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Beyond the courts: the prospects of padel business

April 19, 2022 by Jazmin

Padel has seen in recent years, especially in Italy, a dizzying development both in popularity and in the evolution of the business that has been generated around this sport, but also in the governance of the sport itself. With WSBSPORT CEO Pierfrancesco Iazeolla, we discuss the current situation and prospects of padel in Italy and its market, in light of the changes and progress made in recent years, and how WSBSPORT is approaching this important new phase.

  1. The padel market, especially in Italy, has seen a real boom in recent years, also thanks to the conditions generated by the pandemic; what is the state of the market right now?

In the beginning, the first ones to open padel clubs were tennis clubs, followed by entrepreneurs who invested in the creation of padel-only clubs; in the initial phase there was a lot of demand and little supply and those who took advantage of the market at that time made a fortune.

But now, in some Italian regions, padel has reached a point of saturation in relation to the existing demand and those who did not rely on expert consultants will pay the price.

Mind you, the demand is estimated to be growing given the high number of people who still have not approached it despite the surge in recent years, also due to the pandemic. If we look at the numerical data, in fact, in Italy are still missing about 10,000 padel fields to have a ratio fields / population similar to Spain.

But there will be a stabilization and rationalization: some centers will close, others will be absorbed, there will be a demand for greater professionalism both by managers who want to be better advised, and by players who will seek a different level of service.

  1. What do you need to know and do to start a successful business in this market?

Open a padel club is now a professional activity, no more or less than any other business, and therefore has certain characteristics: in particular, it is an activity of fixed costs, that is, regardless of the number of people who enter the management costs are almost the same. It is therefore necessary to look carefully at the turnover; the clubs that will work are those that will generate more revenue, not those that will save money.

My advice is: information, preparation, execution.

It is certainly important to study the project carefully: discussing it with consultants, experts and professionals in order to elaborate it in the best possible way, also by carrying out in-depth market analyses and financial simulations, is a necessary step to avoid making the wrong investments. This is fundamental because one of the cornerstones of the design of a successful center is precisely to assess its potential in relation to the market where you are going to place, since the investment must always be made in relation to the market potential to then bring results. Once the market potential has been established and the relative investment defined, the most suitable concept is created.

  1. What are the critical issues that need to be given the most attention?

WSBSPORT has identified 11 risk factors that must be carefully considered when creating a sports club; for each risk factor it is important to study an intervention plan that can minimize its effects.

The main risk factor is that the analysis of the market is wrong, so the demand that is actually found is too low, or too high in relation to the investment. It is important, therefore, to carry out a precise market analysis, also through the use of focus groups that allow you to go in depth and discover the true extent of demand.

It is then necessary to understand the potential competition, so not only study the competitors already existing on the market but also those clubs that could open, as in many cases tennis clubs in the vicinity that have not yet been equipped with padel courts; they represent an important potential competition that can not be underestimated during the preparation and during the activity of the center.

Another requirement that should not be overlooked because it represents a critical point in the opening of a center is to have enough money to manage at least 6 months of activity, since this is the period that, in our experience, elapses before we can expect stable revenues.

The construction of the center is another critical point, it is necessary to pay close attention to the plan of construction of clubs and the calendar; this is because it is necessary to be able to define the date of opening as precisely as possible in order to activate the marketing campaigns on time. Generally they should start about 1 and a half months in advance so that you can actually find yourself with a customer base when the center is opened. The only way to do this is to have a consultant, manager or company to whom you can entrust all the work. cancelare tying it into a contract.

  1. What are the prospects for the padel business in light of its recent expansion?

The outlook for the padel business is that more fields will be sold than those really needed, a normal phenomenon of over-shooting; if demand will increase then there will be a proper absorption of it, otherwise there will be a phenomenon of consolidation for which some centers will close, others will be incorporated by larger clubs with different business models that can be satisfied with a margin of 5% – 10% net, as for large chains. There will therefore be a phenomenon of concentration both in terms of number of fields and in terms of ownership of the facilities. Clubs will, over time, focus more and more on complementary services to broaden their revenue lines, just like many other types of business and products.

  1. What are WSBSPORT’s goals for the Italian market?

WSBSPORT is vigilant about the situation in the Italian market, maintaining attention on all the aspects that govern it. Clearly, knowing the market and following its trends, we try to give the right advice to those who are now entering the padel market, because it is certainly more complicated than it was some time ago. Accompanying virtuous clubs in their development is another important objective of WSBSPORT, and this is done by continuing to follow them even after they have opened: in our experience, after 3 or 4 years from when a club has been opened, it happens that they want to sell or grow. WSBSPORT also accompanies a client in the sale of his club, and for those who have ambitions and want to grow, so make a second club or move on to the next phase, we are there to help them with our expertise. So our goal in the market is to help the client, support him in making his business profitable through our knowledge and experience. This is how we work, we are not just salesmen.

News,  WSB Stories Club Design,  Consultancy,  New Trends

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