How to set up a Gym or Personal Training studio | Back

How to set up a gym or personal training studio

One of the very first questions to ask is why do you want to set up your own business, Is this right for you and do you have the right knowledge, experience and drive? It’s hard work, you will need to put the hours in and make many sacrifices. The first year of opening my gym I worked 7 days a week open to close.

What type of gym?
You would have already got an idea of what type of gym you are wanting to open. Some things you should consider first, can the gym you want to open be profitable? For instance if you choose to open a personal training studio which is only big enough for you and one other trainer, what happens when one of you goes on holiday, with just will there be enough income? You need to ensure that whatever you decide to do that you can afford the bills, having the room for additional personal trainers definitely helps with that income! Opening a CrossFit box can be another low earner. You may love your job but you need to pay bills and retire one day. I’m not saying you can’t make a profit from these types of gyms, it’s just harder to do than a conventional gym with large membership numbers and relatively smaller outgoings.

Total cost to open a gym
Quite simply, there isn’t one. There is no one total cost to open a gym, each business will be totally different, further on we deal with what they may want to think about

Is there a gap in the market for your business and are there any other gyms/PT studios nearby? Why would customers come to you over your competition?

Unique Selling Proposition (USP)
You need to decide what your USP is, how does it describe you and in particular how will it make you different from the competition and make you stand out from other gyms? Once you have decided what this is, you use it to sell your business, as a slogan, in advertising, but mainly to sell your business to prospective customers. You use your USP to help you to attract funding if needed.

Business plan template/business analysis
Either produce this yourself or get advice/assistance to do so. If you are requiring any kind of funding this will be a basic requirement, even if you don’t it will help you to think about all aspects of your business set up and think about the pros and cons…Don’t miss this step out, it’s essential for every good business! The words business plan can seem very onerous, it almost was enough to put me off the idea, just think about it as putting the thoughts that are already in your head down on paper. There are also helpful templates on the internet, here is one I put together. (link to business template)
Remember to factor in business growth, this may at this stage be only aspirational, but needs to be considered at the outset. Remember that blue sky thinking is important, it will help you to think outside the box and not to limit yourself!

If you need funding, as most of us do, you will need a financial business plan, which will lead on from your business plan. This will assess all your costs over the first few years of your business.
You need to decide if you need funding, investors, or if you have enough finance to set it up alone. Once you have decided what route to take you need to think carefully about what the benefits and risks are of each of your choices and what the payback/constraints would be. Business loans are normally best done through the banks, however wherever you feel you will get the best rates and support, just watch the small print! If you can get people you know to invest in you and your business that’s great, just make sure that you have a legally binding agreement, whoever they are. I admit to getting specialist help in translating my business plan into a financial plan. This was definitely one area that two heads were better than one.

Essential to make sure you have the right amount of finance in place, but always have a sizable contingency pot, this is essential to take the pressure off the first year of trading and of course there will always be some expense that you hadn’t planned on or forgotten. Do a breakdown of every single item (this level of detail will not be required for your business plan, here is where it matters). As highlighted earlier, growth aspirations need also to be considered at this stage too.

Solicitors are not cheap but could save you a lot of money in the long run. They will be able to give you expert advice on your leave saving you thousands in the long run. You need to make sure the solicitor you choose specialises in commercial property. Ensure that every single agreement that you are required to sign, you completely understand. A solicitor may add to the costings, but will be worth it in the long run.

Understanding the basics of company tax is important. I would suggest a session with your accountant as below.

Company name and structure
Company name, this needs to be relevant to the industry, easy to remember, with a logo too.

What business and staffing structure do you need? Will you have Directors and shareholders, if you have, particularly pay attention to the legal requirements around this set-up and seek advice from your solicitor and accountants. In terms of the staffing structure, how many staff do you require and what level of skills do they need. You will only know what your start up requirements are, be prepared for this to change, so think flexibly!

Business license and restrictions
Your local council will be able to give you information on this. The premises may already have the necessary permissions, if not you will have to liaise with the council to seek the relevant license and permissions, this at times can be quite onerous, but don’t give up!

Registering the Company
You will need to register your Company at Companies house. To do this you will need at least one Company Director and at least one shareholder. Your company will also need to be set up for corporation tax. Again always best to seek advice from the expert, your accountant or solicitor will be able to assist with company registration. You will need advice about whether it is best to set your company up as limited or unlimited. The basic difference is with a limited company you have limited liabilities, if you opt for unlimited then your liabilities are unlimited. There are of course advantages and disadvantages of both, so speak to the experts to see what is right for your business.

Choosing the right property
Below is a list of things that you need to consider when deciding if the property is right:
Is the premises viable for your business, I would advise you have a survey done on the premises
Location, can your client base reach you easily?
Competition within your locality.
Business rates, in some areas these can be prohibitive.
Are you looking to lease or buy the property, if leasing how long is the lease for? What are the break clauses? How often is the rent reviewed. Is the lease within the tenants act. The lease must be legally written up and your own solicitor to review it, before you sign anything.

Choosing gym equipment
Choosing the right equipment and in particular from a trustworthy supplier, it may be worth going to (shows) to see what equipment is on offer and get to talk to some of the suppliers. Beware of promises of instant deliveries only to find that there are long delays.

Not all gym equipment is made to the same standard. For instance machines made by Prime Fitness are made so that the resistance profile matches your strength profile. Most gym equipment manufacturers design machines purely on looks and with cost in mind. For example the new Nautilus strength equipment is nothing like their older models such as the Nitro and Xpload range. They might look pretty and shiny but the manufacturers neglected the most important design, the resistance profile.

Gym strength equipment we recommend:
Prime Fitness
Nautilus Nitro
Nautilus Xpload
Cybex Eagle
Cybex VR2

Consider whether you want to buy the equipment outright or to lease some of it, with leasing agreements, make sure you read the small print. Make sure to do your sums and compare the overall cost of leasing against outright purchase.

Consider what your main source of income is and then think about possible secondary income. So primary income will be membership fees. You will then need to consider how else you could increase income. Below is a list to consider, but is not exhaustive:
Personal trainers: rent
Treatment rooms: rent these out to physiotherapists and/or osteopaths, for example.
Supplements: protein shakes, pre-workouts, health supplements ie multivits etc, energy drinks, water,
Merchandise: branded gym wear and bottles etc

Consider business costs, think about the monthly, quarterly, annual costs that you will have, which will occur from day one. You should have already thought of most of these within your business plan, but may need to be broken down further. Some of the costs listed below, but again not exhaustive!

Staffing cost (including on costs)
Maintenance costs (repairs, annual PAT testing, annual fire alarm/extinguisher and intruder alarm servicing, etc)
Bills (water, electricity, telephone/internet etc)
Music licences
Card payment fees (monthly card machine fee, and transaction fee for each card payment)
Stationary etc (printer paper, card machine paper, printer ink cartridges)
Toilet roll, hand soap, hand sanitiser, cleaning spray and paper towels for members in gym
Waste collection
Website (initial cost of building one plus regular SEO work)
Corporation Tax
Insurance: contents, liability, building
Consultant support
miscellaneous , for those one off costs, which can be sizeable.

Recruiting the right staff for your business is crucial, if you don’t have the expertise personally then I would recommend getting a recruitment or HR specialist to assist, getting recruitment wrong can be costly in time and money. You need to think about what competencies you require and a job description. Remember your staff really are your best asset, so get it right!
You may want to think about ongoing HR support for issues relating to staff, for example employment contracts, policies and procedures, it’s important that all staffing issues are handled professionally or there could be consequences. With regards to Payroll and Pension, consider outsourcing to an HR Consultancy or use your Accountants.

Managing the gym
Who will be managing the gym? If you are a PT and want to continue while running the gym, will you have time? Even if you hire a manager to run your business you will still have a lot of administration to work through each day. To find a good manager let alone an excellent manager isn’t easy. Not everyone has the same drive and motivation for the business as you do. When you find the right person make sure you look after them after all they are holding the business together while you are occupied training clients. Remember that your members will like to see you around and talk to you or maybe seek advice, they see you as the expert, so make time for them within your schedule.

Personal trainers
Will the personal trainers working at your gym be employed or will they be freelance paying you a fee? Is that fee a set amount per month or percentage of the amount they charge their clients?
Remember that whatever you decide about them being employed or self-employed, ensure that they are part of the team and still feel valued. They are representing you and your brand

How are you going to advertise your business? Don’t forget to consider that this will not just be for your business launch but will be on going, you can’t afford to be complacent about this, you need to refresh and enhance your website, social media or whatever vehicles you choose to advertise your business, you must ensure this does not get stale! Back to budgeting, remember that advertising can be costly and particularly if you require some consultancy help.

Social media: This really is the way forward now as the majority of people are attached to their phones all day every day now. You can put out paid adverts that will target certain people within your area based on their age range, and things they look at and like on social media that is relevant to the fitness industry. These are relatively simple to do as long as you make your target market clear, and set timescales for when you want the adverts to go out and the type of campaign you are doing.

Flyers: This old fashioned way of advertising is time consuming and quite costly. Saying that it is probably one of the best ways to target the older generation (who tend to have more expendable income) that don’t use social media.

Banners: A well placed banner can be very effective if it’s by a busy road. It is extremely unlikely that your council will allow you to put banners up and will most likely fine you if you for doing so. I would suggest speaking with the council first to see what their rules are regarding this.
It is possible that the amount of exposure to 10 well-placed banners around the local area outweighs the cost of the banners.

Word of mouth: Obviously this is free and the very best form of advertising. Doing a good job and looking after your members/clients should be your utmost priority. I can’t recommend this enough!

Website: Every gym, PT studio and personal trainer should have an online presence. Most people like to research the PT before contacting them. Ensuring your SEO is constantly kept on top of making sure that you are always at the top of google searches for your establishment is key.

Piaggio Ape (TukTuk): For me this was and still is a very powerful form of advertising. I have owned one for several years and park it in several different lay-bys on busy main roads local to my gym. They are small enough to park at an angle and with a banner attached to the back I could get thousands of people seeing our advert as they driving past.

Future costs
You will be needing to invest in new gym equipment over time. Your beloved equipment will take a hammering from daily use and won’t take long before they start looking tired.
With the heavy foot fall, the building will also have wear and tear so you will need to factor in general maintenance such as painting

Choosing the Membership management company

I would advise that you need to use a company to collect/manage your direct debits initially. Each company will come with their own software for your computer which will allow you to keep track of your members and also use this as a way for them to sign in. There are numerous companies out there to choose from that come with different features and work in different ways so make sure you do your research and choose one that will be right for your business needs. These companies offer demo’s so you can get an idea of what they include and how they work. These companies will collect your monthly membership payments from each member on a set date, and they will then pay it into your business account in one lump sum each month a week or two after they have collected it, minus their processing fees. Check carefully what the fees they charge cover and what may considered as extra.

If you decide, once your business is established, not to use a membership Management Company you will need your members’ direct debits to go directly into your business account rather than through the membership management company if you can obtain a Service User Number (SUN) from your bank. If you are a new business starting up then it is unlikely that you will be given one of these and will for the first few years at least need to use a membership company to collect your direct debits, then once you are an established business you may be able to obtain a SUN and get your direct debits redirected straight to your bank account, the Management Company will just bill you for their processing fees.
You will need to assess what the cost of doing this yourself is in terms of managing and controlling DD’s and then balance that against the cost of using a Management Company.

Signing in systems

There are different methods that most companies’ software is compatible with so ensure that you choose the method that is right for you and your members. The most common method is swipeable membership cards to allow your members access into the facility. This method is quite old fashioned and many people forget their cards, this in turn can increase costs in terms of new cards and staff time. Other methods include QR codes on the members mobile phones that they can scan, and also fingerprint scanners. Some larger chains use 4-6 digit codes that the member can type in on a keypad. I would not recommend this however as this code can easily be passed around to the members friends and you subsequently your business losses income.

Mobile app: Does your software come with a mobile app for members? This is a useful way for members to book themselves onto/cancel classes, and saves on admin time for your staff.

Additional features: Ideally you want your software to include a POS (point of sale) till system so that you can process transactions and payments such as an initial payment for new member sign ups in house, day passes for non-members, and supplement purchases etc. It is also helpful if the software includes a feature where you can access and download data in order to be able to see monthly membership numbers etc. Some may also come with a retention key, so when they sign in it will either come up as green, yellow or red depending on how frequently they visit. If they are infrequent then it is more likely that they are going to cancel at some point, therefore if you can see this on the screen then when they sign in it is an opportunity to talk to them and see if you can help in anyway ie for motivation by giving them a new programme to follow etc.

About the author


Location: Hathern , Leicestershire

Author Bio

Our LPT Admins are experienced Health and Fitness Professionals from the world of Personal Training, Coaching, Sports and Nutrition.