Printed from : LMD

23 Apr 2013

Nimble thinking
   BY Liz Terry

Designing, funding, building and running facilities is an expensive undertaking, but because the majority of people's out-of-home leisure-time activity has traditionally taken place in and around some kind of facility, operators have always had to bear the costs associated with this infrastructure.

But it's becoming clear that in every sector, they're facing new competition from operations which are seeking to profit by offering equivalent experiences to customers, while bearing none of the costs associated with facility operations – and they're doing it in innovative, creative ways.

Health clubs have high fixed operating and maintenance costs, but makers of fitness apps, home fitness videos, home workouts and outdoor fitness boot camps can capture much of the same audience for the same purpose at a fraction of the cost.

Spas are facing a competitive threat from non-spa hotels which are putting together 'spa retreats' by bringing in experts to offer classes and treatments, but without needing the investment in infrastructure associated with a full-blown spa operation.

I could go on, but you get the point.

Added to this is a new generation of popup operations which use existing or temporary locations to launch time-limited, often highly creative leisure experiences on a low-risk basis. These operations are thriving in every part of the market and we cover them with a special report in the latest issue of Leisure Management on page 42.

Pop-ups have the advantage of a low entry point in terms of costs, enabling operators to test concepts and locations without high risk, and some pop-ups have been so successful they've morphed into permanent operations.

So should facility owners be worried about this fluid and entrepreneurial approach to creating leisure experiences? Perhaps. However, people love new things and let's face it, some leisure operators are pretty set in their ways and dreary – it seems as though having concrete foundations makes it difficult for some to be nimble in their thinking. I for one welcome this trend of innovation, creativity, change and general deliciousness.

These new entrants to the market may be shaking things up, but there's no reason facility owners can't take a leaf out of their book and get more creative with sub-letting and sharing facilities to generate new revenue streams or get some pop-up action for themselves.

The fact London's South Bank has been hosting not only a pop-up restaurant, but also a (sell-out) pop-up hotel – in a boat – on the roof of the Queen Elizabeth Hall – no less, shows that even the most established institution can get into the trend.

So a threat – perhaps – but the motto needs to be, if you can't beat 'em, join 'em.

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