Opening a Gym? Here’s an Ultimate Guide for 2023
Opening a gym can be an exciting and rewarding venture for first-time owners. However, it’s important to consider several factors before diving in.
Here are some key considerations for opening a gym for first-time owners.
But first things first:
How Does a Gym Make Money?
According to data from Statista, the gym industry is on a rebound after a pandemic-led decline that hit in 2020. It hit its peak in 2018, bringing in $41.8 billion and currently is forecasted to hit $32.02 billion in 2022.
Of the sub-market of gym types, the data suggests that CrossFit gyms are the most common type to be profitable, followed by boutique/yoga gyms. This may be an important consideration in the event you are looking at opening a specific type of gym.
Gyms make money by charging members a fee for access to their facilities and equipment. Some gyms may also offer personal training services or classes, which can be an additional source of revenue. Some gyms may also generate revenue through the sale of branded merchandise or by renting out their facilities for events. Additionally, many gyms have partnerships with companies that offer discounts to employees, which can bring in a steady stream of new members.
On average, gyms in the United States make an annual revenue of $846,827.05 with their owners taking home just north of $70k per year.
Below, let’s look at some of the other factors that can make a gym more profitable.
Gym Location Considerations
The location of your gym is crucial to its success. Ideally, it should be easily accessible to potential customers and have plenty of parking. It’s also important to consider the competition in the area and whether there is a need for another gym.
The equipment you choose for your gym will depend on the type of gym you’re opening and your target audience. It’s important to invest in high-quality equipment that is safe and well-maintained. You should also consider offering a variety of equipment to cater to different fitness levels and goals.
The cost of gym equipment can vary greatly depending on the type and quality of the equipment. Basic gym equipment, such as dumbbells and a bench, can cost a few hundred dollars, while more advanced equipment, such as a treadmill or exercise bike, can cost several thousand dollars. It’s important to research and compare prices from different vendors before making a purchase.
Look to wholesale equipment providers who may actually allow you to purchase well-maintained used equipment to help save money.
Hiring the right staff is crucial for the success of your gym. Look for experienced and knowledgeable professionals who are passionate about fitness and can provide high-quality customer service. It’s also important to provide ongoing training to ensure that your staff remains up-to-date on the latest fitness trends and techniques.
According to insights from Precor, the following roles are common to most gyms:
- Membership sales manager
- Operations manager
- Maintenance personnel
- Front desk staff
It should go without saying that you’ll want top-notch trainers to help maintain a solid clientbase and enjoy the margins of premium services like personal training.
Look to reputable personal training certification bodies like Fitness Mentors for certifications created to help your trainers excel in the following areas:
Effective marketing is essential for attracting new customers to your gym. Develop a marketing plan that includes a variety of tactics, such as social media, email marketing, and traditional advertising. You should also consider offering promotions and special deals to attract new members.
This is a position that can be internal to the company or outsourced to specialists.
Finances: The Cost to Open a Gym
Running a gym is a significant financial investment, so it’s important to carefully plan your budget and finances. This includes not only the upfront costs of equipment and rent, but also ongoing expenses such as staff salaries and utilities. It’s also important to plan for unexpected expenses and have a backup plan in case of financial setbacks.
In this scenario, it’s best to have a well-established business plan to guide you along the way. Involving financial professionals will help with forecasting and other financial factors, such as monthly carrying costs.
Legal Requirements for Opening a Gym
The specific legal requirements for opening a gym will vary depending on the location of the gym and the type of services it will offer. In general, however, there are several key legal considerations to keep in mind when opening a gym. These may include obtaining necessary business licenses and permits, complying with zoning regulations, and ensuring that the gym meets all relevant safety and health standards.
It may also be necessary to obtain liability insurance to protect the business in case of accidents or injuries on the premises. It’s always a good idea to consult with a lawyer and local authorities to ensure that you are in compliance with all applicable laws.
Opening a Gym Franchise
A gym franchise may be a safer way for some to get into the gym space. They have a proven brand, and potentially of more importance, proven processes that you can adopt that have already been optimized.
According to data from NerdWallet, the a few of the best gym franchises include the below:
- Initial franchise fee: $3,150 to $42,500
- Estimated total initial investment: $58,870 to $521,437
- Initial franchise fee: $54,950 to $59,950
- Estimated total initial investment: $563,529 to $999,121
- Initial franchise fee: $20,000
- Estimated total initial investment: $1 million to $4.1 million
To open a gym franchise, the first step is to research different gym franchise opportunities and choose a franchise that aligns with your interests and business goals. Once you have selected a franchise, you will need to complete the franchise application and meet any franchise-specific requirements, such as attending training sessions or completing certification courses. Of course, an initial franchise fee will be included.
After your application has been accepted, you will need to secure a location for your gym and obtain any necessary licenses and permits. Once you have completed these steps, you can begin the process of setting up your gym, which may include purchasing equipment, hiring staff, and marketing your business to potential members.
It’s important to closely follow the franchise’s guidelines and procedures to ensure the success of your gym.
Opening a Gym FAQ
Data suggests opening a gym can be profitable. The gym industry as a whole is is forecasted to hit $32.02 billion in 2022. The average gym owner makes over $70,000 a year, and the market is expected to grow 8.7% per year.
The cost of opening a gym will vary depending on a number of factors, including the size and location of the gym, the types of equipment and services offered, and the business model (e.g., whether it is a franchise or independent gym). In general, however, it is common for the startup costs for a gym to range from $65,000 to $115,000. These costs may include expenses such as leasing a space, purchasing equipment, hiring staff, and obtaining necessary licenses and permits.
According to data from Entrepreneur.com, Planet Fitness ranked as the number one fitness franchise to own.
Gyms owners make $70,109/year on average, according to data from ZipRecruiter.
Owning a gym can be stressful, as with any business venture. There are many challenges and responsibilities that come with running a gym, including managing staff, maintaining equipment, marketing the business, and ensuring that the gym is operating safely and profitably.
Additionally, gym owners may face competition from other gyms in the area, which can add to the stress of running the business. However, for many people, the rewards of owning a gym, such as being able to help people improve their health and fitness, can outweigh the challenges. Ultimately, the level of stress associated with owning a gym will depend on the individual and their approach to managing the business.
Opening a gym is a big decision that requires careful planning and consideration. By considering factors such as location, equipment, staff, marketing, and finances, first-time gym owners can set themselves up for success and provide a high-quality fitness experience for their customers.