The 2021 IHRSA Global Report takes a deep dive into the COVID-19 pandemic’s impact on the fitness industry and its current path to recovery.
Only 15 months ago, one in three health clubs, gyms, and studios were closed worldwide. The 2021 IHRSA Global Report examines the pandemic’s impact on an industry whose mission is to promote and safeguard health.
Regional analyses of leading global markets show that while 2020 is behind us, the impact of the pandemic continues as club operators and professionals aim for industry recovery.
In the U.S. and Canada, closures lasted through the first quarter of 2021 in many states, provinces, and other jurisdictions. Last year, mandated restrictions allowed open clubs to operate outdoor-only and at 50% max indoor capacity in most parts of the region.
By year-end, 17% of gyms and fitness studios closed as the industry collectively lost 58% of revenue relative to 2019. According to the Fitness Industry Council of Canada, once fitness facilities opened in the Great North, they operated at approximately 50% of revenues. Much like the U.S., many clubs in Canada filed for bankruptcy.
The vast majority of fitness clubs in North America were allowed to open with fewer restrictions by mid-year 2021. However, industry damage continued as the number of closed facilities ballooned to 22% of all pre-COVID U.S. health clubs by the end of June. In the same month, Canada’s national health and fitness day was restricted to outdoor and home exercise only.
Clearly, the impact of the pandemic on the North American fitness industry will be reflected in 2021 performance, which may not be quantified until early 2022.
The top Latin American markets encountered prolonged shutdowns, some continuing into 2021. Clubs in Mexico, Argentina, Colombia, and Chile were closed for several months. Brazil had regional closures in many parts of the country. In Peru, where closures dragged on into 2021, experts estimate that 30% of brick-and-mortar fitness businesses have closed permanently.
At the mid-year mark, the fitness industry in South America continued to struggle with new gym closings and delayed reopenings. At press time, clubs in Chile, Argentina, and parts of Brazil are contenders with another series of shutdowns as clubs in Peru continue to be closed.
“The short-term prospects are not good, since the region is entering the cold months and the pandemic is expected to hit even harder,” said Guillermo Velez, editor and director of Mercado Fitness. “Undoubtedly, Europe and the United States show us the light at the end of the tunnel, although we know that, unfortunately, many gyms [in South America] will not be able to survive the winter.”
With the exception of Sweden, multiple waves of shutdowns across the EMEA region afflicted leading markets in 2020. Publicly listed companies felt the impact of the pandemic:
Basic Fit’s clubs in Benelux, Spain, and France encountered a decline in membership of 5% in 2020 as revenue dropped by 27%,
Nordic-based SATS saw membership fall by 9% while revenue decreased by 10%,
Saudi operator Leejam lost 6% of members and 30% of revenue, and
The UK’s Gym Group saw membership and revenue drop by 27% and 47%, respectively.
The 2021 European Health and Fitness Market Report details the impact of COVID on three key markets:
Germany: revenue fell by 25% as membership decreased by 11.6%,
UK: revenue plummeted by 52% while membership dropped by 20%,
Spain: revenue and membership declined by 43% and 22%, respectively.
Late 2020 closures across most of the European Union lingered into the second quarter of 2021. By June, Europe reopened for clubs with fewer restrictions. Time will tell the added impact in closures and membership loss the European fitness industry encountered in 2021.
Initially the model (and envy) of pandemic management and recovery in 2020, the Asia-Pacific region is contending with challenges due to a new wave of cases at press time. In early 2020, fitness club closures were brief in China, Japan, and South Korea. Closures lasted several months in Australia and India last year.
By mid-year 2021, most of the Asia-Pacific region struggled with a resurging wave of COVID cases. India recorded daily cases topping 400,000 for nearly two weeks in late April to early May, obviously affecting a shutdown of business. Cases also rose in parts of Southeast Asia. A delay of the Olympics and absence of spectators hampered Japan’s fitness and sports economy. Australia’s major metros mandated sporadic closures as the vaccine rollout progressed slowly in the face of the new delta variant.
Perhaps the only bright spot in the Asia-Pacific region was China, where club closures were brief, lasting no more than two months.
“Our post-COVID business rebound in mainland China has been very encouraging, said Colin Grant, co-founder and CEO of PURE Group, which has 30+ clubs across South Asia. “We’re seeing strong daily check-ins across many of our yoga studios and fitness centers, while our lead-generation and referral- marketing channels are doing particularly well. We believe the integration of wellness into mainstream society has accelerated, with health and fitness moving to the top of the priority list.”
Fitness clubs and studios have a clear, critical role to play as wellness becomes top of mind for consumers. The long-term future outlook for the industry is bright. With the vast majority of global fitness clubs now open, the Global Report reminds us that good momentum at the mid-year mark cannot undo the enduring industry damage caused by the pandemic.
Melissa Rodriguez is a Market Research Advisor for IHRSA. When she's not analyzing data and statistics, Melissa enjoys spending time with family, watching superhero series, poring over NBA and NFL box scores, and reading a good book.
