Every gym owner intends to run a profitable health club, but reaching that goal can feel impossible. There are, however, small effective steps you can take today to position your studio for a stronger, healthier future. These good habits start by conducting a line-by-line review of every expense and considering new ways to run an old business.
Accountants and business analysts recommend printing out a 12-month profit-and-loss statement twice a year (or even quarterly) in order to accurately appraise every company expenditure. Although such effort sounds tedious, watching every penny is the only way to ensure you’re not wasting money. As one business owner put it, you probably have more money than you think, you just need to find it.
First steps to cleaning up the balance sheets:
- Scrutinize subscriptions. Although many online subscriptions seem inexpensive, multiple ones add up. Take time to itemize these costs and see where you can combine services, or eliminate unused ones.
- Review business agreements. Sometimes owners find reading the fine print reveals just how expensive a product or service really is. Gym management software is a good example. Most of these companies take a slice of your profits through a payment provider chosen by the software firm, frequently hoisting your monthly costs into the stratosphere. If this is the case for you, consider switching to a fixed-priced subscription service such as Gym Insight, that bases its monthly fees on membership growth, and lets you pick the credit card company.
- Take a magnifying glass to everyday expenses. The costs of unmonitored supply purchases, long-term cleaning contracts, vendor and credit card processing agreements all creep up over time. Regularly renegotiate these terms and compare suppliers to guarantee you’re not paying more than necessary to run your health club.
- Evaluate staffing needs. Employee overtime can be a budget blaster. Keeping track of who frequently clocks overtime can point out inefficiencies, while varying staffing levels throughout the day may lower costs overall.
Re-think the big stuff.
- Buy used fitness equipment. Investing in used commercial gym equipment can cut your replacement expenditures by more than half. This move allows you to pay off any recent purchases much quicker.
- Consolidate high-interest credit card debt into a small business credit card offering an interest-free grace period.
Talk to professionals
- Hire an accountant. Although turning your books over to a professional may sound counterintuitive, asking a second set of eyes to reevaluate your company’s budget is a good idea. Their advice can potentially identify waste, reduce company spending, and optimize any existing tax advantages.
- Take out a loan before you need it. Establishing a low-rate line of credit provides access to cash reserves and keeps high-interest credit cards in the wallet.
Take the leap — go 24 hours.
- Staying open 24/7 can increase your customer base while decreasing the number of employees. However, switching to a round-the-clock operation requires updating and automating your door-access technology, buying on-site camera security, and taking a fresh look at procedures. In the end, though, operating a leaner, longer-running gym saves money — which is often the first way to make some.
Go social. Building a social media presence takes longer to show a return than buying advertising, but costs less up front.
Gym Insight
We don’t normally use this blog space for self-serving promotion, but we feel this moment is different. Too many small gyms are struggling and they need a way to build business without losing any more money. Our software is priced to grow with your gym. We never take a percentage of sales, our flat monthly rate is based on membership, and we provide ongoing customer service to ensure you use our software to its best advantage. Call us today for a free demonstration on how we can lower your software management costs and free up more of your time and capital.