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Australia's billion dollar gym industry
Australia’s gym industry is booming – with revenue reaching the billion-dollar mark.
The industry is worth roughly $1 billion, according to IBISWorld’s Gyms and Fitness Centres report, and is projected to continue growth throughout the 2015-2016 financial year.
“[I]ndustry growth has been largely stimulated by the advent of budget 24-hour gym chains, which have grown exponentially over the past five years as consumers have been attracted to their affordability and accessibility”, said David Whytcross, IBISWorld Industry Analysis.
However, are Australians’ credit card balances suffering?
Health awareness sees gym popularity increase
Health awareness has soared over the last five years, with weight loss reality television shows such as The Biggest Loser, just one example of the fitness trend infiltrating popular culture.
IBISWorld noted that the nation’s obesity levels continue to increase, yet more and more Aussies continue to embrace the regular routine of pumping iron.
There has been a surge in the number of budget, 24-hour gyms, which boast affordable plans. For those wanting a flexible and budget friendly exercise option, these kinds of gyms are incredibly appealing.
However, the market has reached saturation, with an extensive selection of 24-hour, full-service and women-only gyms. This could lead to further competition in the industry, which could help drive down prices for consumers.
Are consumers getting a good deal?
Despite an increase in the number and variety of gyms across Australia, there are concerns about the real costs of gym membership.
“Consumers have become more price-conscious,” IBISWorld reported.
But despite this apparent focus on getting the best deal, New South Wales’ Fair Trading department has issued a measured warning.
“Joining a gym can be costly, so don’t be pressured into signing up on the spot,” said Matthew Mason-Cox, NSW Fair Trading Minister.
Just as consumers shop around for home loan and credit card deals, they should also adopt the same approach when it comes to locking in a gym membership.
Mason-Cox advised Australians to find gym agreements that are best for their individual needs, as well as cost effective. One option is to sign up for a short-term membership, to see if the gym habit will stick. Another is to sign up to pay-as-you-go agreements so that you don’t find yourself trapped in a long-term contract.
“Be wary of special deals and promotions offered in a verbal sales pitch. Put any changes in writing as proof of what has been agreed and understand that by signing a contract, both parties are agreeing to all the small print,” Mason-Cox stated.
During the 2013/14 financial year, the Fair Trading department received the largest number of complaints about health clubs and gyms in three years – a total of 456.
Whatever agreement you opt for, make sure you observe when payments are due. Using your credit card to make payments is good for your credit rating, provided you make your credit card repayments on time. Otherwise, an automatic payment could be a better way to manage the costs.
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Disclaimer
This article is over two years old, last updated on August 26, 2014. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent credit cards articles.
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