Gym Business Plan & Example
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Gym Business Plan Example
Use the example below as a template to write a business plan for a gym or fitness center.
Executive Summary
Business Overview
Steven’s Gym is a startup locally owned gym located in El Paso, Texas. Steven’s Gym will include various exercise equipment, strength training equipment, free weights, aerobic equipment, and plenty of cardio equipment. The gym will also offer HIIT group classes, spin classes, strength training instruction, and personal training.
Located in an up and coming, newly developed, and highly trafficked area of town, Steven’s Gym will attract both men and women ages 16 to 75+. There is something for everyone at Steven’s Gym, whether someone is just beginning their fitness journey or is a seasoned athlete and gymrat. The gym will have a welcoming atmosphere, experienced personal trainers, friendly staff, and frequently cleaned equipment and restrooms.
The membership options are affordable and will be offered on a month-to-month basis, a 6 or 12 month contract, or the ability to pay for an entire year upfront. Discounts will be offered to military, teachers, and healthcare workers.
Service Offering
The following are the services that Steven’s Gym will provide:
- Strength training equipment
- Cardio equipment
- Free weights/dumbbells
- Aerobic equipment
- HIIT group classes
- Strength training instruction
- Training sessions upon request
Customer Focus
Steven’s Gym will target all men and women ages 16 – 75+ who are interested in achieving and maintaining a healthy and active lifestyle. El Paso is a very diverse city that includes men and women from all walks of life. There are numerous blue collar individuals, white collar individuals, government employees, and military members as the local Army base is one of the largest in the country. Since Steven’s Gym will be very affordable, it will be able to attract people from all walks of life.
Management Team
Steven will manage the day-to-day tasks of running the gym, while overseeing the staff, scheduling the group HIIT classes, and making sure all equipment is working properly and safely. He will also be in charge of ordering any new and replacement equipment and cleaning products and supplies. Steven will hire a gym manager to manage all new member sign-ups, placing them on a recurring payment schedule, and handle all member issues. There will be three trainers that will be available to personally train any member that requests training. They will also take turns running the group HIIT classes. Steven will outsource a local CPA to handle payroll, accounting, and tax payments. He will also outsource a local advertising company to develop the gym’s logo, branding, photography, social media accounts, website, and billboard design.
Success Factors
Steven’s Gym will be able to achieve success by offering the following competitive advantages:
- Large, clean, and spacious facility that has all the necessary equipment for their fitness routine.
- Knowledgeable and friendly staff of trainers.
- Best value for membership pricing. The membership pricing options are affordable and offer military, teacher, and healthcare employee discounts.
- Convenient hours of operation.
Financial Highlights
Steven’s Gym is seeking $300,000 in debt financing to begin operations of the business. The funding will be dedicated towards securing the warehouse space, gym build-out, and purchase of the equipment. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and working capital. The breakout of the funding is below:
- Securing warehouse space, gym build-out, and design: $25,000 to $125,000
- Gym equipment purchase: $50,000 to $100,000
- Three months of overhead expenses (payroll, rent, utilities): $15,000 to $55,000
- Marketing & advertising: $15,000
- Working capital: $10,000
The following graph below outlines the pro forma financial projections for Steven’s Gym.
Company Overview
Who is Steven’s Gym?
Steven’s Gym is a new, locally owned gym located in El Paso, Texas. Steven’s Gym will include strength training equipment, free weights, aerobic equipment, and plenty of cardio equipment. The gym will also offer HIIT group classes, spin classes, strength training instruction, and personal training. Located in an up and coming, newly developed, and highly trafficked area of town, Steven’s Gym will attract both men and women ages 16 to 75+. There is something for everyone at Steven’s Gym, whether someone is just beginning their fitness journey or is a seasoned athlete and gymrat. The gym will have a welcoming atmosphere, experienced trainers, friendly staff, and frequently cleaned equipment and restrooms. The membership options are affordable and will be offered on a month-to-month basis, a 6 or 12 month contract, or the ability to pay for an entire year upfront. Discounts will be offered to military, teachers, and healthcare workers.
Steven’s Gym History
Steven’s Gym is owned by Steven Malone, a retired Army Master Sergeant who is also a seasoned powerlifter. Steven was stationed at El Paso’s Fort Bliss for many years before eventually retiring and deciding to stay in El Paso and embark on his dream of eventually owning his own gym. As a frequent gym goer, Steven recognized that El Paso lacks high quality independent gyms. The nicest and most equipped gyms in El Paso are large franchises that have too many rules and regulations. Other independent gyms are dirty, unorganized, and do not offer a large selection of equipment. Steven envisioned a gym that was welcoming to all types of people that is encouraging, clean, and adequately equipped for those who are focused on sustaining an active, healthy lifestyle.
Since incorporation, Steven’s Gym has achieved the following milestones:
- Found a 10,000 square foot warehouse space for lease in El Paso, Texas that can easily be converted to a gym.
- Registered Steven’s Gym, LLC to do business in the State of Texas.
- Began the branding image, logo, website, and social media accounts for the gym.
- Began researching and pricing out equipment.
Steven’s Gym Services
The following will be the services Steven’s Gym will provide:
- Strength training equipment
- Cardio equipment
- Free weights/dumbbells
- Aerobic equipment
- HIIT group classes
- Strength training instruction
- Training sessions upon request
Industry Analysis
The Gym industry is expected to grow to an annual revenue of $38 billion in the next five years. This growth is likely a result of increased per capita disposable income, in addition to growing health-consciousness. As consumers’ disposable income levels rise, individuals are usually more willing to purchase gym memberships. Additionally, time spent on leisure and sports is expected to increase over the next five years, effectively increasing the potential pool of consumers.
During this period, demographic changes are expected to drive revenue growth for operators. Additional revenue streams are also expected to play an integral part in industry growth. In particular, as healthcare costs continue to escalate, health insurance providers may implement incentives to promote preventive health practices, including the use of fitness centers among individuals within their provider network. Furthermore, the number of obese individuals in the United States has increased in recent years. Consequently, to cut healthcare costs, many health insurance providers will likely attempt to lower an individual’s risk for type 2 diabetes, heart disease and high blood pressure, among other ailments. Additionally, initiatives that promote the health benefits of exercise will likely increase over the next five years, stimulating industry revenue.
Customer Analysis
Demographic Profile of Target Market
Steven’s Gym’s target audience will include all men and women ages 16 – 75+ who are interested in achieving and maintaining a healthy and active lifestyle. El Paso is a very diverse city that includes men and women from all walks of life. There are numerous blue collar individuals, white collar individuals, government employees, and military members as the local Army base is one of the largest in the country. Since Steven’s Gym will be very affordable, it will be able to attract people from all walks of life.
The precise demographics for El Paso, Texas are:
| Total | Percent | |
|---|---|---|
| Total population | 870,340 | (X) |
| AGE | ||
| Under 5 years | 63,225 | 7.30% |
| 5 to 9 years | 59,631 | 6.90% |
| 10 to 14 years | 58,030 | 6.70% |
| 15 to 19 years | 54,319 | 6.20% |
| 20 to 24 years | 61,938 | 7.10% |
| 25 to 29 years | 77,386 | 8.90% |
| 30 to 34 years | 69,457 | 8.00% |
| 35 to 39 years | 61,807 | 7.10% |
| 40 to 44 years | 50,441 | 5.80% |
| 45 to 49 years | 48,930 | 5.60% |
| 50 to 54 years | 48,487 | 5.60% |
| 55 to 59 years | 55,764 | 6.40% |
| 60 to 64 years | 48,859 | 5.60% |
| 65 to 69 years | 37,506 | 4.30% |
| 70 to 74 years | 30,045 | 3.50% |
| 75 to 79 years | 19,066 | 2.20% |
| 80 to 84 years | 9,905 | 1.10% |
| 85 years and over | 15,544 | 1.80% |
Customer Segmentation
Steven’s Gym will primarily target the following customer profiles:
- High school and college students
- Military and their families
- Blue collar workers (factories, warehouses, service industry)
- White collar workers (corporate or government office)
- Retirees
- Athletes who frequently train for fitness competitions
Competitive Analysis
Direct and Indirect Competitors
Steven’s Gym will face competition from other companies with similar business profiles. A description of each competitor company is below.
Gold’s Gym
Gold’s Gym is a large franchise-owned gym with two locations in El Paso. Gold’s Gym gives access to everything one needs to transform their life: state-of-the-art amenities, a variety of classes tailored towards someone’s fitness needs, and the world’s best trainers. There are weekly classes for group workouts ranging from martial arts-inspired cardio classes to foundational yoga sessions. There are also certified trainers if someone is new to exercise or just looking for more guidance and coaching. Gold’s Gym also has innovative digital tools to take the fitness journey further, no matter the fitness level.
Gold’s Gym’s amenities include cardio equipment, group exercise, personal training, a pro shop, sauna/steam rooms, group cycle, free weights, functional training, kids club, locker rooms, and wifi.
Planet Fitness
Planet Fitness is for people from all walks of life, whether they’re a first-time gym user or a veteran member, they are there to provide a workout environment in which anyone and everyone can be comfortable. All Planet Fitness members enjoy unlimited access to their home club and the support of their friendly, knowledgeable staff anytime they need it. PF Black Club members receive additional benefits, including the ability to bring a guest for free and access to any of their 2,000+ PF locations. Also, the PF member can take advantage of their free fitness training or find motivation by reading real member experiences on Planet of Triumphs. The goal of Planet Fitness is to provide a clean, safe, welcoming environment for anyone who walks through the door, and all the equipment, amenities, and support they need once they arrive.
Planet Fitness provinces a diverse, Judgment Free Zone where a lasting and active lifestyle can be built. They seek to provide a safe, energetic environment where everyone feels accepted and respected.
The key benefits of Planet Fitness is that they are open 24 hour, offer clean, spacious amenities, free fitness training, Judgment Free Zone, have tons of equipment, and always have a friendly staff.
Anytime Fitness
Anytime Fitness is a welcoming gym that exists to help someone get to a healthier place – by giving the right support at the right times, in the ways the member wants. Every member receives a free, personalized Get Started Plan when they join. Their friendly, professional staff is trained to help someone along their fitness journey, no matter how much support they need.
Aside from a large selection of strength and cardio equipment, Anytime Fitness offers the following services – 24-hour access, 24-hour security, convenient parking, anywhere gym access, private restrooms, private showers, health plan discounts, wellness programs, cardio tvs, and hdtvs.
Competitive Advantage
Steven’s Gym will be able to offer the following advantages over their competition:
- Large, clean, and spacious facility that has all the necessary equipment for their fitness routine.
- Knowledgeable and friendly staff of trainers.
- Best value for membership pricing. The membership pricing options are affordable and offer military, teacher, and healthcare employee discounts.
- Convenient hours of operation.
Marketing Plan
Brand & Value Proposition
Steven’s Gym will offer the unique value proposition to its clientele:
- Large, clean, spacious, and well-equipped facility.
- Dedicated team of trainers.
- Affordable membership pricing plans.
- Convenient hours of operation.
Promotions Strategy
The promotions strategy for Steven’s Gym is as follows:
Social Media Marketing Strategy
Steven’s Gym will invest in advertising the gym on social media platforms Facebook and Instagram. By using targeted social media marketing, Steven’s Gym will be able to reach the appropriate target audience of El Paso. Before opening, Steven will hire an advertising agency to develop the branding and photography needed to create captivating social media posts.
Billboards
Steven will invest in two billboards strategically located at busy intersections that receive thousands of traffic daily. The advertising agency will develop the print for the billboard design.
Website/SEO Marketing Strategy
Steven’s Gym will invest in a strong SEO presence so that when someone enters “El Paso gym” or “local gym near me” in their Google or Bing search bar, Steven’s Gym is at the top of the list. Their website will list all of Steven’s Gym’s services, location, pricing, and contact information.
Word of Mouth
Word quickly spreads around town and once a few people experience the clean, affordable, and professional staff at Steven’s Gym, more and more people will come in to see for themselves and sign up for a membership plan.
Pricing
The pricing of Steven’s Gym will be moderate and on par with competitors so customers feel they receive value when purchasing their services.
Operations Plan
The following will be the operations plan for Steven’s Gym.
Operation Functions:
- Steven Malone will be the sole gym owner and operator of Steven’s Gym. He will oversee the staff, maintain that the cleaning schedules are being enforced, and ensure that all equipment is working per standard and safely. He will also manage all ordering of new and replacement equipment, schedule the group HIIT classes, and daily management tasks.
- Steven will hire a gym manager to be in charge of new member enrollments, place them on an automated payment schedule that will be automatically debited from their account, manage the books, and handle any member issues.
- Steven will hire a team of three trainers to start off with to offer help and training to any member that requests it. Two of the trainers will take turns running the group HIIT class. As the membership grows and clients require more attention, more trainers and classes will be added.
- Steven will hire a local CPA to manage all high level accounting functions, such as payroll and tax payments.
- Steven will also hire an advertising agency to develop the gym’s branding, photography, website, social media accounts, and billboard design.
Milestones:
Steven’s Gym will have the following milestones completed in the next six months.
8/1/202X – Finalize contract to lease warehouse space.
8/15/202X – Begin build-out and design converting warehouse space into a functional gym.
9/1/202X – Hire advertising company to begin developing gym’s branding, logo, social media accounts, website, and billboard design.
9/15/202X – Order all equipment.
9/30/202X – Launch social media campaign and website. Billboards go up.
10/5/202X – Hire gym manager and team of personal trainers.
10/15/202X – Train staff on proper policies and procedures.
11/1/202X – Grand Opening of Steven’s Gym.
Management Team
Steven’s Gym will be solely owned by Steven Malone.
Steven Malone is a retired Army Master Sergeant who has been stationed off and on at El Paso’s Fort Bliss for the past twelve years. Upon retirement, Steven decided to make El Paso his permanent home and embark on his dream of owning his own gym. Steven recognizes the lack of quality, independent gyms in El Paso and wants to open a gym that fits his idea of what a high-quality gym should be.
As a former powerlifter and personal trainer while serving in the military, Steven is aware of the proper equipment and facilities a gym should have. Steven envisions his gym to be friendly, clean, well-equipped, and affordable for the average person so that people from all walks of life will feel comfortable going to the gym and achieving their fitness goals. Steven will dedicate his life and focus on ensuring that his gym is always clean, staffed with the best trainers, and members are happy with what the gym has to offer.
Financial Plan
Key Revenue & Costs
The revenue drivers for Steven’s Gym are the membership fees it will charge each person that signs up to become a member. Each member will be placed on a membership plan where they can either pay month to month, enroll in either a 6 or 12 month contract, or pay for the entire year upfront.
The cost drivers will be the payroll for the staff, rent, utilities, cleaning supplies and equipment, and gym equipment purchase and maintenance. Other cost drivers will be the targeted marketing costs on social media and monthly fees for the CPA and advertising company.
Funding Requirements and Use of Funds
Steven’s Gym is seeking $300,000 in debt financing to begin operations of the business. The funding will be dedicated towards securing the warehouse space, gym build-out, and purchase of the equipment. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and working capital. The breakout of the funding is below:
- Securing warehouse space, gym build-out, and design: $25,000 to $125,000
- Gym equipment purchase: $50,000 to $100,000
- Three months of overhead expenses (payroll, rent, utilities): $15,000 to $55,000
- Marketing & advertising: $15,000
- Working capital: $10,000
Key Assumptions
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.
- Initial Number of New Clients per Month: 60
- Average Monthly Membership Fee: $150
- Gym Lease per Year: $100,000
Financial Projections
Income Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Total Revenues | $360,000 | $793,728 | $875,006 | $964,606 | $1,063,382 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $64,800 | $142,871 | $157,501 | $173,629 | $191,409 | |
| Lease | $50,000 | $51,250 | $52,531 | $53,845 | $55,191 | |
| Marketing | $10,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
| Salaries | $157,015 | $214,030 | $235,968 | $247,766 | $260,155 | |
| Initial expenditure | $10,000 | $0 | $0 | $0 | $0 | |
| Total Expenses & Costs | $291,815 | $416,151 | $454,000 | $483,240 | $514,754 | |
| EBITDA | $68,185 | $377,577 | $421,005 | $481,366 | $548,628 | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| EBIT | $41,025 | $350,417 | $393,845 | $454,206 | $521,468 | |
| Interest | $23,462 | $20,529 | $17,596 | $14,664 | $11,731 | |
| PRETAX INCOME | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Use of Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Taxable Income | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Income Tax Expense | $6,147 | $115,461 | $131,687 | $153,840 | $178,408 | |
| NET INCOME | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 |
Balance Sheet
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $30,000 | $33,072 | $36,459 | $40,192 | $44,308 | |
| Total Current Assets | $184,257 | $381,832 | $609,654 | $878,742 | $1,193,594 | |
| Fixed assets | $180,950 | $180,950 | $180,950 | $180,950 | $180,950 | |
| Depreciation | $27,160 | $54,320 | $81,480 | $108,640 | $135,800 | |
| Net fixed assets | $153,790 | $126,630 | $99,470 | $72,310 | $45,150 | |
| TOTAL ASSETS | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $315,831 | $270,713 | $225,594 | $180,475 | $135,356 | |
| Accounts payable | $10,800 | $11,906 | $13,125 | $14,469 | $15,951 | |
| Total Liability | $326,631 | $282,618 | $238,719 | $194,944 | $151,307 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| Total Equity | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| TOTAL LIABILITIES & EQUITY | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 |
Cash Flow Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | ||||||
| Net Income (Loss) | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 | |
| Change in working capital | ($19,200) | ($1,966) | ($2,167) | ($2,389) | ($2,634) | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| Net Cash Flow from Operations | $19,376 | $239,621 | $269,554 | $310,473 | $355,855 | |
| CASH FLOW FROM INVESTMENTS | ||||||
| Investment | ($180,950) | $0 | $0 | $0 | $0 | |
| Net Cash Flow from Investments | ($180,950) | $0 | $0 | $0 | $0 | |
| CASH FLOW FROM FINANCING | ||||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 | |
| Cash from debt | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow from Financing | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow | $154,257 | $194,502 | $224,436 | $265,355 | $310,736 | |
| Cash at Beginning of Period | $0 | $154,257 | $348,760 | $573,195 | $838,550 | |
| Cash at End of Period | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 |
Gym Business Plan FAQs
What Is a Gym Business Plan?
A gym business plan is a plan to start and/or grow your gym. Among other things, it outlines your business concept, identifies your target customers, presents your marketing strategies and details your financial projections.
You can easily complete your gym business plan using our gym business plan template here.
What Are the Main Types of Gyms?
There are many types of gyms. There are large, franchise gyms that have multiple locations across the country. There are also large single facility gyms. Finally, there are smaller gyms that tend to focus on a particular fitness segment, such as strength training, CrossFit, or group HIIT training.
What Are the Main Sources of Revenue and Expenses for a Gym Business?
The primary source of revenue for gym businesses are membership fees. Typically, members pay month-to-month, or fulfill a year-long contract. Members are also usually able to pay for a full year upfront for a discount.
The key expenses for a gym business are the costs associated with payroll, purchase and maintenance of equipment, cleaning supplies, marketing costs, and working capital. Other expenses will be rent, utilities, taxes, accounts payable, and other licensing fees (if necessary).
How Do You Get Funding for Your Gym?
Gym businesses are most likely to secure funding from banks. Typically you will find a local bank and present your gym business plan to them. Family and/or friends could also be potential investors and other types of capital-raising such as crowdfunding are other common funding sources.
What are the Steps To Start a Gym Business?
Starting a gym business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop A Gym Business Plan - The first step in starting a business is to create a detailed gym business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast. Our business plan template is the perfect guide to show you how to start a gym business plan.
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your gym business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your gym business is in compliance with local laws.
3. Register Your Gym Business - Once you have chosen a legal structure, the next step is to register your gym business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your gym business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Gym Equipment & Supplies - In order to start your gym business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your gym business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.
Learn more about how to start a successful gym business:
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