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Summarised: State of the Fitness Industry 2023 Report

In the dynamic world of fitness, staying abreast of industry trends is crucial for understanding the evolving needs and preferences of health-conscious individuals – your current and future clients. The recently released State of the Fitness Industry 2023 Report delves into a comprehensive analysis of the World’s fitness landscape, offering valuable insights into the current state of the industry and its future trajectory.

In this blog post, we’ll delve into some of the key facts and statistics outlined in the report, accompanied by our insights and interpretations of the findings.

Our Thoughts:

Coming soon.

Key Takeaways

In order to better understand the current state of the fitness industry, Two-Brain Business conducted a survey of 13,444 gyms worldwide. The survey collected data on a variety of topics, including gym ownership, revenue, marketing, and staffing. Here are some of the key facts:

Clients

The average microgym has 159 members. This number has been increasing steadily over the past few years, with a 3.2% increase from 2022 to 2023.

Marketing

To succeed in today’s competitive fitness industry, gyms must continuously innovate their marketing strategies.

Marketing Strategies for Gym Success

While paid ads aren’t essential, gyms that use them tend to be more profitable.

Client Retention

Revenue

Gym revenue varies throughout the year, with December typically being a challenging month and January offering a boost. The average monthly revenue from Wodify in four different regions is:

Group Training

What Are Gyms Selling?

Classes & Attendance

Average Class Size

Attendance Patterns

Wodify supplied detailed tables showing very clear attendance patterns.

Personal Training

Nutrition Coaching

Online coaching

Supplements

Kids Classes

Hybrid Programs

Uncoached Access

Percentage of Revenue

Client Retention

Length of Engagement (LEG)

The average length of engagement (LEG) in the fitness industry is 7.8 months. However, Two-Brain clients have an average LEG of 20.7 months. This suggests that Two-Brain gyms are doing a better job of retaining clients than the industry average.
It is important to note that these cancellation rates are percentages of active users, so they do not necessarily reflect the overall churn rate for Wodify. The churn rate would also take into account new users who signed up during the same period.

Importance of LEG

LEG is an important metric because it reflects whether a gym is actually changing clients’ lives. If clients only stay for a few months, they may not have enough time to develop new exercise and nutrition habits that will last a lifetime.

Factors Affecting LEG

LEG is highest with personal training clients, followed by semi-private training clients and group training classes. LEG tends to decrease as the number of clients per class increases.

Benefits of Longer LEG

Longer LEG is good for business because it means that gyms don’t have to spend as much money on marketing to replace departing clients with new ones. The table shows the percentage of Wodify users who cancelled their memberships in each region, by month.

Expenses

Monthly Expenses for Gyms

Gym expenses are on the rise, with an average increase of $3,617 per month from 2022 to 2023. Access gyms have the highest monthly expenses, followed by CrossFit gyms and Other gyms.

Gym Size Trends

The average square footage of gyms has decreased from 5,220 to 4,899 square feet from 2022 to 2023. This suggests that gyms are becoming more efficient in their use of space.

Access gyms have the most space on average, with 6,906 square feet. Personal Training gyms have the least space on average, with 3,199 square feet. This suggests that Personal Training gyms are likely focusing on more specialized services that require less space.

Real Estate Strategy

Building ownership is not always a key indicator of business success for gyms.

Business Debt

37.2% of gym owners reported no business debt in the survey, up from 42% in 2022. This suggests that gyms are increasingly finding ways to operate without taking on debt.

Staff

Gym Staffing

The average gym has 12 team members, according to PushPress, and 8 team members, according to TeamUp. However, it’s important to note that the definition of “full-time” can vary in the fitness industry.

Full-Time Staff

Part-Time Staff

Cost of Coaching

Highest-Earning Staff Member

Owner Benefit

Net Owner Benefit (NOB)

Median monthly net owner benefit for all gym types increased from $3,787 in 2022 to $3,967 in 2023. This is an increase of $180.

Effective Hourly Rate (EHR)

In general, your time should be worth more as an owner than it would be as a coach.

Net Owner Benefit and Mentorship

Gym owners who work with a mentor are more likely to earn a higher income than those who do not. This is true across all income levels, but the effect is most pronounced for gym owners who earn $6,000 or more per month.

How Many Hours Per Week Do Gym Owners Work?

Gym owners who work 20-40 hours per week are the most likely to be profitable.

The Importance of Working Smarter, Not Harder

The data suggests that gym owners should focus on working smarter, not harder. This means optimizing output in the time you have instead of working as many hours as possible. This could involve delegating tasks, automating processes, or focusing on high-value activities.

Profitability by Facility Size

Profitability by Years in Business

The Fitness Industry

Average Cost to Open a Gym

Business Partner

Mergers and Acquisitions

Business Coaches

Gym Owners Working With A Mentor

Gym Owner Willingness to Sell

CrossFit Approval

The data shows that CrossFit HQ’s approval rating among CrossFit affiliates is on the rise. In 2023, 89.7% of gym owners in the CrossFit category who are currently affiliated feel confident about the future of the brand. This is up from 71.9% in 2022.

Here is a breakdown of the data by respondent type:

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