Advice on buying a fitness club
For fitness fanatics and personal trainers looking to amplify their income, buying a gym could be a perfect solution. Purchasing a fitness business as a going concern can remove some of the risks and high entry costs associated with starting from scratch, but every gym is different and will have its own benefits and limitations. Before you buy, you need to ensure that your own personal ambitions, and the operational realities of the business you’re planning on buying, are in alignment.
When you are in discussions to buy a gym, make sure you understand the ownership arrangements for the gym equipment. Is the equipment owned outright, or is it on a hire-purchase or leased arrangement? If the equipment has been purchased outright, are there outstanding bank debts that need to be serviced following your purchase of the gym? Will any of the cardio, weights or spinning equipment need maintenance or replacing in the near future?
The demographic of the gym’s membership is equally important, particularly if you want to offer a different gym experience to what the current owners are offering. You need to know the average age group and relative affluence of the local residents, as well as the breakdown of students, professionals, families and retired couples. The local market will dictate the direction of the business in future. For instance, you might want to focus the business you buy on bespoke personal training, but if there isn’t enough demand for this kind of service in the local market you will need to realign your expectations.
The location of the gym, its marketing methods, insurance premiums and local competition are all highly important factors, as is the membership churn rate (the number of new members joining every month or quarter, versus the number of current members leaving over the same time period). The more information the seller can provide you with in this regard, the better.