Owning a gym sounds like a great idea. You get to make money while working a job you love, right? While this isn’t necessarily wrong, there are far more details to consider.
For example, do you know the failure rate of health and fitness businesses? Do those gyms fail because of bad luck or is it something more? And most importantly, how can you set your gym up for success (hint: you’ll need gym management software)? Keep reading to learn what you’ll need to do to open a successful gym.
Start your new gym off on the right foot with Exercise.com. Book a demo to get started.
What is the failure rate of new health and fitness businesses?
According to the Global Health and Fitness Association (IHRSA), 81 percent of health and fitness studios fail within their first year.
That number sounds bad enough on its own, but it gets worse. According to the US Bureau of Labor Statistics, the first-year failure rate of private-sector establishments across all industries is about 20 percent. This means that new health and fitness businesses are four times more likely to fail than other types of business.
However, this grim statistic hasn’t kept the health and fitness club industry from growing. Statista reports that there were 41,370 fitness clubs in the US in 2019, which is up from 30,022 fitness clubs in the US in 2008.
Why do new health and fitness businesses fail?
Most businesses, including gyms, fail due to money. Here are a few common reasons a gym might fail:
- The business opened without enough operating capital.
- The business isn’t generating enough volume to turn a profit.
- The business’ finances are being mismanaged.
As fun as it may sound to open a gym, at the end of the day, that gym is still a business and must be treated as such if it is to succeed.
Book a demo to learn more.
Exercise.com can help you operate your gym like a pro.
How can I make sure my new gym will be successful?
If you want to prevent your new fitness business from becoming a failure statistic, you must take the business side of your gym seriously. Learn how to put together a business plan and how to read a lease. Gain experience in gym marketing and sales (or seek out someone for your team who has this knowledge).
Your new fitness business will need gym management software; do you know what features you need in that software or where you will get it? Have you managed employees before? Have you ever applied for a business license or submitted tax forms?
As the owner of a new gym, you’ll need to do all this and much, much more. If you’re truly a beginner in these areas, take some business classes. Yes, really. The surest way to set your new gym up for failure is to proceed with opening it before you know what you’re doing.
The Bottom Line: How often do gyms fail?
As sad as it is to say, new health and fitness businesses fail far more often than they succeed. However, this fact shouldn’t scare you away from opening a new gym if you do your homework. Nail the business side of your new venture, and the rest will take care of itself.
Are you ready to maximize your gym’s profits by streamlining your operations? Book a demo to find out how Exercise.com can help.