Business Essay Example: Gold Gyms Overview and SWOT Analysis

Business Overview

Established in 1965, Gold Gyms has grown into one of the most iconic fitness enterprises in the US. The business established itself in the fitness industry prior to the emergence of the contemporary health clubs, a factor that has without any doubt helped it become one of the most recognizable brands in the industry (Gold's Gym, 2016). Starting from 1980, Gold Gyms adopted the franchising strategy, a move that has helped it expand its presence across the US as well as other countries around the world. Currently, the business operates in 38 states in the US and has a presence in more than 20 countries. This has seen the number of customers served by the gym increase over the years to currently stand at over 3 million clients (Gold's Gym, 2016). Apart from changing in terms of business strategies over the years, the company has also been changing in terms of equipment, amenities and training programs. This has been largely in response to the changing market trends and conditions, a factor necessitates continual evolution of the businesss profile (Gold's Gym, 2016).

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Apart from the health club facilities, the enterprise also makes and markets its own apparels through its Pro shops. The successful efforts to refresh Gold Gyms brand have seen it become a force to reckon with both in the domestic and international market. Recently, the franchise emerged tops in the J.D. Power Health and Fitness Center Satisfaction Report. It was particularly recognized for its outstanding performance in safety, cleanliness as well as equipment condition (Stromgren, 2016). However, the company continues safe stiff competition from the many players that have emerged in both the domestic and international markets. This report analyzes the business marketing situation, highlighting the prevailing conditions in the industry

SWOT Analysis

This is a framework used by business entities to identify the internal and external strengths and weakness as well as the opportunities available to the business and the potential threats

Strengths

Reputable brand name-Gold Gym is well known both within America and in other countries where it has operations

Strong management- The company boosts of a properly skilled management team that allows it to properly coordinate all its programs

Presence in many locations- The business is present in over 30 states in the US and more than 20 countries around the globe, allowing customers to access the same services even when they are away from their home-town gyms

Numerous amenities and programs- this allows customers to freely use the facilities and equipment without having to struggle with other clients seeking the same services. Availability of many different programs tailored made to meet specific customers needs means that client can never fall short of finding what is the most appropriate program.

Informative and up to date website- The Companys website has all the important information that both the new and old customers will find useful. This includes the companys history, programs as well as facilities located near the clients

Weaknesses

The business receives many clients leading to crowding in most facilities. This often scares away potential customers

The sophistication in terms of the businesss profile, fitness programs and quality of services often intimidates new customers who think the franchise charges huge fees

Increasing turn-over rates of customers.

Limited accountability among employees which has on a number of occasions served to tarnish the businesss strong reputation

Opportunities

Emerging markets and increased demand for fitness services in other developed countries offers a great opportunity to increase the number of facilities and the businesss overall global footprint

Innovations in the fitness industry offers an opportunity to increase the number of programs

Technological advancements offers the business the opportunity to come up with and incorporate new techniques for customer engagement

Threats

Increased competition from other firms offering similar services such as PlanetFitness and Crunch Fitness

Economic slowdowns which threaten to limit consumers spending on things that are not very necessary such as keeping fit

Increased availability of cheap alternatives to gym services such as home trainers

Market Analysis

The number of people heading to the gym has been increasing over the years, with estimates indicating that one out of five people in America is enrolled to a gym program. This is as a result of the increased awareness the people of the importance of staying fit as means of enhancing the quality of life. A large population of overweight and unhealthy individuals is now seeking to get fit in a bid to counter lifestyle disorders such as obesity and cardiovascular disorders. In terms of structure, many consider the fitness industry to include weight loss centers as well as fitness centers such as gyms. The current analysis focuses on the fitness centers in which Gold Gyms is part of.

Industry Facts and Figures

As of 2014, the total number of fitness centers around the world was estimated to be 180,000 (Franchisehelp, 2016). These centers are said to have had around 145 million members, generating combined revenue of $84 billion. In America, the 2014 statistics indicate that more than 54 million people paid membership fees to gyms, with the average time that each member visited the gym being 100 times (Franchisehelp, 2016). Compared to 2008, gym enrollment has increased by 18.6% with the trend expected to grow in 2015 and the subsequent years. The number of fitness centers is said to have significantly increased within the same period, hitting the 34,000 mark in 2014 (Franchisehelp, 2016). The total revenues that the fitness centers earned in the US in the same year were $24.2 billion and the total number of people they employed was 533,200. Growth in terms of revenue as well the number of people the industry employs is expected to show a positive trajectory moving forward, with the number of new jobs created by the industry expected to increase by 8% by 2024 (Franchisehelp, 2016).

Market Trends

The global fitness industry has been experiencing steady growth over the past few years, with programs such as personal training, free weight training, senior fitness programs and body-weight resistance programs reporting the fastest growth rates (ACE Fitness, 2016). Additionally, small group training, Boot-camp style training, functional style training as well as HIIT group exercise classes are reported to have attained a high level adoption in the industry and look set to maintain an above average growth (ACE Fitness, 2016). In terms of technology, the market trend reports show that many players have intensified their utilization of social media, making it the only technology that has been properly adapted in the industry. It is reported that many players in the industry have not embraced technology as a way of enhancing customer experience and attaining higher levels of productivity and efficiency (ACE Fitness, 2016). Technological opportunities that show signs of gaining popularity in the coming few years include virtual training, online registration of members and making of reservations, club mobile applications as well as online pricing transparency (ACE Fitness, 2016).