What are the prospects for the fitness industry in China?

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What are the prospects for the fitness industry in China?

According to research conducted by Daxue Consulting, the fitness industry in China expects a great future. Major drivers are the rising disposable income per capita and the increasing awareness of a healthy lifestyle. Since 2011, the number of Chinese gym attendants increased yearly about 4-5 million. Interested in the market trends? Click here to read more about it.

The high-potential market attracted Daxue’s client

Daxue Consulting’s client, a Western fitness club group, attempted to expand their operations to the Chinese market. Therefore, the company contacted Daxue’s research team to carry out a feasibility study for their concept to implement in the fitness industry in Chinaincluding an overview of the market, its key players, consumers, and regulations.As to reach the client’s objectives, the team performed the following steps:

Phase 1: Desk Research

Initially, Daxue Consulting executed an extensive desk research, which is a crucial part of the whole research. The team thereby gained an in-depth understanding of the fitness industry in China by identifyingmarket trends, consumer segments, and their habits, or key market players and their strategies.

Phase 2: In-Depth Interviews

As to confirm, but also to complete the information gathered from the desk research Daxue’s consultants conducted in-depth interviews with knowledgeable experts in the field, such as fitness consultants, managers, real estate offices, law firms, etc. It enabled the team to obtain additional valuable insights ranging from influencing factors to attract consumers to potential entry cities, or risks concerning finance management. Clement Mougenot, Head of Research at Daxue Consulting, explains: “Tier-2 cities are more attractive for a basic offer in the fitness industry in China. A major challenge is the cost of real estate in cities like Shanghai or Beijing. Scarcely any fitness clubs are profitable. Their strategies consist of opening many stores to gain market share but disregarding quality aspects or targeting niche markets with high prices.”

Phase 3: Store-Checks

Furthermore, Daxue’s research team organized gym-checks to ensure the accuracy of prior information as well as to evaluate the different business models and key competitors’ strategies. Through on-site visits, Daxue Consulting could assess various aspects such as the location and equipment, type of customers, services, prices and payment methods.

Phase 4: Feasibility Study

By utilizing the insights from the previous steps, the consulting team could analyze the overall environment of the fitness industry in China. By understanding national and local regulations, strength and weaknesses of competitors, potential opportunities, and risks in the market for the client’s operations, Daxue could finally assess the feasibility of the market entry project, thus announce a so-called Go/No-Go Recommendation.

Daxue’s deliverables enabled the client a smooth entry into the fitness industry in China

As the last step, Daxue Consulting provided the client with a comprehensive business plan including actionable strategic recommendations. The consultants advised the client with detailed steps to enter the market and proposed priorities to count on with regards to location, or tools, for instance. Also, the team suggested potential differentiation strategies. Additionally, Daxue Consulting provided the client with an analysis of the environmental context, such as regulations, and prepared a detailed financial forecast.

See also:

Fitness Center in China: Adapting the Demand of Chinese Consumers

Fitness Industry in China: What are the Trends?

Why Feasibility Study in China?