FBA 35: Emerging Markets – Analysing Opportunities in Vietnam, Cambodia, Sri Lanka, Myanmar etc

What opportunities are there in Asia’s more developing and emerging markets? What should you consider if you’re looking to open a fitness business in a country like Vietnam, Cambodia or Myanmar?

Jack explores the opportunities and potential pitfalls of jumping into one of Asia’s young fitness industries.

In today’s episode we discuss:

  1. How I almost opened a gym in Yangon
  2. The benefit of hindsight – what I learned
  3. When is the right time to open in a young market?
  4. Political and legal instability
  5. Vietnam’s – ‘the land of opportunity’ 25 years ago, and still today
  6. My observations of the Phnom Penh fitness scene
  7. Know what you’re getting in for











Welcome to the fitness business Asia podcast, my name is Jack Thomas, I’m the host of the show and also the founder and CEO of BASE which is made up of 3 group class and personal training studios in Bangkok.

Before we crack onto today’s topic if you enjoy today’s content I’d like to ask a couple of small favors to help support the podcast. Number 1 – go back through our episodes and download those that are relevant to you and then share any episodes with people in the industry who might benefit. That’s it, not a big ask, but I’d appreciate it greatly to help grow this movement and raise the standards of the industry in Asia and beyond.

Today I want to give some love to some of Asia’s smaller markets based on my experience in them over the 8 years I’ve been in the industry and also the experiences I’ve heard from people in these emerging markets.

The inspiration for this episode came from a visit I’ve just made to Phnom Penh in Cambodia to teach a course on fitness management. It was a great visit and I do really love the Cambodian people who are very warm and friendly but it was also a strong reminder on just how far some of these developing countries have to go before they can support a booming or even growing fitness industry.

Not everyone knows this, but I was close to opening a gym in Yangon, Myanmar about 5 years ago. The country had just had democratic elections and was genuinely opening to expats and international investment. I was visiting regularly and every time I went there it felt like the land of opportunity and it felt like the time to invest was now. Everyone I spoke to was just so bullish and excited about the potential and you’d hear stories of property prices in central Yangon selling for 50% more after just a few months. There were a few hotel gyms and bigbox gyms that were charging outrageous amounts of money and no boutique offerings and honestly, it was easy to get swept up in this wave of excitement.

Big companies were setting up offices and there were more and more expats moving to the city and there was one bootcamp running that was really busy which was showing there was a demand. Like any Asian city there was a portion of the locals who had money and were looking for things to spend it on and there were Burmese born overseas who were coming back to get in on the action.

It felt like this was Myanmar’s time, this was the wave of opportunity and if I didn’t ride it I might miss out.

As things turned out, after speaking to some potential investors and reflecting on the situation I chose to stay in Bangkok and open a studio here instead and that’s proven to be a good move for me.

I can now look back at the situation with hindsight I realise the market was very young and vulnerable and actually, I could go in now or in 5 years time and it could very well be a much better time – I could analyse 5-10 years of their transition to a democratic government, I could let things settle from the massive changes to the structure of the country and also let the market develop a little so that a high end gym would be more well received from the market. I look at what we’ve done with BASE and if we’d opened that in Myanmar it would have been too much – I’m not sure anyone would’ve known what to do with it and it would have been unnecessarily advanced for the market.

International expansion would also have been harder as a Burmese brand would have been a harder sell overseas.

There have been political troubles in Myanmar since then, and that makes everything so much less stable. If expats leave in droves that could be the end of the business almost overnight. Any political change could put the business at risk. Laws and regulations are less stable there which just makes things more risky.

Myanmar could have been a success for me of course, but I now realise that those early thoughts of ‘this is the time, I must jump in now in this once in a generation opportunity here’ were very misguided.

The Yangon fitness market has developed quite nicely recently and there’s even a ClassPass type offering called Flexible Pass which shows the industry is reaching a level of maturity.

In summary, I think now is a much better time to open than 5 years ago when I almost did it, and a friend is opening a studio soon and I think he’ll be far better equipped than I was.

I recently had a conversation with a friend who was in Hanoi in 1993 setting up one of the first business schools in Vietnam. She said that Vietnam in 93 was how I described Yangon – everyone getting mad excited about the country opening up, talking about the opportunities and that this is the time. Growth was huge, but soon hit a plateau. Vietnam has stalled numerous times since then but there’s a lot happening now, 25 years on.

A friend of mine moved to Sri Lanka around 5 years ago and I spent some time there checking out the industry. She was working in a studio that was doing kettlebell classes and TRX classes and it looked lively. Looking around there wasn’t much happening and I felt like there was a lot of opportunity there for something special and different. 5 years later, not much has really happened in the industry and to go there then and educate a new market on boutique fitness and lead growth in the industry would have been very tough, both in business terms and also personally as well.

The inspiration for today’s podcast episode came from a trip to Cambodia last week. I was in Phnom Penh teaching a course on Fitness Management which was interesting as it gave me a real insight into the industry there. I was in Phnom Penh 3 years ago and not much has changed since then – there were 2 Crossfits then and last week I went to check one of them out and it’s closed and the building has just been knocked down to make way for development.

Most of the fitness industry is hotel gyms, most of which are quite inspiring. There are some bigbox offerings but it will be a long time until Fitness First or another big chain goes in. There’s no certification body offering  qualifications of any kind and from spending a few days there looking around and talking to people in the indsutry you just start to see that everything will happen so slowly there.

However – there is a Crossfit box in Phnom Penh called Crossfit Amatak that’s doing great – I went on a Friday night and the place was full. They were doing a great job and had created something that really stood out in Phnom Penh. They showed me that there are certainly opportunities in these markets.

So I guess that leads nicely to my conclusions and main points:

  • Young markets like Cambodia, Sri Lanka, Myanmar take a long time to develop and grow and there may be many setbacks along the way, many of which will be completely out of your control such as political and legal hurdles
  • Don’t think ‘now is the time or I will have missed this huge opportunity that may never come again’. You may benefit from waiting a few years and the opportunities will still be there – they will even be bigger in a more mature market
  • Don’t be obsessed with being first to market. You’ll have to build the industry and educate the market and that will be a tough ride
  • In our industry, hiring quality talent will be very, very difficult so you’ll probably need to bring people in from abroad
  • Don’t get me wrong, you can do well in these places and my message certainly isn’t don’t open anything there – if you want a lifestyle business you can make decent money and of course, there are many stories of people getting in early in a market and really benefitting from that, just know what you’re getting yourself into and don’t get swept up in the hype of a developing country
  • The fitness industry has been volatile or stagnant in these countries in the last 5 years whereas in the so-called tiger economies of Thailand, Malysia and Singapore they’ve absolutely exploded. A bigger market means more competition of course but that could be a good thing. Would you rather be the only boutique yoga, pilates, spinning studio in the city, or one of 5 offerings?
  • Lastly – ask yourself if you are happy to spend a lot of time and energy in that country helping build an industry and educating a market. Looking back, spending 5-10 years in Yangon wouldn’t have been the best move for me. Make sure you know exactly what you’re getting in for with wherever you choose to open your fitness business – I almost opened a gym in Yangon and honestly, I can’t say I knew this.

I am really interested in your thoughts and feedback on this episode – are you involved in these markets? Do you agree with my thoughts? Any big points I should have covered?

If you have any stories or advice for opening or operating a fitness business in a these young, emerging, very developing markets I’d love to hear from you and hear your thoughts and experiences. Today’s was just my personal thoughts and I’m aware that each market has it’s own stories, barriers and opportunities.

Thank you for tuning in, you contact me through Instagram fitnessbusinessasia or by email, details in the shownotes. I look forward to hearing from you, thanks for tuning in and wherever you are, have a great week ahead and we’ll catch you next Monday…

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