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by Jon Feld

We’re in the midst of persistent, ongoing, international growth.

According to the International Monetary Fund (IMF), overall global gross domestic product (GDP) should increase to 3.7% this year, up from 3.6% in 2017, with each of the world’s major economies firmly in the growth column.

That growth is reflected in the fortunes of the fitness companies that compose the IHRSA Global 25.

The world’s largest economy—that of the U.S., which accounts for 25% of the global total—boasts the top three entries: Planet Fitness, Orangetheory Fitness, and Anytime Fitness, which, in terms of revenue, achieved growth rates of 21%, 64%, and 16% between 2016 and 2017, respectively. No. 4 on the “Revenue Growth” list is Qingdao Impulse Health Management Co., Ltd., reflecting China’s place at No. 2 in the global economy.

Moving down the list of the top 10 economies, you find Japan, Germany, the U.K., India, France, Italy, and Canada.

Five of them are well-represented—by Konami Sports (Japan); BodyStreet GmBH (Germany); David Lloyd Leisure (U.K.); Keep Cool (France); and Goodlife Fitness (Canada). Only entries from India and Italy are absent.

Power in Franchising
In almost every category, franchisors are among the industry’s leaders. Last year, we mentioned that they were doing well. This year, they’re really blowing the doors off of the current lists.

In fact, of the 53 companies whose metrics provide the basis for the Global 25, 15 are either franchise-based or offer franchises. And while some things look similar on the surface, exploring further tells a bit of a different story.

“Number of Members 2017,” for example, shows a top five that looks much like it did in 2016, which was: (1) Planet Fitness, with 8.9 million members; (2) 24 Hour Fitness USA, Inc., with 3.8 million; (3) Gold’s Gym International, with 3 million; (4) Anytime Fitness, with 2.85 million; and (5) McFit, with 1.4 million. For 2017, the order is nearly identical, with Anytime switching places with Gold’s.

The difference? Planet Fitness grew to 10.6 million (+19.1%); 24 Hour is down, at 3.54 million (-6.8%); Anytime is at 3.54 million (+24.2%); Gold’s is stable at 3 million; and McFit is at 1.73 million (+23.6%).

Fortunately, in the fitness industry, change often equals growth. While Planet Fitness, Anytime Fitness, and McFit had milestone-type growth, 24 Hour was down, and hybrid owned/franchised Gold’s Gym was unchanged. Proceed a little further down the list, and you’ll find that Snap Fitness expanded from 438,536 members in 2016 to 509,642, a more-than-healthy 16.2% increase.

Truth in Revenues
More impactful than member numbers, which are nothing to sneeze at, are the revenues.

For franchise firms, these figures are nothing less than blockbusters. On the “Revenues 2017” chart, Planet Fitness, Anytime Fitness, and Orangetheory Fitness check in at Nos. 1, 3, and 6, respectively. The revenue picture becomes much clearer, though, when you explore the “Top 10 Five-Year Revenue Growth” chart.

No. 1, Planet Fitness, leapt from $211 million in 2013 to $2.3 billion in 2017, a jump of 990%. Orangetheory, No. 2, grew from $28 million to $739 million over the same period, or better than 2,500%. The third entrant, Anytime Fitness, shifted from $799 million to $1.45 billion over the five-year span, an 81% change.

The largest and most entrenched corporately owned players on the chart—Life Time Fitness (from $1.2 billion to $1.59 billion) and 24 Hour Fitness (from $1.3 billion to $1.4 billion)—grew 32% and 11%, respectively.

While both continue to grow—a tribute, given that Life Time Fitness was founded in 1990, and 24 Hour Fitness has been in business since 1983—franchisors hit their revenue strides much more quickly, and, at this point in time, there’s no telling where their ceilings might be.

If franchise companies are benefitting from global growth in the near term, then a rising tide will likely lift all fitness boats. The IMF has projected a global GDP of 3.9% for 2019, with just a minor drop beyond.

Check in next year to see which companies and segments break out in the IHRSA Global 25. In the mean time, visit ihrsa.org/publications to access The 2018 IHRSA Global Report for more on all of these and many other companies.

STIPULATIONS
IHRSA’s Global 25 listings are designed to provide basic information about some of the world’s largest and/or fastest-growing club companies, but they are not definitive. Many of the firms that should appear on these charts do not because they were unwilling or unable to provide all of the information requested by CBI’s deadline. The figures reported were obtained from the companies themselves or from public, published sources, and, in most cases involving major firms, represent the one-year period ending on December 31, 2017. None of the figures, it should be noted, have been independently verified.