Five Things Every New or Aspiring Gym Owner Should Know
Five things to understand and consider prior to making the choice to open a gym.
Five things every gym owner should know
Owning a gym sounds fun, it sounds like the pinnacle of success in the industry, and sounds like the ultimate freedom for former strength coaches or personal trainers to transition into – doing something their way. And all of those things can be true. But it can also utterly break you, cost you far more than you expected, take far more work and effort than you thought, and make you less money.
I am going on year 5 of owning my first gym and we just opened a second location, and I have learned a *lot* about this industry – so I figured I would share some tidbits that may help you get in the mindset of what you will experience before you make the plunge. These aren’t going to be true in every scenario, in every location with every gym and every culture, but after talking to hundreds of gym owners around the country, its pretty standard stuff that we experience and not unique to me.
- Most people don’t care about fitness, health, or training – in any capacity. You are speaking to a minority of people. If you want to open a youth sports performance gym, you will almost assuredly offer adult fitness classes eventually (very few gyms can rely on seasonal sports revenue alone). You have to understand that most people do not give a shit about training, at all. They don’t want to do it, they don’t knowhow, they don’t feel comfortable, whatever it is. You are selling a service that most people simply don’t want, and they don’t want to pay a lot for it either. You will have to learn how to productive your service to sell what people DO want – to not get winded playing with their kids, to look better naked, to get more dates, feel comfortable in their clothes again.
- Owning a gym is far more expensive than you realize. Costs add up – fast. My new location has rent of $4300, equipment lease of $2320, and a single part time employee, not to mention over $15,000 in initial buildout costs for renovation, maintenance and more just to get OPEN. Our expenses BEFORE we even opened the door were over $10,000 per month. You must have a marketing plan to help you cover these expenses, or be prepared to lose a lot of money – fast. We opened because we had a product, a marketing plan, and willingness to spend a lot in ads and time meeting people to achieve the goal - to be profitable in month one.
- An unfortunate reality – your relationship with your clients is completely transactional. When your utility runs out, your relationship with them will be over. Some clients will remain friends, for sure – but most will be gone when your business no longer serves their needs. It becomes difficult to see people who became your friends leave your business, I still struggle with it, but you have to emotionally detach or you will not last.
- Everyone quits. Everyone. This goes to number 2 –you must have a marketing plan to help offset your churn, or number of people who quit every month. And just an FYI about churn, average gyms have 4-8% churn per month. At 4% churn, half the people in your gym will not be there in a year. At 8% per month, you will have complete client turnover in 12 months. Hence, your relationship is transactional. There is some stuff you can do to lower churn – having a strong culture and strong community, a product that over delivers, results, and most importantly –clients having fun (clients will choose enjoyment over results every single day, whether they admit it or not – consider this in your programming). However, churn is inevitable, and hard, and frustrating, especially when the clients that need it the most are the ones who leave for any litany of reasons.
- All this combined – a population that largely does not take care of themselves, clients that prefer fun and sporadic over effective and simple, high costs, high turnover, and high frustration make this an industry where very few actually survive to the 5 year mark, and even fewer do it as a primary form of employment. You MUST be dedicated to the business aspect to survive, because it is far more important than the training itself(unfortunately). You must be willing to dedicate a lot of money to marketing, learn how to sell fitness to people who don’t realize how bad they need it, deliver the services in a way that encourage people to stay, and every other business operation that stacks up over the years (onboarding, CRM, member management, cancellation, channels of communication, staff, payroll, purchasing, gym maintenance, etc). Be ready for this, and you will carve out the niche you want and succeed. If you aren’t you will struggle.
Hope this helps you understand some of the things you WILL go through, so you can emotionally and strategically prepare for whats coming.