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features

Statistics: State of Europe

The European Health & Fitness Market Report, published this month, gives deep insights into the impact of the pandemic on the sector. Liz Terry highlights some of the key findings

Published in Health Club Management 2021 issue 6

Deloitte’s annual report into the European Health and Fitness market in partnership with EuropeActive – now in its eighth edition – has assumed extraordinary significance this year, given it details the impact of the pandemic on health and fitness businesses across the continent, laying bare for the first time the full extent of the destruction wrought by COVID-19 on the sector.

In introducing the report, the authors note this is the first year since records began where the market was not measured as having increased in size.

As such, the report becomes a benchmark from which the industry can rebuild and track a new course, as we consider the wider opportunities for growth as revealed by the disruption.

Strong direction in this regard is given in the Foreword by Andreas Paulsen, CEO of EuropeActive, who says: “EuropeActive’s recovery strategy will focus on helping our businesses recover and come back stronger after the pandemic in order for our sector to regain and expand our positive impact on the health and wellbeing, as well as the economy, of Europe.”

What’s inside
The 128 page report includes all the major market numbers, country comparisons and also individual country reports, giving insights into macro economic factors, such as population size, disposal income, fitness club memberships and –usefully – average health club membership fees as a percentage of disposable income.

Deloitte has also tracked the current situation with VAT around Europe, showing how differing government approaches have either supported or burdened the sector. In Romania for example, VAT on gym memberships is set at 5 per cent, while in neighbouring Hungary, it’s 27 per cent – the highest in Europe.

Norway wins the VAT race overall, with VAT set at zero on health club memberships.

A number of other governments have chosen to give the health and fitness sector VAT breaks, including Ireland, Poland, the Netherlands, Belgium, and the rest of Scandinavia.

The European Health & Fitness Market Report also has a whole section detailing the major European operators and their status in 2020 in terms of borrowings, turnover and development plans.

Primary findings
Clubs, studios and gyms across the continent had a total of 54.8 million members in December 2020 – a significant fall from the 64.8 million members recorded in 2019.

This loss of roughly 10 million members represents an average drop of 15.4 per cent across Europe – although losses hit UK operators harder than those in many other countries, with The Gym Group, PureGym and Nuffield reporting falls of 27 per cent, 27.8 per cent and 26 per cent respectively, versus European operators such as Basic-Fit (10 per cent fall), RSG (9 per cent) and SATS (9 per cent).

This is mainly explained by the lengths of government mandated lockdowns experienced Europe, with Deloitte research showing the UK suffered the greatest number of lockdown days in Europe, while at the other end of the scale, Sweden did not experience any closures.

The report also shows that revenues fell by nearly a third (32.9 per cent) across Europe, from the highest ever recorded level of €28.2bn in 2019 to €18.9bn in 2020.

Again, the UK was hit hardest, with Nuffield, Virgin and The Gym Group reporting falls of 46.5 per cent, 47.7 per cent and 50 per cent respectively, versus Basic-Fit (26.8 per cent), RSG (23 per cent) and SATS (18.5 per cent).

Deloitte found that the top 15 European fitness operators by themselves, achieved total revenues of €2.6 billion in 2020.

The total number of fitness clubs declined by only 1.4 per cent in 2020 to 62,775 – a relatively small loss, considering pandemic lockdowns forced clubs to close for an average of between 40 to 50 per cent of their operational days during the year.

This robust result is attributed both to the high levels of government support received by the sector and also operators’ ability to raise funds to support their balance sheets.

Among the other key findings in the European Health & Fitness Market Report is that the confidence of investors in future growth opportunities within the fitness sector remains high. “This is demonstrated by the large sums that were invested in the various segments of the fitness ecosystem during 2020 and early in 2021, both in existing companies and start-ups, both online and offline.” say co-authors, Karsten Hollasch and Herman Rutgers.

Mergers and acquisitions
In spite of the pandemic, and in some cases because of it, 2020 was a busy year for mergers and acquisitions across the European health and fitness market, with 16 M&A deals reported.

Some were standard business transactions, while others – such as JD Gyms’ purchase of Xercise4Less (see our interview with Alun Peacock on page 42) were the result of them entering administration. The market has also seen six M&D deals already in 2021.

In total, deals saw 835 clubs changing hands in 2020, with 19 Fitness World clubs in Poland being sold twice – once to Pure Gym in January and then out of administration to insurance company, Medicover, in December.

RSG’s acquisition of Gold’s Gym – a major coup for the European operator and one which has given RSG global reach – was not counted, as at the time all Gold’s Gyms locations were outside Europe, although RSG has wasted no time in bringing the Gold’s brand to Europe, with a major new flagship having opened on 4 June in the German capital. Watch out for our interview with RSG CEO, Rainer Schaller, in the next issue of HCM.

The opportunity going forward
Andreas Paulsen’s comments serve to set direction for the sector when he says: “The COVID-19 health crisis represents a transformative opportunity for our industry. This has led EuropeActive to identify our sector’s foremost goal as becoming a publicly recognised solution for health and wellbeing.

“When considering our recovery post-COVID-19, it’s clear our market opportunities as providers of essential health and wellbeing services are vast...our post-pandemic renewal as a sector should, therefore, focus on how we, individually and collectively, ensure this great transformation.

“Scientific research and evidence are on our side and the rest is very much in our own hands”.

• The European Health & Fitness Market Report is compiled by Karsten Hollasch and team at Deloitte Deutschland, with co-editor, Herman Rutgers and published by industry body EuropeActive.

Buy the report: www.HCMmag.com/EHFMR20

Sign up here to get Fit Tech's weekly ezine and every issue of Fit Tech magazine free on digital.
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features

Statistics: State of Europe

The European Health & Fitness Market Report, published this month, gives deep insights into the impact of the pandemic on the sector. Liz Terry highlights some of the key findings

Published in Health Club Management 2021 issue 6

Deloitte’s annual report into the European Health and Fitness market in partnership with EuropeActive – now in its eighth edition – has assumed extraordinary significance this year, given it details the impact of the pandemic on health and fitness businesses across the continent, laying bare for the first time the full extent of the destruction wrought by COVID-19 on the sector.

In introducing the report, the authors note this is the first year since records began where the market was not measured as having increased in size.

As such, the report becomes a benchmark from which the industry can rebuild and track a new course, as we consider the wider opportunities for growth as revealed by the disruption.

Strong direction in this regard is given in the Foreword by Andreas Paulsen, CEO of EuropeActive, who says: “EuropeActive’s recovery strategy will focus on helping our businesses recover and come back stronger after the pandemic in order for our sector to regain and expand our positive impact on the health and wellbeing, as well as the economy, of Europe.”

What’s inside
The 128 page report includes all the major market numbers, country comparisons and also individual country reports, giving insights into macro economic factors, such as population size, disposal income, fitness club memberships and –usefully – average health club membership fees as a percentage of disposable income.

Deloitte has also tracked the current situation with VAT around Europe, showing how differing government approaches have either supported or burdened the sector. In Romania for example, VAT on gym memberships is set at 5 per cent, while in neighbouring Hungary, it’s 27 per cent – the highest in Europe.

Norway wins the VAT race overall, with VAT set at zero on health club memberships.

A number of other governments have chosen to give the health and fitness sector VAT breaks, including Ireland, Poland, the Netherlands, Belgium, and the rest of Scandinavia.

The European Health & Fitness Market Report also has a whole section detailing the major European operators and their status in 2020 in terms of borrowings, turnover and development plans.

Primary findings
Clubs, studios and gyms across the continent had a total of 54.8 million members in December 2020 – a significant fall from the 64.8 million members recorded in 2019.

This loss of roughly 10 million members represents an average drop of 15.4 per cent across Europe – although losses hit UK operators harder than those in many other countries, with The Gym Group, PureGym and Nuffield reporting falls of 27 per cent, 27.8 per cent and 26 per cent respectively, versus European operators such as Basic-Fit (10 per cent fall), RSG (9 per cent) and SATS (9 per cent).

This is mainly explained by the lengths of government mandated lockdowns experienced Europe, with Deloitte research showing the UK suffered the greatest number of lockdown days in Europe, while at the other end of the scale, Sweden did not experience any closures.

The report also shows that revenues fell by nearly a third (32.9 per cent) across Europe, from the highest ever recorded level of €28.2bn in 2019 to €18.9bn in 2020.

Again, the UK was hit hardest, with Nuffield, Virgin and The Gym Group reporting falls of 46.5 per cent, 47.7 per cent and 50 per cent respectively, versus Basic-Fit (26.8 per cent), RSG (23 per cent) and SATS (18.5 per cent).

Deloitte found that the top 15 European fitness operators by themselves, achieved total revenues of €2.6 billion in 2020.

The total number of fitness clubs declined by only 1.4 per cent in 2020 to 62,775 – a relatively small loss, considering pandemic lockdowns forced clubs to close for an average of between 40 to 50 per cent of their operational days during the year.

This robust result is attributed both to the high levels of government support received by the sector and also operators’ ability to raise funds to support their balance sheets.

Among the other key findings in the European Health & Fitness Market Report is that the confidence of investors in future growth opportunities within the fitness sector remains high. “This is demonstrated by the large sums that were invested in the various segments of the fitness ecosystem during 2020 and early in 2021, both in existing companies and start-ups, both online and offline.” say co-authors, Karsten Hollasch and Herman Rutgers.

Mergers and acquisitions
In spite of the pandemic, and in some cases because of it, 2020 was a busy year for mergers and acquisitions across the European health and fitness market, with 16 M&A deals reported.

Some were standard business transactions, while others – such as JD Gyms’ purchase of Xercise4Less (see our interview with Alun Peacock on page 42) were the result of them entering administration. The market has also seen six M&D deals already in 2021.

In total, deals saw 835 clubs changing hands in 2020, with 19 Fitness World clubs in Poland being sold twice – once to Pure Gym in January and then out of administration to insurance company, Medicover, in December.

RSG’s acquisition of Gold’s Gym – a major coup for the European operator and one which has given RSG global reach – was not counted, as at the time all Gold’s Gyms locations were outside Europe, although RSG has wasted no time in bringing the Gold’s brand to Europe, with a major new flagship having opened on 4 June in the German capital. Watch out for our interview with RSG CEO, Rainer Schaller, in the next issue of HCM.

The opportunity going forward
Andreas Paulsen’s comments serve to set direction for the sector when he says: “The COVID-19 health crisis represents a transformative opportunity for our industry. This has led EuropeActive to identify our sector’s foremost goal as becoming a publicly recognised solution for health and wellbeing.

“When considering our recovery post-COVID-19, it’s clear our market opportunities as providers of essential health and wellbeing services are vast...our post-pandemic renewal as a sector should, therefore, focus on how we, individually and collectively, ensure this great transformation.

“Scientific research and evidence are on our side and the rest is very much in our own hands”.

• The European Health & Fitness Market Report is compiled by Karsten Hollasch and team at Deloitte Deutschland, with co-editor, Herman Rutgers and published by industry body EuropeActive.

Buy the report: www.HCMmag.com/EHFMR20

Sign up here to get Fit Tech's weekly ezine and every issue of Fit Tech magazine free on digital.
Gallery
More features
Editor's letter

Into the fitaverse

Fitness is already among the top three markets in the metaverse, with new technology and partnerships driving real growth and consumer engagement that looks likely to spill over into health clubs, gyms and studios
Fit Tech people

Ali Jawad

Paralympic powerlifter and founder, Accessercise
Users can easily identify which facilities in the UK are accessible to the disabled community
Fit Tech people

Hannes Sjöblad

MD, DSruptive
We want to give our users an implantable tool that allows them to collect their health data at any time and in any setting
Fit Tech people

Jamie Buck

Co-founder, Active in Time
We created a solution called AiT Voice, which turns digital data into a spoken audio timetable that connects to phone systems
Profile

Fahad Alhagbani: reinventing fitness

Let’s live in the future to improve today
Opinion

Building on the blockchain

For small sports teams looking to compete with giants, blockchain can be a secret weapon explains Lars Rensing, CEO of Protokol
Innovation

Bold move

Our results showed a greater than 60 per cent reduction in falls for individuals who actively participated in Bold’s programme
App analysis

Check your form

Sency’s motion analysis technology is allowing users to check their technique as they exercise. Co-founder and CEO Gal Rotman explains how
Profile

New reality

Sam Cole, CEO of FitXR, talks to Fit Tech about taking digital workouts to the next level, with an immersive, virtual reality fitness club
Profile

Sohail Rashid

My vision was to create a platform that could improve the sport for lifters at all levels and attract more people, similar to how Strava, Peloton and Zwift have in other sports
Ageing

Reverse Ageing

Many apps help people track their health, but Humanity founders Peter Ward and Michael Geer have put the focus on ageing, to help users to see the direct repercussions of their habits. They talk to Steph Eaves
App analysis

Going hybrid

Workout Anytime created its app in partnership with Virtuagym. Workout Anytime’s Greg Maurer and Virtuagym’s Hugo Braam explain the process behind its creation
Research

Physical activity monitors boost activity levels

Researchers at the University of Copenhagen have conducted a meta analysis of all relevant research and found that the body of evidence shows an impact
Editor's letter

Two-way coaching

Content providers have been hugely active in the fit tech market since the start of the pandemic. We expect the industry to move on from delivering these services on a ‘broadcast-only’ basis as two-way coaching becomes the new USP
Fit Tech People

Laurent Petit

Co-founder, Active Giving
The future of sports and fitness are dependent on the climate. Our goal is to positively influence the future of our planet by instilling a global vision of wellbeing and a sense of collective action
Fit Tech People

Adam Zeitsiff

CEO, Intelivideo
We don’t just create the technology and bail – we support our clients’ ongoing hybridisation efforts
Fit Tech People

Anantharaman Pattabiraman

CEO and co-founder, Auro
When you’re undertaking fitness activities, unless you’re on a stationary bike, in most cases it’s not safe or necessary to be tied to a screen, especially a small screen
Fit Tech People

Mike Hansen

Managing partner, Endorphinz
We noticed a big gap in the market – customers needed better insights but also recommendations on what to do, whether that be customer acquisition, content creation, marketing and more
More features