The future of Gyms
Having been a regular gym goer through my life but not going to the gym for the last year has prompted me to reflect on whether I will go back to the gym post COVID-19.
The gym for me was a place to seriously train, with all the equipment needed around me to develop my body and understand performance. I’ve had personal trainers for periods of time at the gym and their help and input has been worth its weight in gold, along with boosting motivation. That meant that after gaining that knowledge I could have a set repertoire to follow during my own gym sessions and go in with a focused mindset, the correct technique and exercises for my personal goals.
Whether the goal was to build muscle and strength or to improve cardio for running, the gym provided an ideal location to improve. I became a member of the gyms I joined based upon location, equipment, busyness and friendliness of staff.
Gyms globally have had to adapt due to Covid-19 and those based in the UK have had a difficult task in pivoting their business models during times of lockdown. The key USP of a gym is the location, environment and staff knowledge and equipment. There is no escaping that revenue depends upon customers physically coming through the door. During COVID-19 lockdowns, gyms have had to reduce operating costs significantly to minimise the impact of lost revenue and take government support in the form of business rates relief and wages support for furloughed staff. Conversely, given the closure of gyms, customers have had to pivot and either buy equipment themselves for home, use apps or follow workouts via TV or some other streaming medium.
It will be interesting in the future to see if any major gyms partner with fitness app companies to give consumers the best of the digital and physical experience. A Gym busyness tracker built into the app might assist members wanting to visit at quieter times and for gym’s to optimize usage throughout the day.
It’s interesting to take a look at a gym stock to see how Covid-19 has impacted the share price of this type of business. The Gym Group Plc on the London stock exchange that has 183 gyms is trading at 255p on 26th March 2021, up from 127.20p on 30th March 2020. This appears to point to a high degree of optimism by investors of a return to previous gym numbers and growth in usage given a doubling of the share price from 1 year ago, particularly given the financial impact to the balance sheet the company has received. As always, do your own due diligence on any stock before buying or selling.
Gyms are certainly facing an unpredictable future as pent up consumer demand may or may not return or as quickly as hoped. Customers that might have gone to the gym pre COVID-19 may be paying off that Peleton bike or gym equipment for a period of time or may have discovered a better way to exercise in the fresh air through bike rides or hiking. It will be interesting to see what develops and if consolidation occurs across the gym chains nationally and globally.
