Fit: Pas­sion for sports means big busi­ness

China Daily (Canada) - - FRONT PAGE -

in­stalling air pu­ri­fiers to lure con­sumers.

Cao Yan, chief ex­ec­u­tive of­fi­cer of Pow­er­House Gym, based in Tian­jin, says the com­pany opened three new sites last year, in Bei­jing, Tian­jin and Kun­ming.

With more than 20 gyms, the chain claims to have full membership and fur­ther ex­pan­sion is ex­pected, says Yan, who is greatly en­cour­aged by the fact that ven­ture cap­i­tal­ists are also start­ing to re­al­ize the health mar­ket’s po­ten­tial.

As well as its gyms, Pow­er­House of­fers its mem­bers per­sonal train­ing at home, man­aged by a book­ing sys­tem which is fully on­line.

Sports­wear pro­duc­ers, too, have been keep­ing a close eye on the grow­ing mar­ket.

Sab­rina Che­ung from Adi­das AG says it has seen a rise in de­mand for sports ap­parel of all types, es­pe­cially run­ning gear, helped by a surge in the num­ber of run­ning events be­ing or­ga­nized.

In 2015 alone, there are more than 50 marathons planned by the na­tional sports au­thor­i­ties in China, not to men­tion count­less five-kilo­me­ter runs and fun runs. “This trend is re­ally en­cour­ag­ing. We are ex­cited to see more peo­ple get in­volved in sports. As a lead­ing sports brand we want to foster a sports cul­ture in China and en­cour­age more peo­ple to par­tic­i­pate in var­i­ous sports ac­tiv­i­ties,” says Che­ung.

As con­sumers across China be­come more pas­sion­ate about sports, they are also in­creas­ingly look­ing for prod­ucts which help max­i­mize their per­for­mance, ac­cord­ing to Che­ung.

Adi­das sold 1.1 mil­lion pairs of its Boost run­ning shoes and train­ers, for in­stance, last year and tar­gets 2.9 mil­lion pairs this year. “In fact, the re­sponse to Boost has been so pos­i­tive we’ve de­cided to roll out more Boost footwear in other cat­e­gories too,” she says.

The re­vival of the sports mar­ket has also been good news for China’s do­mes­tic sports brands, some of whom have strug­gled over the past two years just to keep afloat.

First-half prof­its at Anta Sports Prod­ucts Ltd, for in­stance, rose to 177 mil­lion yuan ($28.5 mil­lion) and Peak Sport Prod­ucts Co Ltd has just re­vealed a 31 mil­lion yuan profit in­crease for the same pe­riod.

In the wake of the Bei­jing Olympics, some high-pro­file do­mes­tic sports brands first saw a surge in sales, with 2008 rev­enues at both Anta and LiNing Co Ltd, the two largest man­u­fac­tur­ers, gain­ing more than 50 per­cent.

The re­sults en­cour­aged LiNing, Anta and smaller ri­vals Peak and 361 De­grees In­ter­na­tional Ltd to open a to­tal of more than 9,000 stores across the coun­try be­tween 2008 and 2011 — an av­er­age of eight per day.

But over-ex­pan­sion and poor brand­ing soon ate into their mar­gins, and in 2012, the in­dus­try en­tered a slump pe­riod. Some listed brands suf­fered from sharp de­clines and their whole year net prof­its dropped, with Li-Ning re­port­ing a net loss of 2 bil­lion yuan.

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