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I watched him build a tall building, and I watched it collapse. Amid the turbulent industry landscape, stories of former superstars falling from the clouds are not uncommon. In just less than four years, BowFlex, a popular American fitness equipment brand, experienced a sharp drop from annual revenue of over 100 million to the brink of bankruptcy.
It is learned that recently, BowFlex, a well-known fitness equipment seller on Amazon, has filed for bankruptcy protection in a US court. According to its bankruptcy filing, BowFlex plans to lay off more than 200 employees, enter Chapter 11 bankruptcy reorganization, and sell its company assets to Johnson Health Tech Retail for $37.5 million . At present, the bankruptcy procedure has not affected BowFlex's normal operations, and its products are still being sold on its official website and e-commerce platforms. It is understood that BowFlex was founded in 1986 and is headquartered in Vancouver, Washington, USA. Its main products include aerobic exercise machines, adjustable dumbbells, kettlebells, etc., which are not only popular among American consumers, but also have been on the Best Sellers list of Amazon US many times. It has been observed that to this day, an adjustable dumbbell product from BowFlex is still on the Best Sellers list in the fitness equipment category on Amazon, with a price of over US$400, more than 20,000 cumulative reviews , and sales of over 4,000 units in the past month. From this point of view, the revenue of some of BowFlex's products is still very considerable today, but it still fails to save its overall performance decline: in the first nine months of fiscal 2023, BowFlex's sales totaled US$158 million (approximately RMB 1.143 billion), a decrease of 24.8% from US$218 million in the same period last year, and a net loss of US$51.8 million. In its bankruptcy filing, BowFlex blamed the "post-pandemic environment and ongoing macroeconomic headwinds." In 2020, due to the increase in demand for home fitness equipment stimulated by the epidemic, sales of many BowFlex products soared, and performance hit a new high. It was revealed that annual revenue could reach as high as US$500 million (approximately RMB 3.618 billion). But the good times did not last long. With the arrival of the post-epidemic era, market competition became increasingly fierce, and the national exercise mode gradually shifted to returning to the gym. BowFlex, which specializes in home fitness products, not only saw a sharp decline in sales, but also had to deal with the problem of oversupply of fitness equipment on the market. According to sources, BowFlex has made many efforts to save its declining performance: Since the second half of 2021, BowFlex has been seeking “strategic partnerships and sources of capital injection”; In November 2023, BowFlex's parent company Nautilus was renamed BowFlex in an effort to attract more consumers as a "home fitness brand."
But in the end, BowFlex's operational problems still failed to improve. Industry insiders analyzed that the reasons for BowFlex's "failure" can be summarized from two aspects: product and brand: On the one hand, BowFlex is relatively dependent on a single product line , with more than 46% of its revenue coming from aerobics products, while sales of this product fell 28.5% in the first nine months of fiscal 2023 compared with the same period of the previous year; On the other hand, in the increasingly competitive fitness equipment market, BowFlex has failed to build a solid brand moat , and therefore does not have the user stickiness of brands such as Lululemon, and is easily affected by market fluctuations.
Overall, the fall of BowFlex is regrettable, from its products frequently appearing on Amazon's BS list to its current bankruptcy filing. But at the same time, some industry insiders have smelled business opportunities from it.
When a whale dies, all things come to life. This law applies not only to nature but also to the business world. In 2023, after the collapse of the American home furnishing retail giant Bed Bath & Beyond, many parties predicted that in the long run, not only Walmart and Target, which occupy a large share of the US offline home furnishing market, will become beneficiaries, but small home furnishing companies such as Williams-Sonoma will also benefit from the withdrawal of 3B companies. By analogy, for Chinese fitness equipment companies exporting overseas, the decline of overseas fitness equipment products such as BowFlex actually means the expansion of market blank space. Nowadays, as health awareness and self-pleasure awareness are deeply rooted in people's minds, the demand for fitness equipment among global consumers is growing. According to a report by Research and Markets, the global fitness equipment market size is expected to be US$17.97 billion in 2024, and will grow at a compound annual growth rate of 5.75% between 2024 and 2030, and the market size is expected to reach US$25.17 billion by 2030. Industry insiders said that the current fitness equipment-related categories have ushered in a broad space for growth, and Chinese fitness equipment companies going overseas want to seize the opportunity. The moment when brands such as BowFlex are selling well and falling is a good time to pick up bargains. However, it is worth mentioning that my country has always been the world's largest exporter of fitness equipment. The outbreak of the epidemic in 2020 has not only led to a short-term surge in global fitness equipment sales, but also attracted many fitness equipment export sellers to join the market. According to statistics from the General Administration of Customs, from January to October 2023, my country's exports of fitness equipment reached US$6.26 billion. However, to this day, China's fitness equipment industry has not yet gotten rid of the OEM dilemma - most companies export to the European and American markets in the ODM/OEM model. Even the popular Kangliyuan, which has been successfully listed, has not yet completely gotten rid of its production and operation model that is still mainly based on OEM. The collapse of BowFlex has already told the industry that products with insufficient brand power will not be able to maintain long-term "vitality" even if they are hot-selling. Therefore, facing the huge fitness equipment market with steadily growing demand, how to deeply understand the consumer needs of the target audience and build a brand moat is undoubtedly an issue that Chinese fitness equipment export sellers need to consider urgently. What do you think about this? Welcome to discuss in the comment area~
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