Pyramid sets, High-Intensity Training, calories deficits and gym gains; all common parlance for individuals these days. The health and fitness industry in the UK is still in a ‘bulking’ phase as the general public continues to maintain its trend towards positive body image and healthier lifestyles.
Industry growth has been fuelled by increasing awareness – and actual experience – of the benefits of exercise on both physical and mental health.
Rises in obesity, heart disease and diabetes have further highlighted the need to alter 21st Century lifestyles. Government initiatives and sporting events have given the industry a further boost, as have technological developments.
The figure below shows some of the key industry stats. Market value, membership and number of sites have all grown at an incredible rate over the past decade. The success of the industry and the active customer base has led to a number of fresh entrepreneurs to enter the fray each adopting and adapting subtly different business plans to carve out their own niche.
More than 1 in 7 UK adults have a gym membership at an average cost of around £40 per month. This subscription-based revenue model has bolstered a chain of add-on revenue streams that is seemingly unlimited. From pay-per classes, one-on-one personal training sessions, health and diet assessments, sports massage, food supplements, training clothing and equipment among but a few.
This wide variety of associated services allows for a wide range of variety and flexibility from the current market players. From the ‘budget’ pay as you go style of Pure Gym to the more exclusive offering from companies like Nuffield Health there is something there for most budgets and most needs.
Regular gym goers will spend, on average 3 sessions a week getting fit and strong and our data shows that quality gyms will tend to see around 300 patrons each and every day with total memberships numbers for each business sitting around 5,200 per facility.
Each gym has its own blend of equipment and services. The graphic below indicates the uptake of the most popular offerings. The combination and/or specialism of one or more of these services and equipment is what allows each gym to differentiate itself from others in the market.
The ‘traditional’ gym offerings that can be used independently by members remain the cornerstone of most gyms. Self-use cardio machines and free weight areas are utilised by most facilities and require limited numbers of staff to maintain and monitor. Group classes such as spinning sessions are a preferred option in just over half of gyms (56%). Often these classes are add-ons to a monthly membership and utilise relatively small spaces. Again, these sessions can be run by a single staff member making them an extremely efficient way to offer a service to a wide number of members.
One-on-one services such as Personal Training (81%) and Nutritional Advice (18%) are more resource heavy but are invariably can be charged for an additional fee.
The Cost of Gym Membership
With the rise of the ‘budget gyms’ and flexible membership terms, the average cost of membership as actually fallen slightly in the past couple of years. This fall in subscription fees has been offset by a rise in membership as a whole.
Consumers are increasingly savvier and willing to shop around for better deals meaning business owners are under extra pressure to adaptable quickly to the market around them.
How Do Gyms Get Financed?
Let’s be frank the start-up costs to get a brand new gym off the ground are not cheap. The cost to start a Gym business would normally start at around £80,000. With careful business planning and shrewd purchasing, it is, in fact, possible to strata gym for less than £25,000. Those savings can be made using out of town premises, purchasing second hand or used equipment, or even leasing bigger equipment that might need regular maintenance.
Franchise opportunities do exist in the UK. Anytime Fitness is one of the leading franchises in this sector and operates over 5,000 franchise gym outlets in seven continents, having initially launched in the UK back in 2012. It offers a franchise package for minimum liquid capital investment of £110,000 but this includes everything from support and training through to access to marketing materials. Successful applicants to a franchise opportunity would need to present a solid business plan and show themselves to be fully capable of running a business and managing the franchise brand.
The most popular way of funding a gym venture is through personal savings, but as the start-up costs are high these funds are often needed alongside other forms of finance. Having great knowledge and experience in the industry is always going to be a big help. The gym game is very customer facing so it helps to have a proper understanding of health and fitness generally as well as a great business brain
The table below shows the main sources of business finance and their associated percentage. In some cases, for larger projects, businesses may need to obtain finance from more than one source.
The layperson may be misled into thinking a fully written business plan would only be a requirement if looking for outside finance. Whilst it is true a solid business plan would be a pre-requisite for any form of form debt or equity finance the value of having a quality business plan cannot be underestimated. Even for those self-funding, a viable and robust business plan is a sure way to keep focused and accountable which will ultimately lead to better business decision making.
Importance of a plan
Given that the start-up costs can be big and the market
So what can we say about starting your own gym?
- Industry in a period of sustained growth
- Plenty of ways to create an alternate offering
- Lots of opportunities to develop additional revenue streams
- Strong general awareness of the importance and benefits of a healthy lifestyle
- Competitive market place
- Can be expensive to start though creative thinking can greatly reduce those start-up costs
How you can succeed
The best way to get ahead of the competition and eliminate the biggest unknowns and risks when starting your own gym business is to invest in a quality business plan. For the cost of a single rowing machine, you can obtain a high-quality, visually stunning, financially robust business plan. It will give you a greater chance of seeking that vital finance and in the long run, could save you thousands.
If owning and running a gym sounds like the kind of business for you get started with a MyBizPlan. Use Discount Code G7MBIZ!5 for 15% off and get the Number One business plan on the market.