The average cost to open a gym can easily exceed £50,000. However, the projected growth of the fitness industry is poised to exceed that of other occupations, making it a lucrative business to be in.
In order to achieve success, most would-be gym business owners will need to secure bank funding. And this will require having a clear and concise business plan. The question is: are business plans for gyms different from the business plans for companies in other industries? The answer is yes; gyms have aspects that are different from those of most other companies.
The target audience of a gym business will be different from that of many other businesses. Those who work or live a convenient distance from where you plan to have your gym will be the audience you will target. This will mean not only understanding their likes and dislikes, but also knowing the neighbourhoods in which they live, as well as their general lifestyle, spending behaviour and patterns of exercise.
Taking Over, Starting Anew or Franchising
If you are planning to take over an existing gym, then you will need to first understand why the previous owner is selling, as this will tell you a lot about future profitability and business viability. For example, if the previous owner is having issues with the building’s structure, you will be responsible for remedying this, which will add additional costs to your budget. Likewise, building and equipping a new building has its own set of challenges and costs that must be considered before writing your business plan.
Taking on a franchise is something that many wanting to own a gym decide to do. If this is the case with your particular business, it will have its own revenue models and pricing structure, as well as financial projections for the size of gym you wish to have.
The marketing associated with a gym is much different than that involved with other businesses. It makes no sense to advertise a gym to a different city, as it is highly unlikely that those living in other cities will want or be able to travel to your location to exercise. That being said, local and offline marketing is likely best.
Although marketing locally is a traditional marketing type, it can be challenging if you’ve never done it before. Therefore, you may wish to research how to market effectively in your location. This can be done by searching online for help with marketing fundamentals, or seeking the assistance of a professional in your city to help you.
Due to the many costs associated with starting a gym business, it is crucial that you are able to track the flow of money. This can be done with a cash flow statement, which will allow you to itemise every business cost, as well as every revenue source. Unlike the cash flow statements of other businesses, the one for your gym will look much different before you begin your business than it will after you have started.
In addition to employing a cash flow statement, you will also wish to ensure that your gym is financially sustainable. That being said, it’s a good idea to have or request enough money to keep your business going for at least one year.
Not only will your business plan be instrumental in determining whether or not you receive a loan from the bank, but it is also the blueprint by which your business will be run. That being said, it’s important to ensure your business plan is as clear and realistic as possible.