Want to open a gym?
For many people in the personal training business who love what they and working with a range of clients, it’s the ultimate dream!
But starting a gym is certainly no walk in the park, that’s for sure. And just how to open a gym is a question that many personal trainers ask themselves as they make their way in their fitness journey, especially once they are more established in their career.
So I thought I would do a little research into the subject, to look at some important information and the factors that are part of owning a gym as a personal trainer.
Of course, this is only a blog post, so we are just going to scratch the surface, that’s for sure. But my intention is to give you an idea into the steps to open a business like a gym and answer a number of questions that you might have.
Some of these will include how to open your own gym and the steps you need to follow to do so, the cost to open a gym, the types of gyms you could open, what a gym owner salary is and many more interesting ideas about being a personal trainer and gym ownership.
So if the question of “how to start a gym business” is of particular interest to you, I think you will this blog pretty worthwhile!
Why open a gym you can call yours?
As a personal trainer, you probably have thought about starting your own gym one day down the line. And there are plenty of reasons to do so, other than the fact that running a gym gives you far more potential to make money than you would as just a regular personal trainer.
According to the Small Business Trends website, the global fitness industry rakes in around $81 billion dollars each year! And the United States contributes just under a third of that, coming in at around $26 billion per annum.
Who doesn’t want a part of that as the fitness market in America continues to boom.
At present, around 1 in every 6 adults have some form of a gym membership. That means that of the 209 million people over the age of 18 living in the United States, 34 million go to the gym!
Those are staggering numbers, that’s for sure, and surely proof enough that opening gym can be lucrative indeed. But you still need to go about it in the right way, even though the undoubted potential for success is there.
So where do you start finding personal training business clients?
Research and planning is key
As you probably could guess, starting a gym isn’t the easiest thing in the world. And you not going to be able just to rush into it, buy or rent the first vacant building you find and up pops your new life as a gym owner.
There is plenty of research and planning ahead for you. It may even take a number of years before you are anywhere near the point where you can realize your dream of gym ownership.
There’s much to think about, worry about and mull over and it’s critical to get all of these things sorted out before you set everything in motion.
Start with research and by speaking to other gym owners to find out just how they did their planning and preparation before opening their gyms. Remember, they were once like you, bright-eyed and eager to have run their own fitness gig.
It’s imperative that you speak to as many as possible as well, learn from what they tell you, ask them all the relevant questions you have, from business plans to bank loans, how to secure venues and equipment, staffing requirements and more.
It can be a little daunting as to what information you can get from them but your questions should focus on finding out the following which will definitely prove useful in your research:
- What problems/barriers that they didn’t anticipate gave them difficulties and had to be overcome?
- How much does it cost to open a gym including operating costs, staff costs, equipment costs and other expenses?
- What type of gym do they run and how many members do they have?
- How do they generate revenue? Which sources do they use (for example, do they have a regular gym or do they operate other revenue streams)?
- How to draw up effective budgets that aren’t pie-in-the-sky projections?
The thing is, as a personal trainer, you already have an advantage over someone who doesn’t work in fitness but wants to open a gym. And that’s because you would have worked in a gym environment and know a fair bit about how it all operates.
There are other important research areas that you will need to focus on and get answers for at this point as well. Things like identifying potential locations for your gym premises, do you have immediate competition, where will clients come from, what kind of equipment do you need are questions to consider.
Where’s the money coming from?
Ok, so I probably don’t need to tell you this but opening your own gym isn’t cheap! And you going to need to have some kind of capital outlay to help you get everything set up and underway.
Because there are plenty of considerations that you are going to have beforehand that need to be funded. The most obvious example is the gym equipment you will need but there are plenty more.
Now getting into the money side of things is a whole different article but there are some scenarios that I just want to work through when it comes to fronting the cash for your new gym operation.
And believe me, many people don’t think deeply about the money side of things but it’s one of the most important, especially if you don’t have the capital floating around to fund your dream, and therefore, need to secure it elsewhere.
Will you have a business partner?
Starting a business together with someone else is the perfect way to halve the money side of things but it’s not without its own pitfalls. Plenty can go wrong, that’s for sure.
If you are setting up a gym with a business partner, make sure you have the necessary legalities in place protecting both parties. Of course, it’s nice to go into something like this on your own but often, financially, you need help.
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Just make sure the relationship is strong, even before you start out with the business side of things.
Do you need to take out a loan to open a gym?
For many, the only way to get the capital to start a new business is by means of a loan from a financial institution. If that’s the route you need to go to fund your own gym, preparation is key.
Well, a bank is certainly not just going to fork over the cash, that’s for sure. They are going to want to see some key facts and figures when it comes to your proposed business. Again, getting the information you need should probably be a blog post all on its own but rest assured they going to want to see things like:
- A full business plan
- Cost projections (for equipment, staff, upkeep, running the gym and more)
- Income forecasts for worst-case and best-case scenarios
That’s just some of the information a bank will need before they even consider lending you any money!
You need cash reserves… do you have any?
Any good business person will tell you, building up some capital reserve is a key part of running a business. And owning a gym, especially as you attempt to get it off the ground, is no different.
That’s why building up some sort of reserve capital can go a long way to establishing the foundations for early success.
But why do you need reserve funds?
Well, the main reason is because of hidden expenses that you most certainly will incur. You could have planned perfectly but in all types of business, there are always hidden expenses and a gym is no different.
Most business analysists will tell you, aim for reserve capital that covers a least two months of rent and staff costs. Those are likely to be your biggest monthly overheads starting out.
And if something goes horribly wrong, you know you can still pay your rent and your staff as you try to turn things around.
Other costs you need to consider include utility bills (including water, gas, internet and more), office supplies, building maintenance, gym equipment and furnishings.
Who are your clientele?
A gym is going to fail without clients, that’s a no-brainer. But you can’t just open a gym and think that’s enough to bring in clientele. Again, this is another subject that probably needs its own blog post but let’s look into it a little bit, ok?
First up, it goes without saying that if you start your own gym, you are going to have SOME clients. These are going to include the following:
- Those who move to your new gym with you as you are their personal trainer
- Those who are family and friends who want to support you
- People from the surrounding neighborhood in which you establish your gym
That said, if you are a personal trainer that uses another gym currently to train your clients, they could already be locked in a gym contract and moving to your new gym brings more expenses. That can make everything pretty difficult to juggle, that’s for sure.
We have already discussed all the pre-planning that you will need to do in order to open a gym, all the fact-gathering that is necessary and everything else related to that. Part of this will obviously be a budget.
From that, you will know all your costs as well as income projects based on certain client numbers and membership packages. It’s crucial here to know that with a small number of dedicated members, you can still run your gym effectively. That’s because gym clientele is something you are going to be building up over a long period of time. 1000s of people are not going to come through the door from the start.
If your income covers your costs from early on, there is no need to tap into your reserves, or worse still, get an extra bank loan. The key factor here is expenses. Why?
Because at this point, it is the easiest thing for you to predict, especially if you have done your homework. On the other hand, income is the most difficult to predict, especially in the beginning.
How will you handle staffing?
As a new gym owner, you are going to need staff.
Not only is staff an important component to factor into your overall expenses, but they also play a critical part in keeping gym clients happy. And a happy gym client will keep coming back.
Ok, so let’s start with yourself. While you are now a gym owner, any of your personal training clients that have followed you to your new venture probably still want you to train them, so that’s going to take up a fair amount of your time.
And then there is the day-to-day running of your gym as well, plus so much more. So it’s easy to see how crucial staffing will be. In the beginning, you certainly will need some front-line staff to take the pressure off.
Initially, if you have only have a few clients, it might just be someone to run the front desk and answer phones, for example. This doesn’t have to be a full-time employee if you cannot afford one. You could consider a student who is studying to become a personal trainer or perhaps an intern of some kind.
Things like maintenance, cleaning and other important day-to-day tasks are probably going to fall to you in the beginning. As your gym grows, you can factor into your budget the need for more staff and perhaps, one day down the line, a gym manager.
Staffing will play a critical role in the success of a new gym, that’s for sure. That said, always remember to keep the number of staff in relation to the number of members you have. That ensures they have the best experience possible.
How many ways can you generate revenue?
I think it’s important to touch on revenue streams and just what it is you will offer at your gym.
As with so many of the other points we have already looked at, this will form a massive part of your pre-planning, contribute to your overall budget, affect staffing and helps to determine what types of gym you will eventually run.
Obviously, as a personal trainer, the first kind of service you will offer is your current expertise. So clients will come to your gym to train specifically in that type of environment.
But as you know, a gym can be so much more than that. While personal training will offer a single source of income, you could also have many other types of income streams.
Examples of these include:
- A regular walk-in gym for clients who want to train by themselves
- Group fitness classes
- Space for other trainers, nutritionists or massage therapists to rent
There are so many ways to improve your income streams, that’s for sure. But don’t bite off more than you can chew in the beginning by seeing dollar signs flash before your eyes.
Of all the things you need to do first, establishing your own business is the most important. Do the one thing you do (provide personal training) well in your new environment and then go from there as your business establishes itself and you look to expand.
Looking at it long-term
While your focus might be on the present when looking to start a gym, there is nothing wrong with starting to already establish a long-term vision, or at least, keep in mind where you want to end up.
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For some people, being their own boss means yearning for a success that snowballs, getting bigger and bigger. In the world of fitness, do you want that? Do you want to expand to many locations in your city? Your state? The country?
Or, you might simply want to afford your members the best local gym experience they can find.
The easiest way to put your long-term vision into practice is by devising a plan of action. This can be one that covers the next year, five-years or even ten-years, for example.
Ask yourself why you are aiming to be your own boss?
Strangely enough, many people who want to be their own boss don’t often take the time to really think about the reasons why they are doing so.
As a personal trainer, I think one of the main reasons why you might want to start your own gym is because of the true passion we often display for fitness. But it goes deeper than that as well, I think.
As a personal trainer, no doubt you love helping people. You love seeing their transformations under your tutelage as you guide them towards their fitness goals. And where is a better place to do that than in your own gym?
Of course, you need to pay the bills as well, so making money also plays a part in your overall motivation and we would be lying if we said it wasn’t.
All-in-all, I think knowing why we do the things we do prove to be the best motivation, even when the going gets tough!
What does a gym owner earn?
It’s a question that I think a lot of people ask, especially if they have an interest in fitness and see themselves becoming involved career-wise… “How much do gym owners make?”
Ok, the first thing to note here, a gym owner is not earning a fixed salary like an office worker or someone similar.
There are plenty of things in play, some of which we have already covered, for example, staffing costs, the number of gym members who hold contracts, overheads and more. I won’t go into all of them again.
Overall, there are three main factors that will determine the salary of a gym owner.
The profit a gym generates
Ask any businessperson and they will tell you. The success of any business is about only paying yourself a salary if you making a profit. If not, you simply eating into your business reserves.
As a gym owner, you can increase profits by:
- Having more streams of revenue
- By getting more members to sign up
- Increase your membership prices (careful with this route as a way to increase profits just for the sake of it)
Current levels of debt
Unless you had plenty of cash reserves when starting out your own gym, you probably are in debt in some way or another. Most of us would need to take out a loan from a financial institution to get our gym up and running.
And debt means a fixed monthly cost that needs to be repaid until the debt amount is fully paid off. That’s obviously going to affect a gym owner’s salary. That said, the quicker you can clear your debt, the better for you and your business as you save heaps on interest overall.
Is reinvestment taking place?
As a gym owner, you probably won’t be plowing any extra money into your gym once you first get it off the ground. But as it becomes a success story and generates more clients, reinvestment will have to take place.
This can include:
- More staff
- Better equipment
These are just some of the areas where you can reinvest into your business. Again, this can have an impact on the salary that you pay yourself over time. But reinvestment should never be viewed as a bad thing! If your gym is a huge success, and you can reinvest, that means it can grow even further. Any reinvestment that you undertake for your business is also tax-deductible.
So give us the numbers then…
While there are many factors at play in determining how much a gym owner would make per annum, according to RDX Sports, established owners will be pulling in a salary of over $100,000 per annum for a well-established gym.
Well, I hope I have given you some insight into how to start a gym if you are a personal trainer who wants to go that route in your career. Without a doubt, without proper preparation and planning, the cost of opening a gym can spiral out of control. It’s not an easy thing to do, that’s for sure.
I think that it’s important that the question of “how much to open a gym” is something that is at the forefront of your research and planning at all times, especially before you jump into a venture that you will regret down the line.
Again, it’s impossible to cover everything you need to know in a short blog post like this but there is so much information out there on the internet that you can do extensive research to help you in your endeavor.
I hope this has given you some idea of the size of the task ahead of you as you plan to open a gym. If it’s the route you see yourself going one day, good luck!
As usual, should you have any questions, please don’t hesitate to contact me by commentating below.