Top Biz News

Getting fit big business

By Yu Tianyu (China Daily)
Updated: 2009-11-16 07:54

Lower fees

Here is a piece of good news for Chinese exercisers who, like Song, are not wealthy.

About a decade ago, fitness club membership was regarded as a luxury and also a symbol of the upper class. Clubs were located at four-star or five-star hotels, and the cost of membership was 10,000 yuan a year or more.

In the past two years, with the rapid growth of Chinese fitness clubs and also competition, many Chinese fitness club operators have had to cut the price of membership and offer more discounts.

Famous fitness club brands like Hokay, Zhangbei and CSI-Bally Total have had to follow the suit -- especially considering the global economic recession.

Zhou Fen, a business school student, paid 1,500 yuan for a two-year membership at Hokay last August. Her friend only paid 1,100 yuan this year for the package, she said.

The price of membership at Nirvana Fitness, which used to focus on the high-end fitness market, has decreased to 5,000 yuan or less in Beijing.

An industry insider said that among the 1,000 newly established fitness clubs in the past year, 600 to 700 clubs might soon be forced to close down because of the long gap between huge initial investments and a return on those investments.

And the operators are also facing pressures from soaring land rents and personnel costs, he said.

China's relatively young fitness market also lacks the management experience found in other countries, insiders said.

"China provides a huge market, but it is in its infancy," said David Chan, who established Megafit, the first Chinese chain of fitness clubs in Shanghai, and is now a fitness consultant.

Wang Cheng, general manager of Nirvana, said the current price war will hurt the fitness industry as a whole, suggesting that relevant government agencies or industry associations bring operators together to discuss solutions.

Wu Shijun is a businessman who has been involved in China's fitness industry for the past decade.

"One of the answers for Chinese fitness club operators is to find their exact target consumers, and then work out relevant strategies along with services and products," Wu said.

A report published in Asian Social Science by Wan Bin of the Dalian University of Technology, described who joins fitness clubs in China today.

According to the report, business employees are the major customers, accounting for 35.7 percent of fitness club membership in 2007.

Self-employed professionals accounted for 23.7 percent, civil servants 7.4 percent and teachers 2.6 percent. Students accounted for 13.7 percent of fitness club memberships.