FITNESS GROUP MUSCLES UP WITH ONLINE ACQUISITION
Written on the 17 July 2014 by Nick Nichols
MOLENDINAR-based Australian Fitness Supplies (AFS) has muscled up its national profile through the acquisition of retail chain Gym and Fitness.
The move is part of a strategy by AFS founder Daniel Alenaddaf (pictured) to extend the company’s retail base to bolster a decline in the wholesale market over the past two years.
Gym and Fitness, which was established in 2002, operates three stores and a website which is one of Australia’s largest online gym equipment retailers, selling more than 3000 products.
AFS has been involved in the health and fitness industry for more than 40 years.
The company is one of Australia’s largest importers and wholesalers of fitness equipment and is one of a few in its field designing, manufacturing and distributing its own range of specialty fitness equipment.
Alenaddaf says the deal will offer a seamless transition to both businesses with no changes expected to Gym and Fitness’s staff and stores in Melbourne, Adelaide and the Gold Coast.
The Gym and Fitness acquisition brings a number of key brands to the AFS portfolio, including Force USA, Liberty Fitness Systems, Advanced Fight Gear, Vortex, Titan Fitness and Monster Fitness.
Alenaddaf says Gym and Fitness will improve margins for AFS which will continue operating its wholesale division in support of fitness equipment retailers.
“The wholesale market is in decline and by entering the retail sector we can continue to operate on both fronts and still support our frontline clients,” he says.
“We will also explore an enhanced online presence for the Gym and Fitness brand and strategic expansion of new locations for stores, strictly in areas without existing fitness retail businesses.”
Alenaddaf says the slump in the wholesale sector has been driven by the growth in online sales and AFS was moving to capitalize on that trend.
“Several prominent retail chains have lost market share in the past few years to online sellers, making the timing ideal to bolster Gym and Fitness’s retail position with established AFS networks,” he says.
“The purchase of Gym and Fitness is a huge opportunity to expand into specialty fitness retail with an established brand and adds a retail ‘face’ to the integrated Australian Fitness Supplies model.”
Alenaddaf says the acquisition will bolster AFS’s position for future mergers and acquisitions.
“Apart from future plans for retail expansion, the deal cements us as a vertical player in the industry, integrated across research and development, manufacturing, importing, exporting, distribution and now retail channels, and could position us for future acquisition by a larger company,” he says.
Author: Nick Nichols