How the fitness sector may be different and never be the same again - and why this may not be all bad news. Interview with Herman Rutgers.
Herman is co-founder of EuropeActive and FIBO Ambassador. He is an international executive armed with 45 years of experience in managing international businesses, twenty-five of which have been in the global fitness industry, both on the manufacturing side as well as the operator side.
FIBO: Most European countries are still deep in lockdown, but a few are beginning to exit. Why could exiting from lockdown for fitness be more complicated than entering it was?
Entering was relatively simple as it was mandated at very short notice by the authorities and happened within 24 hours. However, given the complexity of the issue, European authorities need to develop detailed plans to reopen their economies and at the same time secure people’s livelihoods well before easing lockdown restrictions. EuropeActive has produced materials to support operators in these difficult times and will from a pan-european point of view support operators and national associations in their public policy activities with advice on designing reopening protocals and sharing best practices from around the world with articles on the special website and weekly webinars with valuable advice for the operators during lockdown and for reopening strategies. These should be well thought out and clubs should not open too soon, and only after official approval and following the strict protocols that will be needed.
FIBO: What do clubs need to consider in terms of their business plan when they open again?
When we open again for business we need to realize ourselves that the world will be in a severe recession and companies will be in a crisis mode for the foreseeable future. Companies will have to focus less on growth per se, but more on stabilizing their business, obtain again profitable growth, work with more conservative balance sheets and improve cash flow. Companies will have to work with somewhat larger reserves for doubtful accounts/uncollectables and pay more attention to costs, the fixed versus variable relationship will be more critical.
FIBO: Do business models need to be rethought?
Business plans for 2020 and beyond will have to be revised; short and long term strategic reviews need to take place. Some operators have dealt with this crisis situation very well and gained sympathy and brand loyalty; others lost it. In any case, the biggest impact is that digitisation will play a major role; it was accelerated by the lockdown.
FIBO: How can hygiene concepts look like?
No physical contact, “the 1,5 meter economy”, no handshaking (“namaste”), use of masks, cleaning of touch points, of machines will be our daily routine. Due to more frequent cleaning and the use of disinfectants, operators must be prepared for higher cleaning and hygiene costs. The clubs need to re-arrange machine layout to ensure distancing, and staff will need to be trained in the new “sanitized” normal. Also in the phase 1 of reopening locker rooms, showers will probably have to stay closed and group exercise rooms will be forced to limit their capacity and clients will need to book their visits to the club in order to ensure capacity controls.
FIBO: How will the lockdown affect fitness consumers?
This is the biggest question – will the consumer have trust and confidence in going into a confined space and sweat with other people in a group? Will the consumer go back to his/her “pre-corona” fitness routines? Recent consumer research in the USA and experience in China tells us that we can be hopeful in this respect!
Many consumers will have experienced for the first time home fitness during lockdown and may like it and want to continue using online fitness. The good news is also that many consumers have in the closed period intensively used the apps and the online exercise opportunities and started to use more functionalities, like nutrition and relaxation advice. It is also expected that consumers will be more price sensitive. But the crisis is also a great opportunity for the entire fitness industry. People have developed a higher awareness for the health benefits of fitness; “Exercise is medicine”. And will appreciate the social aspects of the sector more. Fitness will get even more support, more fans, in the future, I am sure.
FIBO: What does the fitness sector look like after Corona?
To answer this question, let me remind us all of the famous words from Charles Darwin; “It is not the strongest, nor the most intelligent of species that survives, but the one that is most adaptable to change”….
Like in any deep crisis, there will be winners and losers, sadly some companies will not survive this period, but the ones that are best in adapting to the new world will get through and maybe come out even stronger! The future of our sector after corona is very difficult to predict today. For sure it will not be black or white….what tone of grey it will be will depend in which country you are and in what kind of segment of our sector. One thing is for sure; it will not be business as usual….