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Rising Health-Care Costs Fuel Demand for Corporate Wellness Services

More business owners are investing in corporate wellness, a market that continues to show strong growth, according to a recent report, “Corporate Wellness Services in the U.S.,” by IBISWorld. Over the next five years, corporate wellness industry revenue is forecast to grow by 8.4 percent annually to $12.1 billion.

Fitness facility operators could benefit from that growth. Seventy-nine percent of companies with lifestyle management programs are providing nutritional and weight counseling, and 72 percent are offering fitness-related services. IBISWorld forecast that nutrition/weight management could account for about 17.4 percent of industry revenue, and fitness-related services may comprise about 15.9 percent.

“Typically, corporate wellness companies may help businesses develop on-site fitness facilities that garner a high rate of employee participation,” the report states. “In addition, some corporate wellness companies may use their large size as leverage to secure low-cost gym memberships, effectively passing these cost savings to businesses in the form of lower prices for subsidized employee gym memberships.”

IBISWorld healthcare analyst Sarah Turk, the author of the report, said, “Businesses are realizing that they can have a high return on investment for disease management services, with each dollar allocated toward these programs resulting in a $3.80 ROI.”

Seventy-two percent of employers purchased screening services to identify employees’ health risks or intervention services to promote healthy lifestyle choices, according to RAND, a research corporation. For example, companies are collecting employees’ biometric data, such as their height, weight, blood pressure and blood glucose levels, so they can target high-risk employees for intervention programs.

A recent study from Fidelity Investments and the National Business Group on Health found that employers will pay each employee an average of $693 this year as an incentive to participate in wellness programs. That’s an increase from $430 five years ago. The report also found that 47 percent of employees participate in the wellness programs that their employers offer.

Read the original article at Club Industry.

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Planet Fitness’ Surging Expansion Highlights Huge U.S. Economic Trends

Gym chain Planet Fitness continues to surge in popularity in the United States. The secret sauce of the company has been its low-cost gym membership and inviting workout environments. Now, the company is starting to take its show on the road, with an entry into Canada in 2015. But, Planet Fitness’ rise to the top in the highly fragmented gym industry sheds light on two huge trends in the U.S. The first is the growing number of fast food chains, which are packing on the pounds on a nation that is battling with robust levels of obesity. Second, the uprooting of physical retail due to more mobile consumption, as seen hundreds of store closures, continues to afford Planet Fitness access to attractive real estate assets. Brian Sozzi talks with Planet Fitness CEO Chris Rondeau to discuss.

To read the original article, please click here.

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Indoor Tanning Tax Final Regulations Issued

Sally P. Schreiber wrote in the Journal of Accountancy that:

IRSOn Monday, the IRS issued final regulations on the 10% excise tax that has been in effect for amounts paid for indoor tanning services since July 1, 2010 (T.D. 9621). The regulations, which apply to amounts paid on or after June 11, 2013, finalize proposed rules issued in 2010 when the tax first became effective and withdraw the temporary regulations issued at the same time (T.D. 9486; REG-112841-10). The final rules are slightly different from the proposed rules.

The regulations provide that “amount paid” includes all amounts paid to a tanning services provider for indoor tanning services, including any amount paid by insurance. Tans that are received as redemptions of “bonus points” in a loyalty program or “free” tans received after having a certain number of tans are not subject to the tax. Because many tanning salons sell other goods and services in addition to tanning services, the regulations provide rules for determining the tax when the provider charges for various goods and services in addition to the tanning services.

She went on to report:

The regulations carve out an exception for “qualified physical fitness facilities” that include access to indoor tanning facilities as part of a membership fee. The IRS has determined that where that access is incidental to a physical fitness facility’s predominant business, the amount attributable to the indoor tanning access is difficult to determine. Thus, amounts paid to qualified physical fitness facilities are not subject to the 10% tax. The regulations narrowly define “qualified physical fitness facility” to exclude businesses that predominantly engage in indoor tanning or other cosmetic services. Despite a number of commenters’ objections to this exception, the IRS retained these rules intact from the proposed regulations.

Read more at the Journal of Accountancy

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Planet Fitness Domination Has Only Just Begun

PF-logo-registeredBrian Sozzi of The Street reports:

You won’t find jacked, sweaty bodybuilders pumping iron at Planet Fitness, nor will you find skinny folks sipping drinks from the juice bar. That’s by design, according to Dorvin Lively, CFO at the rapidly growing gym chain.

Planet Fitness was founded by Mike Grondahl in 1992 as a welcoming place to work out at prices more affordable than upscale competitors Lifetime Fitness (LTM_) and Town Sports International (CLUB_). The business attracts people who have never gone to a gym before, benefitting from the movement by the general population toward a healthier, more active lifestyle. The U.S. has 32,000 health clubs, according to industry research firm IHRSA. More than 62.1 million Americans used a health club in 2013. Since 2008, U.S. health club memberships have risen 16%, with growth clocking in at 5.3% in 2013.

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Read More at: The Street

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Forbes Magazine Ranks Planet Fitness as the 3rd Best Franchise to Invest In

Forbes-best-and-worst-300x261Forbes magazine rated the best and worst franchises to invest in.

Planet Fitness was Ranked Third best!

Here are the numbers Forbes represented:

No. 3 Planet Fitness

Bulks up muscles and memberships at its “judgement free” health clubs.

Average Initial Investment: $1,980,150
Initial Training Hours: 80
Growth rate: 26%
Continuity: 93%
Franchisor Support: A

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