Costs and methods for opening a personal gym | What to pay attention to when attracting customers when starting a business
Personal gyms are gyms where you can receive instruction from a dedicated trainer in an environment where you don't have to worry about other people's eyes. Many trainers who want to "provide their own unique menu" or "have their own gym" probably dream of opening one.
- What are the precautions after opening a personal gym?
- What should I do before starting gym management?
- Can a personal training gym succeed as a business?
This article introduces the knowledge necessary for starting and managing a personal gym. Since it is a business that can be started individually, please refer to it.
Is Personal Gym Management a "Profitable Business"?
Are personal gyms and private gyms, which have been increasing in recent years, profitable businesses? We will analyze and explain this based on statistics and market trends.
Training Demand Continues to Expand, Spreading to Women
Training demand is no longer just for muscular men. With the growing health consciousness, women's fitness demand is also increasing, and the market continues to expand. The demand for high-quality training with the guidance of a personal trainer is also spreading.
According to Teikoku Databank, the fitness market is estimated to reach 700 billion yen in fiscal year 2024. This is a growth of 50 billion yen from the 650 billion yen estimated for 2023. This is partly due to the spread of high-value-added business models such as private gyms.
Reference: "Fitness Clubs and Sports Gyms" Industry Trend Survey (FY2023)
Low Fixed Costs, High-Profit Margin Business Model
A personal gym is a business that has low running costs among individual proprietorships. Unlike restaurants, there is no need to constantly purchase and discard fresh ingredients, so sales and annual income tend to be close in value.
Additionally, it is a business model that allows for adding value depending on the service content, so if you can attract customers, you can operate with a high-profit margin.
How to Open a Personal Gym
There are roughly two ways to start a personal gym: becoming a franchise owner, which means operating under an existing brand, or starting your own independent business. Let's look at the characteristics of each.
Method 1: Become a Franchise Owner
The advantage of becoming a franchise owner is that you can become a business owner with low risk and extensive support from the headquarters. If you open a business suddenly, you will have to operate without knowing left from right. Receiving advice from the headquarters on customer acquisition methods and equipment allows you to concentrate on management with peace of mind. If you are anxious about suddenly going independent without management experience, consider a franchise.
On the other hand, when managing a franchise, a加盟金 (franchise fee) and royalties are often mandatory. It is good to weigh the peace of mind against the fact that a portion of the money you earn will go towards royalties.
Method 2: Start an Independent Business
If you start an independent business, you will need to handle all operations yourself, from procuring equipment to managing the business. If you lack know-how, you may encounter many difficulties.
The advantage of going independent is the freedom to work wherever and however you like. You can operate a gym from your home without answering to anyone. If you seek freedom and discretion, going independent might be a better fit for you.
Advantages of Opening a Personal Gym
We will explain the points that trainers are likely to find advantageous in opening a personal gym compared to other startups. Having your own gym quickly is an advantage, so keep this in mind.
Advantage 1: No Qualifications Required
No special qualifications are required to open a personal gym. For example, operating a restaurant requires food sanitation manager and fire prevention manager certifications, but there are no qualification requirements for gym management. The time and cost spent acquiring qualifications can be allocated to preparing for opening and branding.
Also, since no qualifications are required, it is easier to find someone to take over operations when you expand to multiple stores and leave the现场 (on-site work).
Advantage 2: You Can Own Your Own Training Gym
For many trainers, owning their own gym is a dream. To become the master of your own castle, arranging equipment suitable for the menu you want to offer, and attracting your target customers – those who aspire to manage a gym have probably thought about this at least once.
There is also an article explaining how to select equipment for those considering opening a gym, so please read it if you are interested.
Disadvantages of Opening a Personal Gym
Opening a personal gym, of course, has its disadvantages. We will explain the risks associated with becoming a business owner and the funds required for opening.
Disadvantage 1: Bearing the Risk of Becoming a Business Owner
A business owner receives the authority to set their own compensation in exchange for losing the guarantees that come with being employed by a company. For example, monthly income is not guaranteed, and if investments cannot be recouped, debt will be incurred.
If you hire staff and can no longer pay their wages, you will have no choice but to close the company. How to avoid running out of money is a challenge that business owners must constantly consider. Keep in mind that "starting a business does not necessarily mean becoming wealthier than an office worker."
Disadvantage 2: Initial Investment Required
Starting a personal gym, whether as a franchise or an independent business, requires an initial investment. In the case of an independent business, you will, of course, need to prepare equipment and a location yourself, but a franchise also requires an initial investment such as a franchise fee.
It is almost never possible to start a business for free, so when considering starting one, you should consider methods for raising funds and maintaining your livelihood.
Steps to Opening a Personal Gym
We will explain the necessary items and 7 steps to take when opening a personal gym. Before starting the work, let's grasp the overall flow from strategy decision to execution.
Step 1: Strategy Design
Strategy development is essential for opening a personal gym. By knowing your rivals and your own strengths, a winning strategy—that is, a strategy that attracts customers—will emerge.
Thoroughly Research Competitors in the Area
First, thoroughly research competing gyms in the area where you are considering opening. If you open a gym without establishing a comparative advantage over surrounding businesses, you won't be able to create an attractive concept for customers. List the access, prices, services, and scale of competing gyms.
If a large gym nearby offers light services for beginners, and you do the same, you will struggle to attract customers. Competitor research is essential to discover your unique appeal that other companies do not have.
Differentiate Your Concept from Other Establishments
Once you've identified your competitors, create a unique concept that you can offer to customers at your gym. Uniqueness increases the possibility of attracting customers that nearby gyms haven't been able to capture.
For example, if there are no personal training gyms nearby, specializing in personal training would be a good idea. You can then expect customers who weren't training "because there were only regular gyms" to visit.
Competitive yet Market-Appropriate Pricing
Aim for pricing that is neither too high nor too low. Even with a unique concept, high prices can make it difficult for customers to frequent your gym. Conversely, if prices are too low, you may find yourself overworked with little profit, leaving no time to refine your business operations.
The benchmark is the prices of your competitors. Set prices that customers perceive as cheaper than competing gyms while still ensuring sufficient profit if your anticipated customer acquisition is met.
Step 2: Create a Funding Plan
Once your concept is established, create a funding plan. Opening a personal gym requires money, depending on its scale. When creating a funding plan, you need to ensure that initial costs and running costs can be covered by the expected customer acquisition.
It is recommended to incorporate your funding plan into a business plan. A business plan is always required when obtaining a loan from a financial institution, so there are benefits to creating one beyond just outlining your business prospects.
Step 3: Secure Funding
Once you have a clear picture of the necessary funds and overall cash flow, start raising the capital needed to open your business. While it's ideal to cover as much as possible with savings, you can utilize loans and subsidies if you don't have enough.
Start with Maximum Self-Funding
For initial costs, try to start with as much self-funding as possible, meaning your savings. Unlike loans, self-funding does not accrue interest, so it is money you can use with peace of mind.
Additionally, there is a credit limit on the amount an individual can borrow. By maximizing your initial self-funding, you will find it easier to obtain loans later. Conversely, relying entirely on loans will make it difficult to receive additional loans if business challenges arise.
Obtain Loans from Financial Institutions
If your own funds are insufficient to cover the necessary capital, obtain a loan from a financial institution. You will need a business plan when applying for a loan. The business plan should include the amount of funding requested, sales forecasts, company strengths, and repayment plans.
If it is difficult to obtain a loan from a major financial institution, you might consider visiting a local credit union. Also, don't forget that opening a company bank account is a hurdle even before applying for a loan.
Utilize Subsidies and Grants
You may be able to receive subsidies and grants from the national or local government. Since this is not guaranteed money, you should not make a plan solely relying on subsidies, but keep it in mind.
There are interest-free loans for startups and systems that subsidize a portion of the amount used. Since application periods for subsidies and grants are often limited, always check the schedule for programs that might be able to provide assistance.
Step 4: Acquire Property
Once you've secured funding, you'll move on to the first step of creating your personal gym. First, secure a property. The ideal location is one that is easily accessible to your target customers and won't put a strain on your finances.
There are two ways to acquire property: leasing and purchasing. Leasing offers the advantage of being able to easily vacate if the business doesn't go well, but it doesn't become an asset.
Purchasing becomes an asset, but if you take out a loan, your debt increases, and it becomes more difficult to vacate. Determine the location while considering your planned opening area and credit limit.
Step 5: Interior Renovation
Once the property is secured, renovate it so it can operate as a gym. If you'll be using training machines, loud noises are expected, so soundproofing will be necessary to prevent problems with neighbors.
Investing heavily in interior design from the start to achieve a specific atmosphere can put a strain on your business. While keeping your concept in mind, limit renovations to what is sufficient for providing your services.
Step 6: Equipment Procurement
Procure equipment according to the menu you will offer. Personal gyms often have limitations in space and funding. Rather than forcing a large quantity of equipment, focus on acquiring the necessary equipment to provide your services.
You don't need to have all the familiar equipment found in a large sports gym. Narrowing down your selection to offer services that align with your concept is also a necessary step in opening a personal gym.
Step 7: Submit Business Registration Form
Once all preparations are complete, submit the business opening notification to the relevant tax office. If you are registering as a sole proprietor, it is generally required to submit the notification within one month of starting your business.
Since opening a business can lead to busy daily work, it is recommended to schedule the day for submitting your business opening notification.
If you are establishing a corporation, submit the corporate establishment notification to the prefectural tax office, the relevant tax office, or the municipal office.
Costs to Open a Personal Gym
Understand the costs involved in opening a personal gym. This article will explain the two types of costs: the initial investment required to open and the running costs that will continue after opening.
Cost 1: Initial Investment
Initial costs are the expenses required to open a personal gym or private gym. For a monthly rent of 200,000 yen, approximately 4.5 million yen is the minimum required amount. Let's look at the breakdown.
Property Acquisition Costs / 5 Months' Rent
Property acquisition costs include security deposits, key money, and brokerage fees to real estate agencies. For rentals, this typically amounts to about five months' rent. For purchases, it varies depending on the down payment amount.
Property acquisition costs are a significant expense, but if you skimp on rent and open in an unpopular location, you may not attract customers, leading to even greater losses. Acquire a property in a location with good customer traffic, within a reasonable budget. Condominiums and other densely populated areas are also an option.
Note that property acquisition costs do not include equipment costs.
Interior Renovation Costs: Approximately 500,000 yen and up
Interior renovation costs are for general interior modifications, such as soundproofing and creating the gym space, excluding training equipment. A personal gym can be opened in even a single room if it's the minimum required space. When using training equipment or speaking loudly, install soundproofing to avoid disturbing neighbors.
Also, creating an atmosphere that makes customers want to visit is included in interior renovation costs. While the interior is a point you'll want to focus on when opening your personal gym, initially, only renovate the parts that directly impact customer satisfaction.
If you're looking for mats that are effective for soundproofing and floor protection, please check out our gym-specific mats.
Equipment Costs: Approximately 3 million yen and up
Equipment costs are expenses for acquiring training equipment such as power racks and training benches, as well as machines for accounting.
Customers who visit personal gyms expect high-quality service. Equip your gym with facilities that maximize customer satisfaction within a reasonable budget.
High-quality gym equipment is also effective in increasing repeat customer rates. If you're interested, please check out the equipment from the link below.
≫ Personal Gym Training Equipment List
Equipment also includes computers, reception desks, and furniture.
You can also reduce initial costs by effectively utilizing rental services such as PC rentals.
Cost 2: Running Costs
Running costs are the expenses necessary to operate a personal gym. The reason many brick-and-mortar businesses fail is their inability to pay running costs. Let's check the breakdown of running costs to use funds strategically.
Rent and Utilities
Rent and utilities are expenses that occur regardless of the business situation. They are likely the first expenses that come to mind when calculating running costs.
Rent is generally fixed, but utilities fluctuate depending on the season and circumstances. When creating a business plan, make sure to build in a buffer so that funds don't run out even if utility costs increase by several tens of percent.
When managing a personal gym, it is also necessary to constantly strive to find the location that offers the best balance between rent and customer acquisition.
Equipment Maintenance Costs
Equipment maintenance costs are for irregular maintenance, etc. Equipment purchased as initial investment cannot be operated safely without maintenance and inspection. When introducing equipment, it is necessary to consider the long-term costs that will be incurred simultaneously.
Also, equipment undergoing maintenance cannot be used. It is necessary to devise ways to prevent customers from leaving during the period of equipment maintenance. Also consider replacement costs when equipment becomes old, and procurement costs for consumables.
Insurance and Taxes
Insurance premiums, such as for personal and employee insurance and fire insurance, and corporate taxes paid based on profits if you are a corporation, are also running costs. Consumption tax payment is also an obligation, so the discount amount for taxes on monthly sales must be set aside as running costs.
Expenses for equipment updates and maintenance are deducted from income and profits as business expenses. When an expense occurs, always keep the receipt properly so that you can prove that you have paid taxes correctly in the event of an inspection.
Personnel Expenses
Your own and your employees' incomes are recorded as personnel expenses. If you manage the business alone, a low income only affects you, but if you have employees, you cannot afford to delay their salary payments.
If you plan to operate a personal gym with employees, you must have a clear vision for continuously paying personnel expenses. If you are not confident about continuously paying personnel expenses at the time of opening, you will need to design a business that allows you to manage all operations by yourself.
Advertising Costs
Advertising costs are an essential investment for customer acquisition in a brick-and-mortar business. To make customers aware of your gym and encourage them to visit, you need to advertise.
Advertising costs are not limited to flyers and web ads. They also include the source of campaign prices, such as discounts for new customers. Choose a method that matches your gym's concept and target audience, considering paid listings on media, commercials, and other options.
If you skimp on advertising and fail to attract customers, fixed costs like rent and personnel expenses will account for a large proportion of your sales.
Customer Acquisition Strategies for a Successful Personal Gym
We will explain customer acquisition strategies to maintain a personal gym and stabilize its management. Let's try to implement customer acquisition methods that individuals can use to make customers recognize the gym and purchase its services.
Strategy 1: Website Creation
Your website is the face of your personal gym. Customers searching for a personal gym nearby online will learn about your existence through your gym's website.
On your website, clearly post detailed information necessary for customers to visit, such as prices, services, and access. If there isn't enough information, customers won't trust the gym and will leave the page.
There are multiple services that allow you to create a website without programming knowledge, so if you are comfortable with computers, it's recommended to try creating one yourself. If you are not confident in your time or skills, you can also consider it as part of your advertising budget and commission a production company to create a high-quality page.
Strategy 2: Web Advertising
In modern times, where most people use the internet, web advertising is increasingly becoming the first point of contact with customers. There are various types of web advertising. All these advertisements allow you to some extent control where they are displayed based on region and customer attributes.
- SNS advertising
- Listing advertisements
- Display advertising
- Placement on web media
SNS advertising is viewed by younger generations, listing ads and display ads by those who frequently search, and web media by those with high purchasing intent. Advertise while considering the balance between the target demographic for your gym, your advertising budget, and the expected advertising effect.
Strategy 3: Promote on Social Media
Actively promote your personal gym on social media even before it opens. It costs no money to acquire customers through regular social media posts. You can post as much as you like, so showcase all your gym's strengths without holding back.
Even after opening, you can increase your customer acquisition power by sharing information that personal gym seekers want to know, such as posting service scenes with customer permission.
On the other hand, refrain from attacking other gyms or badmouthing customers. If personal gym trainers are perceived as scary, potential customers may go to other gyms.
Strategy 4: Offline Customer Acquisition such as Strengthening Word-of-Mouth
Approach customers who have visited once to ask them to write a review. When people purchase a product, user reviews are more trusted than seller advertisements. By encouraging reviews on media where your establishment is listed, or by offering referral bonuses, you can achieve grassroots customer acquisition.
Setting up loyalty cards is another offline customer acquisition method for repeat customers. By continuously implementing initiatives that make one-time visitors want to refer others or revisit, you can stabilize your business.
Points to Note to Avoid Failure in Personal Gym Management
We will introduce five points to keep in mind to avoid failure in personal gym management. It is important not to compete directly with major players and to increase points of contact with customers within a manageable scope.
Point 1: Do not open with a concept that overlaps with major competitors nearby.
It will be difficult for a newly opened personal gym to compete head-on with a large corporation because it will lack name recognition and trustworthiness. By thoroughly analyzing competitors and offering services that nearby competitors do not yet provide, you may be able to attract a new customer base.
Also, it is difficult to compete directly with large companies on price, as they have the advantage of scale.
Create a unique concept for your gym in the area so that customers visit without considering other options.
Point 2: Start small with one store initially.
A common mistake in brick-and-mortar businesses is expanding to multiple locations too quickly. At the initial stage of opening, there is no guarantee that the concept or services are optimized. If you rush to expand to multiple locations just because you "received a loan," all locations could end up operating at a loss.
Initially, stabilize the business with one store, and then expand when personnel or space become insufficient for business growth.
Point 3: Open in an Area with Expected Customer Traffic
Secure a property in a location where you can expect customer traffic. A location with good customer traffic doesn't necessarily correlate directly with rent. Rent is generally higher in densely populated areas. However, a high-rent location doesn't unconditionally guarantee a high influx of customers.
Even if a location seems good, if it's next to a major competitor, you'll lose all your customers, right? Carefully consider your gym's concept and competitors' locations, and choose the location where your business can attract customers most efficiently. Choosing a deserted location "because it's cheap" is a bad idea.
Point 4: Increase Opportunities for Public Exposure
Increase the opportunities for your personal gym to be seen by customers. Advertising costs can feel like wasted money until results appear, but you need to view them as necessary expenses for customer acquisition. Identify where the kind of customers who would come to your personal gym gather information and advertise there.
Also, there are many ways to make contact with customers besides paying for media, such as posting on social media, putting up signboards, and distributing flyers. Combine various exposure methods to increase your customer acquisition power.
Point 5: Increase Available Payment Methods
It is important to adapt to the growing demand for cashless payments these days. Especially younger people are increasingly leaving home with only their smartphones. Customers who don't carry cash may hesitate to visit if they can't pay by credit card or QR code.
While cashless payments typically incur a few percent in fees, a business cannot operate if customers do not come in the first place.
By the way, avoiding fees by stating "cash only for amounts below XX yen" or similar is a violation of the terms and conditions of most payment methods and can also cause distrust among customers, so it should be avoided.
Open Your Personal Gym with a Solid Strategy and Financial Plan
Opening a personal gym requires detailed competitor analysis and a meticulous financial plan. While it is necessary to invest in customer acquisition, advertising expenses are necessary as part of running costs.
The fitness industry, including personal gyms, is a growing industry, so if you implement customer acquisition based on a solid strategy, there is a good chance of success.
If you are looking for high-quality training equipment to place in your gym, please check out the equipment carefully selected by professionals at Uchinogym.
