Plus Fitness has also found success using the 24/7 low-cost model.
Plus Fitness was founded in 2009 by Nigel Miller and John Fuller and turns over $13.4 million a year with a 56% growth rate thanks to opening 42 new gyms in the last financial year.
According to chief executive Nigel Miller, one of the keys to success in the gym business is innovation.
“You need to be innovating at all times”, Miller says.
“You need to be aware of what’s happening in the industry, assess how valid trends are – they come and go quickly – once you figure out what fits within your model, move ahead with it, but you can never be too niche, so our ethos has been to always be aware of what is around you,” Miller says.
Additionally, he says, “You can never have completely dismissed anything in this industry, it’s not smart.”
Plus Fitness has implemented virtual class programs, group exercise and cross-fit to its gyms recently, all ideas which underwent the process of validity tests and were successful enough to be implemented into its gyms around the country.
On top of this, Miller says the biggest challenge that he has faced whilst at Plus Fitness is similar to the challenges at any business.
“The challenge for us is to understand when to increase staff in office and knowing when to grow. Knowing who to bring in and what to delegate with new members going forward is important, as is ensuring people understand the positive culture that you’re trying to promote in the business.”
Both Jetts Fitness and Plus Fitness have achieved success using a franchise model and both Oliver and Miller say, given the current market maturity and saturation, franchising is the only way to succeed in the gym industry.
This is particularly so given the expansion of international chains in Australia such as Fitness First, Curves, Anytime Fitness and Virgin Active.
Oliver believes the support received from buying into a franchise is more important than anything, as it gives the highest chance of success.
He says the assistance that franchisees get from extensive support offices, as well as regional directors and business managers who support the franchisee to develop their business are the reasons why franchising is the “dominant formula” for gym businesses.
“You just don’t have that security as a solo owner”, Oliver says.
“Obviously if you are doing one by yourself rather than doing one as a franchisee, there’s a lot more risk in the population penetration,” he says. “You will get something a little bit more boutique, because it is more personal to you, but you don’t get that supportive structure that allows you to drive the business.”
Miller, started out as a solo gym owner before expanding into a franchise and he agrees with Oliver.
Miller says he assessed the impact of overseas ventures competing locally with him and determined that to achieve success and continue to compete, he couldn’t stay solo.
He says the advantages for franchisees are buying power, brand awareness and beyond that, being a part of a group.
“Having support mentors and peers that assist you and share experiences are extremely valuable as a business owner. Having those things as a franchise is a huge edge over an independent business.”
“I would have dismissed the issue if you asked me eight years ago, but now I understand the importance of franchising,” he says.
