Part One: Understanding The Costs Of Opening An Independent Gym
In today’s blog we will be looking at a question we have been asked a lot over our twenty five years of experience in the fitness industry. That being “What are the costs of opening an independent gym or fitness club?” It is a short question that leads to a lot of answers.
So today we will start looking into the main costs to expect, how these costs will vary depending on the size and type of the gym and much more.
We will include distilled insights from many of the gym and club owners we have worked with over the years to ensure that any reader comes away better prepared if they embark upon their own gym venture.
What will we cover in this article?
(you can also click to skip ahead!)
Budget
Budget is a term we are hearing everywhere at the moment, whether it comes from consumers seeking value for money or businesses trying to make their resources go a little further.
Unfortunately the pressures of the general economy will feed into the setup cost of any independent gym or fitness club. However while it can feel like a time of risk, this can also mean it is a time of opportunity.
The last few years have seen a large shake-up across many industries, including the fitness industry.
The core price of opening a gym or fitness club will vary significantly depending on the size of the facility, the area, scope, required expertise of employees and so much more. While we will get into more detailed figures either below or in another article, we can attest that unless you are inheriting an already functioning/functional operation, the sum will be substantial.
Of course there are certain things that can reduce this price, or conversely, add to it. The difference between opening a purely independent gym and opening one that is part of a franchise (a difference we will cover). We will also overview the different type of costs, whether it is ongoing and expected costs, potential ‘shock’ costs and expenses that will only affect certain types of gyms.
All this to say that if you are thinking of opening an independent or franchise gym or fitness club, financial depth is a significant asset. This article can make you aware of the potential pitfalls, but awareness isn’t worth a lot if the funds are not there to cover the expenses.
As such, we would always recommend a comprehensive idea of the risks and potential costs. A checklist can be invaluable for keeping track of these pitfalls (and is something we may cover in a later blog if the uptake is there).
To be forewarned is to be forearmed, and here at Ashbourne we believe in supporting independent gym and fitness clubs however we can. Please don’t hesitate to reach out to us if there is something missing from the guide that you would like to see.
Recurring Costs
Recurring costs are some of the most important to factor in when starting a new independent gym or fitness club. These are the costs that it is important to get right. Because if not, it is going to be a pain felt every month, or every quarter or every year. And that will quickly mount up and sap momentum and money from the venture.
These costs are the ones that will be necessary to keep everything running smoothly. They are the sort of costs that neither your staff nor members will pay much attention to unless they are suddenly absent. Everyone expects functioning access controls and clean bathrooms but not many people spend time thinking about the maintenance personnel and their costs.
Recurring Costs Checklist
- Gym Membership Management Costs
- Marketing Budget
- Gym/Club Operating Software
- Gym/Club Equipment Leasing*
- Facility Costs (Leasing/Rent etc)
- Wages
- Accountancy Fees
- Health and Safety/Compliance Costs
- Taxes
- Ongoing Training
- Maintenance Costs (Inc. either Staff or Third Party Fees)
- Loan/Interest Repayments
- Multiple types of Insurance**
- Miscellaneous Supplies
- Specific Costs Associated with Gym/Club type
**Insurance covered at length elsewhere. Will be linked in a later article on Insurance.
This is the same when it comes to all aspects of gym membership management. It is a classic case of ‘if it is going right, people won’t notice you’ve done anything at all’. This is the curse and the blessing of providing service to members. They want a painless, sleek and professional gym membership where access control, entry verification and payments are all handled seamlessly. But if they have to stop and think about it, the chances are this service isn’t being provided.
As such, it is all the more important when establishing a new independent gym or fitness club to get these recurring costs correct. Any new members trying out a new facility will quickly have their goodwill degraded if the fundamentals are not there.
Members can be understanding during the initial setup of a gym, but if they sense that some core aspect of the operation is not working, that will be a significant blow to retention rates.
Recurring Costs or One-Off Cost?
Inevitably there will be costs that can fall into either category, depending on the route taken and how the payment is structured. The one highlighted above is Gym Equipment. This is an area where there is a divide, some new gyms and clubs lease gym equipment initially to save on the upfront costs. This is a valid approach, opening a gym is cost intensive enough and there will be areas where it will be tempting to spread the costs.
Of course, in turn, those leased machines will often turn out to be more expensive than buying them outright. Even if by some combination of support and maintenance it ends up being a relatively favourable outcome, it will still represent a recurring cost instead of a one-time opening cost.
At a certain point some of these decisions will become one of necessity. What can be afforded immediately, what cannot. As with any business, it will be about understanding what is a good investment and what is not.
This is why planning and risk assessment is so vitally important before any large business venture. Understanding the lower and higher estimates of how much money is going to be coming in and where it will stand in relation to recurring costs and any potential loans or invested money.
What Next?
In our next article we will be focusing on the one-off costs with another checklist to follow. As this series continues we hope to build up a comprehensive guide for any aspiring gym or fitness club owner to be able to reference during the process.
As you might have gathered, there is a lot to cover and we are in a good position to cover it.
Here at Ashbourne we’ve been working with independent gyms and fitness clubs, as well as small franchise gyms for over twenty five years. The above is just a small fraction of the expertise we have accumulated in that time.
We have helped countless gyms and fitness clubs with everything from membership management, non-payment collection and direct debits to access control, marketing and website building. We believe we have something to offer every gym or club, whether you are recently established, still setting up or firmly entrenched in your local area.
So if you are setting up a gym or fitness club, or have recently started one and are keen to know more, please don’t hesitate to contact our demo team here. They will be able to talk you through what Ashbourne can do to give your business the best start or take it to the next level.
Get your club in shape.
Want to discover how? Let us show you.
the goals you want to achieve, and how our system can help you.
Get your club in shape.
Want to discover how? Let us show you.
Simply select your preferred timeslot and we’ll be in touch to have a chat about your health club, the goals you want to achieve, and how our system can help you.
Get your club in shape.
Want to discover how? Let us show you.
Simply select your preferred timeslot and we’ll be in touch to have a chat about your health club, the goals you want to achieve, and how our system can help you.