Basic Fit Spain: McFIT History & Spanish Gym Market Structure

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You told me you had this long-term goal of reaching 100 clubs. How did McFit approach the pace of expansion? In the sense that you told me they came to the Spanish market with a concept, a German gym concept, how did that concept change? Could you explain a bit about that evolution?

Easy. They came to market with pretty much the first low-cost gym in Europe and in Spain.  Dreamfit existed, but it was practically unknown; there was no structure. So, like any good German company when it arrives in Spain – and I can give you this example with Aldi or with MediaMarkt or many German firms – what works in Germany isn't touched. We are incredibly good and when we open the doors, people will come running to sign up because the Germans who do it best have arrived. So their idea was to make gyms just like in Germany. In fact, the first gym was built by German workers and companies. We're going to position ourselves at the entrance of the town, on the road where the most cars pass, and if we have parking, even better, and we make a mega warehouse full of machines with some locker rooms and that's it. Their idea of a gym user in Germany was someone who doesn't socialize, who enters, trains, and leaves. The less time spent in the gym, the better. So that was their idea. And that's how we grew.

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How many gyms did you have by then when you changed this process and started to convince them?

We would have been in Spain for more than five years and probably had 20 or so. At that point, we realized we couldn't grow more. Yes, it's true that we had saturation at some times, but we weren't reaching a different audience than what we had. So we started thinking about what could be done, started talking about putting in classes, etc. Their first concept was that they agreed we can do classes. McFit's owner always wanted to be special in everything, always had his own brand and his own stamp and has never wanted to work with partners. His attitude was, I don't want instructors that cost me a fortune and that I depend on them. I'm going to make a group class product but it's going to be my own product. I'm not going to go to Les Mills, not going to the market; I'm going to create a brutal product. Like all the projects they did, he went to the USA, hired the best personal trainers in the world, trainers of celebrities. He went to the best scenarios in the world, to the Las Vegas desert, to Miami Beach, went to hotels, to places to record group classes. There were yoga and wellness classes that Kate Hudson, the actress did, just to give you an idea. And David Kurtz was personal trainer to Madonna and Anne Hathaway and they recorded a bunch of classes for us. 

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How many gyms did you have by then when you changed this process and started to convince them?

In the end, he always had a criterion which was to give more for less. The problem is that he went too far. We were making gyms initially costing over €2.5 million euros, finally around €2 million, with member fees that were at €19.90. So they weren't giving you the result that maybe any other competitor could give you who was investing €600,000 less and charging the same. He always wanted his product to be his brand and the best. So he always said that if we earn €1, I'm already satisfied because we're not losing money.

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