An active sport regulation was introduced after the World War II when governments of the European countries realised the benefits that mass sport could provide. The initial practice of subsidising sport clubs was then replaced by an increasing interest in sport as a sphere of public regulation and the accents moved to the promotion of physical activity. The market realised the commercial opportunities of providing sport services and, as a result, during the last decades, non-profit sport clubs found themselves under significant pressure of commercial sport providers, namely fitness and health clubs, bowling centers, and commercial swimming pools.
The growing impact of commercial sport clubs is partly associated with the global success of the fitness sector. During the last decades, a considerable increase in the range of services offered by fitness centers was observed as a majority of fitness clubs were transformed from bodybuilding and weight lifting clubs into full-range service centers providing fitness, cosmetic, wellness and mental procedures. Mass sport has grown from a monopolistic market controlled by sport clubs into a fast growing and competitive industry. However, even in this competitive industry, integration of supply chain and vertical mergers can potentially lead back to monopolisation of the industry.
According to Leisure DB’s report on the UK fitness industry (2015) shows that the number of fitness facilities increased by 4.6% in 2018 and total membership in fitness clubs expanded by 2%. The total market value of the fitness industry in the UK has reached £4.9 billion.
Three major providers of the mass sport today are non-profit sport clubs which mainly represent voluntary or civic sphere, sport authorities representing the state sphere and commercial fitness clubs that represent the market sphere. The three spheres are distinct enough in their features such as their purposes, management as well as financial and labour resources. While the majority of non-profit sport organisations are either subsidised or sponsored to create opportunities, enlarge sports involvement and advance the “Sport for All” principle, commercial clubs, on the contrary, cannot enjoy such a variety of financing sources normally having only revenues from sales of their services.
The fitness industry has both direct and indirect effects on the economy of the country. The measure of the direct contribution to GDP is the value added (VA) which is the output adjusted for the value of intermediate inputs. Industry VA can be estimated by aggregating the outputs of the primary factors of production, capital, labour that contain gross operating surplus (GOS) plus taxes minus subsidies. The industry VA in the value chain can be taken into account avoiding the issue of double counting.
The indirect effect of the fitness sector on the economy is seen in the relationships between fitness centers and their suppliers and services they consume. For example, in case a fitness center needs repairs, the contractor receives income, its workers obtain wages and these income and wages are spent on expansion of GDP. Adding to this, fitness centers reduce direct spending on health care, illness averting and health popularisation, which provides significant benefits to the labour force by increasing participation and productivity.
Since competition entails innovations, the sphere of commercial fitness is frequently called the most rapidly developing sector of the sport area. In addition to the continuing progress of new training facilities, practices and equipment, the appearance of low-budget fitness clubs has become the next step providing, unlike full service centers, minimal sets of basic services at lower prices. As in many competitive and growing markets, organisations need to constantly innovate to secure their positions in the industry, and the growth of competition will lead to a more diverse set of services for consumers of the fitness industry.
Anna Clarke is the owner of online writing company 15 Writers. She is a successful entrepreneur with over 20 years’ experience in both freelancing and academic writing industries, specialising in Business, Economics, Finance, Marketing and Management.