California Fitness slows expansion in Vietnam to improve member retention

December 5, 2022

One of the most popular high-end gym chains in Vietnam, California Fitness and Yoga, is suspending its expansion to focus on retaining members.

Dane Fort, FLG Vietnam Chief Executive, which operates California Fitness & Yoga told VnExpress "we are not perfect.

"We developed and expanded too fast and had to face certain difficulties. That is why we have not opened new clubs in recent years."

Fort was appointed Chief Executive of FLG Vietnam in 2017. With over 21 years in leadership roles, his career in fitness and wellness spans five countries. In his present role as Chief Executive Officer of Fitness & Lifestyle Group Vietnam, he oversees the operations of 55 fitness centres and beauty clinics, representing brands such as California Fitness & Yoga, Jetts Fitness Vietnam and Hypoxi Studios and employing over 4000 staff across seven major cities in Vietnam

With 35 facilities, California Fitness and Yoga used to be the biggest gym chain in Vietnam. However, it has now been overtaken by 25 Fit, which has 41 facilities, according to VnExpress data.

Third-ranking Curves, which only serves female members, has 27 facilities around the country.

Fort also told VnExpress that anyone with money can build a gym chain with quality similar to that of California Fitness, but what his company is focusing on now is retaining members.

It costs 10 times more to acquire a new member than to keep a current one. California Fitness, with 250,000 subscribers (including 30,000 daily users), accounts for more than three-quarters of the market in Vietnam.

According to Fitness and Lifestyle Group (FLG), its number of members accounts for around 72-73% of the market.

This is why Fort plans to invest $2 million into upgrading the current clubs to retain members. Fort said that staff training is important and plans to train his staff to increase their professionalism and consistency.

Fort noted that COVID has made people take better care of their health and that this is giving the fitness industry new opportunities.

FLG has been seeing growth compared to pre-pandemic levels in some areas, such as the number of active members, new members and revenues, he said.

Growth potential in Vietnam remains, he said, adding that the penetration of the health and fitness industry among the middle-class is 14% in Hong Kong, 17% in the U.S. and 23% in Australia, while in Vietnam it is still below 1%.

By the end of this year, the rate is set to rise to 1.25%, and in the next five years it could reach 5%, Fort said.

FLG Vietnam has been making moves to assert its market dominance, such as importing new technology from Australia and opening Jetts Fitness.

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