Forzani Group to take on specialty fitness in Canada with a twist

Canada's retail giant Forzani Group has announced its plan to enter the specialty fitness retail arena by early to mid-2005 with a prototype store that it would then start franchising across the country by as early as spring 2006.
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Canada's retail giant Forzani Group has announced its plan to enter the specialty fitness retail arena by early to mid-2005 with a prototype store that it would then start franchising across the country by as early as spring 2006.

The stores, to average about 8,000 to 10,000 square feet, would go beyond just being someplace that sells equipment, Tom Quinn, president of Forzani's franchise division, told SNEWS®. Instead, they would combine a personal training studio with an equipment showroom that would bundle a starter package of training sessions with equipment sales to get customers started on the right foot, while also allowing trainers better access to steady business and potential clients.

Fitness "is an area where we don't do a lot of activity," Quinn said. "We see our biggest opportunities where we have our lowest market share today."

Currently, the 391-store chain of corporate and franchise stores (TSX: FGL) has a minute area of fitness and exercise retail space on average per store -- 250 to 500 square feet, Quinn said, with only a couple of stores having more. The stores, therefore, sell mostly accessories like balls and bands, with a few bikes and benches here and there -- "nothing very serious," he added.

The concept going forward would try to tie the growing trend of fitness with personal trainers and their business needs, with local communities the stores are in, he said. He said more and more people are saying they want to get fit, and they go look at treadmills or bikes and may buy something, but then they have no idea how to use them to be able to stick to a program. The relationship the stores would have with local trainers would give one-on-one contact to help the customer with the equipment purchase get a fitness assessment and some education in a package that includes perhaps three private sessions.

"It's a natural thing," Quinn said, pointing to the success of its newest acquisition, Nevada Bob's golf chain, with combining lessons and equipment. "Why wouldn't it work for fitness?"

Forzani has tried in the past to grow its fitness sales, including talks a couple of years ago with Canada's Fitness Depot retail chain, the maker of Northern Lights equipment. Those talks failed, but the plan to enter specialty fitness remained on the books, Quinn said. In fact, the store prototype has been ready to go for more than a year, he said, but Forzani has so many irons in the fire, it was a matter of what goes first and when.

The chain has also said it will grow its specialty franchise business in golf via Nevada Bob's, as well as hockey and running. All of the growth leads toward the company's announced strategy to grow Forzani into a CDN $2.2 billion company by 2008. In the last fiscal year, its sales reached CDN $1.1 billion.

The as-yet-unnamed specialty fitness stores could lend some portion to that growth, with numbers slated at reaching at least 30 to 50 across Canada.

The Forzani Group Ltd. (www.forzanigroup.com) is Canada's largest national retailer of sporting goods, offering brand names and private-label products. It has 217 stores under three corporate banners (Sport Chek, Coast Mountain Sports and Sport Mart) and 174 stores as franchises under six banners (Sports Experts, Intersport, RnR, Econosports, Atmosphere and Tech Shop). The company also retails online at www.sportmart.ca and has sporting goods information at www.sportchek.ca.  

SNEWS® View: It seems the Canadian dealers -- of which many of the largest do fitness alongside something else like tires, spas or farm tractors -- should start looking over their shoulder. In fact, although the model is a bit of a no-brainer, it exists only rarely anywhere in the world. Yet, it could be the very concept that helps hold people's hands so they get comfortable and stick with a program that in the long run benefits themselves, their family, the dealer, the personal trainer and the national economy to boot. We look forward to seeing these stores as they roll out.

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