China’s next as Anytime Fitness tackles the world
With more than 3,500 gyms in 27 countries on five continents serving nearly 3 million members, the company Runyon and co-founder David Mortensen launched in 2002 with one location in Cambridge, Minnesota, calls itself the fastest-growing fitness club franchise in the world. Considering it took McDonald’s 20 years and Dunkin’ Donuts 37 years to reach the 3,000-unit market, while Anytime Fitness did it in 13, the business is likely in contention for a record-breaking growth title.
From that first international location—gym No. 77 in Halifax, Nova Scotia, in 2005—to its most recent master franchise agreement in China, Anytime Fitness has been intentional in its global growth plan, first analyzing the market potential in any given country but not moving forward until the right franchise partner is identified.
“We’re very careful to ensure we have the right people. Even if we love a country, we won’t go there if we don’t have the right person,” says Runyon.
Speaking in his office, part of the 40-acre campus Anytime Fitness opened in the Minneapolis suburb of Woodbury, Runyon, the company’s CEO, says appealing to members is “the easy part.”
“The aspiration for people to achieve better health is universal in every country,” he continues.
Access, chimes in Mortensen, Anytime’s president, is what’s lacking in many foreign markets, making the franchise’s community-based model an ideal fit for regions without high gym membership penetration. The convenience of its 24/7 operating hours and flexible approach to real estate that allows smaller locations to open in suburban and rural areas, along with major metropolitan markets, are key to Anytime’s international growth.
“Don’t say small, I prefer intimately sized,” says Maurice Levine, referring to the footprint of his Anytime Fitness gyms, which are around 2,000 to 2,500 square feet versus the 20,000-square-foot-or-more facilities of other big-box clubs. “They’re the right size for that location.”
The franchise’s real estate strategy was one of the things that first stood out to Levine, who signed on as Anytime Fitness’s master franchisee in Singapore in 2013 and now owns the rights for Malaysia, the Philippines, Taiwan, and China.
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Fitness is an international language
Fitness is an international language, says Chuck Runyon, and if the numbers are any indication, it’s one Anytime Fitness speaks fluently.
“When I first started looking at locations in Singapore, I was shown a 50,000-square foot location on Orchard Road—it’s this major retail area, shopping, everything—and so I asked, ‘Where wouldn’t you locate,’” he recalls, noting, as Mortensen did, the community-based model. “I was told the Woodlands because ‘people don’t work out there,’ and that’s where we went.”
A community center was being built in the mostly residential area and Levine was able to work with the developers to open his first Anytime Fitness as part of the complex. Within four months he says the location reached the operational breakeven point and had 900 members. “It’s about convenience, we’re always within walking distance from where people live,” Levine says from his office in the Philippines. “It’s the hours, we cater to members. And we’re not a big-box gym, so we’re not chasing wallets … we’re not geared so heavily to monthly sales goals.”
Since 2013 Levine has grown Anytime Fitness Asia in more than 170 territories, and in China, where Anytime recently became the first U.S.-based fitness franchise to get a license, he sees the potential for more than 300 gyms. The company reports that less than one-half percent of Chinese engage in a fitness system, “so the opportunity is immense,” he says.
A “born-and-bred New Yorker,” Levine’s knowledge of markets across Asia came from his years leading worldwide learning and development firm CMC Global and as CEO for Gold Buyers, where he established the retail brand with more than 60 stores across Asia.
“Asia is a 24-hour place,” says Levine, but it was without a 24-hour gym network. And while that means Anytime Fitness has plenty of room for growth, it also means educating novice gym-goers, something Levine says Anytime does extremely well.
“We really take the time to orient them, make them feel comfortable,” he explains. “We don’t take ourselves so seriously, we really stress personal relationships and an exciting culture that’s dynamic and fun.”
“My competitors really are laziness and people not wanting to work out or not understanding health and wellness,” Levine continues, something his franchisees combat with lots of social media engagement and the hosting of community events such as fun runs. These franchisees, he stresses, are really the ones driving growth, making it crucial to find partners who “have a passion and genuinely care.”
“You can find high net worth individuals in Asia, they’re everywhere,” Levine says. “So I really look for the right attitude and that emotional connection.”
On the operations side, Levine has worked to extend the franchisor support of Anytime Fitness in the U.S., which includes bringing franchisees to Minnesota for training, and the creation of a pan-Asia finance network to assist ‘zees with equipment financing.
“Everything here is about figuring out the way,” he says of operating in Asia. “We’re writing the book, it hasn’t been written before.”