Perspective features the opinions of prominent people in the fitness industry. Here, renowned fitness business educator, Thomas Plummer, explains why he believes the US fitness market is so important to the Australian fitness industry.

There are a number of factors that make the US small business market the most unique in the world.
First of all, anyone with an idea can take a chance and open a business. There is little regulation and relatively easy access to funds, so anyone’s dream can quickly become a business.

Secondly, the size and density of population, coupled with intense competition, means that a new business will either succeed or fail in a matter of weeks and months, rather than years. Competition either kills you or validates you.

Thirdly, entrepreneurs in the US are often first in the game with new ideas, or at least in stealing an idea, turning it into a fully capitalised working business plan and getting it into the market faster than anywhere else in the world. The American love of innovation is nowhere better illustrated than in its approach to small business.

So, what does this mean to the Australian fitness industry? It means that, because US successes and failures occur years before anyone else tries the ideas, the Aussie market has a prevision of what might work and what might fail, helping to shape the way in which it plans and runs similar concepts.

You can actually model this out: idea is born – market accepts or denies – accepted businesses move forward – imitators appear – business settles at a specific level – idea slowly fades and is replaced by the next big thing – someone in another country takes the idea and starts the cycle over again.

For example, the 24-hour fitness concept is old news stateside, but for a few years it was the big story in fitness, prompting a rush of imitators to the market, with even the large box players attempting to add round-the-clock access. Now there are only several players left in the game, and, because it was so easily copied, it no longer has a competitive edge in the market.
Low-priced ‘value’ clubs have also been all the rage, and there has been a rush to imitate those as well. But again, we are already seeing that market decline as the imitators fail and the realities of running a business based upon finding an endless stream of new members proves to be difficult. Research now shows these clubs tear up the market for about five years and then fall off a cliff as the ability to continually replace lost members fails. We have also learnt that as competition for that same cheap client intensifies in the market, the cliff edge appears even sooner.

Other trends that have hit hard and then failed or declined are the circuit clubs (which are practically nonexistent in the US today), circuit training in box clubs, Latin-flavoured dance fitness, and some areas of group exercise, which are declining in many markets as the new generation gym-goers gravitate toward group personal training. Nothing lasts forever, and this applies to most areas of fitness.

Unfortunately, most people who replicate US business models in other countries seem to think, in the face of evidence to the contrary, that their experience will be somehow different. It’s like having your parents tell you that getting married when you are 20 is stupid, it won’t last and yes, that guy is a loser. Does their opinion change anything? Knowing bad news is ahead seldom dims someone’s view of the present, both in life and in business.

The lesson to learn is that every business has a pattern, and that the US experience will often provide a roadmap to how the same business model will perform in Australia. The 24-hour idea will be copied and fade; the cheap clubs will kill it for a few years, be copied and then fail; and the big box club will slowly fade and be replaced by the training-centric business based upon results and a higher return per client rather than volume. Are these ideas still worth trying? Of course, but knowing there is a limit on that business helps you create an exit strategy before you even get in – and the foundational rule of business is to never get into anything unless you know how you are going to get out.


Thomas Plummer
A 30-year veteran of the fitness business, Thomas is founder of the Thomas Plummer Company and the National Fitness Business Alliance (NFBA), the world’s largest provider of education for fitness business owners. Considered by many to be one of the most influential people working in the business of fitness today, Thomas speaks in front of over 10,000 people annually, and has authored six bestselling books on the business of fitness.