Little Weight to China’s Gym Fad

Insurance agent Wen Wenhua goes to a huge new Total Fitness Club here, with its gleaming treadmills and weight machines, about three times a week. His favorite activity? The free online war game in the bar area.

He plays at least an hour of computer games before changing out of his jeans, he says. And though he does like the tae kwon do class, he doesn’t bother with any of the machines. “I don’t want to get buff,” he said.

What he really likes about the gym is meeting new friends and just hanging out. “Since I started coming to the gym a year ago, my health hasn’t changed much,” he said. “But my life is more interesting.”

Welcome to China’s booming gym industry, powered in large part by fiscal -- not physical -- fitness. Forget the traditional idea of flaunting one’s wealth by ordering more than one can eat in expensive restaurants. Today, membership in posh fitness centers is the latest status symbol for a growing middle class ever more in love with the once-forbidden pastimes of the bourgeoisie.

Simon Huang, sales and marketing manager at the three-story Megafit, says that the country is still more familiar with slow-motion tai chi than hard-body crunches.

“Joining a gym is still a very new concept in China,” Huang said. “Most of our members see it as a kind of fashion statement, not necessarily linked to their health.”

But fashion consciousness can be a powerful incentive. As China’s trend-setting city, Shanghai has been at the forefront of the gym mania. Megafit opened large free-standing fitness centers -- the country’s first -- in the city in fall 2000. Within the last several years, about a dozen state-of-the art gyms have sprung up in the city’s fashionable downtown.

Most of the larger clubs plan to open branches within the next year or so. Add that to the much smaller residential health clubs linked to fast-rising apartment buildings and more primitive community-based exercise centers, and some industry analysts estimate that there could be as many as 2,000 gyms of various sizes in the city.

Large international players are eyeing developments in the China market and seeking a way in. Britain’s Fitness First already has entered Shanghai. U.S.-based Bally Total Fitness has several outlets in Beijing.

But the recent failure and pullout from Shanghai of the famed Gold’s Gym rang alarm bells for anyone eager to take the plunge.

“It goes back to the gold rush days for a lot of businesses in China. There’s money to be made in a certain field, and everybody gets excited and wants a piece of the pie. That’s sort of what’s happened to gyms,” said Esdon Lee, an Australian who helped start two branches of Total Fitness Club in Shanghai and now works for the Shanghai International Tennis Center. “At the moment, the industry is still very young. It’s still got a long ways to go.”

A key challenge is nurturing the limited client base. Gym managers are trying to keep their members coming to the club even though exercise may not be their main goal.

Yuan Puzi, 30, a bespectacled sales executive for a cashmere exporting company, lives a few blocks from a Total Fitness Club. He joined the gym along with his mom and dad, both 60. His retired parents exercise during the day and he goes after work, each paying $380 a year. “There are so many activities to choose from here. But even if we just come every day to use the shower and sauna, we are paying only about $1 a day. That’s cheaper than going to the local bathhouse!” said Yuan, pausing amid stomach crunches on a bench next to the gym’s boxing ring. “I wish more people would join health clubs. That way the prices would be even better.”

Fierce competition among similarly equipped gyms already has sliced the rate of annual membership from more than $1,200 to about $360 -- still a sum unthinkable for most Chinese. With so many fancy gyms concentrated in a small area, there is a lot of room for potential clients to shop around and demand a bigger and more spectacular workout environment.

“We spent $1.6 million just on this branch alone,” said Sunny Wang, general manager at a Total Fitness Club, which reports a membership of about 10,000. “All our training equipment is imported from the U.S.”

But a large crowd is not necessarily a good thing. Many don’t even bother to use the expensive treadmills and treat their membership merely as a free ticket to the bathhouse. The worry is that those who aren’t coming for the exercise won’t be so eager to renew their memberships when the fashion for fitness fades.

“Almost everyone in that building has a membership card from us,” said Huang of Megafit, referring to an office tower nearby. “But their primary goal is to come here and take a shower after work. They are thinking, ‘I don’t have time to exercise -- how can I still get my money’s worth?’ They don’t think about whether they’ve met their goal of improving their health.”

It’s a common concern for gym operators.

“Some customers come here not just to exercise but to get their money’s worth, break even. Every three months I need to buy new towels because there aren’t enough to go around again. They will even take toilet paper home.”

That’s why Megafit is focusing its expansion efforts on the second-tier cities in the Chinese inland.

“Markets in Shanghai, Beijing and Guangdong are saturated,” Huang said. “We want to make money. And according to our survey, markets in secondary cities are wide open.”

Memberships that go for $360 in Shanghai could sell for about $490 in Xian, home of the terracotta warriors. In far western Urumqi, the capital of the Xinjiang region, it could be as much as $1,230.

“If I sold it for that price here in Shanghai, this place would be totally silent,” Huang said as he walked around the palatial gym, buzzing with activity during the evening hours. “But out in those cities they’ve got plenty of rich entrepreneurs who have too much to eat and no healthy place to go. They want to be members. They want the status. Cost is less of an issue.”

The gyms have different approaches to pulling in the customers.

Although Megafit prefers a sunny, bright, outdoorsy feel, the Total Fitness Club has chosen to turn down the lights and paint the walls a metallic color. Add that to the constantly throbbing techno music, and the place has the feel of a sophisticated nightclub. There’s even an area set aside for nonalcoholic drinks, pool tables and free Internet time.

Wen, the computer game enthusiast, loves the social aspect of the gym. He does, however, have one complaint.

“When I first joined, I felt kind of special for having the card. Now too many people from too many different backgrounds can afford it,” he said, before turning back to his computer game. “It doesn’t feel as exclusive anymore. This should be a high-class activity.”