Spring is in full bloom and the streets of Warsaw are full of cyclists and joggers. The city’s dwellers flock to organic food markets. And WBJ Observer investigates the perspectives of the health and fitness market in Poland
by Kamila Wajszczuk
Poles are not exactly a nation of athletes, but a growing group of mostly young people is becoming physically active. Data from Eurobarometer show that 5 percent of the country’s population regularly pursues a sport or fitness activity, while 23 percent do so “with some regularity.” Meanwhile, as many as 52 percent of the respondents said they never exercise or play sports.
Those who do engage in physical activity usually do so outdoors (35 percent) or at home (37 percent). Only some go to a fitness center (9 percent), sports center (6 percent) or a sports club (5 percent).
Still, the money they leave there and in related outlets is not insignificant. Last year’s Eurobarometer estimated the market value at more than PLN 1 billion. What’s more, physical activity is becoming increasingly popular and the trend is expected to continue.
Working out is in
“We can say that a healthy lifestyle is in fashion and that includes fitness,” said Tomasz Józefacki, CEO of Benefit Systems, a company that offers access to various sports and fitness facilities thanks to its membership card. “Our experience and available data show that it is 20-40-year-olds who are most engaged in sports and fitness activities, but older people, even the elderly, are also interested.”
People go to fitness clubs for various reasons. Some simply want to stay fit, others plan to lose weight and some are curious about new sports disciplines. Then there is also the need to meet other people and to motivate one another, Józefacki explained.
In 2013, Benefit Systems recorded more than 450,000 users of its membership cards. Data collected by pollster GfK Polonia for the company showed that in 2011, 71 percent of the users were newcomers to regular fitness activity.
“So we are convinced that there is still a lot of potential in the sports and recreation market and that it will continue to gradually expand,” Józefacki said.
You are what you eat
Anyone who pursues a healthy lifestyle knows that physical activity is just one of the elements. A growing number of Poles are paying attention to what they eat as well. While some choose improved versions of regular products, others will look for certified organic food.
With a total value of PLN 17.59 billion, the health and wellness food and beverages segment stood for 21.2 percent of the total Polish packaged food and beverages market in 2013, according to data from Euromonitor International.
This value includes several types of food and drink. The “naturally healthy” sub-segment, which includes such products as high-fiber food, 100-percent fruit juice and herbal tea, accounted for PLN 8.44 billion in 2013. Euromonitor expects this part of the market to grow by 1.54 percent in 2014 and by 1.55 percent in 2015.
The organic packaged food sub-segment is much smaller, but with more dynamic expected growth. In 2013, it was worth PLN 247.8 million, while in 2014 and 2015 it is expected to grow by 4.2 percent and 4.4 percent respectively.
Euromonitor analysts see potential in the health and wellness segment in Poland. Despite a difficult year in the country’s economy, the consumer base increased, fueling growth of healthy food sales.
“More Poles are becoming interested inleading healthier lifestyles, paying special attention to daily diets, regular exercise and proper relaxation. As a result, they are more inclined to enrich their diets with health and wellness positioned products that offer health benefits and contribute to overall well-being,” Euromonitor International said.
Stores for health
As Euromonitor analysts remarked, the majority of health food sales in Poland take place in specialized stores, which
benefit from an expert image and the capacity to provide advice to shoppers. They can also offer a wider product portfolio, including smaller, niche brands.
A major player on this highly fragmented market is Organic Farma Zdrowia, which manages a network of more than twenty stores offering organic food and beverages in the largest Polish cities plus an e-commerce outlet.
The company estimates the total organic food retail market (both packaged and non-packaged) in Poland at PLN 700 million, just 0.25 percent of the food retail market. The average Pole spends just €4 annually on organic food, while in neighboring Germany the figure is €86. This gives room for growth and Organic Farma Zdrowia predicts the market’s expansion at 15 percent annually over the next ten years plus.
“Poles are still not aware that healthy nutrition is a very basic thing,” the company’s chief executive Sławomir Chłoń recently told the Newseria information service. “They are increasingly inclined to go to fitness clubs, they ride bicycles, go skiing, jogging, play sports. That is fantastic, but we must be aware that even if we exercise five times a week, it will not bring effects with poor nutrition.”
Chłoń is optimistic about the change of attitudes and the resulting sales growth. In his opinion, Poland may follow the example of the Czech Republic, where the organic food segment has already expanded to 1 percent of the total food retail market.
“Customers are getting more access to healthy products, so they can try them out and as a result they show a growing interest in them. We are convinced that the Polish organic food market will only grow over the next three to four decades,” Chłoń said.
For now, growth trends are more visible in large cities. Residents of smaller towns are not so inclined to follow healthy lifestyle trends, the CEO said. That is why his company has no plans to launch stores in such locations.
Future trends on both the fitness and the health food market will, however, depend not only on attitudes and what is upscale, but also on general consumer sentiment. The past years were a period of slow economic growth for Poland and consumption has only started to pick up after the crisis.
Organic food is still visibly more expensive than its non-organic equivalents, so price-conscious buyers may avoid such shopping. Similarly, Poles who choose to be physically active may prefer jogging in the park to working out in the gym. Nevertheless, a growing demand for all that is healthy may lead to lower prices in the future, thus triggering further sales volume expansion.