Franchise Gym Profitable?

[ticalman2000]

Sorry that this is not neccessarily a direct question on personal training but I was wondering if any of you had any idea of if their gym owners (specifically small fanchise owners) are profiting from their gym? I figured personal trainers would have some valuable insight on this and really appreciate any input.

A friend and I are in the very preliminary stages of discussing opening a gym and are trying to get as much information on the subject before we approach our potential investor. We aren't able to find much concrete information on the subject and the franchise requires financial information prior to disclosing anything so we have to wait ofr our investor to be on board before we can proceed.

We're looking into Extreme Gym and based on their published data our initial calculations are that we'll need at least $130,000 which is above what they list but we will need at least double the equipment of their package. Aslo if anyone has experience on Extreme Gym franchises that would be great.

Thanks!

[SFT]

How much do they actually want as an initial fee or an ongoing percentage? Compare this to what value you gain from there as far as discounted equipment, forms that would otherwise be drafted by a lawyer, signs, marketing, etc. I've personally never heard of them, so I'm not sure how much the brand itself is worth?

You might consider contacting other franchisees. They will probably have some valuable feedback for you. In any case, there are owners who fail with great franchise systems. In the end, most of the success will probably depend on how you guys are as business owners.

[OC8]

Invest in a program called business pro ~$100
Use it step by step.
List your Franchisee costs included in your disclosure that will be given to you by the Franchise. Make sure you list them monthly.
Find out how big you want your facility to be and price out your lease.
Add in your insurance costs and extra local promotional costs.
Add in your costs for management and trainers (monthly salaries)


When you do all of this you will be able to find your break even point by how many members you will need.
It is very possible to be profitable but it's likely that it won't happen in the first 4-6 years and that is normally best case scenario. After you find your break even point you will need to add about 100 new memberships to start peeling away that initial debt build up.

I had to turn down a couple opportunities because I just didn't see the money in it, I hope you find better results.

[ticalman2000]

Thanks for the info guys! I'm definetly going to look into that program. I already have a successful career but just lack any passion for it. I've always really wanted to pursue a career in fitness and this opportunity has presented itself at a time where I'm really focused on making things happen in my life so I'm aggressively going to see what I can do. That software seems like it will be key to help me get an idea if this is actually feasible.

[SFT]

Definitely not trying to discourage you here, but a lot of people come to the fitness field because they are sick of their other jobs. It doesn't always turn out so well. You obviously have to be confident that it will work, but also be prepared for the possibility of losing every penny that you put in.

Some people will say that you have to be very confident in your future success. I think it is a strength to question yourself. This keeps you on track and keeps you from doing stupid stuff. A lot of trainers and gym owners I have met were so confident that they would succeed that they never stopped and realized how ****ty their business model was. The truth of the matter is that there are many successful chains out there. Just in your area you have Anytime Fitness and Planet Fitness. These are cheap gyms that are impossible to compete with because of the high volume of equipment that they purchase. I'm sure you also have higher end gyms in the area that charge reasonable rates. You definitely need something different. I'm not speaking out of my ass either. I've seen a fair number of gyms go out of business in the last 3-4 years.

If you already have a successful career, I would consider whether or not you could find passion for it in a different position or company. I lost my passion for fitness because of a bad employer, but luckily I gave it a second chance after a year off. I'm sure you aren't taking this decision lightly, but I would definitely think about every last detail.

[ticalman2000]

Definitely not trying to discourage you here, but a lot of people come to the fitness field because they are sick of their other jobs. It doesn't always turn out so well. You obviously have to be confident that it will work, but also be prepared for the possibility of losing every penny that you put in.

Some people will say that you have to be very confident in your future success. I think it is a strength to question yourself. This keeps you on track and keeps you from doing stupid stuff. A lot of trainers and gym owners I have met were so confident that they would succeed that they never stopped and realized how ****ty their business model was. The truth of the matter is that there are many successful chains out there. Just in your area you have Anytime Fitness and Planet Fitness. These are cheap gyms that are impossible to compete with because of the high volume of equipment that they purchase. I'm sure you also have higher end gyms in the area that charge reasonable rates. You definitely need something different. I'm not speaking out of my ass either. I've seen a fair number of gyms go out of business in the last 3-4 years.

If you already have a successful career, I would consider whether or not you could find passion for it in a different position or company. I lost my passion for fitness because of a bad employer, but luckily I gave it a second chance after a year off. I'm sure you aren't taking this decision lightly, but I would definitely think about every last detail.

I appreciate the input and yes I am not taking this decision lightly. Like I said we just engaged in talks so I'm doing lots of thorough research before I even consider switching careers. I'm just reaching out to people to gauge the industry and I did purchase Business Pro to calculate the costs and see if it is even realistic.

We do want to put something in in our area (not necessarily Plymouth) and our niche would be to focus on free weights. At PF they are constantly removing equipment such as decline benches, limited flat/incline benches, down to 2 squats racks, they got rid of all hammer strength plate loaded machines, and the dumbells max out at 70 lbs. Each time they remove something all the guys at the gym go into a panic and talk about leaving but never do as the other options locally are WOW or Anytime which aren't any better. Plus when the evening crowd comes everyone's trying to use the same limited benches and squat racks. By providing sufficient free weight equipment and gearing towards the younger/serious lifter crowd would be our only option to compete in this area.

It's just an idea now but I'm going to do my research and see if it could actually prove to be feasible. Thanks!

[SFT]

I appreciate the input and yes I am not taking this decision lightly. Like I said we just engaged in talks so I'm doing lots of thorough research before I even consider switching careers. I'm just reaching out to people to gauge the industry and I did purchase Business Pro to calculate the costs and see if it is even realistic.

We do want to put something in in our area (not necessarily Plymouth) and our niche would be to focus on free weights. At PF they are constantly removing equipment such as decline benches, limited flat/incline benches, down to 2 squats racks, they got rid of all hammer strength plate loaded machines, and the dumbells max out at 70 lbs. Each time they remove something all the guys at the gym go into a panic and talk about leaving but never do as the other options locally are WOW or Anytime which aren't any better. Plus when the evening crowd comes everyone's trying to use the same limited benches and squat racks. By providing sufficient free weight equipment and gearing towards the younger/serious lifter crowd would be our only option to compete in this area.

It's just an idea now but I'm going to do my research and see if it could actually prove to be feasible. Thanks!

Backspace just screwed up my post... again. Short version:

- Add a group exercise studio or private personal training studio. Even if you don't want to PT - it will be a great source of extra income. Charge trainers based on percentage, or a fixed amount per month.
- Younger/serious lifters aren't always as willing to drop money on a gym membership (obviously there are exceptions). They won't necessarily be coming over for the group classes (unless they are Crossfit?)
- Maybe even have an area for an S&C place to operate out of? Again, I don't see the younger/serious lifting crowd and their monthly fees being enough to keep the doors open and you making a profit.

[ticalman2000]

Backspace just screwed up my post... again. Short version:

- Add a group exercise studio or private personal training studio. Even if you don't want to PT - it will be a great source of extra income. Charge trainers based on percentage, or a fixed amount per month.
- Younger/serious lifters aren't always as willing to drop money on a gym membership (obviously there are exceptions). They won't necessarily be coming over for the group classes (unless they are Crossfit?)
- Maybe even have an area for an S&C place to operate out of? Again, I don't see the younger/serious lifting crowd and their monthly fees being enough to keep the doors open and you making a profit.

Thanks man! We definetly would have at least one PT on staff and I've already got some ideas of people who I will approach if we go with this. We really want to add Zumba and/or boot camp classes if we can get the area for a room as those have a huge draw for females. My wife switched gyms within the last year for that purpose and she's got her friends that don't workout much going with her so I definetly realized the impact and potential profit in that. I already got on my wife's ass to get certified to teach it if we get this thing rolling! I'm also aware of keeping costs low for the younger crowds so we know we have to offer a variety of services to get the masses in but we want to be sure to provide the free weight equipment that the other gyms seem to be condemming lately.

[SouthsideLifter]

Have you considered supplement sales or pre/post workout drinks for sales. I swear that workout drinks have at least a 50% markup at my gym. Either way, good luck and I look ofrward to hearing about your progress.

[SFT]

Thanks man! We definetly would have at least one PT on staff and I've already got some ideas of people who I will approach if we go with this. We really want to add Zumba and/or boot camp classes if we can get the area for a room as those have a huge draw for females. My wife switched gyms within the last year for that purpose and she's got her friends that don't workout much going with her so I definetly realized the impact and potential profit in that. I already got on my wife's ass to get certified to teach it if we get this thing rolling! I'm also aware of keeping costs low for the younger crowds so we know we have to offer a variety of services to get the masses in but we want to be sure to provide the free weight equipment that the other gyms seem to be condemming lately.

If free weights is going to be your thing, have introduction to weight training classes. There is definitely nothing wrong with free weights, but we definitely have to work hard these days to distinguish ourselves from other gyms with all of the Planet Fitness, Anytime Fitness, and other gyms out there. Sounds like you are thinking it through and doing your research. Let us know how it ends up working out.

[ticalman2000]

Will do and thanks!

[Ronin4help]

Sorry that this is not neccessarily a direct question on personal training but I was wondering if any of you had any idea of if their gym owners (specifically small fanchise owners) are profiting from their gym? I figured personal trainers would have some valuable insight on this and really appreciate any input.

A friend and I are in the very preliminary stages of discussing opening a gym and are trying to get as much information on the subject before we approach our potential investor. We aren't able to find much concrete information on the subject and the franchise requires financial information prior to disclosing anything so we have to wait ofr our investor to be on board before we can proceed.

We're looking into Extreme Gym and based on their published data our initial calculations are that we'll need at least $130,000 which is above what they list but we will need at least double the equipment of their package. Aslo if anyone has experience on Extreme Gym franchises that would be great.

Thanks!

I've never met anyone who profited from a name. Guys I know who bought a Gold's Gym or Fitness Together or Curves have all eventually had to sell them. Some of them were sold and converted into another gym entirely. The franchise thing is very sketchy because you have to cough up so much principle and there's no real guarantee you will make it back and be able to keep the doors open while supporting yourself and your staff. If you have that type of money, you may want to consider opening your own place under your own name.

[ticalman2000]

That was actually our original plan (and my real dream) but then it appeared that the franchise option was less of an investment and the security of having things mapped out is nice. I did find some consulting companies that assist with equipment purchasing and setting up the scan card/computer system. Either route we take (if it happens) I plan on taking business management courses to ensure I know what I'm doing and that the company operates effectively so once I have a better grasp on that I'll be more comfortable not relying on a franchise.

There's so much information that I'm diving into online and having some real life input from you guys is invaluable. Thanks!

[Ronin4help]

That was actually our original plan (and my real dream) but then it appeared that the franchise option was less of an investment and the security of having things mapped out is nice. I did find some consulting companies that assist with equipment purchasing and setting up the scan card/computer system. Either route we take (if it happens) I plan on taking business management courses to ensure I know what I'm doing and that the company operates effectively so once I have a better grasp on that I'll be more comfortable not relying on a franchise.

There's so much information that I'm diving into online and having some real life input from you guys is invaluable. Thanks!

Good luck brother.

[ticalman2000]

Just wanted to update you guys that we've decided to become certified personal trainers and work part-time (full-time as soon as possible) as trainers for a few years to educate ourselves on the industry while also saving up money but more importantly become a successful personal trainer as this has always been my dream job but I was always concerned about the income. I start the NASM eTeach course on 6/24 but have access to the site so I'm getting a jump start tonight. I'm beyond excited to pursue this dream! Thanks for all the help and feel free to come by our gym once we get this thing rolling!

[OC8]

Very wise decision, good luck bro!

[ticalman2000]

Very wise decision, good luck bro!

Thanks man!