IBISWorld Industry Report OD4198 Pilates and Yoga Studios in …collegeofweightmanagement.com.au/wp-content/uploads/2015/02/O… · 25 Annual Change 25 Key Ratios 26 Jargon & Glossary

2 About this Industry2 Industry Definition

2 Main Activities

2 Similar Industries

2 Additional Resources

3 Industry at a Glance

4 Industry Performance4 Executive Summary

4 Key External Drivers

5 Current Performance

7 Industry Outlook

9 Industry Life Cycle

11 Products & Markets11 Supply Chain

11 Products & Services

13 Demand Determinants

13 Major Markets

14 International Trade

15 Business Locations

17 Competitive Landscape17 Market Share Concentration

17 Key Success Factors

17 Cost Structure Benchmarks

19 Basis of Competition

19 Barriers to Entry

19 Industry Globalisation

20 Major Companies

22 Operating Conditions22 Capital Intensity

23 Technology & Systems

23 Revenue Volatility

24 Regulation & Policy

24 Industry Assistance

25 Key Statistics25 Industry Data

25 Annual Change

25 Key Ratios

26 Jargon & Glossary

IBISWorld Industry Report OD4198Pilates and Yoga Studios in AustraliaNovember 2013 Caroline Finch

Well-balanced performance: Industry growth remains steady amid volatile conditions

www.ibisworld.com.au | (03) 9655 3881 | [email protected]

WWW.IBISWORLD.COM.AU Pilates and Yoga Studios in Australia November 2013 2

This industry comprises facilities that offer Pilates and yoga instruction to individuals or groups. Pilates is a body conditioning routine to build strength and flexibility while yoga is a physical

and spiritual practice focused on breath control, flexibility and strength. The industry includes Pilates and yoga classes taught at gyms or other health clubs.

The primary activities of this industry are

Pilates and yoga studio operation

Pilates and yoga classes

Specialised training involving Pilates and yoga activities

Pilates and yoga accreditation training

Accessories and equipment sales

Industry Definition

Main Activities

Similar Industries

Additional Resources

The major products and services in this industry are

Accreditation and training

Equipment and accessories retailing

Pilates and hybrid classes

Prenatal and postnatal classes

Yoga classes

About this Industry

Q8533 Physiotherapy Services in AustraliaThis industry is made up of companies and practitioners that primarily provide physiotherapy services.

R9111 Gyms and Fitness Centres in AustraliaThis industry includes companies or organisations that operate indoor and outdoor sports or exercise facilities, except for those used for horse or dog racing.

X0015 Alternative Health Therapies in AustraliaPractitioners in this industry primarily deliver treatments such as acupuncture, traditional Chinese medicine, aromatherapy and homeopathy.

X0025 Fitness in AustraliaThe Fitness industry provides products and services that are used specifically to aid fitness.

For additional information on this industry

www.abs.gov.au Australian Bureau of Statistics

www.ausport.gov.au Australian Sports Commission

www.yogaaustralia.org.au Yoga Australia


Market ShareThere are no major players in this industry

Key External DriversReal household discretionary incomeTotal health expenditureTotal time available for leisure and recreationSport participation

Key Statistics Snapshot

Industry at a GlancePilates and Yoga Studios in 2013-14

Revenue

$998.4mProfit

$50.9mWages

$695.8mBusinesses

2,715

Annual Growth 14-19

1.7%Annual Growth 09-14

2.6%

Industry Structure Life Cycle Stage Mature

Revenue Volatility Medium

Capital Intensity Low

Industry Assistance Low

Concentration Level Low

Regulation Level Light

Technology Change Low

Barriers to Entry Low

Industry Globalisation Low

Competition Level Medium

FOR ADDITIONAL STATISTICS AND TIME SERIES SEE THE APPENDIX ON PAGE 25

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SOURCE: WWW.IBISWORLD.COM.AU

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Revenue vs. employment growth

Establishments

31.1%NSW

2.8%TAS

28.6%VIC

2.4%ACT

0.9%NT

20.0%QLD

7.2%WA

7.0%SA


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Key External Drivers Real household discretionary incomeExpenditure on Pilates and yoga classes is discretionary and therefore positively affected by rises in discretionary income. Discretionary income is the amount of

income available for consumers to use at their discretion after paying all essential expenses. IBISWorld defines ‘necessary’ household expenses as all expenses on food, clothing and footwear, rent and

Executive Summary

The Pilates and Yoga Studios industry has grown from a highly specialised niche to an established part of the health and fitness sector over the past 15 years. The industry has transitioned from growth to maturity, with the initial rush of new entrants now slowing. Australians are becoming increasingly concerned with maintaining their health, as seen from the growth in Australia health consciousness and sports participation. By catering to these trends, the industry has cemented its place in the health and fitness sector.

Over the five years through 2013-14, industry revenue has grown at a compound annual rate of 2.6%. This rate of growth is exaggerated due to the significant 2008-09 drop off in demand for industry services brought about by the global financial crisis. In 2009-10, the industry regained ground quickly as government stimulus packages and strong economic growth lifted consumer confidence and demand for services stabilised. Internal competition in the industry remained fierce over the period despite the demand recovery. In 2013-14, the industry is expected to expand by

1.4% to $998.4 million.In the next five years, the industry is

expected to fare better, as demand continues to increase for industry services. Due to the widespread existence of basic industry products, specialisation and the targeting of new markets is likely to drive growth. The core disciplines of yoga and Pilates are likely to strengthen in popularity as more people incorporate them into their lifestyles. The development of services for specific markets, such as prenatal and postnatal yoga and Pilates, will continue to expand the industry’s share of the health and fitness sector. The market for services targeted towards seniors is expected to further broaden the industry’s revenue base. The adoption of industry practices is also anticipated to result in a continuing stream of potential instructors seeking training and employment. In the highly fragmented industry, greater use of industry services is expected to amplify internal competition, suppressing industry class prices and limiting revenue growth per enterprise. The industry is forecast to expand at a compound annual rate of 1.7% to be worth $1.1 billion in 2018-19.

Industry PerformanceExecutive Summary | Key External Drivers | Current Performance Industry Outlook | Life Cycle Stage

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Industry Performance

Current Performance

Over the five years through 2013-14, the Pilates and Yoga Studios industry has transitioned from a growth phase to maturity. After a rocky start to the five-year period, with revenue declines in 2008-09, the industry has recovered to grow at a compound annual rate of 2.6% to an estimated $998.4 million. In 2013-14, industry revenue is expected to increase by 1.4%. This is a dramatic shift from the preceding five-year period in which the industry expanded quickly to meet growing community interest in yoga and Pilates. After initial rapid expansion, industry expansion has slowed due to the combination of internal price competition and market acceptance of basic industry services.

Growing internal competition has pushed operators to compete on either price or product. The sophistication of industry services has increased and the markets targeted by industry services have expanded. Increased price competition over the past five years has

adversely affected industry profitability. Margins have declined over the period at a compound annual rate of 4.9% to an estimated 5.1% of revenue in 2013-14. While demand for industry services has grown over the period, the movement to the mainstream of the fitness industry has led to larger operators chasing volumes not margins.

Key External Driverscontinued

other dwelling services, electricity, gas and other fuel, operation of vehicles, transport services and communications. In 2013-14, real household discretionary income is expected to grow, providing an opportunity for the industry.

Total health expenditureTotal expenditure on health includes expenditure on Pilates and yoga services. This driver captures the total amount of health expenditure in Australia. An increase in the total expenditure on health will have a positive effect on industry revenue. In 2013-14, total health expenditure is expected to increase.

Total time available for leisure and recreationAn increase in the availability of leisure time has a positive effect on consumer demand for industry services. This driver analyses the average amount of leisure

time available per person, per week. The more free time people have, the more likely they are to engage in yoga or Pilates activities. In 2013-14, the total time available for leisure and recreation is expected to remain stable.

Sport participationAn increase in the number of people participating in sport or general exercise is good for the industry. This driver measures the median number of exercise and sports sessions per week by Australians and is sourced from the Australian Sports Commission. An increase in the sport participation rate can represent an increase in demand for the services of competing industries, so the driver oscillates between a positive and negative affect on industry revenue. In 2013-14, sport participation is expected to decline, which poses a threat to the industry.

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Prices and competition

The expansions in revenue over the past five years captures the industry’s recovery from poor demand conditions in 2008-09. However, it obscures the much slower rate of growth over the past three years, which is more indicative of the current state of the industry. The rush of operators that joined the industry in the five years through 2008-09 created a highly competitive operating environment in the industry. Gym chains, community centres and other sport and fitness service providers were active in the industry over the period and tended to increase the number of classes on offer. These organisations typically provide a more generic product, but at a substantial per-class discount than dedicated yoga or Pilates studios.

Revenue per enterprise has grown at a slower rate than industry revenue over the past five years. This suggests that industry revenue growth is coming

through an increasing number of enterprises and establishments, not through revenue growth for existing players. As the number of establishments and employees has increased over the past five years, downwards price pressure has grown. The industry’s low barriers to entry mean that industry exits grow faster in periods of intense price competition, which is compensated for by yet more entrants. Growing industry participation masks the underlying turbulence in the industry, particularly in 2008-09 and 2010-11.

Industry price competition has extended to wages, with average wages declining by 3.8% as more people gravitate towards a career in the industry. For many practitioners, yoga and Pilates represent more than just exercise. Yoga in particular often becomes a holistic practice, involving mind, body and

Growth and acceptance

During the mid-2000s, there was widespread adoption of yoga and Pilates in Australia. The industry has since expanded from a niche activity, to a mainstream fitness activity with yoga classes offered in studio spaces inside large gyms and community centres. The industry’s services have achieved widespread acceptance within the Australian community, with participation rates for yoga and Pilates on par with Australian Rules football. Pilates and yoga are also funded through the extras packages of some health insurers, particularly for Pilates classes run by trained physiotherapists. This has further increased community access to and acceptance of industry products.

The growth in demand for industry services is part of a broader Australian growth trend in health and wellbeing. IBISWorld evaluates trends in sports participation using data from the Australian Sports Commission. This data shows the average number of sessions of exercise to be stable over the five years

through 2013-14, likely due to growing awareness of the adverse health effects caused by an inactive lifestyle. The industry has increasingly tailored services to niche markets such as prenatal and postnatal yoga and Pilates. These classes are likely to be gateway products for the industry, helping to establish new health habits at a period in women’s lives when their focus on health and wellbeing is high, which could act to draw in long-term clients.

Although the popularity of yoga and Pilates has grown, this has not always translated into increased revenue over the past five years. Following the global economic turmoil in 2007, consumers cut back on discretionary purchases despite the Australian economy emerging from the crisis relatively unscathed. Casual class visits and memberships are considered discretionary purchases, and therefore easily cut back during tough times. In 2008-09, industry revenue declined by 3.9% due to a combination of falling demand and internal price competition.



Prices and competitioncontinued

lifestyle. The uptake of both disciplines has increased the pool of people interested in participating in the industry

as instructors or studio operators. This has set off a long-term trend of increasing industry employment.

Industry Outlook

Over the five years through 2018-19, industry revenue is projected to grow at a compound annual rate of 1.7%, to be worth $1.1 billion. In 2014-15, the industry is expected to grow by 1.8%. Demand for industry services, particularly niche services, is expected to grow in the next five years and allow the industry to expand

in real terms. While price competition will remain a factor for operators with mainstream product offerings, high-value industry activities, such as the provision of accreditation and teaching programs, are forecast to make up an increasing share of industry revenue as internal regulation of the industry increases.

Finding their niche In the next five years, the industry is expected to aggressively target special-needs groups. Already, niche classes, such as prenatal and postnatal yoga and Pilates, contribute to industry revenue in a discernible way. The industry is likely to extend into other stage-of-life markets such as seniors’ classes. Operators are expected to benefit by catering to the specific health needs of ageing Australians by tailoring services to address mobility, flexibility and strength issues. The recognition of the role of flexibility in overall health and wellbeing is also expanding industry markets. Operators are increasingly finding work in the public sector, such as in schools and aged-care facilities.

With the widespread acceptance of the industry’s products and services, differentiation through studio types and equipment is expected to increase internal competition. Bikram yoga operators, due to the specific requirements of their studios, are an early example of this trend. Within Pilates, operators are expected to distinguish themselves further with

classes targeted at specific injuries and medical conditions. Investment in specific Pilates equipment is expected to grow as well. This strategy will allow studio owners to set themselves apart from gyms and other providers who only offer basic mat classes. Niche operators are expected to charge higher fees for their specialised services and to generate higher profitability levels than the overall industry.

An increased emphasis on training and accreditation is expected to come as a by-product of specialisation. Industry employee numbers are forecast to grow as people seek to extend their yoga or Pilates practice by teaching. Although industry employment and wages are calculated on a full-time equivalent basis, in reality many of the industry’s employees work part-time. Therefore, the expansion in full-time equivalent employees is likely to have a larger impact on revenue generated from accreditation and teaching than the forecast employment growth rate of 1.5% annualised might suggest.

Growth matures After solidifying its presence in the Australian health and fitness sector over the five years through 2013-14, the industry is expected to consolidate over the next five years. This is a sign of the increasing maturity of the industry. Over

the five years through 2018-19, the number of industry enterprises is expected to decline while establishment growth remains low. The size of industry operators is expected to increase, both in terms of revenue and in terms of



Growth maturescontinued

employment. Over the next five years, revenue per enterprise is expected to grow at a compound annual rate of 2.4%, which is a healthy sign for the industry. Wage costs are expected to contract as a

share of industry revenue. Despite increasing rents, industry margins are forecast to hold steady as the industry expands the scope of the products and services it provides.


Industry PerformanceIndustry value added is expected to underperform GDP over the 10 years through 2018-19

There has been wholehearted market acceptance of industry products

The number of establishments has reached saturation point and, in many localities, limited opportunities exist for new entrants

Life Cycle Stage


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DeclineShrinking economicimportance

Quality GrowthHigh growth in economic importance; weaker companies close down; developed technology and markets

MaturityCompany consolidation;level of economic importance stable

Quantity GrowthMany new companies; minor growth in economic importance; substantial technology change

Key Features of a Mature Industry

Revenue grows at same pace as economyCompany numbers stabilise; M&A stageEstablished technology & processesTotal market acceptance of product & brandRationalisation of low margin products & brands

Physiotherapy Services

Toy and Sporting Goods Wholesaling

Gyms and Fitness CentresIndustrial and Other Property Operators

Alternative Health Therapies

Pilates and Yoga Studios



Industry Life Cycle While the Pilates and Yoga Studios industry has grown rapidly over the past two decades, the industry has begun to exhibit signs of maturity. Indicators that the industry is currently in the mature phase of its life cycle include the shrinking growth rates for industry revenue and value added and a saturation of industry operators.

Industry value added (IVA), which measures the industry’s contribution to the overall economy, is forecast to grow at a compound annual rate of 0.4% over the 10 years through 2018-19. This is a much lower rate than Australian GDP growth over the same period, which is projected to rise at a compound annual rate of 2.5%. Therefore, the Pilates and Yoga Studios industry is forecast to contribute a smaller share to the overall economy in 2018-19 than it did in 2008-09.

Over the past 10 years, a large number of health-conscious people, particularly urban women, flocked to group fitness

classes, which drove demand for the services of the Pilates and Yoga Studios industry. While the practices of yoga and Pilates are not new, the popularity of these activities has soared over the past two decades as interest in alternative forms of fitness and relaxation have grown.

There are currently limited opportunities for new operators to enter the industry as participation rates have begun to stagnate. The industry’s low barriers to entry have meant that a large number of new operators flocked to offer yoga and Pilates services in the early 2000s. This included both gyms providing yoga and Pilates as part of a portfolio of other fitness services and niche operators running specialised yoga studios. The industry is now saturated in many localities and the number of enterprises is expected to grow by a compound annual rate of just 0.2% in the 10 years through 2018-19.

This industry is Mature


Products & Services The industry’s activities include a number of types of classes, accreditation and training and retail sales of equipment, clothes and other yoga and Pilates accessories.

Yoga classesYoga is an ancient Indian discipline combining mental, physical and spiritual practices. Contemporary Western interpretations tend to view yoga as a holistic approach to general health and fitness that involves different breathing techniques, postures and meditation. Most styles of yoga used for general health and fitness are derived from hatha yoga, which is focuses on poses, breathing techniques and meditation. Other popular forms of yoga include ashtanga yoga, Bikram yoga and Iyengar yoga. Bikram is an intense high-impact form of yoga, which is

practised in studios heated up to 37 degrees Celsius. The popularity of Bikram and other high-impact yoga styles have grown rapidly over the past decade due in part to their fast rate of adoption by fitness centres.

Other slower paced versions of hatha yoga, such as Iyengar, focus on alignment using props. The term ‘hatha yoga’ is often associated with slower and gentler style of classes. These slower paced yoga styles have also grown rapidly over the past decade because they are viewed as effective methods of exercise for beginners, for the elderly and for people rehabilitating from injuries. In addition, the spiritual and meditation components of yoga have broad appeal due to the growing desire of many people, particularly in major cities, to unwind and disconnect from their busy lives and growing workloads.

KEY BUYING INDUSTRIES

Z9901 Consumers in Australia Consumers drive demand for yoga and Pilates services.

KEY SELLING INDUSTRIES

F3734 Toy and Sporting Goods Wholesaling in Australia This industry supplies sporting goods to Pilates and yoga operators, including yoga balls, yoga straps, Pilates springs and athletic gear.

L6712c Industrial and Other Property Operators in Australia This industry leases studio space to Pilates and yoga companies.

Products & MarketsSupply Chain | Products & Services | Demand Determinants Major Markets | International Trade | Business Locations

Supply Chain

Products and services segmentation (2013-14)

Total $998.4m

47.3%Yoga classes

4.1%Other

30.2%Pilates and hybrid classes

7.3%Accreditation and training

6.0%Equipment and accessories retailing

5.1%Prenatal and postnatal classes



Products & Markets

Products & Servicescontinued

In the past five years, yoga classes have declined in terms of their contribution to industry revenue, due to faster growth in other less mature segments.

Pilates and hybrid classesPilates was developed in the 1920s and focuses on developing core body strength, posture and alignment. The main types of Pilates practised in the industry include a series of stretches and exercises that create resistance through gravity and body weight, or by using specialised equipment or weights. Pilates classes range from beginners to advanced and generally cost between $15 and $35. Other hybrid forms of Pilates and yoga exist (referred to as Yogalates or Yogilates), which incorporate core strength exercises, yoga postures, breathing techniques and meditation or relaxation components. Although not as prevalent as yoga, Pilates and hybrid forms of the two practices have also grown rapidly in popularity over the past decade because they also cater for different types of people in terms of their level of intensity, impact and difficulty. Their contribution to industry revenue has increased over the past five years.

Prenatal and postnatal classesYoga and Pilates classes catering specifically to pregnant women, mothers and children are a major area of growth within the industry. Prenatal yoga classes generally involve a series of gentle poses and breathing and relaxation techniques, which help women maintain a gentle exercise routine through pregnancy. These techniques also assist women prepare for labour and motherhood by developing core strength and good breathing techniques. They often involve a meditation and relaxation component to help manage the stress of pregnancy and impending motherhood.

Yoga for children in schools or other institutions has also grown rapidly over the past five years, especially given recent concerns over rising levels of childhood

obesity in Australia. These classes can range from instructors teaching school classes to new mothers practising gentle yoga with babies under the supervision of an instructor. These classes represent areas of growth for industry operators since they involve people during formative periods during their lives (pregnancy and childhood) when they are more likely to be receptive about holistic approaches to health and wellbeing. This area of industry activity is expected to increase in the next five years.

Equipment and accessories retailingThe retail segment of the industry involves the sale of yoga and Pilates accessories such as clothing, yoga mats, blocks, workout equipment, straps, nutritional supplements and food. Retail sales for yoga and Pilates studios are generally a means for businesses to make extra revenue on top of existing yoga and Pilates classes. These are generally discretionary purchases and so are contingent on macro-economic factors such as consumer sentiment and disposable income. Accordingly, retail sales of yoga and Pilates accessories have remained stagnant over the past five years due weak consumer sentiment and the adverse impact of the global financial crisis.

Accreditation and trainingThe accreditation and training of yoga and Pilates instructors generally costs between $2,000 and $5,000. Revenue from this segment initially grew rapidly over the past decade in line with the rising popularity of yoga and Pilates. However, over the past five years, revenue from this segment has remained largely stagnant as the industry has become more saturated and overall participation has slowed. As the industry becomes more specialised over the next five years, revenue for this segment is likely to increase as people attempt to build on their yoga and Pilates skills through teaching.


Products & Markets

Major Markets Major markets for this industry can be broken down according to participation rates of four key age brackets.

People aged less than 24 yearsThe number of young Australians involved in yoga has grown over the past five years, mainly due to rising concerns about the health and fitness of school children and

the growth in childhood obesity in Australia. The growing popularity of mother and baby yoga, since it offers a bonding opportunity for parents and babies, is also responsible for the growing participation of this market. Yoga can also be a popular school activity that external instructors can teach during physical education classes or during more

DemandDeterminants

Health consciousness, real household discretionary income, leisure time availability and seasonal conditions determine demand for the Pilates and Yoga Studios industry. The industry is driven by Australians’ desire to live a healthy lifestyle. As people change their daily schedules to improve their health they are more likely to demand the services of Pilates and yoga studios. As such, the level of health consciousness has increased over the past five years. As people become more conscious of their health and how to improve it, the number of enrolments at Pilates and yoga studios has increased. The relative cost associated with other health-orientated recreational activities, in particular sports, can moderate the demand for industry services.

The level of real household discretionary income influences demand for Pilates and yoga. When discretionary incomes are high, people have more

money in their pockets to spend on industry services. When household income falls people tend to cut back unnecessary expenses. Specifically, they may hold off expenses at Pilates and yoga studios. Consumer confidence follows a similar pattern. When consumer confidence is high, Australians are confident in their financial outlook and are more willing to spend on industry services. When consumer confidence is low, such as during recessions, people are less confident about their financial futures and therefore reluctant to spend on discretionary services, like those provided by the industry.

The amount of time Australians have available for leisure affects the level of demand for industry services. With more free time, people will have the option to enrol in Pilates and yoga studios. In terms of holiday seasons, the forming of New Year’s resolutions is estimated to boost demand for industry services.

Major market segmentation (2013-14)

Total $998.4m

41.9%People aged 25 to 44 years

35.1%People aged 45 to 64 years

13.8%People aged less than 24 years

9.2%People aged over 65 years



Products & Markets

International Trade The Pilates and Yoga Studios industry is a service-orientated industry and international trade does not generally apply. The majority of operators are locally owned and operated and earn most of their revenue from domestic activity. The main way the industry is

connected to the international marketplace is through the provision of services to tourists visiting Australia, especially those visiting specialist spa retreats or resorts. By definition, this type of service does not fall under the purview of international trade.

Major Marketscontinued

specialised before- or after-school programs. Yoga has also become a popular activity for health-conscious teenagers or young adults. For people in this age group, beyond the perceived health benefits, the industry’s services are also a good social outlet and stress-relieving activity.

People aged 25 to 44 yearsThis is the industry’s largest market segment because it consists of groups of people that are generally in full-time work with higher disposable incomes. This means they have a greater capacity to attend regular yoga and Pilates classes and buy the necessary accessories. This market segment is also the most likely to undertake yoga or Pilates training and accreditation courses. People in this age bracket are also most likely to be or become parents, which means that it incorporates the fast-growing market for post and prenatal yoga classes. The market share of this age bracket has remained steady over the past five years in line with overall industry saturation.

People aged 45 to 64 yearsThis age bracket generally consists of

people with high disposable incomes due to the relatively higher rates of employment and career advancement that are likely to occur compared with the younger or older age brackets. Consumers in this category also have the capacity to attend regular classes or contemplate undertaking a yoga or Pilates accreditation course perhaps as part of a career change or because they are moving into early retirement. Participation from this segment has grown marginally over the past five years due to the amount of baby boomers moving towards retirement.

People aged over 65 yearsThis market segment mainly includes retired and senior Australians. Industry participation is expected to be concentrated mainly around gentle yoga classes. This market segment is expected to grow strongly over the next five years given the ageing Australian population and the large amount of baby boomers moving into retirement. This will also be supported by the long-term trend of rising health consciousness.


Products & Markets


TAS2.8

WA7.2

QLD20.0

VIC28.6

NSW31.1

NT0.9

SA7.0

ACT2.4

Establishments (%)

Cold Zone (<10) <25 <50 Hot Zone (<100) Not applicable

Business Locations 2013-14


Products & Markets

Business Locations Pilates and yoga studios are concentrated around Australia’s eastern seaboard given that Victoria, New South Wales and Queensland account for 79.7% of industry establishments collectively. As such, the spread of business locations for the industry generally follows the dispersion of the Australian population. The large share of establishment numbers in eastern Australia has remained largely stable over the past few years. Within this area, establishment numbers have risen in Victoria and Queensland but have declined slightly for New South Wales.

These trends make sense given that a key success factor for this industry is location and the size of the market. As such, most business establishments operate in the major cities of Sydney, Melbourne, Brisbane, Adelaide and Perth where the bulk of the population resides. Many studios are located in suburban areas, shopping malls and inner-city areas. Some of the more expensive businesses operate in CBDs where they

can target office workers who generally have high levels of disposable income. This is a lucrative growth area given the rise in corporate wellness and the number of corporate gym memberships in major cities.

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Distribution of establishments vs. population



Cost Structure Benchmarks

While industry cost structures vary depending on the services provided, the markets served and geographic locations, they are all dominated by wage expense.

ProfitIndustry profitability is projected to have declined over the past five years. Industry operating profit margins declined from an estimated 6.5% in 2008-09 to 5.1% in 2013-14. Profitability has fallen due to increasing competition between providers. The popularity of Pilates and yoga prompted an initial rush of service provides, which heightened competition and subsequently hurt profit margins.

Industry profitability is expected to improve marginally over the next five

years. Profit margins are forecast to increase but round off to a near identical 5.2% in 2018-19. Profitability is expected to rise slightly as some operators exploit market and service niches to minimise direct competition.

WagesWage costs as a percentage of revenue are huge and form the largest industry expense. The industry spends most of its revenue on wages because of its reliance on high-skill employees with the expertise needed to teach within the industry.

While wage costs are high, wage costs as a percentage of revenue have decreased over the past five years. Wage costs fell as a slew of new instructors

Key Success Factors Easy access for clientsA high-profile location that offers easy access and parking can provide a competitive advantage for firms in the industry.

Having a good technical knowledge of Pilates and yogaPilates and yoga studios rely on skilled instructors and staff members to lead training sessions, including group classes and individual workouts.

Quality instructors help attract and retain customers.

Effective product promotionBeing able to promote a business effectively increases awareness and attracts greater membership and local patronage.

Provision of appropriate facilitiesProviding appropriate equipment and maintaining it regularly is essential to attract and retain customers.

Market Share Concentration

The Pilates and Yoga Studios industry is highly fragmented with no one company holding a dominant market share. The four largest players are expected to account for less than 5.0% of industry revenue in 2013-14. Most operators run a single location that caters to a narrow local market. The industry’s high labour costs and relatively low profit margin are generally not conducive to opening multiple locations across a wide geographic area.

Market share concentration has declined over the past five years as participation in yoga and Pilates has

increased, as more forms of specialised yoga and Pilates have become available and as barriers to entry remain low. These factors have allowed sole-traders to set up quickly wherever an active market for their services exists. On the other hand, a number of large gym chains offering yoga and Pilates classes alongside free weight, sauna, spa and fitness facilities, have struggled to compete against more nimble competitors.

Market share concentration is expected to remain fragmented over the next five years as the industry remains highly competitive and limited merger and acquisition opportunities exist.

Competitive LandscapeMarket Share Concentration | Key Success Factors | Cost Structure Benchmarks Basis of Competition | Barriers to Entry | Industry Globalisation

Level Concentration in this industry is Low

IBISWorld identifies 250 Key Success Factors for a business. The most important for this industry are:


Competitive Landscape

Cost Structure Benchmarkscontinued

entered the industry. The greater availability of instructors heightened wage competition and pushed down wage costs as a percentage of revenue. New instructors are expected to continue to enter the industry over the next five years and further push down wage costs.

RentRent costs as a percentage of revenue are significant due to the industry’s reliance on large spaces for classes. Many companies tend to rent out facilities rather than own them. Over the five years through 2013-14, rent as a percentage of revenue is forecast to increase in line with higher rents in the rest of the property market.

PurchasesPurchase costs as a percentage of revenue are small compared with industry revenue due to the lack of raw materials or inputs. The industry is instead highly reliant on teachers and instructors, with purchases being small compared with

teacher compensation.

UtilitiesUtilities costs are relatively small but vary across industry firms. Some industry providers, such as those that provide Bikram yoga services, use more energy. Bikram yoga providers spend more on utilities because they must heat their premises to high temperatures over long periods of time.

DepreciationDepreciation costs as a percentage of revenue are relatively slim. This is because there is little equipment needed to provide yoga and Pilates services, and what is needed is generally low value. Service providers also have the option to rent equipment.

OtherOther costs within the industry include administration, insurance, marketing and certification.

Sector vs. Industry Costs

■ Profi t■ Rent■ Utilities■ Depreciation■ Other■ Wages■ Purchases

Average Costs of all Industries in sector (2013-14)

Industry Costs (2013-14)

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enue

80

1007.6

13.6

61.0

10.42.5 1.53.2

5.1

6.3

69.7

4.72.23.0

9.0



Competitive Landscape

Industry Globalisation

Although a number of companies with international arms operate in the industry, the Pilates and Yoga Studios industry has a low level of globalisation. The majority of firms operate on a local level, earn most of their revenue from domestic activity and are owned and

operated by small business owners.The level of industry globalisation is

expected to remain stable over the next five years. Limited economies of scale exist for Australian Pilates and yoga studio operators to expand overseas or for international companies to enter the Australian market.

Barriers to Entry Barriers to entry into the Pilates and Yoga Studios industry are low, as are capital requirements. A new entrant can rent studio space rather than investing in a property purchase, which lowers capital requirements. Furthermore, the equipment required to provide Pilates and yoga services are relatively low cost.

The brand strength of existing firms does not pose a significant hurdle. While there is some brand recognition within the industry, a new entrant that offers a good service at a competitive price can build its own brand recognition in its area. As such, new entrants do not face an unfair advantage in terms of brand recognition.

The training of instructors does not pose a significant barrier to entry. The

cost to train qualified staff is low compared with other professions. A larger hurdle is the customer loyalty. However, as long as the new entrant offers a competitive service and price, and is located near to customers, the entrant can quickly gain customer loyalty.

Basis of Competition The Pilates and Yoga Studios industry has become more competitive over the past five years. Competition has increased largely due to market penetration, particularly in metropolitan areas where there has been the strongest growth in the number of new firms.

Studios compete on price, quality of service and location. Studios that have difficulty differentiating their service will compete through price. The firms that can compete on quality rely on seasoned and highly skilled instructors. These instructors provide engaging sessions that generate business and retain clientele. Consequently, industry operators compete for high-quality instructors to help drive business growth.

Some firms use brands strength and accreditation to compete. These firms

may join a network chain to gain access to a trusted brand. Such memberships can help firms save on overhead costs, in particular marketing expenses. Additionally, these firms may invest in accreditation as a signal to potential clients that their services are high quality.

Operators may also compete by offering a variety of class types to entice customers. Such classes can include power yoga, prenatal yoga and children’s yoga. On the other hand, operators can differentiate themselves to reduce direct competition to their service. Studios that offer memberships can also smooth their revenue stream and plan expenses better. They may also diversify their revenue stream by offering a range of retail products such as clothing, mats and equipment.

Level & Trend Competition in this industry is Medium and the trend is Increasing

Barriers to Entry checklist Level

Competition MediumConcentration LowLife Cycle Stage MatureCapital Intensity LowTechnology Change LowRegulation & Policy LightIndustry Assistance Low


Level & Trend Barriers to Entry in this industry are Low and Steady

Level & Trend Globalisation in this industry is Low and the trend is Steady


Other Companies The Pilates and Yoga Studios industry is highly fragmented and no one operator controls a significant portion of the market. As the popularity of yoga and Pilates has increased over the past five years, traditional gyms that run classes as part of a full cache of services have been joined by specialist yoga and Pilates providers operating out of small studios.

YMCA AustraliaEstimated market share: 1.2%The National Council of YMCAs of Australia (YMCA Australia) consists of a federation of 30 Member Associations across Australia, which employ over 13,000 staff across Australia. YMCA Australia is affiliated with the World Alliance of YMCAs, which is a confederation of national YMCA movements. The YMCA movement first began in the United Kingdom in 1844. Each YMCA Australia Member Association operates in a city or region and provides a range of accommodation, aquatics and youth services. YMCA Australia provides yoga and Pilates services under the group’s Health and Wellness service division, which contributes around 25% to the YMCA’s annual revenue. In 2010-11, there were over 4.2 million attendances at YMCA Australia’s health and wellness activities. Pilates and yoga activities contribute an estimated 4.0% to the organisation’s combined revenue.

Fitness FirstEstimated market share: 1.0%Fitness First started as a small operation in the United Kingdom and is now one of the largest gym, health and fitness club groups in the word, with around 500 clubs and over 1.2 million members worldwide. The global chain is run by hedge fund investors Oaktree Capital and Marathon Capital, after acquiring the group from BC Partners in 2011. Fitness First landed in Australia in 2000 and is now one of the country’s largest operators of full-service gyms, with around 300,000 members.

Most Fitness First gyms provide free

and loaded weight facilities, saunas, steam rooms and swimming pools. A major draw-card to Fitness First gyms is the range of classes provided for members including BodyPump, Step, Tai Chi and Zumba. They also provide a number of yoga and Pilates options.

The company’s financial performance in the early 2000s was impressive as revenue and profit both grew year on year as Australian gym memberships grew. Over the past five years, the business model of providing large-scale, one-stop-shop access has become less profitable and Fitness First is currently struggling to compete with a growing number of low-cost gyms with nimbler operating structures. As of 2012-13, the company is looking to off-load up to 30 of its wholly owned clubs as part of a restructure. Six Fitness First gyms were sold to Ardent in early 2012.

Yoga and Pilates classes are estimated to account for around 3.0% of Fitness First’s total revenue.

Ardent Leisure Group Estimated Market Share: Less than 1.0%Ardent Leisure Group is one of the largest owners of leisure assets in Australia, where it runs a portfolio of bowling centres, theme parks and marinas. The company also operates in the United States through Main Event, a chain of family entertainment centres. Ardent participates in the Pilates and Yoga Studios industry through its health clubs arm, which includes Goodlife Health Clubs and a number of other gyms and fitness centres. Goodlife Health Clubs was established in 2002 and has grown to a network of over 40 gyms for more than 130,000 members across Victoria, New South Wales, Queensland, South Australia and Western Australia. The chain was purchased by Ardent Leisure Group (then Macquarie Leisure Trust Group) in September 2007.

Ardent’s health club segment has performed strongly over the past five years and has been the company’s best performing division. An estimated 5.0% of Ardent Leisure Group’s health club

Major CompaniesThere are no major players in this industry | Other companies


Major Companies

Other Companiescontinued

revenue is derived from yoga and Pilates services.

In 2012-13, Ardent continued its recent buying splurge, picking up Fenix Fitness Clubs for $60.9 million and six Fitness First clubs for $5.4 million.

Ardent is expected to continue to pursue an aggressive acquisition strategy over the next five years, looking to make targeted purchases of low-cost, well-performing health clubs that it believes have growth potential.


Capital Intensity Capital intensity in the Pilates and Yoga Studios industry is low. The industry is highly reliant on skilled employees and has little need for equipment and production plants. The industry spends an estimated $31.68 on labour for every dollar invested in new capital. The industry spends little on new capital such as specialised equipment for Pilates workouts. Instead, the industry spends most of its revenue on attracting and maintaining a group of talented instructors who will then provide a high-quality service to entice repeat customers.

Operating ConditionsCapital Intensity | Technology & Systems | Revenue VolatilityRegulation & Policy | Industry Assistance

Tools of the Trade: Growth Strategies for Success


Labo

ur In

tens

ive Capital Intensive

Change in Share of the Economy

New Age Economy

Recreation, Personal Services, Health and Education. Firms benefi t from personal wealth so stable macroeconomic conditions are imperative. Brand awareness and niche labour skills are key to product differentiation.

Traditional Service Economy

Wholesale and Retail. Reliant on labour rather than capital to sell goods. Functions cannot be outsourced therefore fi rms must use new technology or improve staff training to increase revenue growth.

Old Economy

Agriculture and Manufacturing. Traded goods can be produced using cheap labour abroad. To expand fi rms must merge or acquire others to exploit economies of scale, or specialise in niche, high-value products.

Investment Economy

Information, Communications, Mining, Finance and Real Estate. To increase revenue fi rms need superior debt management, a stable macroeconomic environment and a sound investment plan.

Physiotherapy Services

Toy and Sporting Goods Wholesaling

Gyms and Fitness Centres

Industrial and Other Property Operators

Alternative Health Therapies


Capital intensity

0.5

0.0

0.1

0.2

0.3

0.4

SOURCE: WWW.IBISWORLD.COM.AUDotted line shows a high level of capital intensity

Capital units per labour unit


Administrative and Support

Services

Economy

Level The level of capital intensity is Low


Operating Conditions

Revenue Volatility Revenue volatility is considered moderate in the Pilates and Yoga Studios industry. The highly discretionary nature of Pilates and yoga has contributed to the medium volatility in industry revenue. Consumer sentiment has fluctuated greatly over the past five years, particularly during the economic downturn. Periods of low consumer sentiment cause consumers to cut back on discretionary expenses, including expenditure on Pilates and yoga services. These cutbacks have contributed to revenue volatility over the past five years.

Levels of competition also affect

revenue volatility. Industry participants enter and leave the industry in waves, which can lead to periods of price-based competition. These shifts in industry competition contributed to the level of revenue volatility over the past five years.

While these factors encouraged greater revenue volatility, the level of volatility has actually decreased over the past five years. The industry is coming off a growth phase. The initial rapid growth stage created volatility in industry revenue. As the industry’s growth cooled, revenue growth slowed and led to an overall decrease in revenue volatility.


Volatility vs Growth

Reve

nue

vola

tility

* (%

)

1000

100

10

1

0.1

Five year annualised revenue growth (%)–30 –10 10 30 50 70

Hazardous

Stagnant

Rollercoaster

Blue Chip

* Axis is in logarithmic scale


A higher level of revenue volatility implies greater industry risk. Volatility can negatively affect long-term strategic decisions, such as the time frame for capital investment.

When a fi rm makes poor investment decisions it may face underutilised capacity if demand suddenly falls, or capacity constraints if it rises quickly.

Level The level of Volatility is Medium

Technology & Systems Yoga classes are often performed using little or no equipment as most exercises are conducted using only the participant’s body weight as resistance. Necessary equipment rarely extends beyond simple yoga mats and exercise balls. Technology requirements for businesses offering basic yoga classes are low. Forms of yoga, such as Bikram, which requires a moderated room temperature, have higher technology requirements. Installing heating, ventilation and shower facilities mean set-up costs can be high for these types of establishments, as much as $500,000 for even a small studio.

Pilates have slightly higher technology requirements. Most exercises require physical equipment, which can be

expensive for operators seeking to open a new business on a tight budget. The most widely used apparatus in Pilates is the reformer: a sliding chair on a wooden or metal base, with leather straps for resistance. Other forms of equipment typically used in a Pilates studio include exercise balls, the Cadillac, Wunda Chair, ladder barrel and high chair.

There have been some slight developments in yoga and Pilates equipment over the past five years. However, these have been improvements in existing technology, rather than outright advancements. Technological change is expected to continue to remain low over the next five years in line with current trends.

Level The level of Technology Change is Low


Operating Conditions

Industry Assistance There is no specific provision of government assistance for the industry. Operators can source information, training and advice from many industry organisations. These include Yoga Australia, the International Yoga Teachers Association, Satyananda Yoga

Teachers Association, BKS Iyengar Yoga Association of Australia, Yoga Alliance, Australian Association of Yoga in Daily Life, Australian Fellowship of Yoga Teachers, the Australian Pilates Method Association and other related organisations.

Regulation & Policy Regulation for operators involved in yoga and Pilates include consumer protection laws, accreditation requirements for instructors and local council permits for the location of a studio. Consumers are protected under the Trade Practices Act and other fair trading acts in most states for issues regarding the disclosure of membership contracts, especially if they attend yoga and Pilates classes at gyms or fitness centres. These acts protect consumers against misleading communications, and ensure confidentiality and information privacy.

Operators in the industry must also follow work health and safety laws recently developed by the Federal Government, which consolidated the former occupational health and safety laws of all the states and territories. Instructors have a duty of care to workers, students and themselves to minimise the risk of potential dangers such as the safe provision and monitoring of equipment, incense and essential oils. This also includes cautious teaching and monitoring difficult and intricate poses or exercises that entail a high risk of injury.

Yoga and Pilates instructors also need to follow certain guidelines in order to become accredited teachers. For yoga teachers this includes completing the required teaching training and experience to obtain a Yoga Australia membership. Yoga Australia provides provisional membership to people who have completed 200 hours of training and full membership once 350 hours of training have been completed. Beyond that, the recognised instructor level of qualification increases in proportion with the subsequent hours of teaching. Fitness professionals must also obtain recognition from Yoga Australia by demonstrating a minimum of 200 teaching hours. Once members, instructors must then abide by the rules of Yoga Australia, the associations code of ethics, have an up-to-date first aid certificate and invest in personal development training. Pilates instructors must also complete an accreditation course and a minimum of 200 teaching hours in order to take classes. Pilates instructors generally need to have first aid and CPR certificates.

Level & Trend The level of Regulation is Light and the trend is Steady

Level & Trend The level of Industry Assistance is Low and the trend is Steady


Key StatisticsRevenue

($m)

Industry Value Added

($m) Establishments Enterprises Employment Exports ImportsWages ($m)

Domestic Demand

2004-05 753.2 660.0 4,685 2,288 8,064 -- -- 573.5 N/A2005-06 881.5 717.7 5,168 2,521 9,134 -- -- 637.4 N/A2006-07 897.4 679.7 5,038 2,455 8,655 -- -- 600.7 N/A2007-08 913.6 722.2 5,280 2,565 9,099 -- -- 645.4 N/A2008-09 877.8 780.5 5,438 2,640 9,218 -- -- 704.6 N/A2009-10 943.9 780.3 5,499 2,667 9,248 -- -- 700.7 N/A2010-11 952.2 734.0 5,507 2,662 10,242 -- -- 635.2 N/A2011-12 967.6 732.6 5,480 2,646 10,201 -- -- 628.5 N/A2012-13 984.7 752.6 5,614 2,709 10,747 -- -- 678.8 N/A2013-14 998.4 768.7 5,642 2,715 11,042 -- -- 695.8 N/A2014-15 1,016.1 780.5 5,518 2,651 11,468 -- -- 706.4 N/A2015-16 1,031.5 793.5 5,555 2,664 11,563 -- -- 718.2 N/A2016-17 1,037.9 808.1 5,573 2,670 11,611 -- -- 731.3 N/A2017-18 1,063.3 815.9 5,611 2,688 11,741 -- -- 737.1 N/A2018-19 1,087.6 814.4 5,670 2,685 11,918 -- -- 733.9 N/A

IVA/Revenue (%)

Imports/Demand (%)

Exports/Revenue (%)

Revenue per Employee

($’000)Wages/Revenue

(%)Employees

per Est.Average Wage

($)

Share of the Economy

(%)2004-05 87.63 N/A N/A 93.40 76.14 1.72 71,118.55 0.062005-06 81.42 N/A N/A 96.51 72.31 1.77 69,783.23 0.062006-07 75.74 N/A N/A 103.69 66.94 1.72 69,404.97 0.052007-08 79.05 N/A N/A 100.41 70.64 1.72 70,930.87 0.052008-09 88.92 N/A N/A 95.23 80.27 1.70 76,437.41 0.062009-10 82.67 N/A N/A 102.07 74.23 1.68 75,767.73 0.062010-11 77.08 N/A N/A 92.97 66.71 1.86 62,019.14 0.052011-12 75.71 N/A N/A 94.85 64.95 1.86 61,611.61 0.052012-13 76.43 N/A N/A 91.63 68.93 1.91 63,161.81 0.052013-14 76.99 N/A N/A 90.42 69.69 1.96 63,013.95 0.052014-15 76.81 N/A N/A 88.60 69.52 2.08 61,597.49 0.052015-16 76.93 N/A N/A 89.21 69.63 2.08 62,111.91 0.052016-17 77.86 N/A N/A 89.39 70.46 2.08 62,983.38 0.052017-18 76.73 N/A N/A 90.56 69.32 2.09 62,780.00 0.052018-19 74.88 N/A N/A 91.26 67.48 2.10 61,579.12 0.05

Figures are inflation-adjusted 2014 dollars.

Revenue (%)

Industry Value Added

(%)Establishments

(%)Enterprises

(%)Employment

(%)Exports

(%)Imports

(%)Wages

(%)

Domestic Demand

(%)2005-06 17.0 8.7 10.3 10.2 13.3 N/A N/A 11.1 N/A2006-07 1.8 -5.3 -2.5 -2.6 -5.2 N/A N/A -5.8 N/A2007-08 1.8 6.3 4.8 4.5 5.1 N/A N/A 7.4 N/A2008-09 -3.9 8.1 3.0 2.9 1.3 N/A N/A 9.2 N/A2009-10 7.5 0.0 1.1 1.0 0.3 N/A N/A -0.6 N/A2010-11 0.9 -5.9 0.1 -0.2 10.7 N/A N/A -9.3 N/A2011-12 1.6 -0.2 -0.5 -0.6 -0.4 N/A N/A -1.1 N/A2012-13 1.8 2.7 2.4 2.4 5.4 N/A N/A 8.0 N/A2013-14 1.4 2.1 0.5 0.2 2.7 N/A N/A 2.5 N/A2014-15 1.8 1.5 -2.2 -2.4 3.9 N/A N/A 1.5 N/A2015-16 1.5 1.7 0.7 0.5 0.8 N/A N/A 1.7 N/A2016-17 0.6 1.8 0.3 0.2 0.4 N/A N/A 1.8 N/A2017-18 2.4 1.0 0.7 0.7 1.1 N/A N/A 0.8 N/A2018-19 2.3 -0.2 1.1 -0.1 1.5 N/A N/A -0.4 N/A

Annual Change

Key Ratios

Industry Data



Jargon & Glossary

BARRIERS TO ENTRY High barriers to entry mean that new companies struggle to enter an industry, while low barriers mean it is easy for new companies to enter an industry.

CAPITAL INTENSITY Compares the amount of money spent on capital (plant, machinery and equipment) with that spent on labour. IBISWorld uses the ratio of depreciation to wages as a proxy for capital intensity. High capital intensity is more than $0.333 of capital to $1 of labour; medium is $0.125 to $0.333 of capital to $1 of labour; low is less than $0.125 of capital for every $1 of labour.

CONSTANT PRICES The dollar figures in the Key Statistics table, including forecasts, are adjusted for inflation using the current year (i.e. year published) as the base year. This removes the impact of changes in the purchasing power of the dollar, leaving only the ‘real’ growth or decline in industry metrics. The inflation adjustments in IBISWorld’s reports are made using the Australian Bureau of Statistics’ implicit GDP price deflator.

DOMESTIC DEMAND Spending on industry goods and services within Australia, regardless of their country of origin. It is derived by adding imports to industry revenue, and then subtracting exports.

EMPLOYMENT The number of permanent, part-time, temporary and casual employees, working proprietors, partners, managers and executives within the industry.

ENTERPRISE A division that is separately managed and keeps management accounts. Each enterprise consists of one or more establishments that are under common ownership or control.

ESTABLISHMENT The smallest type of accounting unit within an enterprise, an establishment is a single physical location where business is conducted or where services or industrial operations are performed. Multiple establishments under common control make up an enterprise.

EXPORTS Total value of industry goods and services sold by Australian companies to customers abroad.

IMPORTS Total value of industry goods and services brought in from foreign countries to be sold in Australia.

INDUSTRY CONCENTRATION An indicator of the dominance of the top four players in an industry. Concentration is considered high if the top players account for more than 70% of industry revenue. Medium is 40% to 70% of industry revenue. Low is less than 40%.

INDUSTRY REVENUE The total sales of industry goods and services (exclusive of excise and sales tax); subsidies on production; all other operating income from outside the firm (such as commission income, repair and service income, and rent, leasing and hiring income); and capital work done by rental or lease. Receipts from interest royalties, dividends and the sale of fixed tangible assets are excluded.

INDUSTRY VALUE ADDED (IVA) The market value of goods and services produced by the industry minus the cost of goods and services used in production. IVA is also described as the industry’s contribution to GDP, or profit plus wages and depreciation.

INTERNATIONAL TRADE The level of international trade is determined by ratios of exports to revenue and imports to domestic demand. For exports/revenue: low is less than 5%; medium is 5% to 20%; and high is more than 20%. Imports/domestic demand: low is less than 5%; medium is 5% to 35%; and high is more than 35%.

LIFE CYCLE All industries go through periods of growth, maturity and decline. IBISWorld determines an industry’s life cycle by considering its growth rate (measured by IVA) compared with GDP; the growth rate of the number of establishments; the amount of change the industry’s products are undergoing; the rate of technological change; and the level of customer acceptance of industry products and services.

NONEMPLOYING ESTABLISHMENT Businesses with no paid employment or payroll, also known as nonemployers. These are mostly set up by self-employed individuals.

PROFIT IBISWorld uses earnings before interest and tax (EBIT) as an indicator of a company’s profitability. It is calculated as revenue minus expenses, excluding interest and tax.

VOLATILITY The level of volatility is determined by averaging the absolute change in revenue in each of the past five years. Volatility levels: very high is more than ±20%; high volatility is ±10% to ±20%; moderate volatility is ±3% to ±10%; and low volatility is less than ±3%.

WAGES The gross total wages and salaries of all employees in the industry. Benefits and on-costs are included in this figure.

Industry Jargon

IBISWorld Glossary

BIKRAM YOGA A popular form of high impact intense yoga. It involves completing yoga postures in a room heated to 37 degrees Celsius.

CADILLAC A Pilates exercise product that includes a trapeze swing, arm and leg springs and push bars fitted to a metal frame above a padded bench.

HATHA YOGA A philosophy focusing on the physical aspects of yoga. It is the main form of contemporary yoga in Australia with many derivatives. It is also considered a gentle type of yoga.

Disclaimer

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