Should You Buy An Existing Fitness Studio Business Or Start Your Own?
Generally speaking, entrepreneurial fitness trainers and athletes have two options when they decide to set off on their own and start a new gym/fitness facility: start the business from scratch and build it from the ground up, or buy an existing facility.
In this article, we’re going to be discussing the pros and cons of each option to help you make a more informed decision.
Before we begin, it’s important to get one thing very clear: When you decide to start a new gym, you effectively become a businessman first and fitness trainer second. A lot of people have trouble getting their priorities straight at this point and they struggle to keep the business running despite purchasing world-class equipment and planning the perfect floor layout.
If you want to make it big in the fitness industry, you’ll need to be incredibly smart and business savvy with how you go about things. The competition in the market increases every year, and there’s almost no room for mistakes in the first few months.
With that out of the way, let’s jump straight into it. Should you buy an existing gym or build your own?
Starting From Scratch
Building a new gym, or any other business for that matter, from the ground up can be incredibly rewarding, but you’ll need to have a strong idea of what you want to accomplish and the will power to actually get it done.
Much like any other small business, starting a new gym from scratch comes with its own set of unique entrepreneurial challenges and risks.
For one, you’ll soon realise that there’s a big difference between getting involved in the day-to-day matters of a standard fitness facility as a trainer and actually venturing out to start your own. You’ll need to deal with all kinds of legal documents, most of which you’ll never even have heard of, and the responsibility of handling money can be quite overwhelming for a lot of people.
Then, of course, there’s the risk factor. It can take years for a gym to become established and profitable. That’s money going out of your or your investor’s pockets for at least 8-9 months before anything comes back as a return. Are you sure you can handle such a massive commitment?
The commitment isn’t just financial, it’s also personal. If you do decide to go down this route, you’ll soon find yourself working 100-hour weeks with no time to eat or sleep. If you’re not mentally prepared for all that hard work, it can and will drive you crazy.
Of course, there are plenty of upsides to this option too.
Starting a gym from scratch allows you to make it your own. You can run it however you see fit, handpick and purchase all your favourite equipment, hire staff you’re comfortable with, and basically do whatever you feel like. That freedom is the biggest reason why people choose to venture out on their own and leave six figure salaries at their 9-5s.
Another great benefit of building your own gym or fitness center is that it’s generally cheaper than the alternative. When you buy someone else’s business, you pay for their location, facilities, AND all the work they’ve put into getting the business where it is today.
Finally, starting from scratch means a new beginning. You won’t need to worry about any debt the previous owner might have accrued over the years, the existing brand’s reputation, problems with the employees, etc.
Buying An Existing Gym
Buying an existing facility is the preferred option for people who want to avoid all of the difficulties involved in setting up a new fitness centre.
When you buy an established business, you effectively take over a facility that is already profitable and generating revenue. You also save yourself from the biggest hassle associated with opening a new fitness center – attracting and retaining members.
There are plenty of other great benefits too.
To start with, you’ll already have a workforce that understands the business and its customers inside out. Unless they were fiercely loyal to the previous owner or they don’t like you, they’ll likely help you get settled in during first few months of your tenure.
You’ll also have financial security. As we discussed earlier, starting a new business from scratch is extremely risky because there are no guarantees of success. We’ve seen plenty of excellent gyms fail for no apparent reason. It’s just the nature of the industry; sometimes people don’t appreciate great ideas until it’s too late. You won’t need to worry about that with an established business.
In addition, buying a new gym might be more expensive, but it’s also easier to obtain financing for. Banks and investors are always on the lookout for business opportunities that have a proven track record of success. Nothing makes them happier than a venture that starts paying back in profits the moment it’s purchased.
The biggest advantage of buying an existing business, however, is that it won’t require as much physical effort and hard work on your part. Yes, you’ll still need to put in a few gruelling hours every at the start to make sure operations remain stable and successful, but it’s nothing compared to the 100-hour works weeks a new business demands.
On the downside, there can and will be management problems with this option since you’ll inherit the staff hired by the previous owner. It’ll be quite the challenge getting rid of the underperformers without losing the support of the rest of the team. They might think they’re jobs are in danger too and start conspiring against you.
Another disadvantage with buying a gym is that, unless you’re willing to spend excessive amounts of money, you might get stuck with outdated equipment and facilities. Renovations not only cost a large amount of money, but they also represent downtime for the gym which might deter some of the regular customers.
Which Option Should You Go For?
What you choose will depend almost entirely on your own preferences and requirements.
If you want complete control over your gym and are prepared for the immense hard work required, then starting a new fitness centre from scratch is the choice for you.
If you want to avoid the risk and effort that comes with a new business venture, you should probably purchase an existing facility.
As a general rule, industry experts will typically recommend that you buy instead of build. It’s safer, quicker to work through, and your business will be profitable from day one. What more could you ask for?
Copyright RDX Sports, Tracey Heinz
