January is often cited as the “boom period” for Britain’s fast growing gyms sector, with thousands of consumers nationwide using the turn of the New Year to fulfil their fitness resolutions by signing up for memberships at their local chain.
However, for Yorkshire based budget brand Xercise4less the emphasis will not be upon shrinking down but on rapid growth, as the business has now secured funding allowing it to grow both in the UK and overseas.
During the past 18 months, founder and chief executive Jon Wright has overseen the opening of 15 new locations, bringing the total number of Xercise4less gyms to 24. This has allowed turnover to almost double in the past year alone, with membership having risen to 200,000 nationwide and the business currently being valued at £128 million.
As a result of this significant progress, Xercise4less has managed to acquire a £5 million equity investment from the Business Growth Fund (BGF) along with £6 million in asset finance and leasing facilities from Lloyds Bank Commercial Banking. The primary lender has also extended the business an increased debt facility of £20 million, meaning yet more rapid growth is on the cards.
Mr Wright claims that the financial backing provided by a number of investors will be used to strengthen the business.
He says; “We are less than halfway through a five year plan, with ambitions to grow to over 100 gyms nationwide and create more than 4,000 jobs.
“Our growth has really accelerated in the 18 months since BGF’s first investment – gaining the backing of a minority equity investor has lent us additional credibility and played a big role in helping us to increase our lending agreements with Lloyds Bank and others.
“Having investment backing of this kind enables me to fully realise my vision for the business and drive it forward at the pace it needs for us to further disrupt the leisure industry and strengthen our place amongst the big players.”
Xercise4less currently has three new destinations under construction, with the Hounslow branch set to become the business’ first opening within the M25. Altogether, Mr Wright intends to open around 30 new locations this year and 40 next year, bringing Xercise4less’ portfolio to around 100 gyms by the end of 2016.
However, it is not only the UK in the sights of this ambitious chain, as Mr Wright has revealed he is examining a number of potential opportunities in Europe. Spain is the first destination on the cards, as the concept of budget fitness is still a relatively new one there, but Germany is also expected to become a strong contender for growth in future.
Regional director of strategic finance at Lloyds Bank, Martin Beckett, says; “The management team at Xercise4less has built a successful business based around the principle of providing consumers with access to high quality fitness facilities at affordable prices.
“The latest round of funding provides the business with the capital to accelerate its rollout strategy.”
