If you have opened a new gym, you must know that it is, after all, a new business. So you should be prepared to run and develop that business as a business. To do so, you must acquire knowledge about the fitness business industry, and also be aware of the pitfalls for why new gyms fail so you can be sure to avoid them. In my opinion, here are the top 10 reasons why new gyms fail…
#1 – No Proper Business Plan
No business plan can be fatal to your new gym. Before starting a gym, you should be equipped with the knowledge of your short-term and long-term goals, finances, as well as gym equipment you need, people to be employed, and promotions for your gym. If you don’t plan where to go, you will most likely never survive the journey.
#2 – Shortage of Capital
Capital is the life-blood of a business. If you open your gym without adequate capital to buy the required equipment or employ the right people, you would not be able to finally earn so much that you can develop or expand your gym further. You will also not be able to have the cushioning necessary to absorb potential losses.
#3 – Neglecting Finances
First and foremost, you do not have be an accountant to run a business. BUT, you must be responsible and familiarize yourself with the gym business terminology and the basics of finance 101. Unless you keep track of your finances, you are bound to overspend. As a result, even if you had opened your gym with adequate capital, you might squander it in no time, and then you will find it impossible to survive. Stay alert and aware daily of your budget! Write down goals for your business’s financial goals to achieve and stay accountable to them! Track everything, new membership sales, retention, attrition, recurring revenue, personal training sales, membership length – just to name a few! MEASURING these statistics ahead of time will help you IMPROVE your strategies and GROW your fitness business’s PROFIT! At the end of the month you will not be scratching your head wondering where all of your hard earned money went.
#4 – Improper Location
Place your gym in a location where it is VISIBLE and CONVENIENT your target members! If you open your gym in some place just because you are getting the space cheap, you might be heading for failure on the grounds of not being able to attract and retain members!
#5 – Frantic Growth
Don’t try to grow faster than what your revenues can keep up with. Set practical goals and try to achieve them. Even if your gym is making great profits, don’t spend it all in trying to expand because it will add on overheads which your future earnings may not be able to cope with. Slow, steady growth is good!
#6 – Taking Competition Too Lightly
If you have opened a gym at a perfect spot, and it is a great success, don’t let it get to your head. Just because you don’t have competition now doesn’t mean you never will. If you do have competition already, don’t underestimate it. A brand new gym could sneak into the neighborhood without you even realizing it. Stay on top of customer service and listen to their requests. Find a niche that a brand new gym with brand new equipment cannot compete with and market it like crazy!!
#7 – Bad Supervision
If you do not manage your fitness business yourself, you need to hire and pay big for a great manager! Having a great manager verses an OK manager will make or break your business. Find someone you can trust and give him/her no reason to be dishonest to you. The manager is figurehead that all of your employees and personal trainers will follow, if respect is there. Additionally, the manager will directly and indirectly reflect on your membership base. You need to make sure that your members stay motivated enough to keep coming back and the manager will be in charge of motivating your staff who in turn will motivate and retain your membership base.
#8 – Inadequate Promotions & Marketing
Every business needs promotions and marketing strategies. Simply having a great gym, with great instructors and state-of-the-art equipment won’t get you initial inflow of memberships needed to survive. You have to let your target market know that you don’t just exist, but how great you are in terms of services and deals. Once you have promoted enough to get an initial flow of memberships, you will find that, if you stay consistent with customer service, your current membership base will aide you promoting your gym by word of mouth too.
#9 – No Changes over Time
Change is required everywhere. The equipment that is state-of-the-art now may not remain so after a while. The setup that looks and feels great now may change to old and boring later. You need to be always prepared for change. Introduce interesting and unusual fitness equipment every once in a while, changes to your setup and classes from time to time, and always stay on top of gym cleanliness and equipment maintenance. Otherwise, lack of change will lead to member dissatisfaction and loss.
#10 – No Web Presence
Having no web presence makes you invisible to a large mass of today’s population. Internet has become a commodity like water or electricity these days. Everyone uses it, and if you have a website and social media presence, it will not only create a good impression of your gym, but also provide you with a plethora of feasible marketing opportunities and ultimately becoming better known within the fitness industry community!
Now over to you…
What should #11 be?