The sharing economy in China is thriving. Emerging business models include bike-sharing, power-bank-sharing and umbrella-sharing. Now, with the appearance of mini-gymnasiums, there’s another business model springing up in the sharing economy space.
Fitness demands are growing in China due to its fast economic development, the rise of the middle class and an increase in people’s desire for a better quality-of-life. There has been an increase in the number of fitness clubs, as well as, a boost in sales of in-home treadmills and other fitness equipment. Though many recognize the importance of exercise, not all have made it a habit. Even for those who already hold fitness club memberships, going to gyms is a process as many gyms are inconveniently located.
Here, then, is where the mini-gymnasium sharing model aims to take advantage. Misspao wants to meet growing demands in the fitness space by following the hot trend of the sharing economy. It is placing its mini-gymnasiums in communities and schools, thereby, giving its users easier and quicker access to fitness. According to the founder Bi Zhen, who previously worked for China’s leading food-delivery app Ele.me, mini-gymnasiums are not only the most efficient way to do exercises, but they will also help to fill an existing gap of a lack of convenient-fitness.
How mini-gymnasium works
Similar to miniKTVs, mini-gymnasiums are easily identifiable by its users. They resemble a little house covering an area of four square meters and can accommodate one to two users at the same time. They are equipped with an air conditioning unit, a television, offer WiFi access and have air purifiers to provide a good environment for its users. The treadmill, dynamic bike and elliptical machine–all commonly used machines in fitness clubs–can be found in these mini-gymnasiums. For those who mainly do cardio exercises, a mini-gymnasium offers a well-equipped facility and a relatively private space in which to workout.
Misspao’s app allows people to find a mini-gymnasium that is available nearby. Before securing a space, users are required to upload their identification information and provide a guarantee deposit of RMB 99 (USD 15). The app, then, charges RMB 0.2 per minute of use and customers can pay using either WeChat or Alipay. Doors open once the QR code on the door is scanned with Misspao’s app.
Upon entering the mini-gymnasium, an area for hanging clothes and additional storage spaces can also be found. Users can easily turn on the air conditioner and the TV, and can, immediately, begin their workout. We have found that the treadmill in Misspao’s mini-gymnasium costs over RMB 8000 on JD.com. According to Misspao, each of its mini-gymnasiums averages approximately five to six hours of use per day, reaching its break-even-point in 10 months.
The potential of mini-gymnasiums
Misspao quickly secured two financing rounds in the half month since it launched its mini-gymnasiums in July 2017. Its valuation is already in hundreds of millions of RMB (tens of millions of USD). It will focus on expanding its business in communities, similar to the way in which traditional fitness clubs are opened in city centers. However, unlike traditional fitness clubs, Misspao enables its users to immediately start working out and also for shorter periods of time. Because they are mainly placed in communities, Misspao cuts costs by not having to provide shower facilities and changing rooms. Meanwhile, mini-gymnasiums can also be placed in areas other than within communities and schools, such as inside companies and so on.
Compared to traditional fitness clubs which require annual membership fees, Misspao makes it easier to start working out immediately, charging only by usage amount.
What are the challenges
Though these mini-gymnasiums are equipped with air purifiers and are always running ventilators, cleanings at regular intervals are necessary. Misspao is working to resolve this problem by partnering with property operators and having them to do the cleaning. Besides hygiene issues, other potential safety problems should also be considered.
When only comparing costs for users between utilizing traditional fitness clubs or Misspao’s mini-gymnasium, it seems that for most users a mini-gymnasium model is a better fit. This is because most do not workout daily, and so an annual membership, sometimes costing as much as RMB 2,000 in bigger cities, would be a waste for them.
For those who work out everyday, it is better to go to fitness clubs and pay for a yearly subscription. For example, a 1-hour workout at Misspao would cost RMB 12, and so for the year, it would cost RMB 4320. This is much higher than a one year subscription at a traditional fitness club where they can enjoy more facilities and equipment.
