Executive Summary

In 1999, the British spent £3.35bn on the cost of participating actively in sport and keeping fit.

Private health clubs took an estimated £600m of this spending. This figure has overtaken the sum spent on admissions to public leisure centres, where fitness facilities are increasingly available.

Fitness for fitness' sake has taken over from sports and games for many consumers. By the beginning of 2000, 11.1% of adults in the UK were claiming to do some form of weight training or working out.

Spending on private clubs has doubled since the mid-1990s, partly because of the rush to invest in multiple groups of these clubs, either by start-up companies listed on the Stock Exchange or by large leisure and hotel groups. In total, there are over 3,000 clubs, but the majority are small, traditional private gyms, and the rapid market development has been among larger health clubs offering luxury facilities to young professionals.

The David Lloyd Leisure group set the standard for large sports and fitness clubs in the early 1990s. It was bought in 1995 by Whitbread, now a major catering and leisure group (having sold its breweries in 2000). Other leisure companies, some from the brewing sector, have emerged as large health club specialists, including Cannons, De Vere and Esporta.

Hotel owners such as Whitbread, Hilton Group (owner of LivingWell) and Forte (part of Granada Group) have been major developers of health clubs. In addition, fitness suites are provided by many large employers, usually run under contract by companies such as Tweedpark or Spirit@Work (Granada Group).

Specialists such as Holmes Place and Fitness First have taken the lead in buying up health clubs outside the UK, taking advantage of the market maturity here. This should help the companies to spread their risk, although saturation in the UK is some years away, and spending on health clubs is expected to keep rising for another 5 years.

The growth of private health clubs will continue to detract from the UK's network of 1,600 leisure centres, which are owned by local authorities but sometimes managed by private companies. However, the centres are now central to local leisure provision, and they have been adapting to changing demands, installing more sophisticated fitness equipment.

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