THE serial entrepreneur who built up and successfully exited the LivingWell and Virgin Active chains has plans to expand his latest venture across Scotland after unveiling details of its forthcoming Glasgow launch.
Frank Reed is investing £1.5 million to bring his Sweat! gym concept to Glasgow’s fashionable Finnieston area, with the 22,000 sq ft outlet due to open at the Skypark business centre in the New Year.
And Mr Reed, who has pitched the female-friendly chain at the “next level” up from the budget operators, said he is actively looking at sites to take the brand into Dundee, Aberdeen and Edinburgh.
“Our mission is to open 30 gyms,” said Mr Reed. “I’m a bit of an empire builder when it comes to gym operations, having built up a company called LivingWell Health and Leisure, which I sold to Hilton. Then the big one was obviously Virgin Active, which was huge. We went global – eight countries and sold the business for £1.4 billion.”
Asked why the decision was taken to re-enter the gym market, Mr Reed said he and senior colleagues had been motivated to replicate the positive experience they had building Virgin Active.
“We raised the money through EIS (Enterprise Investment Scheme) – £8.5m was raised by EIS to open four [or] five gyms to prove the concept,” he said.
Noting that Aberdeen, Dundee and Edinburgh are firmly on the agenda, he added: “We’re looking at new gyms all the time.”
The Glasgow outlet will be the third Sweat! outlet after Walsall and Sheffield, with an outlet in Manchester next after the Finnieston branch. The company is targeting a chain of 30 to 40 gyms in the UK in total, opening at a rate of five to six per year.
The company selected Finnieston for the inaugural Sweat! outlet in Scotland after its research had flagged it as one of the best areas to open a gym in the UK.
The demographic profile of the area is tilted toward students and young professionals, while the site in the Skypark basement means it has a vast potential customer base on its doorstep. It is estimated that around 5,000 people work in offices in Skypark, many of whom are young and employed in “modern businesses”.
The chain, which said 75 per cent of its members are 35 or under, hopes to attract between 30 per cent and 40 per cent of Skypark workers as members.
Tony Harris, Mr Reed’s long-standing finance boss, said: “There are more than 100,000 people living in that immediate catchment in Finnieston. A third of them are students [and] half of them are, to use an ‘80s phrase, the upwardly mobile happening people of Glasgow.”
Sweat! is scheduled to open in Glasgow early next month, following a 12-week refurbishment of the one-time paint shop.
The high ceiling gym will be equipped with Technogym kit, and offer classes such as spin. Premium members will be entitled to a motivational session with a trainer once a month to review their progress.
Mr Reed began his entrepreneurial career with a sausage machine business, which he sold to Boots 30 years ago.
He moved into gyms while running Holdsworth, a US bicycle company which he brought to the UK.
That company was sold to LivingWell for £20m.
Mr Reed was then approached by Virgin to develop its chain, which he grew to 300 branches before its sale to Nuffield.
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