Virgin Active plans Australian expansion

Sir Richard Branson's Virgin Group is planning to open further Virgin Active health clubs in Australia, in a $40 million move that will see the brand expand beyond its current clubs in Sydney and Melbourne.

Virgin Active, which currently operates three clubs in Sydney and Melbourne, with a further club set to open in Sydney's Baulkam Hills, has close to 900,000 members at its clubs in Britain, Italy, Spain, Portugal, South Africa and Australia.

According The Australian, the UK-based entrepreneur has indicated that Virgin wants to open up to 20 new clubs in Australia over the next four years, with as many as 30 sites believed to be under consideration across the country.

Branson told The Australian "with anything, we try to build the best and if you build the best health club in a city, the best normally survives and thrives.

"We now have about 300 health clubs around the world; it is a very successful business for us, and I think in Australia the Virgin brand is very strong and the health clubs have been extremely well received."

Virgin Active opened its first Australian club in Sydney's Frenchs Forest in late 2008, claiming the move was a direct response to "consumer dissatisfaction with the current gym offerings."

At that time the company highlighted that "Virgin Active will redefine the gym experience in Australia with world-class facilities, a friendly, welcoming environment and that great value for money and customer service that people have come to expect from Virgin."

Business website Start Up Smart suggested that local operators are welcoming Virgin Active's expansion.

David Ciantar, Australian general manager for fitness franchise Anytime Fitness, was quoted as saying that while Virgin Active has a "fantastic" offering, it doesn't see the company as a direct competitor.

Ciantar explained "we're a franchise business so we work with franchisees.

"We're dealing with franchisees who are very entrepreneurial; they want to make their club a success in their local market.

"We focus on being member-centric, so ensuring that they become the focus of the club."

In addition to its expansion plans for Virgin Active, Virgin Group has flagged a move into Australian hotels, although Branson claims the company's current focus is the US market.

Last year, Virgin Group revealed it had conducted preliminary work in Australia with a view to eventually offering a 4.5-star hotel operation at four-star prices, but Branson has stressed the project remains at an exploratory stage.

10th November 2010 - VIRGIN ACTIVE OPENS SYDNEY CBD CLUB