Snap Fitness signs master deal for Japan
Though the Tokyo Olympics were postponed to 2021 and numerous other major events canceled, Japan, as of this writing, hadn’t implemented the types of coronavirus pandemic-related lockdowns that have all but brought economic activity to a standstill in the United States and other parts of the world. And while the world’s third-largest economy is still bracing for a severe blow—and working on massive stimulus measures to counteract the impacts—expansion in the country is a bright spot for Snap Fitness as it grows the footprint for its 24/7 gyms.
Snap Fitness, a sister brand to 9Round and YogaFit under Minnesota-based Lift Brands, signed a master franchise agreement with Global Fitness Japan to develop the concept throughout Japan, starting in the capital of Tokyo.
Naoto Shibuya is chief operating officer of Global Fitness Japan, which plans to develop Snap Fitness throughout the country, starting in Tokyo (top photo).
“By the end of 2020 we are going to open one gym in Tokyo and one in Osaka,” said Naoto Shibuya, Global Fitness Japan’s chief operating officer. Speaking through a translator, Shibuya said his company will operate those first two locations and use them to “demonstrate the brand” to prospective franchisees before beginning to sign agreements of its own next year. He expects the concept to resonate with Japanese consumers and business owners alike, both of which are driving a growing fitness industry in Japan.
“Only 3.8 percent of people in the entire population attend gyms,” said Shibuya, “but that number has been increasing over the past few years. Our forecasting shows the market has lots of potential.” Business owners and even franchisees in other segments “want to switch to fitness because the industry is growing,” he contended.
Snap isn’t without competition. Fellow 24/7 gym franchise Anytime Fitness began its expansion in Japan almost a decade ago and now has more than 600 units. Orangetheory and Gold’s Gym also have a presence in the market, along with local players, but Shibuya said his group, made up of business executives with backgrounds in finance and marketing, believe Snap Fitness has an edge and they have a plan to make it stand out.
“Snap Fitness is unique compared to the competitors because, first of all, most 24/7 gyms just offer the machines and that’s the end of the story,” he said. “But we go beyond that.
We use technologies,” including heart rate monitors, “and we will also offer unique services. We’ll be able to offer yoga and heated yoga.”
The integration of studio classes is part of a framework Ali McElroy, Snap’s chief global development officer, called “prescribed flexibility.”
“Prescribed flexibilty” helps Snap Fitness tailor its gym to markets around the world, such as the country of Georgiaand in the Tin Hau area of Hong Kong (above).
“We have different modules that are more prevalent in different markets,” she explained, with adaptations determined after close consultation with the master franchisee. “In the Middle East, for example, we have women-only areas, that’s essential. Other changes are more subtle, with the look and feel of the branding. Or some have more cardio equipment, versus classes.”
Snap Fitness, with 2,000-plus locations in dozens of countries, has cross-cultural product teams that focus on modifications, and McElroy said the company also works to educate its team on broader cultural nuances and business customs, including “everything from a greeting to how you present your business card.”
Japan, she noted, “was a top priority market” as Snap continues to grow throughout Asia. The brand has 14 gyms in Hong Kong, Taiwan and Indonesia, and has also identified South Korea and Singapore as markets with strong potential. That potential is gauged by assessing consumer interest in health and wellness, understanding how Snap can differentiate itself, and if there are qualified master franchise partners.
“We are looking for people who have prior experience in franchising or multi-unit retail, and the capital, of course,” said McElroy, but that’s not all. “The intangible criteria is working with investors who really are aligned with the goals of the brand. They have a passion for health and wellness, and also see the business opportunity.”
Global Fitness Japan, for its part, has a mission “to improve the wellness of the people,” said Shibuya, and is looking for ways to make Snap an accessible brand for Japanese consumers who, while they have a growing interest in exercise, aren’t used to American workouts.
“American customers are very familiar with fitness, some train really hard,” said Shibuya. “Japanese customers, they aren’t used to a lot of training. So Global Fitness Japan is trying to create an environment where our future customers feel like they can have fun and feel comfortable.” That will mean offering programs and holding events where people can try the workouts, get to know instructors and staff, “and establish a community with other fitness members.”
Like other franchises, Snap Fitness is navigating mandated gym closures in numerous regions, including most states across the U.S. It partnered with FitnessOnDemand to offer free 90-day access to a library of virtual workouts, and in some markets such as Australia and the United Kingdom, the franchisees are suspending membership billing.
McElroy noted that while development plans will likely shift, “everybody is really pulling together,” and Snap will continue to grow. “With every challenge, every difficulty, there are opportunities,” she said.