Opening a Fitness Facility
Under Construction
Below is a Q&A response that I wanted to post up. Hopefully it will help those of you out who are hoping to open your own gym/fitness facility someday!
Hi Mike,
I really enjoy reading your level headed and erudite advice on your newsletter, Fitcast, Mens Health, etc.
I am an aspiring entrepreneur, not unlike yourself, and looking into starting up a gym in the XYZ area. I am emailing you to see if you have any advice to get me started in the right direction, specifically:
1) What resources did you utilize when doing market research for your gym?
2) What mistakes did you make in the planning process that would be easily avoidable?
3) Any resources I need to be looking at regarding starting a gym?
I really appreciate any time you could give me, if only to simply point in the right direction.
1 - Here are the things Bill and I looked for when opening our gym:
- Price per square foot (PPSF)
You could go a few hundred feet towards the primary road in our area and literally triple your PPSF. We didn't need visibility, as we're not your typically "drive-by and join" gym. - Travel Location
We wanted to be near major intersections and highways. This was critical, as it would get people to and from our gym faster. I think the general rule of thumb is people are willing to drive about 20 minutes max to go to your gym. - General Location
This jumps off the previous point. If people are only going to drive 20 minutes to see you, you don't want to be in a horrible part of town. We're in a fairly centralized location that's not only easily accessible, but right in between several affluent communities. - Competition
I'm assuming you also want to know how we scoped out competition. In all honesty, I didn't care who was around us. Bill and I know what we're capable of, and what we bring to the table. I think other fitness facilites will have to plan around us, versus the other way around. We're in a unique demographic, have a higher price point, and offer much more customized services than anywhere else near us.
(Yes, I realize this may sound a little arrogant, but I feel we're the best place in our area.)
2 - As far as planning goes, I'm not so sure we made major mistakes. Instead, what was more evident was that we simply hadn't run a business before!
The training/assessment side is actually easy for us in the grand scheme, because Bill and I are both technicians versus managers or entrepreneurs. The hardest part for us is on the repeatability/systems side of things. If you haven't picked up the E-myth yet, I would do it immediately. Too many of us are technicians for life, and we wonder why our gyms fail.
3 - I would start off with the E-myth, as well as attending a Cosgrove Business seminar or mentorship. I'm actually heading to one this weekend, as I know it will take IFAST to the next level.
4 - You didn't ask a fourth question, but I'm going to give you a piece of advice that has really paid dividends for me.
I have tried a lot of direct marketing stuff, and not really seen the result. This is costly in two ways - first off, I'm spending money and not seeing a return. Second, I was designing a lot of the stuff up front as well. So I was wasting time and money (yes, I'm sure AC is having a fit as he reads this. It's just my experience up this point.)
That said, we've had a huge ROI from our website, Facebook pages, etc. The book Guerilla Marketing talks about all the things you can do for free to promote your business, and it's even more true now than ever before. There are so many platforms out there to help you promote your business, you absolutely must take advantage of them.
Build a blog.
Create a Facebook fan page.
Start a Twitter account.
Anything you can do to generate interest and "buzz" will help you build your brand, and therefore your business.
That's not to say I've given up one direct marketing, as I haven't. I just have to become more disciplined and focused to really make it work. In the beginning, however, you can save a lot of cash and still develop a ton of momentum without breaking the bank on marketing.
I hope that helps. Good luck!
MR
Comments on This Entry
Posted by Mark Young at 06:46AM on February 24, 2010
A few points I'd like to add if I may:
1. Totally agree. Buy The Emyth Revisited and read it. Create your systems BEFORE opening your facility.
2. Make sure you have enough capital. One reason a lot of places fail is because they don't have enough money for operating costs up front.
3. DON'T use personal credit cards or lines of credit to open your business.
4. Incorporate. Protect yourself in case your business comes into trouble. See number 3 above. In Canada this costs around $600. If this is too expensive see point number 2.
Many people are excited to open a facility quickly and make a HUGE mistake by thinking that being good at training will make you successful.
Being good at training AND being good at business will make you successful. Without one or the other you're dead in the water.
Posted by Eric Cressey at 06:46AM on February 25, 2010
The competition bulletpoint EXACTLY reflects out mindset. We never worried about it - and to be honest, just last week, someone mentioned a facility less than ten miles from us...and I'd never heard of it!
Focus on being good at what you do and the chips fall into place.
Posted by Craig at 10:54AM on February 26, 2010
My experience has been that my best marketing is the clients that I already have. Focus on the people who have already put their bodies, time and money into your hands and get them the best results possible.
The trick here, though, is that a person's perception of a product or service is emotionally driven, and even if you're getting someone great results physically, most of their opinion of your business will depend on whether or not thinking of your service makes them feel happy or not.
You must control both factors.
Once that's handled, put a simple system in place to ask for and reward referrals. Even those who are not directly referred by your current clients may hear of your service from them indirectly, and they're going to base a substantial portion of their initial impression on the attitudes and behaviors reflected from your current members the first time they walk in your gym.
I think of this as growing a business organically. You can certainly (and probably should) augment this approach with easily set up things like facebook ads, a blog and a general online presence, but as Mike said the one thing I've had terrible results with is direct mail.
I also totally agree with the competition thing.
Posted by Craig at 11:07AM on February 26, 2010
One other thing I would add is to be prepared to screw up. Almost every day.
The art of it will lie in being able to recognize and understand your mistakes without getting caught up in negative feelings about them. Each one of them is a learning experience.
I think that one of the main things that separates people into successful or not is the ability to do this. Everyone will screw up, not everyone can handle it well.
I keep a shorthand log of every day at my business. In it I write down notes and observations. If a problem comes up or I find something that can be improved, I make a note of it and find a way to make it better.
One year of doing this works out to roughly 365 highly practical lessons on how to improve your business which can eventually be distilled into a set of principles to guide your operations.
Posted by Steve at 04:49PM on February 26, 2010
What are your thoughts about obtaining financing through SBA Loans or other methods? Any suggestions?
Posted by Anna at 11:46AM on February 28, 2010
Hi Mike, I just got back from the Results Seminar and didn't even realize that you were there. I knew you looked familiar but I couldn't place my finger on it :) Alwyn did discuss direct mail and it can be costly but I think his tips make sense about marketing to the top 10% income level in the area with about a 10-15 minute drive to your gym.
I agree on having a blog on the web site and also all the other social media marketing stuff. Thanks for recommending Guerrilla Marketing. Another book to read to add to my growing list :)
Anna
Posted by P. J. Striet at 02:34PM on March 03, 2010
The best thing I ever did in terms of attracting new clients when I opened my facility was getting hooked up with Allen Hill (http://www.internetfitnessincome.com). He taught me all about search engine optimization and building keyword phrase focused web pages. It took a lot of leg work developing several dozen web pages based on his SEO methods, but it worked for me big time. I get 80% of my new clients from SEO. The nice this is, once you get all your pages developed, you are done, and they bring clients to you automatically. I get at least 1 new private training client per month and several who are at least interested because they found me using google or yahoo after they searched for a fitness related term and my city's name in it.He has a SEO for fitness pros product which is really good.
Other stuff. The only paid advertising I do is the all over media/everywhereugo style which are put up in restrooms (we've all seen them while taking a piss at a bar or restaurant). I hand picked the locations in my area, and tried to put them in affluent bars and restaurants. I've picked up a few clients from this and it's not all that expensive.
I've also submitted articles to small local newspapers and niche newsletters and websites in my surrounding neighborhoods (community press type stuff). All of this stuff takes time but it is free. Also, every city has a homepage (mine is cincinnati.com). Usually, readers can create their own blogs on the site, and I've gotten prospects from simply copy and pasting my posts on my business blog over to that one.
Obviously, yes, if you don't have a blog, website, youtube channel, facebook and twitter page, you are missing the boat, as this stuff is really effective.
Finally, as mike noted, keep your overhead and price per square foot low. I have class b office space, but it's in a great location, and, like others have noted, frankly, I don't care about the competition or visibility. Don't use lines of credit or credit cards. Just add a piece of equipment here and there. If you know what you are doing, you don't need much equipment up front anyway. I bought a freedom trainer and nice rack, DB's to 100, 2 0-90 benches, and then rounded it out with gadgets (bands, kettlebells, valislides, sleds, etc.) I just added a schwin airdyne and concept rower this year and paid for them in cash. Also, keep your space open. The days of life fitness circuits and tons of cardio are over. People want 21st century programming and that stuff doesn't fit the bill.
Finally, as mike noted, learn how to implement completely reproducible systems and templates. Don't "wing it". You will fail if you don't have a process, and this is why I'm going out to Cosgrove's myself next week, in order to further my knowledge in this area. You have to know how to coach and program, but you also have to know how to run a business based on systems.