Unlocking Fitness: Unveiling the Price for Open a Gym!
How much does it cost to open a gym?
Despite the popularity of at-home virtual exercises, hybrid fitness is the future. IBISWorld Inc. predicts the gym and fitness facility business would expand from $37 billion to $42 billion by 2026. We can help you start, manage, and grow your fitness business. (Fitness business startup) As you design your business strategy and search for a gym location, consider the following costs.
How much do different types of gyms and exercise centers cost to open?
It’s inevitable: The style of gym or training place you want to open and where you live will determine how much you need to invest to open it.
Robert Linkul, a National Strength and Conditioning Association board member and business consultant, says you can operate a 600- to 800-square-foot yoga, barre, or personal training studio for approximately $25,000. (See 7 stages to becoming a yoga instructor.)
Linkul says a medium-sized gym (1,000 to 2,500 square feet) for group courses or otherthis training will cost $50,000 to $75,000.
If you want to open a 4,000-square-foot small group strength and conditioning gym with all the bells and whistles, know that Dan Kleckner, a fitness business consultant in Seattle and Montana, needed $100,000 to open each of his gyms.
Franchises cost extra. Orangetheory locations cost $575,922 to $1,498,122 to open. Orangetheory equipment, software, and branding are expensive.
Other franchisees provide different workouts, but they all have high beginning expenses. CorePower Yoga franchises cost $455,200 to $1,206,000 to start. Retro Fitness box gyms cost at least $1,500,000 to start.
Is it profitable to establish a gym?
Since opening a gym costs a lot of money, you definitely want to know how much you can make.
IBISWorld, Inc. reports a 9.6% growth rate for the gym and fitness club market during the past five years. The Corporate Finance Institute says this number is average. (Note: in is the difference between your total revenue and your costs.)
However, numerous factors—including your gym’s type—can affect how much you make as a gym owner.
Linkul prefers yoga and barre studios with little equipment. Opening a gym with expensive equipment that needs frequent maintenance and replacement will cost more. If so, you may keep more of your profits.
If you live in a big city, an independent boutique may be better for making money than a franchise. Kleckner says, “In many places, you’re going to be ninth or 10th to market when [opening a franchise]. In Seattle, there are 10 group gyms within two or three miles.
Kleckner says franchises and big-box gyms have higher customer turnover, making it harder to sustain membership numbers in an already saturated market. In these instances, starting a small, specialized business is safer. “The average franchise group class gym keeps clients for six months, but ours stay for closer to 30,” he says. (Cost-effectively retain members.) Remember that franchising involves paying a share of your revenues permanently.
Gym startup costs
Sticker shock is natural. Many would-be gym entrepreneurs think they just need room and equipment. However, a variety of other fees—some of which you may have never heard of—drive up gym starting prices. Here are all the checks you’ll write: We’ll finish the big ones first.
- Rent.
Rent is usually a major expense. Everything costs differently. A modest yoga studio in the Midwest costs much less to rent than a huge strength and conditioning gym in a major city.
Linkul said some neighborhoods charge $1 to $3 per square foot. A 1,000-square-foot apartment costs $1,000–$3,000 per month. Kleckner rents a 1,000-square-foot house in Montana for $10,000 a month at $10 per square foot. Opening in Manhattan’s SoHo? $150/square foot.
Linkul advises: “Start small and overflow out of it.” “Then you have the good problem of needing to expand instead of being in over your head in a larger space,” he explains.
- Building expenses
The place you lease (or buy) for your fitness establishment may need aesthetic construction to become your dream gym. It may require much effort to repair.
“Everything might look ready, but then you have to raise a ceiling to a weight rack, and suddenly you’re spending five figures on building,” Kleckner explains. Large gyms like his should allocate $25,000 for the unexpected. (A small studio renovation will cost less.)
Negotiate with your landlord to make minor upgrades before you move in or include a few months of free rent in your contract to save money.
- Equipment prices
Your gym’s training equipment—and budget—depend on the type of business you’re starting.
Linkul thinks you can fully outa small studio or gym for $5,000–10,000. Kleckner says you’ll need $25,000 to load a larger facility (4,000–5,000 square feet).
Linkul advises establishing “want” and “need” lists to keep expenses down and stay within budget, regardless of space or facility focus. “What do you need to open and start training or coaching?” he asks. Once you’re established, you can start adding items you’d like but can survive without.
Consider whether having the best brand names matters to you. Mike Alpert, a longtime health club executive and member of the American College of Sports Medicine, says a Woodway treadmill costs $13,000, while a Precor costs $8,000. Consider if you need to splurge on household name brands—it might make or break your budget.
Gym startup costs
Sticker shock is natural. Many would-be gym entrepreneurs think they just need room and equipment. However, a variety of other fees—some of which you may have never heard of—drive up gym starting prices. Here are all the checks you’ll write: We’ll finish the big ones first.
- Rent.
Rent is usually a major expense. Everything costs differently. A modest yoga studio in the Midwest costs much less to rent than a huge strength and conditioning gym in a major city.
Linkul said some neighborhoods charge $1 to $3 per square foot. A 1,000-square-foot apartment costs $1,000–$3,000 per month. Kleckner rents a 1,000-square-foot house in Montana for $10,000 a month at $10 per square foot. Opening in Manhattan’s SoHo? $150/square foot.
Linkul advises: “Start small and overflow out of it.” “Then you have the good problem of needing to expand instead of being in over your head in a larger space,” he explains.
- Building expenses
The place you lease (or buy) for your fitness establishment may need aesthetic construction to become your dream gym. It may require much effort to repair.
“Everything might look ready, but then you have to raise a ceiling to a weight rack, and suddenly you’re spending five figures on building,” Kleckner explains. Large gyms like his should allocate $25,000 for theunexpectedn. (A small studio renovation will cost less.)
Negotiate with your landlord to make minor upgrades before you move in, or include a few months of free rent in your contract to save money.
- Equipment prices
Your gym’s training equipment—and budget—depend on the type of business you’re starting.
Linkul thinks you can fully outa small studio or gym for $5,000–10,000. Kleckner says you’ll need $25,000 to load a larger facility (4,000–5,000 square feet).
Linkul advises establishing “want” and “need” lists to keep expenses down and stay within budget, regardless of space or facility focus. “What do you need to open and start training or coaching?” he asks. Once you’re established, you can start adding items you’d like but can survive without.
Consider whether having the best brand names matters to you. Mike Alpert, a longtime health club executive and member of the American College of Sports Medicine, says a Woodway treadmill costs $13,000, while a Precor costs $8,000. Consider if you need to splurge on household name brands—it might make or break your budget.
- Utilities.
Experts recommend budgeting a few hundred to several thousand dollars per month.
Crossclubs may use a huge garage door to let fresh air in instead of heating and AC. “But it’s a different situation if you’re in the south and need to rock your air conditioning all day for nine months,” Linkul says. A non-heated yoga studio and a gym with treadmills and other aerobic equipment are similar. He says that the Fitness Business Association allows zip code searches for average amenities and rent rates.
- Insurance.
The appropriate insurance can save you money later. Linkul estimates that good client and incident insurance costs $2,000 to $3,000. However, your gym’s training determines your cost.
To determine how much coverage you need and how much you’ll pay, talk to your insurance rep about everything from the type of equipment you have (treadmills cost more) to whether your clients will be barefoot.
Linkul advises specifying your coverage. What if the water leaks? An earthquake? What about fire? What if a car hits the window? He suggests telling your rep you want to add it if your policy doesn’t cover it. If the unthinkable happens, you must pay.
Linkul recommends buying fitness insurance from a reliable firm. “Don’t use your auto or home insurance; it’s not their specialty. Research and choose K&K or Philadelphia.
- Promotion.
Linkul suggests $2,500 for simplicity. “This is a good starting point to get swag like t-shirts, tote bags, and stickers for your members, who can be some of your biggest marketers,” he says.
If you go all out with social media marketing and SEO (think Google ads), you may spend $1,500 a month, Kleckner adds
Friendly FYI: we’s sophisticated SEO tools and targeted marketing help enhance site traffic. Find the right plan and learn about fitness marketing here.
- Legal costs.
Fitness centers must have liability disclaimers, member contracts, and employment agreements to avoid litigation and other legal difficulties. (we Forms, included with we Fit, can help you organize this paperwork.)
Linkul advises hiring a lawyer to ensure all forms are completed correctly. “You want to cross your T’s and dot your I’s from the moment someone walks into your facility.”
He advises spending $1,000–$1,500 on legal counsel to save millions and your business.
- Business license.
Alpert says a fitness establishment needs a business license to function legally. State-level business license applications are typical. Registering a business costs roughly $100 in most states.
- Permits.
Linkul says you’ll usually require permissions from your county or city to perform building changes, install exterior signage, or warm up in your parking lot.
Linkul advises becoming engaged with your local chamber of commerce and building a good relationship with your local government because permission requirements vary by city. Permits are usually affordable for gym owners, he explains. Permits may cost $25 or $150 per year.
Exceptions exist. New York City has long required fitness businesses to seek a special 10-year permit that takes up to six months to obtain and costs $50,000. The city has lifted this key hurdle to help small companies after the pandemic, much to the relief of gym-owning aspirants in New York.
The lesson is to research your city’s gym opening fees and obstacles.
- COVID-19 air filtration
In the COVID-19 era, new and returning gym-goers must feel comfortable in your facility. That’ll cost you.
Linkul says monthly costs have climbed by over 30% due to buying new equipment, adding air filters, and going all-in on cleaning supplies.
He suggests spending at least two hundred dollars more per month and charging members a minor facility fee to avoid going into the negative. “Everyone has been on board to contribute a few extra dollars to have all of these extra precautions that ultimately help protect them,” he says.
Linkul suggests pushing the gym owner to update the HVAC system, which usually falls on the tenant and costs thousands of dollars but may be negotiable in the current rental climate.
- Supplies and upkeep
General maintenance and supplies like towels and bathroom freebies (hair ties, spray deodorant, toilet paper, and cleaning spray) are deceptive expenses. Linkul recommends budgeting $200–$300 a month for these expenses.
- Scheduler.
Every facility needs a booking and membership system. The easiest way is to use the we Bookings app or a fitness website design that emphasizes bookings. See we’s online scheduling software here.
Experts recommend budgeting a few hundred to several thousand dollars per month.
Crossclubs may use a huge garage door to let fresh air in instead of heating and AC. “But it’s a different situation if you’re in the south and need to rock your air conditioning all day for nine months,” Linkul says. A non-heated yoga studio and a gym with treadmills and other aerobic equipment are similar. He says that the Fitness Business Association allows zip code searches for average utility and rent rates.
- Insurance.
The appropriate insurance can save you money later. Linkul estimates that good client and incident insurance costs $2,000 to $3,000. However, your gym’s training determines your cost.
To determine how much coverage you need and how much you’ll pay, talk to your insurance rep about everything from the type of equipment you have (treadmills cost more) to whether your clients will be barefoot.
Linkul advises specifying your coverage. What if the water leaks? An earthquake? What about fire? What if a car hits the window? He suggests telling your rep you want to add it if your policy doesn’t cover it. If the unthinkable happens, you must pay.
Linkul recommends buying fitness insurance from a reliable firm. “Don’t use your auto or home insurance; it’s not their specialty. Research and choose K&K or Philadelphia.
- Promotion.
Linkul suggests $2,500 for simplicity. “This is a good starting point to get swag like t-shirts, tote bags, and stickers for your members, who can be some of your biggest marketers,” he says.
If you go all out with social media marketing and SEO (think Google ads), you may spend $1,500 a month, Kleckner adds.
Friendly FYI: Our sophisticated SEO tools and targeted marketing help enhance site traffic. Find the right plan and learn about fitness marketing here.
- Legal costs.
Fitness centers must have liability disclaimers, member contracts, and employment agreements to avoid litigation and other legal difficulties. (we Forms, included with we Fit, can help you organize this paperwork.)
Linkul advises hiring a lawyer to ensure all forms are completed correctly. “You want to cross your T’s and dot your I’s from the moment someone walks into your facility.”
He advises spending $1,000–$1,500 on legal counsel to save millions and your business.
- Business license.
Alpert says a fitness establishment needs a business license to function legally.
State-level business license applications are typical. Registering a business costs roughly $100 in most states.
- Permits.
Linkul says you’ll usually require permissions from your county or city to perform building changes, install exterior signage, or warm up in your parking lot.
Linkul advises becoming engaged with your local chamber of commerce and building a good relationship with your local government because permission requirements vary by city. Permits are usually affordable for gym owners, he explains. Permits may cost $25 or $150 per year.
Exceptions exist. New York City has long required fitness businesses to seek a special 10-year permit that takes up to six months to obtain and costs $50,000. The city has lifted this key hurdle to help small companies after the pandemic, much to the relief of gym-owning aspirants in New York.
The lesson is to research your city’s gym opening fees and obstacles.
- COVID-19 air filtration
In the COVID-19 era, new and returning gym-goers must feel comfortable in your facility. That’ll cost you.
Linkul says monthly costs have climbed by over 30% due to buying new equipment, adding air filters, and going all-in on cleaning supplies.
He suggests spending at least two hundred dollars more per month and charging members a minor facility fee to avoid going into the negative. “Everyone has been on board to contribute a few extra dollars to have all of these extra precautions that ultimately help protect them,” he says.
Linkul suggests pushing the gym owner to update the HVAC system, which usually falls on the tenant and costs thousands of dollars but may be negotiable in the current rental climate.
- Supplies and upkeep
General maintenance and supplies like towels and bathroom freebies (hair ties, spray deodorant, toilet paper, and cleaning spray) are deceptive expenses. Linkul recommends budgeting $200–$300 a month for these expenses.
- Scheduler.
Every facility needs a booking and membership system. The easiest way is to use the Bookings app or a fitness website design that emphasizes bookings.
Conclusion
Starting a gym costs what? First, imagine your ideal gym. A small studio gym costs $65,000, while a mid-size gym costs $115,000. Even with $50,000, you can operate a small cycling studio, although costs vary. The final truth is that a budget gym can cost $50,000, while a luxury mega-gym can cost over $1 million.
Building a gym from scratch costs what? That requires far higher financial projections. Depending on square footage, location, and whether you’ll rent or own the gym, expenditures might range from several hundred thousand to several million dollars. Weirdnewsera that you might not find any other platform which gives you all content about health sports business technology and entertainment.
Costs can be divided into one-time and recurring categories, regardless of your business strategy.
FAQs
How lucrative is it to own a gym?
In our 2021 study, we discovered that 85.3% of gyms that spend over $20,000 per month are profitable, whereas only 65.7% of gyms that spend at least $6,503 are profitable.
Is it prudent to launch a gym business?
Despite the enormous potential of owning a fitness business, eight out of ten will fail within the first year. However, if you are able to overcome the first-year obstacles, you will emerge a stronger person and a better entrepreneur, far more equipped to handle whatever challenges gym ownership presents.
Is gym ownership stressful?
Similar to starting any business, establishing a gym requires a substantial average utility investment of time, money, and resources. The decisions and issues you will confront can be difficult and stressful. However, if you assemble a support team and plan ahead, you have a much higher chance of establishing a successful gym business.
Is gym membership beneficial for money?
A well-managed gym with a diverse membership can generate significant revenue. For instance, a fitness center with 1,000 members paying $50 per month could generate $50,000 per month. If the gym’s monthly expenses are $20,000, then its monthly revenue would be $30,000.
