The fitness industry in Australia is booming. In 2023, gyms and fitness centres were worth about $2.2 billion. From 2014 to 2019, the industry grew by about 4.9% each year and is expected to keep growing by 3.7% yearly until 2024.
Australians spend around $8.5 billion on fitness services and equipment, which means starting a gym or fitness business in Australia could be a good idea that could make you money and help people get fit and healthier. In this guide, we will help you navigate the industry’s complexities so you can start planning your business.
Market Research and Planning
To open a gym in Australia, you need to study the market and plan your business well to stand out from the competitors.
Understand the Market
Gym memberships are the industry’s biggest revenue source, accounting for over half of its earnings. The market caters to various groups, including young people interested in trendy workouts, older adults seeking gentle exercise programs, and women looking for personal training and group classes.
Analyse the Competition
Research fitness centres in your area by looking for guides online that would help you get started. Look at what services they offer, how much they charge, and who their customers are. Big chains like Anytime Fitness, F45, and Virgin Active are major players in Australia, but there might be opportunities to serve specific groups or offer unique combinations of services.
Identify Market Gaps
Look for underserved areas or demographics in your local fitness market. This could include specialised services for certain age groups, income levels, or fitness interests that aren’t currently being met by existing gyms.
Create a Business Plan
A good business plan helps you organise your ideas and can be used to get funding from investors or banks. Your plan should include:
- A clear statement of your gym’s purpose and long-term goals
- Specific, measurable objectives
- Detailed information about your target market and competitors
- Realistic financial projections, including expected income and expenses
Legal and Regulatory Requirements
Starting a business involves legal and regulatory steps. The key requirements are:
Business Structure
First, you need to choose your business structure. You can be a sole trader if you want to run the business yourself. Or you can form a partnership with others. Another option is to start a company that is legally separated from you.
Each choice affects things like taxes and personal liability differently. It’s best to talk to an accountant or business advisor to determine which option is best for you.
Registering Your Business
To run your gym legally, register your business name and get an Australian Business Number (ABN). First, check if the name you want is available, then register it with the government. Then, you can apply for your ABN online.
Licenses and Permits
You might need special licenses and permits depending on where your gym is and what you offer. This could include a general business license from your local council. If you plan to sell food or drinks, you’ll need licenses, too.
Health and Safety Rules
Gyms must follow strict health and safety rules to keep everyone safe. This means ensuring your workplace is safe for employees, having first aid supplies and trained staff, regularly checking and fixing gym equipment, and keeping everything clean and hygienic.
Financing Your Gym
The main costs to start a gym include:
- Lease: $24,000 – $90,000 annually
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- Equipment purchases: $30,000 – $75,000
- Renovations: $30,000 – $105,000
- Insurance: $2,000 – $4,000
- Licenses and permits: $1,700 – $5,000
- Marketing: $5,000 – $30,000 annually
It is important to point out that some of these costs can vary in different states and territories, depending on the region/city/suburb in which you live. For example, running a gym in Sydney might be more expensive, whereas operating a gym in a coastal town like Coffs Harbour or Newcastle could be cheaper.
Personal Savings
Using your own money to fund your gym can help you avoid debt and interest payments. However, it requires having enough savings to cover the substantial startup costs and operating expenses. Make sure you keep some money for emergencies and yourself, too.
Bank Loans
Getting a loan from a bank or a small business lender is a common way to finance a new gym. You’ll need a solid business plan to qualify. Loans provide the capital to start but remember, you’ll have to repay the money with interest over time.
Investors
Finding investors can help you raise funds without taking on debt. In this case, investors typically receive a share of your business in exchange for their money. This option can bring expertise and capital, but you must be prepared to share control and future gym profits.
Grants
Some local governments or organisations offer grants for new businesses. These can be a great funding source because you don’t have to pay the money back. However, grants can be competitive and may have specific requirements. Look for grants in your area that fit your gym plans.
Financial Management
To keep track of your gym’s finances:
- Use gym and fitness software to automate bookings and manage your business.
- Make a detailed budget and review it regularly
- Keep a close eye on cash coming in and going out
- Review your finances every month to make good decisions
Location and Facility Setup
A fitness centre or gym takes planning and smart choices regarding what location to put it in and what to put in it.
Choosing a Gym Location
Pick a spot that’s easy to locate. Look for areas with great foot traffic and make sure there’s parking or public transport nearby. Think about who lives in the area and what kinds of exercise they might like.
Designing Your Gym
Set up different areas for different types of exercise. Leave space for people to move around easily. Use bright lights and colours to make the gym feel welcoming. Make sure the air stays fresh.
Buying Gym Equipment
Get the staples, such as treadmills, bikes and weights. Include equipment for exercise classes, too. You can buy new or used equipment from local shops or online stores.
Setting Up Utilities and Extras
Ensure you have enough power to run all the machines. Install good plumbing for showers and bathrooms. Create nice changing rooms with lockers. Consider adding an area for healthy snacks and a welcoming front desk.
Essential Steps for Launching and Growing a Successful Gym
The journey of launching a successful gym is more than finding a location and how to finance it. Here are some essential steps:
Create a Brand Identity
Your gym needs a unique look and feel. This includes a nice logo and a clear message about what makes your gym different. Think about what your gym stands for and tell people about it. Get involved in local events to help people know and like your gym.
Market Your Gym
Use different ways to promote your gym:
- Social media to show off your gym and share fitness tips
- Local newspaper ads or posters
- Partnerships with other local businesses
- Fitness experts on social media to help promote your gym
These methods can help you reach more potential members.
Membership Plans
Offer a variety of membership options to suit different needs. Start with basic plans such as monthly, quarterly and annual memberships. Monthly plans are good for people who want flexibility, while yearly plans often provide the best value for committed members.
Consider special offers to attract new members. For example, you might offer a discount for the first month or a bonus if current members bring in friends. Don’t forget about groups like students or seniors who might appreciate special rates.
To make your memberships more appealing, consider adding extra services. Personal training sessions, nutrition advice, or special classes could be offered as add-ons. This would give members more choices and make their gym experience feel more valuable.
Opening Your Gym
Have a big event to promote your launch. You can invite people to try free classes and give away some prizes. Get local influencers and community leaders to establish visibility and credibility, which will help create buzz about your gym. Ensure you get contact details from people who come so you can promote your gym to them later.
Customer Retention
Make sure your staff is friendly and helpful. Remember members’ names and what they like. Keep in touch with members by sending them news about the gym. Have events and fitness challenges to keep things fun. Ask members what they think and use their ideas to improve the gym. You can also add new classes and services to keep things interesting for your fitness centre.
Summing Up
While opening a gym costs a lot of money and effort, it can be financially and personally rewarding if you’re passionate about fitness and willing to do the work. Focus on creating value for your members, and don’t hesitate to seek expert advice as you build your business.
Given the fitness industry’s growth year by year, it can be a good business venture. With careful planning, you can create a fitness facility that attracts and retains members while providing a positive workout experience.
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