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Companies in this industry operate fitness and recreational sports facilities that offer fitness equipment, exercise classes, swimming pools, and fitness instruction services. Major companies include 24 Hour Fitness, Bally Total Fitness, Equinox Fitness Clubs, and Life Time Fitness.
Demand is partly linked to income levels and partly to market demographics. The profitability of individual companies depends on good marketing. Large companies have economies of scale in advertising and buying equipment. Small companies can compete effectively if they have favorable locations. The industry is fragmented: the 50 largest companies account for about 30 percent of revenue.
Major services include facilities for aerobic exercise and weightlifting. Running, swimming, racket sports, yoga, karate, basketball, and swimming may also be offered. Small studios may cover just a few thousand square feet; multi-activity operations can cover 100,000 square feet. The operations of all fitness centers are similar: the operator makes space and equipment available for customers to engage in various types of fitness activities, provides staff to help customers properly use the equipment, maintains the facilities, and provides various other services such as professional trainers and class instructors, child care, food and drinks, showers and lockers, hot tubs and saunas, and sales of sports clothing and equipment.
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