19 Dec 2023
Rural locations are the next frontier for expansion for the health club sector
BY Kath Hudson
With between 18 and 30 per cent of the populations of developed countries living in rural locations, this market will be the next frontier for expansion in the fitness industry, according to insight published in HCM magazine.
The challenge is creating the right business model.
Fit+ is a staffless and digitalised concept which founder Torsten Boorberg believes can work anywhere. A 390sq ft (36sq m) club in Bad Doberan, Germany, has 1,000 members in a town of 12,000 people, thanks to the efforts of the licensee, Karsten Luther.
In the UK, PureGym is also exploring the potential of rural development and speaking exclusively in HCMissue 10 2023, MD, Rebecca Passmore, says the company is currently working on alternatives to take its affordable concept into rural areas.
“We’ve been able to deliver an attractive return on capital at a 6,500sq ft (604sq m) site, compared to our average of 15,000sq ft (1,394 sq m),” she says. “And we’ve found a viable model with an addressable population of 30,000 to 40,000.
“It’s been challenging so far to make the affordable model work in rural areas, because it relies on high member densities and in some areas the population just isn’t large enough to sustain a commercial gym,” she said. “After five kilometres, penetration starts to reduce, no matter how well-priced or high-quality the facility, even if there isn’t another gym option nearby.”
A further challenge is that a club which is one-third of the size doesn’t have proportional cost savings, as there are some aspects of a fit-out that cost the same, no matter what size the club is.
In spite of these challenges, PureGym continues to experiment with alternatives and while it can’t yet make a health club work with 1,000 members, Passmore says the company is hopeful it can create a viable concept for 1,500 members which would give its property team new markets to target in underserved areas and as it pushes further into rural areas.
In the trust sector, with 260 leisure centres, GLL is also exploring other models in the countryside, including working with community groups to develop blended management models which combine GLL’s expertise with trained and committed local volunteers.
“Co-locating gyms and leisure facilities with health hubs and libraries keeps the costs down and makes travel easier,” says former CEO and strategic advisor, Mark Sesnan. “We’re also exploring further community use of school facilities, since most communities have a school.”
Wadebridge Leisure Centre in Cornwall was one of GLL’s rural sites which represented a challenge. It was at risk of closure when seven volunteers formed a community interest company, FOWLC, to run it on a not-for-profit basis.
Director, Emma Tudge, says one size doesn’t fit all with rural clubs: “It’s important to listen to what the community wants and needs from their leisure centre. If something doesn’t work, we look at why and tweak it.”
Tudge also says it’s vital to be agile and embedded in the local community: “To make a rural club work you need to listen and engage with the community and have a genuine passion for engaging with people.”
Director at Active Insight, Mike Hill, says the unique needs of communities need to be considered at the design stage. “This might mean adding a meeting room, a community centre or an indoor sports hall,” he says.
Hill points out that in the Netherlands, community health and activity centres have been run 'by the community for the community' successfully for years, serving as hubs for social interaction, mental rejuvenation and skill development, while also boosting social cohesion.
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