You’re in luck! In this article, we’re going to give you a 7-step path to starting your own gym. By the end, you’ll know the how, what, and the why, and you’ll be brimming with confidence.
Ready?
Let’s get started.
#1 – Define Your Vision
If you’re like most trainers, you want to get started. To take action. To make things happen. Not so fast!
You need to clarify your vision before you launch your own gym. Are you trying to build a powerlifting club? A community center where anyone can come for a workout? An elite, high-end gym? A Green Gym? The most successful businesses are those that know their target market. Once you know your target market and your overall vision, you can begin creating specific plans.
Also, consider the type of environment you want to create at your gym. Do you want to attract elite athletes? Families? Children? Power lifters? These factors will influence the type of space you rent and the equipment you purchase.
As you build, define, and sharpen your vision, consider crafting a mission statement. A mission statement will give purpose to your gym and will always keep you laser focused on your overall goal. A motivating mission statement will also attract clients who buy into what you’re trying to accomplish. You may not have better barbells than a competitor, but you can have a more profound mission.
#2 – Build Your Client Base
If you open a gym and don’t have any existing clients, you’ll immediately find yourself behind the 8 ball, scrambling to pay the bills and keep yourself afloat. Before you start a gym, you need to know that you’re going to have at least some paying clients. These clients need to be committed to you as a trainer if they’re going to switch gyms, especially if they’re locked into iron clad contracts.
This has two significant implications. First, relationships with your clients are really important. The only way a client is going to follow you is if they’re committed to working with you. Long before starting your gym, you need to get really serious about building meaningful relationships with a substantial number of clients – the kind of relationships that clients would be sad to lose.
Second, timing is essential. If you have a core group of clients coming up for renewal at the same time, this should factor into when you start your gym.
When considering your initial operating budget, you should base your numbers on the smallest number of clients who will follow you. You don’t want to significantly overestimate and then find yourself stuck with a massive amount of unnecessary space and overhead expenses. If things go gangbusters and clients begin pouring in, you can always rent out more space. The worst thing you can do is saddle your business with a large amount of unnecessary expenses early on.
An additional bonus of starting small is that small spaces usually feel more energetic and bustling than large, empty spaces. A small space also adds a close-knit community feel to your gym, which can be hugely important when first getting started.
Your location is hugely important in relation to your existing clients. Although a few very dedicated clients may be willing to travel some distance to work out, most are going to want to stay close. If at all possible, consider staying within a 15 minute location of where you already are. This will allow your existing clients to stay close.
#3 – Put Together A Realistic Plan
Starting your own gym takes a significant amount of planning. You can’t just wake up one day and decide to do it. Taking the plunge without doing sufficient research is like diving into water without knowing how deep it is.
Begin by putting together a business plan. If you hope to borrow money from a bank, they’ll require a business plan. Even if you’re not borrowing, creating a business plan forces you to think through every contingency and allows you to project costs and revenues. This isn’t about your hopes and dreams; this is about constructing a realistic picture of the future. As a safety net, have someone who truly understands and has operated a business go through the plan with you. A second set of eyes can catch mistakes you miss. If you don’t know how to create a business plan, there are a number of software packages that can guide you.
It’s also crucial to put together a complete budget, including equipment, marketing, rent, insurance, accounting, attorneys, cleaning services, and utilities. As noted above, when projecting revenue, base the number on the lowest number of clients you expect to follow you. The last thing you want is to overestimate your income and then be crushed when revenue is less than expected.
As part of your research, spend a significant amount of time talking to gym owners around the country. Ask them how they got started and about the early pitfalls they encountered. Have them explain the style of their gym as well as the various resources that have helped them along the way. Pick their brains about expenses and operating costs. Ask them how they separated themselves from their competitors. This is a listening session, not a time for you to talk about your plans.
Also consider joining online forums where gym owners hang out. Look for Facebook and LinkedIn groups. If you hit it off with a member of the group, ask them if you could chat in a private channel. Sign up for email lists sent to gym owners. Your goal is to soak up as much information as possible.
#4 – Take Necessary Legal Steps
Before you consider launching, you need to take the appropriate legal steps to protect yourself. If you’re going into business with a partner, you must have a clear partnership agreement that spells out what each partner is investing, including hours, finances, profit sharing, and work performed. The agreement should lay out a clear process if one of the partners wants out. Even if you are friends with your partner, a clear agreement is still necessary to protect both parties.
You would be wise to hire a lawyer to help you draft this agreement. Additionally, a lawyer can help you create a legal structure for your business, register your business, obtain necessary permits, and other necessary steps.
In addition to legal advice, you’ll need insurance to protect yourself against claims and losses. Hopefully this insurance never becomes necessary, but it’s a must for your business.
Finally, you need an accountant who can help you understand your finances and taxes.
Don’t skimp on these resources. Yes, you’re probably itching to get down to business, but you can’t afford to skip any of these.
#5 – Build Sufficient Funds
One of the biggest challenges in starting your own gym is funding. If you do sufficient research and planning ahead of time, you should have at least an estimate of your expenses. Obviously your costs will vary wildly depending on what type of gym you plan on opening. A small group fitness gym will cost significantly less than a 24 hour gym with hundreds of pieces of equipment. A large location in a prime location will raise your costs significantly, and if you plan on hiring a team of trainers, that will also raise your costs.
Once you have a firm grasp on your estimated expenses, you need to adjust your current lifestyle in order to accumulate sufficient funds. You won’t be able to make your dream a reality without making sacrifices. What are you willing to give up to make it happen? Cable? Eating out? Your daily coffee at Starbucks? Exotic vacations? Yes, these sacrifices will sting a bit, but being able to launch your own gym is worth it. You should aim to save at least 6 months of salary before launching your gym. This cushion will allow you to have some breathing room in your budget when you first launch.
There are a variety of ways to raise the necessary funds to start your gym. You can save all the money yourself, although this is somewhat difficult to do. You can partner with someone who will also contribute to the pool of money, but if you do this, be sure to maintain more than 50% control of the gym. Splitting the partnership directly down the middle will only cause problems. When searching for a partner, look for someone who have the same values as you. If you value deep customer service and your partner only values profit, a clash is bound to happen.
You can also secure funds from an investor. If you go this route, make sure to have everything clearly documented in a legal agreement created by your lawyer.
The most common route is to combine personal funds with a bank loan and/or an equipment lease. If you do borrow from a bank or lease equipment, avoid borrowing excessive amounts of money. One of the chief reasons businesses fail is an interest rate hike when they’re already heavily in debt. Borrow the smallest amount which will still allow you to cover your costs, and use any surplus cash to pay back your debt.
#6 – Utilize Word Of Mouth Marketing
When planning your launch, you need to account for traditional marketing costs. Depending on your budget and location, you may want to buy radio spots, door hangers, newspaper advertisements, and other standard marketing options.
But you should also think through how to generate word of mouth buzz. In many ways, word of mouth marketing is more powerful than traditional marketing due to the highly personal nature of it. Ask your friends and family to tell their friends and family about your gym. Spread the word on Facebook, Twitter, and Instagram. Attend community meet-n-greets to connect with local business people.
Free seminars are a great way of connecting with large numbers of people at once. Consider holding monthly seminars on topics that would be interesting to many people, such as weight loss, muscle toning, and fat burning. Yes, it costs you some time, but it’s a fantastic way to quickly generate a significant amount of exposure.
Another outstanding way to connect with the community is to approach local sports teams and offer free training sessions. For example, teaching a Little League team the basics of stretching allows you to meet the parents of the players and shows that you are committed to giving back to the community.
One way to generate initial buzz surrounding your gym is to offer special deals for “founding members”. Rather than trying to offer rock bottom prices and Groupons, devise ways to make your first members feel like they’re part of something special. Extra sessions with personal trainers, gym swag, and even special access hours work well for enticing ground floor members.
#7 – Plan Your Streams Of Revenue
Before you launch, you need to consider exactly how you’re going to make money. Will you sell supplements? Will you sell clothing? Will you offer therapeutic massages, group training classes, or high-end training packages?
Multiple streams of revenue are a protection against downturns in business. If your clientele temporarily drops, you still have your supplement line and training packages. If supplement sales drop, you can push hard to pick up additional clients. If you only have a single source of revenue, a downturn can really hurt your business.
Conclusion
Starting your own gym can be an incredibly rewarding experience. It allows you to build something that truly matters and to make a significant difference in the lives of others. Yes, it can be intimidating. Yes, you will encounter hurdles and unexpected obstacles. But these things shouldn’t stop you. Don’t let fear keep you from fulfilling your dream. By following these 7 steps, you really can set yourself up for success.
Now get to it!
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Adam Boesel, founder of The Green Microgym, has created a program to help you successfully start your own gym business. From just the most basic information, to everything you would need to start and run 5 different business models, you can choose the guide that will work best for you.