Australian fitness chain Goodlife Health Clubs is launching a revolutionary new “studio-in-club” model that is significantly increasing revenue per square foot compared to traditional gym operations.
The vertical integration of HYPOXI studios into a number of Goodlife Health Clubs across the country is delivering high return on investment, while also broadening the brand’s product offering and meeting consumer trends.
According to Goodlife Health Clubs CEO, Greg Oliver, the company has been able to diversify and de-risk its revenue streams with HYPOXI’s simple, yet highly profitable business model.
“By repurposing underutilized and poor-returning areas into HYPOXI studios, we have seen material improvements in overall club revenue performance,” he said. “The studio-in-club model is providing significantly better returns on investment per square [foot] than we have netted from subletting office or retail space to external businesses.”
HYPOXI is a low impact-exercise method that uses advanced vacuum and compression technology to activate the body’s natural ability to burn specific areas of fat and cellulite. Goodlife acquired the exclusive distribution rights for HYPOXI in Australia and New Zealand in 2014, and now oversees the network of 75 owned, licensed and franchised studios.
“Since opening our first HYPOXI studio, Goodlife has rolled out 12 HYPOXI studio-in-club concepts, with another four due to open before the end of this financial year,” Oliver said. “It is a capital-light, low-cost operation that can be easily incorporated without the need for labour-intensive alterations.”
Oliver acknowledged that the rise of specialized health and fitness offerings had changed the landscape for full-service gym operators both in Australia and the US. “The studio-in-club concept presents an opportunity to leverage the growing interest in tailored fitness solutions, while continuing to differentiate ourselves in the market,” he said. “It is just one of many strategic pillars we are using to insulate the Goodlife brand from the competitive nature of the industry – including our ongoing conversion to 24/7 access and digital innovation. HYPOXI has allowed us to broaden our appeal to people who have previously struggled with traditional fitness regimes. And the recent introduction of membership options, in addition to session and package prices, have also made HYPOXI – marketed as a premium product – more affordable and accessible.”
Oliver noted that the studio acted as a lead generator and gateway for the health club. “Approximately 80 percent of clients will also hold a gym membership, and for those who don’t, HYPOXI is a fantastic stepping stone for anyone intimidated by mainstream gym settings,” he said. “This can be credited to HYPOXI’s results-oriented approach, which provides the confidence boost many people need before joining the gym.”
HYPOXI is continuing to roll out its franchise model to independent studio owners and health club chains across Australia. It recently launched its franchise network in the U.S. with the opening of two studios in Phoenix, Arizona.
“Based on the success of the studio-in-club concept, we see this model as a fantastic opportunity for players in the U.S. fitness industry to improve returns and broaden their appeal, as Goodlife has done,” said Oliver.
Press release contributed by HYPOXI.
