Business Franchise Australia


The Feel Good Factor in Franchising

Health, fitness and beauty franchises are attractive businesses that are guaranteed to make you feel good!

Whether you simply want to join these booming industries for the financial returns or you enjoy a healthy lifestyle and keeping fit, then look no further than franchising to provide you with a multitude of exciting business opportunities. Franchising has proven to be a fantastic format for successful businesses across these growth areas. People are becoming more aware of the benefits of maintaining a healthy lifestyle, and have the desire to take better care of themselves than ever before.

The health, fitness and beauty industry covers an enormous choice of businesses, ranging from gyms to spas, to hairdressers and a wide range of beauty services including nails, hair removal, and male grooming.

Keeping in shape, being healthy and well-groomed can make you feel vibrant and attractive, on the inside and out. Fit and healthy people radiate happiness, self-confidence and vitality. Likewise, owning a customer-focused franchise that helps to promote a sense of wellbeing and happiness can be just as rewarding, not to mention lucrative!

Expanding waistlines

The number of people who are overweight in Australia continues to rise according to the Australian Bureau of Statistics.

The 2011-12 Australian Health Survey – the largest check up on the nation’s health ever undertaken – found that nearly two-thirds (63 per cent) of the population are now classified as overweight or obese.

Men are more likely to be overweight or obese (70 per cent) than women (56 per cent) while one quarter (25 per cent) of our children are overweight or obese.

With these staggering figures, it’s no wonder that fitness franchises have experienced rapid growth over recent times.

Two of the top three on BRW’s fast franchise 2014 list are fitness outlets with Jetts Fitness at number two, and Anytime Fitness coming in third. Indeed, five of the top ten are health, fitness or beauty related with the top ranking taken by beauty based franchise Laser Clinics Australia.

Many franchised gyms, in varying formats, have experienced similar success in recent years.

Improving your bottom line

In recent years, franchised gyms have experienced outstanding success as people become more and more aware of the importance staying active and looking after their physical wellbeing.

Added to the mix are 24 hour gyms – catered specifically for our busy lives, single sex gyms and more – and you have a sector of franchising that has boomed across the country and the world.

Check out the figures

A report released by IBISWorld states Australian fitness industry revenue of $2.9 billion and estimated to reach, over the next five years, $3.4 billion. Australians are expected to spend:

• about $1.7 billion on gyms and personal training;

• about $380 million on weight-loss services;

• about $292 million on dietary supplements; and

• about $121 million on surgery.

The Australian Fitness Industry Report 2012 (by Deloitte Access Economics for Fitness Australia) highlights some key statistics:

• Among Australians, aerobics, fitness or gym workouts are now the second most popular physical recreational activity after walking.

• Over four million Australians participate in fitness industry activities.

• Users are typically female (42 per cent) and younger (25-34 years).

• The biggest increase in users was from the 45-54 year age group.

• Looking forward, participation will continue to increase exponentially with total demand increasing to 7.15 million users by 2020.

Big business

The beauty business is big business. These days, people are spending more money on beauty than ever before, and the industry is constantly growing and evolving.

Women have always loved to be pampered and preened, and now with ‘man-scaping’ rising in popularity it’s men too who like to be buffed and waxed – not just their cars! Just about every aspect of the beauty industry is covered by franchising. From teeth whitening to cosmetics, hairdressing, manicures and pedicures, massages, waxing, tanning, and all the beauty products to keep you looking great, there’s a business opportunity out there for you. Perhaps you have been a beauty therapist working out of a salon for many years; now may be the right time to build your own business based on a tried and tested successful formula offered by a franchise. According to an IBISWorld report (Hairdressing, Beauty Salons Market Research Report) key success factors for operators in the industry include:

• Having links with local health professionals. Beauty salons can benefit from client referrals from local doctors and dermatologists.

• Use of specialist equipment or facilities. Having specialist equipment enables salons to provide value-added, higherpriced services.

• Proximity to key markets. It is an advantage to be located in a high profile, preferably wealthy area with significant passing pedestrian traffic and easy parking.

• Having a loyal customer base. It is important for a salon to build up a base of satisfied clients, to ensure repeat visits and attract new customers through good word-of-mouth.

• Ability to control stock on hand. Controlling stock levels, particularly hair-care and beauty products, is important to maintain the liquidity and cashflow of the business.

• Superior financial management and debt management. Financial and business management skills are vital to ensure cashflow and the survival of the salon.

• Access to highly-skilled workforce. A salon depends on the skill of its hairdressers and/or beauticians. Maintaining and updating skills is important to stay abreast of new hair styles and beauty treatments.

• Marketing of differentiated services. Salons can move away from price based only competition by offering quality, value-added and higher priced services.

An alternative approach

Alternative health therapies are also becoming increasingly popular among people searching for alternatives to prescription medicine, which has resulted in an increase in the popularity and use of herbal remedies in recent years.

Financial figures showed the sector, which includes Chinese medicine, acupuncture and other therapies to grow by around six per cent per annum over the next five years. According to the Australian Trade Commission; “The Australian natural (complementary) healthcare industry has domestic sales of over $1 billion per year.

Market research shows that the popularity of natural healthcare products is increasing with a growth rate of seven per cent year on year. Three-quarters of Australians, including 92 per cent of women aged 20-24, take at least one dietary supplement and a quarter of the population visit complementary healthcare practitioners each year.

The Australian industry continues to grow to meet these requirements. Already attuned to alternative approaches to health, discerning baby boomers (Australia’s largest population group) increasingly demand greater choice and adopt a preventative healthcare approach to maintaining healthier lives. In Australia, the fastest growth areas are nutritional oils, men’s health and eye health.

Making the right choice

The decision to purchase a franchise is no doubt a difficult one, and with so many successful offerings out there on the market, how do you decide which one is right for you?

Passion for the industry is an obvious must. Franchisors are looking for people who are passionate about what they will be committing a large part of their lives to. If you already love to spend time at the gym, enjoy exercising and living a healthy lifestyle, then that passion for the industry will be a great backbone for building a successful business.

Becoming a franchisee could be a great step towards improving your lifestyle. Once you’ve done the hard yards in establishing the business it could give you more opportunity for flexibility to work around family life, or other commitments.

Is the price right?

Once you have made the decision about which industry is right for you, the next step is working out whether you can actually afford it!

You must then get with your franchise banker and put together a realistic sum of money you can afford to put into this new venture. This will most likely weed out some systems quite quickly – as the larger, more well-known fitness names come with a hefty price tag. They are strong, tried and tested and have proven success stories – but you must truly be able to afford to buy into them.

Once you have an amount in mind, you can begin to shop around. You will be able to narrow down your search, but don’t rush. If you get to your shortlist, it is time to direct all your attention to the franchise system and the franchisor.

Know your franchisor

The franchisor holds the key. The management system, the operational procedures, the leasing agreements, the contracts, and the fees have been generated by the franchisor. Check the franchisors background – is it solid? Meet with him or her. Do they seem to be a person of integrity? Do they answer all of your questions openly and honestly? Do they invite you to do your own investigations into the company? Are they eager for you to talk to existing franchisees?

If at any point you feel pushed, rushed, bullied or even ignored by the franchisor – it is time to consider walking away. Hopefully though, the franchisor will be professional, honest and open.

The next step is to meet with existing franchisees. While it’s fine to have all the manuals in place and have the franchisor tell you how great and successful the business may be, it’s the franchisees that have the real story. Visit them in their place of business, ask questions, and ask their employees if they enjoy working there.

The hard work begins!

Once you have made the decision to purchase your franchise then the hard work really begins, and that’s where your passion and drive to succeed will be vitally important.

So if being healthy, looking great or keeping fit is something that will get you out of bed every day, ready to work hard at growing your business then perhaps a franchise from one of these exciting growth areas is the one for you!