So you’re looking to open your own gym. You’ve been to at least a thousand fitness facilities from the “Big Box” Chains to your buddy’s customized garage gym. In your travels you have probably thought, “if I owned this place, I would (insert brilliant idea here), and the clients will be lining up around the corner….” Or something to that effect.
Before you start counting the reps and the number of clients outside of your door (with cash in hand of course), take a look at this list that dips into some of the most important questions we have encountered while helping our customers design, build, equip and staff fitness facilities in the Mid-Atlantic.
Have I Considered All of the Details?
We have all heard the cliché, “the Devil is in the details,” but this can’t be stressed enough. The success of your vision, and your financial bottom line, will rest on you being able to answer questions you might not even have thought about yet.
Things like, do I know the actual life expectancy of a treadmill? An elliptical? A stationary bike? Who will service my equipment? Who will staff my facility? How much should I expect to pay my staff? What is the average turnover of the businesses in my area? What are the demographics of my, and surrounding, zipcodes? Is there a different taxation rate according to square footage? These are only a few of those questions. There are quite a few more.
Am I in the Right Location?
There is a lot that goes into the decision of where to build your facility. With your ideal market in mind, you need to weigh where you want to be against whether you can afford to be there—and if it’s a client-rich environment. Some of the things you might want to ask yourself are:
Is there enough? How far away is from my location? Is it free or do my clients have to pay for it? Can I set something up with a local parking structure as part of membership?
Can potential clients see me? Is my facility as visible as it needs to be for pedestrians and/or drivers? How much signage can I afford? How much do I need? Where is it best used?
Who am I surrounded by? Can they help bring traffic to my facility? Will they let me advertise?
Will there be room for expansion?
What can I expect from the person I write a check to every month? Is it someone that I will be able to deal with on a regular basis?
Can I afford it? Will it rise? When? Can I freeze my rate?
Should I Have Legal Muscle?
Basically, yes. You will need some. But get it on the front end, not after the fact. Think of it as a necessary expense. Because when—not if—something goes awry in your new facility, that up-front expense will seem minor in comparison if you wait until it has happened. We talked about details. And you will miss a few. Your lawyer will make sure that any fallout is controlled.
A lawyer can also handle the registration of your business, explain how best to set it up, obtain permits, licenses, tax IDs, EINs and contracts for employees (if necessary).
Of course you can try it alone. But here are some other pesky details that you will have to take on with time you might not have in lieu of legal representation:
- protection from any lawsuits
- negotiations (leases, local and municipal laws)
- HR & payroll
Do I Have Enough Financial Muscle?
If you can’t make sense of what capital you have access to and what it pays for, you might not stay open for long. Operational expenses, equipment expenses, utility cost, employee insurance, hand soap—there are a litany of small and large expenses that will all affect your bottom line before the first client signs up.
There is nothing wrong with seeking professional help when filling out this portion of your business plan. Much like lawyers, accountants will be able to fill in a lot of the gaps you might not notice and stumble over down the road.
Some of the more common items that are overlooked when planning, include:
- actual equipment cost (not “I saw this one elliptical once and it cost this much” approach)
- annual equipment maintenance (sky is blue, grass is green, machines wear out. They just do)
- employee expenses (payroll, worker’s comp, benefits)
- utility costs (they will vary from city to city and county to county)
- operational costs (IT, accounting and finance, cleaning services)
As the adage goes: hope for the best, but plan for the worst. Have some capital in reserve. It is good to be prepared for the lean months, too. There will probably be a few of them, so have a little in the bank—just in case. Don’t fall into the trap of thinking everything will be okay once you get the facility up and running.
Am I Looking at the Right Equipment?
Know your space. You already know what type of facility you want, now determine which types of equipment are most likely to appeal to your clients, and buy according to those perceived needs and their projected use.
Your facility might be new but it doesn’t mean your equipment has to be. There is nothing wrong with using “seasoned” equipment. Chances are, most of your clientele won’t mind the occasional pre-owned piece of fitness equipment as long as it works while they are using it, and it does the job.
Here are some tips to consider when stocking your facility:
Less is more
You may not need to fill your facility with equipment right away. Leave some room for growth, and let your members tell YOU what THEY would like to make their experience better. This will save money, and also show your members that you are willing to listen and meet their needs (i.e. leave room for cardio expansion so when the treadmills are packed so you can add more if members ask—or complain about their availability)
Look into equipment financing. It allows you to make a larger purchase with less up-front expense
If you plan on keeping your treadmill for 5 years, you may want to consider a 5-year warranty to eliminate any unforeseen expenses. You MAY be able to coordinate the 5-year warranty with a 5-year lease to help control and predict costs (the warranty ends with the lease)
Am I Marketing Effectively?
Have a plan ready. A solid plan. And be ready to improvise. Sales and Marketing will drive your financial success in this venture, and should be your primary goal.
Guerilla marketing and promotions work very well. Co-market with your neighboring businesses. There are plenty of creative marketing ideas. You don’t need to buy a billboard that stays over everyone’s head. You just need to stay top of mind.
Here are some helpful (and successful) techniques that have worked for facility owners:
- Cross-promoting with neighboring businesses (give pens to the wait staff at the local eating establishments, product giveaways like water bottles, t-shirts, drawstring bags, etc.)
- Sponsor a local 5k race (lead the stretch before the race) or fitness festival
- Happy Hour promotions
- Set up a tent at a local festival
- Flyers on cars
- Direct mailers
You will need to roll up your sleeves to promote your own gym. One day you might be able to laugh about handing out flyers in a supermarket parking lot. But until then, it’s better to do what needs to be done. Otherwise you might find yourself crying in your empty facility.
To Staff or not to Staff
If you make the decision to hire staff, do it well. The staff—especially your front desk staff—will shape the atmosphere in your club. They are most likely the first people a prospective member will meet when they enter your facility and usually the last ones paying clients see as they leave. You only get one shot at first impressions. And they last a long time. Choose your front desk/customer service staff wisely!
The fitness industry is full of friendly, high-energy people. Put them to work for you and pay them accordingly! You get what you pay for in this industry.
At enerG wellness fitness, as a leading provider of solutions to onsite fitness centers in the Mid-Atlantic, we have experience identifying and solving a myriad of issues—often before they present themselves—when meeting our customers’ unique needs. There are questions we can help to answer beyond the maximum weight capacity on an Adaptive Motion Trainer.
Contact one of our professional staff at 866-681-1251 to see how we can turn your dream facility into a healthy ROI.