The UK’s fitness industry is certainly in very good health. With the opening of more gyms and an increase in gym memberships over recent years, its estimated worth falls at around £4.3bn. The market has also been highlighted for the amount of new opportunities it can offer for clued-up, health-savvy entrepreneurs.
The latest industry figures suggest that almost 9 million Brits are gym members, marking an annual increase of 5.8%. But in terms of needs, habits, expectations, and opinions on what makes a great gym experience, one size most certainly doesn’t fit all. This diversity means that huge low cost chains exist side-by-side small boutique gyms — the challenge for newcomers is to work out where they might fit into this landscape.
The challenge is exciting, and requires an understanding of your potential customers, as well as the practicalities of getting a gym business off the ground. So here’s our guide to what it really takes to start your own gym.
Market positioning: low cost or premium?
For an entrepreneur starting out in the gym industry, aiming to emulate an already existing chain is a very risky strategy. Big chains enjoy considerable buying power, helping them to access equipment cheaply, and keep running costs to a minimum. The likes of LA Fitness and Fitness First use brand recognition to increase footfall. In turn, this allows them to keep the price of membership packages low. They can appeal successfully to lots of different types of gym user, as well as offering the convenience of multi-location memberships.
The boutique gym studio model offers a potentially more accessible way into the industry. Studios such as Boomcore and 1Rebel, are specialist gyms which offer classes their target customers want, personalised services, expert-led training sessions, and a distinct ‘community’ feel.
Trying to compete solely on price means you’re always at risk of being muscled out by one of the big players. Offering a valuable service to a more discerning group of customers can be a much more effective way of gaining loyal members — and of building a sustainable business.
Finding suitable premises and equipping your gym
On first glance, the combined cost of equipment, changing facilities, showers, and saunas—not to mention property expense—makes the task of getting a gym off the ground seem very daunting. Taken step by step however, it becomes possible to see a way forward.
Market research is the first step. Who are your proposed customers? What facilities and services do they expect, and how much are they willing to pay for them? If you are working in the fitness industry already (as a personal trainer, for instance), your existing customers can be a valuable source of insight, as can the opinions of other fitness professionals in your area. Look at what gym facilities exist already, and use your research to identify how and why those existing providers are failing to meet customers needs.
Next, you must assess the likely costs involved in building a business which meets those needs. Look for ways to keep those losses to a minimum. Rather than taking a lease on an empty shell of a building, consider premises that are already kitted out as a studio or gym — but be careful to enquire why the existing owner is moving on. Are there any reasons why those particular premises are no longer suitable? Was the previous business profitable? Have an accountant look over the previous owner’s accounts to determine this.
When sourcing equipment, consider leasing options rather than outright purchase as a way of keeping your initial outlay low. This can also be a good way of scaling up gradually: you can lease a relatively small number of cardio machines to begin with and add to this as your customer base grows.
Rules and regulations: what should I be aware of?
Given the potential for injury within a gym, owners need to ensure that they provide a safe environment for both members and staff. This includes scheduling regular inspections, continued maintenance of equipment, having first aiders on site, and ensuring that members are instructed on the safe use of machines. The UK Active Code of Practice sets out a summary of what gym owners should aim for. Employers’ liability insurance is a legal requirement. Gyms should also take out public liability insurance to cover claims from members. Your insurers will advise you further on the procedures you need to have in place.
Building your membership
Pay-as-you-go memberships appeal to casual, occasional gym users and are more common at the lower, no-frills end of the market. For a more personalised boutique service, the subscription contract model makes much better sense; it gives you the certainty of a predictable revenue stream from monthly membership fees.
Promoting your new gym involves ensuring it is listed on local online business directories and you spread the word online via your own website and on social media. Be careful not to take on too many members too quickly; overcrowding at peak periods can spoil the user experience for all members.
Need help on putting together a business plan to obtain finance for your new gym? Visit our help centre for funding and planning advice.