How to Make a Gym Business Plan
Prepare a Gym Business Plan
This article will tell you how to write a gym business plan, and the next step – how to open a gym.
If you are planning to start a gym business but have no experience, a comprehensive business plan can also be a roadmap for the long-term development of your gym. Writing a business plan requires a well-organized and detailed procedure that defines the key factors associated with any successful business.
Gym Business Opening Plan Outline
Before getting into the details of each section, here is an overview of the main issues you should include when developing your gym business plan:
- Executive Summary
- Introduction of your gym
- Services and products
- Facilities and gym equipment
- Market research and Analysis
- Strategy execution
- Management summary
- Financial Projections
- Appendix
1. EXECUTIVE SUMMARY for your Gym Business Plan
A strong executive summary will impress investors or lenders, and if the first few pages are not compelling, potential investors or loan officers will not be interested in continuing reading. Therefore, it would be great to include some persuasive business cases for your gym in the summary.
Since it is like an index for your business plan, it is recommended to complete this section after completing the rest of the essay so that you can extract important content and data from the overall plan.
Please answer below questions in the executive summary:
- What is your business model and its advantages?
- What is your market size? Where do you get this key market data?
- What market needs does your gym meet? What membership types will you offer and how much will they cost?
- Do you have any unique and practical advantages?
- How much capital will your gym require?
- What are the bottom line revenues, expenses, sales growth, and profits/losses for the first three years?
2. INTRODUCTION OF YOUR GYM
You should already have a skeleton outline of your gym, which the investor or loan manager may not have, so it is necessary to introduce your gym.
- Ownership and investor structure, the legal structure of the gym, is it related to other companies? And what type of company it is.
- Required capital and equity returned, expected return on investment for investors and how they can exit in the future.
- Gym location, transportation, parking, nearby competitors and surrounding environment.
3. SERVICES AND PRODUCTS
Next, you need to define your service concept and the workout environment you are creating.
- How close your business will be intouch of your members?
- Will it bean aura of luxury or a no-frills fitness model?
- Would youprovide a revenue ornon-revenue services?
Like free weights for sale, such as dumbbell set, barbell bar, barbell plates, and kettlebell set could be included as well; or a babysitting service in gym might attract more young members.
4. FACILITIES AND GYM EQUIPMENT
If a site or facility has been selected, please describe its key strengths and benefits, such as size, accessibility, visibility, expansion potential, approximate rents, and area demographics to demonstrate your familiarity with your target market. A map showing the exact location is highly recommended.
If you are still in the facility search phase, please provide the criteria you will use to evaluate potential facilities. Also, please describe in detail what facilities the gym will have, such as a cafe, studios, locker rooms, studios, cafes, and/or amenities, as well as the overall design aesthetic.
Finally, fitness equipment is a major component of the cost, which includes:
- Body weight machines
- Cardio Equipment
- Barbells and Collars
- Dumbbells
- Kettlebells
- Weight Plates
- Exercises bikes
- Ellipticals
5. MARKET RESEARCH AND ANALYSIS for Gym Business Plan
First, it is important to understand fitness industry trends. We can refer to industry reports from IHRSA research, which provide data that can prove the bright future of the fitness industry.
Then, talk about detailed marketing positioning, including where local competition comes from, and the demographics of the primary and secondary markets in the specified area. Based on the research, explain why ideal customers will be attracted to your fitness club or fitness center, such as babysitting services.
Market research and analysis make you stand out from your competitors, ensure the success of your business, and help with information delivery after launch, so you will spend a lot of time and brain cells studying this information.
6. STRATEGY EXECUTION
- What is your competitive advantage? For example, babysitting services, free coffee or soft drinks, or more fitness equipment.
- Marketing and sales forecasts
This section is where you’ll outline your marketing and sales strategy and your sales forecast for the first three years.
Below questions might be involved:
- What are thesales forecasts looks like?
- What would you do to make the target customers join your club, absorb as members?
iii. What is your market strategy?
iiii. Do you have any promotion offer plan to support pre-sales and after-sales?
- V. What would you do to retain members?
7. MANAGEMENT SUMMARY
1.Staffing
In this section, you can subdivide organize structure, salary and benefits plan.
2.Resume
If you want to manage a fitness company (e.g., a club or center), include your resume and team member information in the appendix, and you will need an organizational chart. In addition, you will need a statement from non-management staff at the gym.
Aside from gym equipment and rental, labor is the largest expense for most fitness clubs, so the compensation and benefits structure is very important. Remember that how you structure your compensation and benefits system will determine whether you attract and retain your team members. Also, consider whether your business will be profitable, both in the long and short term.
8. FINANCIAL PROJECTIONS
This section can be the most daunting part of planning.
Based on best and worst case projections, you will create a cash flow statement, income statement, and balance sheet for the next three years.
You will need to provide context by comparing to industry standards and ratios, startup costs, and salary expectations. A debt repayment statement is also important. Take into account membership and revenue growth, service enhancements, membership churn, and employee wages.
9. APPENDIX
This section is the final part of your own gym business plan and includes all supporting documents:
- Resume ofthe management team
- Job descriptions
- Demographic info
- Road map
- Promotion plan
- Marketing plan
Understanding your Goals
Whether you are building a gym from scratch or looking to revitalize an existing center, it is important to know what you are aiming for. If you already own a gym and want to contribute to it, then you should consider the following questions:
What challenges are you currently facing?
Are there new competitors in your field? Taking advantage of areas you are not using? Providing a little more added value to your customers can make a big difference in their experience at your center.
If you are considering opening a gym, we start by asking two questions:
1) What type of gym are you planning to open and what kind of people will it cater to?
What type of users do you want to attract; should you consider building a specialized gym for athletes to train exclusively? Are you building a group training room or a room that is easily accessible regardless of fitness interests?
2) What are the competitors in your area?
This will give us hints about the local market and help you develop ideas to attract customers. What is missing from your neighborhood and community and what might motivate others to train with you?
What equipment do you currently have?
How long have you owned the equipment; everything has a lifetime value. Equipment is constantly used during its use, so it must be replaced frequently under warranty standards. This helps to avoid user disappointment.
What is right for your facility?
Your customers will have their own training schedules and the products they like to use. It is important to consider your users’ needs when evaluating any changes. Don’t just follow trends – your customers will stay with you longer than outdated trends.
Before you begin your gym business plan, consider the following first:
- Space constraints: Don’t overcrowd your gym – people need space to train, especially if users like to create their own personal training space.
- Ceiling height: This is especially important for building racks and drills.
- Subfloor: The requirements of each flooring type (tile, turf, and roll) require a specific subfloor to ensure the best fit and safety for equipment and users.
- Parking: Gym design is not only about what happens in the gym, but also how customers get to the gym – do you need a space with parking for easy access?
- Windows: Often forgotten, equipment placement may need to be repositioned to ensure natural light is not blocked and the gym area is well ventilated.
- Access and circulation: Your clientele should be top of mind, how does the gym feel when you enter it, how does it look, does it entice you to come in and train – large equipment at the entrance may block views of the rest of the gym.
- Power: For lighting, machines, music, and timers. Be sure to assess where the outlets are before you start moving around the space.
- Facilities (Water and Waste): As one of the most expensive spaces to build or move, considering the location of these facilities or where they will go (and their size) will impact your overall design and design.
Next Stage: Zoning
Once you have your own center and have determined the important factors above, the next step is zoning. Zoning not only determines what equipment you can have within your gym, but also the number of members you can invite.
As a company, you now know how many members you need to keep your business profitable. This number must be considered in the design of your gym, as it will determine the minimum amount of equipment you may need.
How much space do you need to accommodate the number of members you plan to have? How much equipment is enough to accommodate the number of people you want to take the classes you want? These are just some of the basics you need to know when considering zoning within your facility.
Your room can be zoned right into 5 main areas:
1) Free Weights area
This area can quickly become the busiest in any gym, make sure you have enough racks, plates, dumbbells and storage units on the gym floor. Practical storage units are a good consideration to keep your gym floor tidy, allowing you to store all your free weights and accessories while keeping them usable.
2) Cardio area
Depending on the size of your gym, you can offer a lot to many users. If you have a smaller room, then focus on how you want to use it.
Studios: Not just for classes, using these spaces allows your members to create their own personal fitness studio when classes are not taking place. Unique product options can help create class principles as well as dedicated personal workout areas.
3) Gym Equipments area
If you’re designing a traditional gym and have room for free weights and cardio equipment, this is an obvious choice:
stair climber
treadmill
exercise bike
rowing machine
Smith machine
Cable pull up and down
Seated Overhead Press
Please note, having high enough ceilings and solid floors is crucial to ensuring the space is suitable for its intended use.
If you want to offer your customers a diverse mix of fitness equipment, but at the same time, you don’t want your space to be overcrowded, difficult to navigate, and unsafe to use, then you need to consider what equipment will work best for your membership. It’s better to have fewer options and more wiggle room.
4) Functional area
It is typically integrated with studio training. However if you have the space, you can produce a separate location for it. You stay clear of shedding your useful area by making an extra open area when courses are taking place. Enabling participants to continue to educate the method they much choose to.
5) Personal Training area
Personal training ranked sixth in the ACMS 2022 Fitness Trends Report. This clearly shows that it is worthwhile to provide personal trainers with room to work with clients in your space.
You need to consider providing your personal trainer with an office space to sit down with clients regularly to discuss their fitness goals and progress. Some gyms offer private rooms/spaces with fitness equipment for one-on-one personal training sessions.
The bottom line is, even though opening a new or small gym is exciting, wrapping it all up can be very complicated. Spending a lot of time studying and preparing your homework and developing a business plan is necessary if you want to succeed.
A complete gym business plan will help you evaluate the feasibility of your gym project, strengthen your idea, set goals and learn how to achieve them, attract capital to launch your gym, and prepare for long-term sustainability.