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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
MINIMUM OF
                50% LOWER
                   THAN
                 INDUSTRY
                   PRICE



 SCOPE TO                                  HEAVY
OPERATE 24                              TECHNOLOGY
  HOURS                                 AND WEB USE
                         MY
                     DEFINITION
                     OF A LOW-
                      COST GYM




      ABILITY TO
     OPERATE CLUB                  GYM-ONLY
     WITH A SINGLE                PROPOSITION
        PERSON
SIMPLICITY


SUPPORTING
  INFRA-
STRUCTURE                     AFFORDABILITY



                  MARKET
                  DRIVERS


                                CONSUMER
 CONSUMERS ARE
                                SENTIMENT
   CHANGING
                              TOWARDS CLUBS


                  SPORADIC
                 ATTENDANCE
SIMPLICITY


SUPPORTING
  INFRA-
STRUCTURE                     AFFORDABILITY



                  MARKET
                  DRIVERS


                                CONSUMER
 CONSUMERS ARE
                                SENTIMENT
   CHANGING
                              TOWARDS CLUBS


                  SPORADIC
                 ATTENDANCE
I Care
Consumers now have
considerable experience
   of low-cost services
“Fly for the price
of a pair of jeans”
  11
Spend a little, live a lot
                       12
13
Look good, pay less
 14
Think of a sector…you will
      find low-cost
300
million units
annually by
2013
SIMPLICITY


SUPPORTING
  INFRA-
STRUCTURE                     AFFORDABILITY



                  MARKET
                  DRIVERS


                                CONSUMER
 CONSUMERS ARE
                                SENTIMENT
   CHANGING
                              TOWARDS CLUBS


                  SPORADIC
                 ATTENDANCE
SIMPLICITY


SUPPORTING
  INFRA-
STRUCTURE                     AFFORDABILITY



                  MARKET
                  DRIVERS


                                CONSUMER
 CONSUMERS ARE
                                SENTIMENT
   CHANGING
                              TOWARDS CLUBS


                  SPORADIC
                 ATTENDANCE
“I can join online – no pushy
sales staff to deal with!”
SIMPLICITY


SUPPORTING
  INFRA-
STRUCTURE                     AFFORDABILITY



                  MARKET
                  DRIVERS


                                CONSUMER
 CONSUMERS ARE
                                SENTIMENT
   CHANGING
                              TOWARDS CLUBS


                  SPORADIC
                 ATTENDANCE
SIMPLICITY


SUPPORTING
  INFRA-
STRUCTURE                     AFFORDABILITY



                  MARKET
                  DRIVERS


                                CONSUMER
 CONSUMERS ARE
                                SENTIMENT
   CHANGING
                              TOWARDS CLUBS


                  SPORADIC
                 ATTENDANCE
36
Word of mouth
on steroids
SIMPLICITY


  INFRA-
STRUCTURE                    AFFORDABILITY



                 MARKET
                 DRIVERS


                               CONSUMER
CONSUMERS ARE
                               SENTIMENT
  CHANGING
                             TOWARDS CLUBS


                 SPORADIC
                ATTENDANCE
“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
McFit Financials 2007
                         Euros        % turnover
                       (millions)
Turnover                   86
Staff costs                3.4           3%
EBITDA                     28            32%
Interest charge            0.1            -
Net assets                 34
Clubs                               88
 56
budgetgymresearch.ning.com
oxygen-blog.blogspot.com
Google: “Ray Algar”

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How the low-cost gym sector will transform the UK health and fitness industry