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AMA RESEARCH Market Report : Fitness Equipment - UK July 2003 .

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Brief Description

AMA Research have recently published the fourth edition of 'The UK Fitness Equipment Market' report. This 90+ page report covers both the commercial and home markets for cardiovascular and strength training fitness equipment. Giving an up to date and comprehensive review of the market, the report should be of interest to manufacturers, suppliers and retailers of fitness equipment, as well as current and potential operators of major fitness facilities.

Areas covered in the report include:-

THE MARKET - market size, trends and influencing factors for home and commercial markets.

PRODUCT MIX - mix between different types of CV and strength training equipment, product trends and developments.

SUPPLIERS - key suppliers and market shares, company profiles.

DISTRIBUTION - key distribution channels and shares.

The fitness equipment industry has continued to enjoy high growth rates over the past two years, reaching a market value of over £250m MSP in 2002. However, the rate of market growth is expected to slow down considerably in the near future, as the market approaches maturity.

Executive Summary

The overall UK fitness equipment market as a whole has been experiencing significant growth in recent years, although the rate of growth has slowed down since 2001.

The market is anticipated to continue to achieve significant growth rates up to the year 2006, although the rate of growth will decrease further as the market approaches maturity. Estimated to be around £258m msp in 2002, total market value is forecast to grow to around £353m by the end of 2006.

Factors such as increased public awareness of health and fitness issues, expansion in the private club sector and investment in Local Authority facilities, together with increased sales and marketing activities of equipment suppliers and club operators are helping to stimulate market growth.

The main factor contributing to a slowdown in growth rates has been the increasingly competitive environment within the private health club sector, which has resulted in consolidation among major players and a slower rate of health club expansion, and led to supplier profit margins coming under pressure.

The commercial market sector is estimated to account for around 65% of the market, with growth rates having generally been higher than in the home fitness sector over the last few years. Key drivers underpinning growth in the commercial sector have been the continued expansion among the larger private club operators, investment in refurbishing local authority leisure and sports centres and growth in the corporate health and fitness sector. Other important contributory factors have been the increased emphasis on development of niche market segments and the high interest among customers in added value services. Significant product development in conjunction with new exercise trends has also stimulated demand for fitness equipment.

The trend towards CV equipment, which has been a key feature of the market as a whole during the 1990s, has continued. However, there has also been a marked resurgence in the use of strength training equipment, in part due to the increasing numbers of women recognising the benefits of weight training in conjunction with dieting. A general trend towards natural movement and low impact exercise equipment has stimulated demand for products such as 'air resistance' machines and cable based strength systems.

It is estimated that CV equipment accounts for around 60-65% of the market by value. Key driving factors include the increasing popularity of the elliptical cross-trainer and demand for other low impact equipment, the application of interactive software and electronics technology to exercise machines. Demand for treadmills and bikes is still strong, while demand for rowers has remained relatively stagnant and stairclimbers/steppers have decreased in popularity.

There has been constant improvement to suppliers' branded support and service packages, as customer expectations have been raised. Service packages typically include equipment/instructor training, marketing support, layout & design services, finance options etc, while customers now expect the support package to include extended warranties and 7 days a week on-site emergency repairs, with equipment being repaired within 48 hours. There has also been a higher emphasis on refurbished equipment, with some manufacturers now supplying certified reconditioned equipment directly to customers.

The market leader in the commercial fitness equipment sector is Life Fitness UK followed by Technogym UK, Pulse Fitness, The Nautilus Health & Fitness Group UK, Powersport, Precor UK and Cybex International UK. Other suppliers with important market shares include Physique, Star Trac UK and Concept 2. In the last two years, the market has become even more fragmented, partly as a result of overseas manufacturers terminating their existing distribution agreements in favour of setting up wholly owned subsidiaries, but also as a result of new entrants to the commercial market.

Imports dominate the fitness equipment market, with an estimated 70-75% of total sales in the commercial sector made through importers or subsidiaries of foreign manufacturers. Sales within the commercial sector are typically directly to the customer, with only a small percentage being sold through specialist retailers.

The market for home fitness equipment has also been experiencing buoyant growth, although growth rates have fallen slightly since 2000, mainly due to strong growth and increased competition at the budget end of the market, leading to lower prices. Further growth is forecast during the next 3 years, although average growth rates are expected to slow down further, underpinned mainly by the impact of the slowdown in the world economy on consumer confidence.

Factors that have stimulated domestic market growth over the last few years include increased awareness of health and fitness issues, improvements in equipment design and performance and the increasing physical activity among certain user sectors, e.g. the over 50s, who value privacy and convenience. The boom in health and fitness club membership in recent years has also stimulated demand for home fitness equipment.

Exercise bikes continue to be the most popular product type of equipment although elliptical cross trainers and strength training equipment have also been experiencing strong sales growth in the home fitness sector.

In the home fitness equipment market, imported brands are even more dominant than in the commercial sector. Although many of the key brands, such as Reebok, Weider and Golds Gym are US-owned, some European products also have a high market profile, notably Tunturi and Kettler. The main suppliers in this market are either direct subsidiaries such as Icon Health & Fitness and Kettler GB or independent distributors e.g. Bolton Stirland, Style Fitness and CSA Fitness. York Barbell is the only large player with manufacturing facilities in the UK. Some of the key suppliers in the commercial fitness equipment market also supply into the home fitness sector including Cybex International UK, Precor UK, Life Fitness and Star Trac UK.

An estimated 40-50% of products in the home fitness equipment market are sold through catalogue shops or by mail order. Typically, it is budget range equipment that is sold through mail order, while premium priced equipment is mainly supplied through specialist fitness equipment retailers and sport goods stores.

A number of factors such as economic, socio-economic and demographic issues influence the development of the home fitness equipment market. The most significant of these include the population age structure, participation rates in sports generally, health and fitness awareness campaigns, level of construction of leisure facilities and consumer disposable income and expenditure. All of these factors are likely to have a positive influence on the future development of the UK home fitness equipment market.

Table of Contents

Tables and Charts

Text © 2003 AMA Research

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Last updated by Amanda Porteous 2003