Snap Fitness India, part of the US-based health club Minnesota, is expanding its footprint in metros and tier II cities across India to aggressively tap younger generation which is increasingly becoming conscious of fitness — a style statement.
“With a rise in footfalls at our fitness stores across India, we are scaling up the stores pan-India to aggressively tap younger generation increasingly growing conscious of their fitness to make a style statement,” Vikram Basaravalli Mohan, CEO at Snap Fitness India, stated.
At present, Snap Fitness India is running major of its fitness centers by franchising across four metros and five cities, four of them are company-owned.
In total there are 43 centers of Snap Fitness across India, and planning to add 27 more.
“We will open 27 new stores by the end of financial year 2014 to take the tally to 70,” Mohan said. Out of this seven will be company owned and 20 franchises, he said.
Mohan said the company will open one new store each in Mumbai, Daman, Raipur and Davangere (Karnataka) within a month. He said besides two stores in Kolkata, the company was in the process finalising locations in other cities and towns.
“Each store require an investment of over Rs 1.5 crore,” Mohan said, adding that since these store were cash positive as the stores were opened only after registering over 300 members with payment, it did not require a working capital. He said the stores usually break even and book profit within four-eight months.
He said the company had appointed Allegro Capital Advisors to raise Rs 60 crore as part of the equity stake in the company in two tranches of Rs 30 crore each for funding expansion and growth.
According to a report of the global fitness trade association International Health, Racquet and Sportsclub Association (IHRSA), the size of the Indian fitness market was pegged at about $510 million (approximately Rs 3,000 crore) with a total of 1,200 health clubs in the country. The industry is largely dominated by unorganised local players.