food/Beverage Sales
Subtotal
COST OF GOODS SOLD
Direct Wages
Food/Beverage Inventory
Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Total
-$74,275 -20,375 -32,975 -45,575 -44,425 -43,275 -25,375 -7,475 10,425
11,575 12,725
125
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$2,500
$600
$700
$7,000
$500
$3,000
$200
$3,000
$4,560
$17,500
$6,500
$349,800
$30,000
$7,200
$8,400
$84,000
$6,000
$36,000
$2,400
$36,000
$54,720
$210,000
$78,000
MARKET RESEARCH
Market Research developed from IBIS World Industry Report
Page 25
WWW.IBISWORLD.COM
ra
Sarah Turk
December 2014
ft
17 International Trade
32 Key Statistics
Industry Definition
18 Business Locations
32 Industry Data
Main Activities
Similar Industries
20 Competitive Landscape
Additional Resources
32 Annual Change
4 Industry at a Glance
32 Key Ratios
5 Industry Performance
23 Barriers to Entry
Executive Summary
24 Industry Globalization
Current Performance
Industry Outlook
25 Major Companies
28 Operating Conditions
28 Capital Intensity
13 Supply Chain
29 Revenue Volatility
15 Demand Determinants
30 Industry Assistance
15 Major Markets
WWW.IBISWORLD.COM
Main Activities
ft
Dance centers
ra
Similar Industries
WWW.IBISWORLD.COM
ra
ft
IBISWorld
Additional Resources
WWW.IBISWORLD.COM
Industry at a Glance
Gym, Health & Fitness Clubs in 2014
Key Statistics
Snapshot
Revenue
Profit
Wages
Businesses
$26.5bn
$2.3bn
2.3%
$8.3bn
Market Share
There are no
Major Players in
this industry
5.4
5.3
Units
% change
2
0
10
12
14
16
18
20
5.0
Year 06
08
10
12
14
16
18
20
Employment
Revenue
p. 25
ft
08
ra
5.2
5.1
Year 06
2.8%
29,894
SOURCE: WWW.IBISWORLD.COM
6%
Participation in sports
5%
Tennis centers
Time spent on
leisure and sports
7%
Swimming pools
7%
Dance centers
Number of adults
aged 20 to 64
Yield on 10-year
Treasury note
10%
Other
65%
p. 5
SOURCE:
WWW.IBISWORLD.COM
SOURCE:
WWW.IBISWORLD.COM
Industry Structure
Growth
Low
Medium
Regulation Level
Technology Change
Light
Medium
Barriers to Entry
Low
Industry Assistance
Low
Industry Globalization
Low
Concentration Level
Low
Competition Level
High
FOR ADDITIONAL STATISTICS AND TIME SERIES SEE THE APPENDIX ON PAGE 32
WWW.IBISWORLD.COM
Industry Performance
Participation in sports
Participation in sports measures the
percentage of individuals that participate
in sports, recreation or exercise per day.
As more individuals participate in sports,
this trend reflects more health-conscious
individuals, which typically increases
consumer demand for gym, health and
fitness club memberships. Participation
in sports is expected to decrease in 2015.
ra
ft
The
WWW.IBISWORLD.COM
Industry Performance
ft
Participation in sports
ra
21
20
5.3
19
5.2
Units
18
5.1
5.0
Year 06
17
08
10
12
14
16
18
20
16
Year 06
08
10
12
14
16
18
20
SOURCE: WWW.IBISWORLD.COM
WWW.IBISWORLD.COM
Industry Performance
8
6
4
2
0
2
4
Year 06
08
10
12
14
16
18
20
SOURCE: WWW.IBISWORLD.COM
ra
Industry revenue
% change
ft
Current
Performance
Industry landscape
WWW.IBISWORLD.COM
Industry Performance
Consumer
preference has
shifted toward smaller
gyms with fewer amenities
Racquet and Sportsclub Association
(IHRSA). Planet Fitness offers
inexpensive gym membership fees of
$10 to $19 per month, depending on the
location, and has steadily expanded
operations over the past three years.
Other growing franchises include Snap
and Anytime Fitness, which have
demonstrated the popularity of niche
gyms that target budget-conscious
clientele. Moreover, consumers that seek
individualized fitness programs, specific
fitness goals or are uncomfortable
exercising in larger gyms particularly
favored small-scale gyms.
ra
ft
Fitness trends
Enterprises and
employment
WWW.IBISWORLD.COM
Industry Performance
New demographics
ra
ft
Industry
Outlook
Demographic
changes will
increasingly drive revenue
growth
Many employers are increasingly viewing
fitness as a vital component of employee
health due to studies indicating that fitness
can boost worker productivity. As a result of
this trend, many employers may subsidize
gym memberships for their employees,
therefore providing a boon to the industry.
Furthermore, as many families become
health and fitness conscious, more
consumers aged 17 and younger will
purchase gym memberships. Less physical
education in schools, coupled with growing
concerns regarding childhood obesity, will
prompt gym membership sales for this age
demographic. As consumers become
increasingly time strapped, many will
invest in fitness classes and individual or
group sessions with trainers to obtain their
fitness goals more efficiently. In the next
five years, group classes are expected to
increase in popularity, especially fusion
classes that combine yoga, Pilates, ballet,
dance and surfing.
WWW.IBISWORLD.COM
Industry Performance
ra
ft
Industry landscape
Operators
will implement a
larger workforce to develop
and retain their clientele
0.6% to 30,818 operators, as the trend
of health consciousness continues to
boost demand for industry services.
Additionally, the number of employees
is anticipated to grow at an annualized
rate of 1.5% to 628,668 people over the
same period, as industry operators
implement a larger workforce to provide
additional services, such as fitness
classes and spa services, to develop and
retain their clientele.
WWW.IBISWORLD.COM
Industry Performance
Increased awareness and interest in fitness and
health has bolstered industry performance
20
Maturity
Quality Growth
Company
consolidation;
level of economic
importance stable
ra
ft
15
10
Quantity Growth
Decline
-5
Shrinking economic
importance
-10
-10
-5
10
15
20
WWW.IBISWORLD.COM
Industry Performance
ft
industry
is Growing
ra
This
WWW.IBISWORLD.COM
Supply Chain
Consumers in the US
Consumers drive the demand for gyms, health and fitness clubs.
23822a
23822b
Plumbers in the US
This industry supplies plumbing services for changing rooms.
33992a
33992b
ra
ft
22133
WWW.IBISWORLD.COM
5%
Tennis
centers
7%
Swimming pools
6%
Ice and
roller rinks
7%
Dance centers
10%
Other
65%
Total $26.5bn
SOURCE: WWW.IBISWORLD.COM
ra
ft
Dance centers
Dance centers and studios are a growing
segment of the industry, generating
about 7.0% of industry revenue in 2014.
These centers are largely available to the
general public for all ages and ability
levels. A wide variety of dance classes
(e.g. salsa and hip hop) are made
available in most areas, appealing to both
beginners and professionals.
Ice rinks and in-line skating rinks
Ice rinks and in-line skating rinks are
another popular industry activity,
accounting for about 6.0% of revenue in
2014. Skating rinks are popular, as
participants can skate both for leisure
and to participate in hockey and figure
skating. The NSGA reports that about
10.0% of the population participated in
either ice or in-line skating during 2010
(latest available data), and 2.0%
WWW.IBISWORLD.COM
Major Markets
ra
ft
Demand
Determinants
WWW.IBISWORLD.COM
8%
4%
Consumers
Consumers aged 6 to 11
aged 12 to 17
35%
Consumers
aged 18 to 34
20%
Consumers aged
55 and up
33%
Consumers
aged 35 to 54
Total $26.5bn
SOURCE: WWW.IBISWORLD.COM
ra
ft
Major Markets
continued
Consumers aged 18 to 34
This age category accounts for the
industrys largest market segment, with
an estimated 5.0% market share. Despite
its size, this segment has shown little
growth over the past decade, compared
with other age categories. While this
demographic is expected to include 10.5
million individuals, this market segment
WWW.IBISWORLD.COM
ra
ft
International Trade
WWW.IBISWORLD.COM
West
New
England
AK
0.3
Great
Lakes
ND
MT
Rocky
Mountains
ID
1.5
West NV
0.6
SD
0.3
WY
0.5
2.0
CO
0.7
KY
0.8
OK
0.9
NC
3.4
TN
AZ
NM
1.5
0.5
Southwest
TX
6.0
HI
0.3
2 NH
3 MA
4 RI
5 CT
6 NJ
7 DE
8 MD
0.3
1.6
0.6
4.2
3.5
0.4
SC
Southeast
0.7
MS
AL
1.2
1.4
GA
2.6
0.7
LA
1.4
FL
5.5
Establishments (%)
0.5
2.2
AR
0.5
1.6
10.8
WV VA
2.8
1.2
1.9
CA
West
3.8
MO
KS
1.8
OH
2.0
4.2
4.7
IN
IL
0.7
UT
PA
3.0
1.1
0.5
1 2
3
NY
7.1
5 4
MI
2.2
IA
NE
0.2
WI
Plains
OR
MN
0.3
0.4
ft
2.6
ra
WA
ME
MidAtlantic
9 DC
0.2
Less than 3%
3% to less than 10%
10% to less than 20%
20% or more
SOURCE: WWW.IBISWORLD.COM
WWW.IBISWORLD.COM
20
10
Southwest
Southeast
Rocky Mountains
Plains
New England
Mid-Atlantic
Great Lakes
West
Establishments
Population
SOURCE: WWW.IBISWORLD.COM
ra
ft
Business Locations
WWW.IBISWORLD.COM
20
Competitive Landscape
identifies
250 Key Success
Factors for a
business. The most
important for this
industry are:
ft
in
this industry is L ow
percentage of nonemployers is
substantial because the industrys low
barriers to entry and low startup
capital costs.
The larger players in this industry have
numerous locations throughout the
United States, while small players are
generally independently owned and
operate in one or two states. However,
over the past five years, the proportion of
businesses that employs 20 people or
more has increased, indicating that
concentration is rising. The industrys
market share will become more
concentrated over the next five years, as
larger firms acquire small, niche gym,
health and fitness clubs.
ra
Level
Concentration
Market Share
Concentration
Economies of scale
Fitness firms that have a large number of
establishments and provide a wide range
of services are able to attract and retain
new and existing members, as well as
reduce costs per member.
Cost Structure
Benchmarks
Profit
Member retention is a key component in
fitness centers profitability, as many gym,
health and fitness centers have fixed
overhead costs. According to the
International Health, Racquet & Sportsclub
Association, the average attrition rate for
gyms in the United States is up to 45.0%,
meaning that 45 out of 100 individuals will
WWW.IBISWORLD.COM
21
Competitive Landscape
ra
ft
Wages
Wages are the largest cost for the industry,
accounting for about 31.3% of revenue in
2014. To minimize this cost, many gym,
health and fitness clubs have implemented
staff that includes part-time employees
that are paid on an hourly basis.
Additionally, gym, health and fitness clubs
also hire salaried staff, including backoffice support, personal trainers and other
professionals, but the majority of these
staff members generate additional
80
Percentage of revenue
Cost Structure
Benchmarks
continued
Industry Costs
(2014)
12.6
8.6
27.1
31.3
60
27.4
40
20
5.1
4.1
6.6
17.1
Profit
Wages
Purchases
Depreciation
Marketing
Rent & Utilities
Other
20.0
7.4
10.0
15.5
7.2
SOURCE: WWW.IBISWORLD.COM
WWW.IBISWORLD.COM
22
Competitive Landscape
Cost Structure
Benchmarks
continued
ra
ft
Basis of Competition
Level & Trend
ompetition
C
in
this industry is
Highand the trend
is Increasing
WWW.IBISWORLD.COM
23
Competitive Landscape
ra
ft
Basis of Competition
continued
Barriers to Entry
Level & Trend
arriers to Entry
B
Level
High
Low
Growth
Medium
Medium
Light
Low
SOURCE: WWW.IBISWORLD.COM
WWW.IBISWORLD.COM
24
Competitive Landscape
Industry
Globalization
ra
in
this industry is
Lowand the trend
is Increasing
ft
Barriers to Entry
continued
WWW.IBISWORLD.COM
Major Companies
ra
ft
Other Companies
WWW.IBISWORLD.COM
Major Companies
ra
ft
Other Companies
continued
WWW.IBISWORLD.COM
Major Companies
ra
ft
Other Companies
continued
WWW.IBISWORLD.COM
Operating Conditions
Capital intensity
Economy
ft
of capital
intensity is Medium
ra
Information, Communications,
Mining, Finance and Real
Estate. To increase revenue
firms need superior debt
management, a stable
macroeconomic environment
and a sound investment plan.
Capital Intensive
Labor Intensive
Old Economy
Agriculture and Manufacturing.
Traded goods can be produced
using cheap labor abroad.
To expand firms must merge
or acquire others to exploit
economies of scale, or specialize
in niche, high-value products.
SOURCE: WWW.IBISWORLD.COM
WWW.IBISWORLD.COM
Operating Conditions
Technology
& Systems
Level
The level
Revenue Volatility
ra
ft
of
Technology Change
is Medium
of
Volatility is Low
Volatility vs Growth
1000
Level
The level
Hazardous
Rollercoaster
100
10
1
0.1
Stagnant
30
10
Blue Chip
10
30
50
70
WWW.IBISWORLD.COM
Operating Conditions
Revenue Volatility
continued
ra
ft
Regulation is
Lightand the
trend is S
teady
Industry Assistance
Level & Trend
he level of Industry
T
Assistance is L ow
and the trend
is Increasing
WWW.IBISWORLD.COM
Operating Conditions
ra
ft
Industry Assistance
continued
WWW.IBISWORLD.COM
Key Statistics
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Sector Rank
Economy Rank
Revenue
(%)
3.2
5.9
0.0
-1.8
2.2
2.3
2.0
2.5
2.4
3.1
3.2
2.8
3.1
2.0
7/19
280/705
Key Ratios
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Sector Rank
Economy Rank
IVA/Revenue
(%)
47.70
47.25
45.91
47.96
46.50
43.51
45.66
45.74
46.64
47.33
47.80
47.40
47.00
46.52
46.27
6/19
148/705
Establishments
31,988
32,432
33,269
33,451
32,864
32,820
33,068
33,385
33,527
34,023
34,331
34,540
35,112
35,498
35,818
5/19
161/704
Enterprises Employment
28,779
488,795
29,000
507,921
30,154
541,562
30,269
550,634
29,031
536,231
28,912
527,086
29,136
548,375
29,365
561,536
29,501
573,328
29,894
583,075
30,031
594,153
30,199
603,660
30,331
610,225
30,604
619,989
30,818
628,668
5/19
3/19
149/704
65/705
Exports
---------------N/A
N/A
Industry
Value Added
(%)
2.2
2.9
4.5
-4.8
-4.4
7.3
2.1
4.5
3.9
4.1
2.4
1.9
2.1
1.5
3/19
179/705
Establishments
(%)
1.4
2.6
0.5
-1.8
-0.1
0.8
1.0
0.4
1.5
0.9
0.6
1.7
1.1
0.9
8/19
269/704
Enterprises Employment
(%)
(%)
0.8
3.9
4.0
6.6
0.4
1.7
-4.1
-2.6
-0.4
-1.7
0.8
4.0
0.8
2.4
0.5
2.1
1.3
1.7
0.5
1.9
0.6
1.6
0.4
1.1
0.9
1.6
0.7
1.4
9/19
10/19
246/704
297/705
Exports
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Imports/
Demand
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
ft
Annual Change
Industry
Value Added
($m)
10,532.6
10,765.3
11,080.3
11,579.7
11,023.3
10,540.4
11,314.8
11,557.3
12,081.5
12,552.8
13,069.5
13,378.5
13,635.7
13,915.9
14,118.5
5/19
200/705
ra
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Sector Rank
Economy Rank
Revenue
($m)
22,080.6
22,783.4
24,136.1
24,145.4
23,707.9
24,227.5
24,781.4
25,269.1
25,904.3
26,522.4
27,339.2
28,225.2
29,014.0
29,913.4
30,511.7
4/19
305/705
Industry Data
Exports/
Revenue
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Revenue per
Employee
($000)
45.17
44.86
44.57
43.85
44.21
45.96
45.19
45.00
45.18
45.49
46.01
46.76
47.55
48.25
48.53
15/19
675/705
Wages/Revenue
(%)
31.10
30.85
31.01
31.06
30.20
29.31
29.56
29.94
30.74
31.33
31.50
31.18
30.70
30.22
30.07
7/19
158/705
Imports
---------------N/A
N/A
Wages
($m)
6,867.2
7,028.8
7,484.0
7,499.1
7,158.9
7,100.1
7,325.0
7,564.8
7,962.7
8,309.2
8,613.2
8,800.4
8,906.4
9,040.0
9,175.6
5/19
169/705
Domestic
Demand
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Health Club
Memberships
(Mils)
46.7
47.3
47.5
47.7
40.3
50.2
51.4
51.7
52.6
54.1
54.8
56.0
56.9
58.2
58.8
N/A
N/A
Imports
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Wages
(%)
2.4
6.5
0.2
-4.5
-0.8
3.2
3.3
5.3
4.4
3.7
2.2
1.2
1.5
1.5
2/19
91/705
Domestic
Demand
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Health Club
Memberships
(%)
1.3
0.4
0.4
-15.5
24.6
2.4
0.6
1.7
2.9
1.3
2.2
1.6
2.3
1.0
N/A
N/A
Employees
per Est.
15.28
15.66
16.28
16.46
16.32
16.06
16.58
16.82
17.10
17.14
17.31
17.48
17.38
17.47
17.55
11/19
295/704
Average Wage
($)
14,049.24
13,838.37
13,819.29
13,619.03
13,350.40
13,470.48
13,357.65
13,471.62
13,888.56
14,250.65
14,496.60
14,578.41
14,595.27
14,580.90
14,595.30
16/19
672/705
Share of the
Economy
(%)
0.07
0.07
0.07
0.08
0.08
0.07
0.08
0.08
0.08
0.08
0.08
0.08
0.08
0.08
0.08
5/19
200/705
SOURCE: WWW.IBISWORLD.COM
WWW.IBISWORLD.COM
Industry Jargon
ra
ft
IBISWorld Glossary
ra
ft
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