Tell us the key facts about your business
You Fit is a leisure and hotel management company, which was launched in 2018 by Kew Green Hotels.
We’ve got a portfolio of 22 clubs across the UK and 15,000 members. Each site has a gym, wetside facilities and group exercise studios, while selected locations also have spas.
Talk to us about the launch of your health club management contracting service
Up until now the development of You Fit has been completely dependent on us growing the wider hotel portfolio of Kew Green through the acquisition of hotels with health club and spa facilities.
We’ve realised there’s an opportunity for other hotels to benefit from the operational and commercial set-up of becoming part of a larger branded group such as ours. We also see opportunities in the independent health club sector.
As a result, we plan to grow the number of You Fit clubs beyond what we could achieve with the expansion of our own company, by branching out to work with investors, owners and operators who can benefit from adopting the You Fit brand and processes.
We’re also aware health club, leisure and spa operations are often secondary to the core business of hotels and outside the scope of some hoteliers. Our plan is to take the strain of running a health club and spa business, while providing a service that complements the hotel operation.
What’s the scope of your ambition?
While we’re initially looking for hotel contracts, our central team has a breadth of experience in private and public health clubs, gyms and spa operations, both in the UK and internationally, so the plan is to move towards working globally with hotels and independent club operators. We’re also planning to launch a You Fit franchise.
Why now?
Expansion is something we’ve been planning for some time. We feel we’re well placed to support and manage the recovery of any business through this post-lockdown period, to enable companies to get the most out of their business.
With the hotel sector fully re-opening, understandably the focus of hoteliers will be the commercial recovery of their properties. With this in mind, we can step in and focus on the leisure business for them by supporting and ensuring the financial recovery of the leisure offering, so they’re able to focus on the core hotel business.
The hotel market has a well established ‘op co/prop co’ model. Why has the health and fitness industry failed to develop in the same way?
There’s no doubt the hotel industry has changed significantly. Once upon a time, if you stayed in a branded hotel, it was owned by the company whose name was over the door. Today, hotels are often a collaborative business partnership between a brand or franchise, an operator and a separate business that owns the physical asset.
The hotel industry is very well established and by comparison the health club industry has only begun to mature in the same way in recent years.
I have no doubt similar multi-faceted business partnerships and ownership arrangements will emerge in the years to come.
Ours is an exciting, evolving industry and we will see the growth of franchise and licenced brands, management companies and venture capitalists working collaboratively as our industry continues to mature and expand.
How will you balance being an operator in your own right with being a contract operator. Do you see any conflicts of interest?
While the majority of our You Fit portfolio represents owned properties, we’ve held management contracts within our existing estate for many years.
To the leadership teams, there is no discernible difference in the way in which we operate, manage and focus on delivering commercial performance when compared to that of our owned clubs.
Managed and franchised You Fit clubs benefit from being supported in much the same way as our owned estate, including operational elements of our culture, centralised marketing and member retention, administration and collections functions. Each also has a dedicated account manager and performance coach.
What’s the business model?
We have many bespoke management options and will work with each client to come up with the best solution to meet their needs and requirements.
Each management contract client will benefit from a service including an external bi-annual health and safety audit, sales and marketing support, professional fees and licencing and a central admin support team.
Will you work with investors?
Initially, our franchise offering will be aimed predominantly at independent club operators who are in need of recovery support and would benefit most from operating with a branded solution.
What are your points of differentiation with existing contract operators?
Branded and franchise businesses repeatedly out-perform independent businesses. We see this across restaurants, fast-food, pubs, hotels, retail and fitness.
While hotel guests are typically travelling from outside the area, hotel health club and spa members are local residents. To this end, hotel-based clubs are competing with a multitude of well-known national brands.
We feel that there’s a clear opportunity for a strong national brand to compete and emerge in hotels.
For owners and operators, partnering delivers a clear brand identity with expansive demographic appeal, giving employees and members a sense of belonging and trust, while offering owners confidence in a proven model and commercial systems.
For small independent club operators it’s an affordable opportunity to join a larger brand and gain from operational and commercial systems.
What do you see coming down the track?
The last big shake up in the health, fitness and wellness industry came after the recession of 2008/9, which led to the emergence of budget gyms.
This led to long standing, well-known mid-market club brands disappearing from our high streets, but it also made health club memberships more broadly attainable and delivered year-on-year growth for the sector.
We’ve seen new fitness trends emerge over the past year which will bring with them further longer term changes that will continue to provide variety, points of differentiation and opportunities for our industry.
