Costs and methods for opening a personal gym | What to pay attention to when attracting customers when starting a business
A personal gym is a gym where you can receive instruction from a personal trainer in an environment where you don't have to worry about being seen by others. Many trainers who want to offer their own menu or have their own gym dream of opening their own gym.
- What should I pay attention to after opening a personal gym?
- What do I need to do to start a gym?
- Can a personal training gym be a successful business?
This article will introduce you to the knowledge you need to start and run a personal gym. This is a business that can be started by an individual, so please use it as a reference.
Is running a personal gym a profitable business?
Personal gyms and private gyms have been on the rise in recent years, but are they profitable businesses? We will analyze statistics and market trends to explain.
Training demand continues to grow, with more women joining the fray
Demand for training is no longer limited to macho men. Due to rising health consciousness, the demand for fitness among women is also increasing, and the market continues to expand. Demand for high-quality training under the guidance of personal trainers is also expanding.
According to Teikoku Databank, the fitness market is estimated to reach 700 billion yen in fiscal year 2024. This represents a growth of 50 billion yen from the 650 billion yen expected in 2023. The expansion of high-value-added business formats such as private gyms is also a driving force behind this.
Reference: "Fitness Club/Sports Gym" Industry Trends Survey (FY2023)
Low fixed costs and high profit margins
Personal gyms are one of the businesses with the lowest running costs among those that can be run by individuals. Unlike restaurants, there is no need to constantly purchase fresh ingredients and then discard them, so sales and annual income tend to be close to each other.
In addition, since this is a business model in which it is easy to add value depending on the service offered, if you can acquire customers, you can operate with high profit margins.
How to open a personal gym
There are two main ways to start a personal gym: as a franchise (FC) using the name of an existing brand, or as an independent business owner. Let's take a look at the characteristics of each.
Option 1: Become a franchise owner
The advantage of becoming a franchise owner is that you can become a manager with low risk and full support from the headquarters. If you open a business suddenly, you will have to operate without knowing what to do. By receiving advice from the headquarters on how to attract customers and the equipment, you can concentrate on management with peace of mind. If you have no management experience and are worried about suddenly becoming independent, consider franchising.
On the other hand, franchisees often require you to pay franchise fees and royalties. You should weigh the peace of mind that comes with knowing that a portion of your earnings will go to royalties.
Method 2: Start your own business
When starting your own business, you need to do everything yourself, from purchasing equipment to running the business. If you don't have the know-how, you may encounter difficulties.
The advantage of being independent is that you can work freely and wherever you want. You can even run a gym at home without being told what to do by anyone. If you want freedom and discretion, being an independent entrepreneur may be the right fit for you.
Benefits of opening a personal gym
We will explain the advantages that trainees may feel when opening a personal gym compared to other business ventures. The advantage is that you can have your own gym right away, so be sure to understand it.
Advantage 1: No qualifications required
There is no need for special qualifications to open a personal gym. For example, to run a restaurant, you need food hygiene and fire prevention qualifications, but there are no qualification requirements for running a gym. You can spend the time and money it would take to get qualifications on preparing to open your business and branding.
Another benefit is that, because no qualifications are required, it is easier to find someone to take over your work when you leave multiple stores.
Benefit 2: You can have your own training gym
For many trainees, having their own gym is one of their dreams. Be the master of your own castle, arrange the equipment that suits the menu you want to offer, and attract the customers you want. Anyone who aspires to manage a gym has probably thought about this at least once.
We also have an article that explains how to select equipment for those who are thinking of opening a gym, so if you're interested, please take a look.
Disadvantages of opening a personal gym
Of course, there are also disadvantages to opening a personal gym. We will explain the risks involved in becoming a manager and the capital required to open a business.
Disadvantage #1: You take on the risk of becoming a business owner
In exchange for the power to set the compensation that an entrepreneur receives, they give up some of the security that comes with being part of a company, such as no guaranteed monthly salary and the risk of incurring debt if they are unable to recoup their investment.
If you hire staff and can no longer pay their wages, you have no choice but to close the company. How to avoid running out of money is a challenge that managers must constantly think about. Keep in mind that starting a business does not mean you will be richer than an office worker.
Disadvantages: Requires an initial investment
Starting a personal gym requires an initial investment, whether it is a franchise or an independent business. If you are independent, you will of course need to prepare your own equipment and space, but even a franchise will require an initial investment such as a membership fee.
Starting a business is rarely free, so when you are thinking about starting a business, you should consider how you will raise funds and sustain a living.
Procedures for opening a personal gym
We will explain what you need and what you need to do to open a personal gym in 7 steps. Before you get started, make sure you understand the big picture, from deciding on a strategy to executing it.
Step 1: Strategy Design
Creating a strategy is essential to opening a personal gym. By knowing your rivals and your own strengths, you can come up with a winning strategy that will attract customers.
Thoroughly research the competition in your area
First, thoroughly research the competing stores in the area you are thinking of opening. If you open a store without creating a comparative advantage for your store compared to the surrounding stores, you will not be able to create a concept that is attractive to customers. Make a list of the access, price, service content, size, etc. of the competing stores.
If a nearby large gym offers light services for beginners, you will struggle to attract customers if you do the same thing. Competitive research is essential to discover your unique appeal.
Differentiate your concept from other stores
Once you have identified your competitors, create a unique concept for your gym. Uniqueness will increase your chances of attracting customers that other nearby gyms have not been able to attract.
For example, if there is no gym nearby that offers personal training, it would be a good idea to specialize in personal training. You can expect to attract customers who have not trained because there are only regular gyms.
Competitive pricing that matches the market
Be mindful of setting prices that are neither too high nor too low. Even if you have a unique concept, if your prices are too high, customers will be reluctant to visit. On the other hand, if your prices are too low, you may end up being too busy to brush up on your business.
A good guideline is the prices of your competitors. Set a price that will make customers feel that the services you offer are cheaper than your competitors', but will also ensure a sufficient profit if you attract the expected number of customers.
Step 2: Creating a financial plan
Once you have decided on the concept, create a financial plan. Opening a personal gym requires money, depending on the scale. When creating a financial plan, you need to have an outlook that allows you to fully cover the initial costs and running costs with the number of customers you expect to attract.
We recommend that you incorporate your financial plan into a business plan. A business plan is required when applying for a loan from a financial institution, so there are other benefits to creating one besides forecasting your business.
Step 3: Funding
Once you have an overall picture of the funds you need and your cash flow, it's time to start collecting start-up capital. Ideally, you should cover as much as possible with savings, but if you don't have enough, you can take out loans or grants.
Start with as much of your own money as possible
As much as possible, you should start by using your own funds, i.e. savings, for the initial costs. Unlike loans, your own funds do not accrue interest, so you can use them with peace of mind.
In addition, there is a credit limit on the amount of loans that individuals can receive. By paying as much of the initial costs as possible from your own funds, it will be easier to obtain loans later. On the other hand, if you rely entirely on loans, it will be difficult to obtain additional loans when business issues arise.
Obtaining a loan from a financial institution
If you cannot cover the necessary funds with your own funds, you can apply for a loan from a financial institution. When applying for a loan, you will need a business plan. The business plan should include the funds to be borrowed, sales forecast, the strengths of the company, and a repayment plan.
If it is difficult to obtain a loan from a major financial institution, you may want to visit a local credit union. Also, don't forget that you will have to open a company account before you can obtain a loan.
Utilize subsidies and grants
You may be eligible for subsidies or grants from the national or local government. This is not money you are guaranteed to receive, so you shouldn't rely on subsidies when making plans, but it's good to keep it in mind.
There are interest-free loans for startups and systems that will subsidize a portion of the amount used. Subsidies and grants often have limited application periods, so be sure to check the schedule of any programs that may be eligible for assistance.
Step 4: Acquiring a property
Once you have secured the funds, the first step in opening a personal gym is to secure a property. The ideal location is one that is easy for your target customers to access and does not put strain on your business.
There are two ways to acquire a property: renting and purchasing. Renting has the advantage of being easy to move out if the business does not go well, but it does not become an asset.
If you purchase it, it will be an asset, but if you take out a loan, the amount you borrow will increase and it will not be easy to move out. Be sure to decide on a location while consulting with the planned location of your business and your credit limit.
Step 5: Interior renovation
Once you have secured a property, renovate it so that it can be used as a gym. Since using training machines is likely to produce loud noises, soundproofing work will be required to avoid causing trouble for neighbors.
If you invest a lot of money in the interior design in an attempt to create a unique atmosphere from the beginning, it can put a strain on your business. Keep in mind the concept, but limit the content to what is necessary to provide the service.
Step 6: Procurement of equipment
Procure equipment according to the menu you offer. Personal gyms often have limited space and funds. Rather than trying to install a large amount of equipment, focus on getting the equipment you need to provide your services.
You don't need to have all the equipment you'd expect from a sports gym. Narrowing down the services you can offer to make the most of your concept is also a necessary step in opening a personal gym.
Step 7: Submitting a business start-up notification
Once you have completed all the preparations, submit your business start-up notification to the tax office in your jurisdiction. If you are a sole proprietor, you must submit your business start-up notification within one month of starting your business, as a general rule.
Once you actually start your business, it is expected that you will be busy with daily work, so we recommend that you include the day you submit your business start-up notification in your schedule.
If you are incorporating, submit a notification of incorporation to the prefectural tax office, the tax office in your jurisdiction, or your city or town hall.
Costs of opening a personal gym
Let's understand the costs involved in opening a personal gym. In this article, we will explain the two costs: the initial costs required to open a gym, and the running costs that continue to be incurred after opening.
Cost 1: Initial cost
Initial costs are the costs required to open a personal gym or private gym. If the rent is 200,000 yen, the minimum required amount is about 4.5 million yen. Let's take a look at the breakdown.
Property acquisition cost and 5 months' rent
Property acquisition costs include the deposit, key money, and brokerage fees to the real estate agency. If you are renting, the average cost is five months' rent. If you are purchasing, the cost will vary depending on the amount of the down payment.
The cost of acquiring a property is a big expense, but if you are hesitant to pay rent and open a store in an unpopular location, you may not get any customers and may incur a bigger loss. Acquire a property in a location that can attract customers, within your means. Densely populated areas such as apartment buildings are also an option.
Please note that the cost of acquiring the property does not include the cost of equipment.
Interior cost: from about 500,000 yen
The interior cost is the cost for general interior renovation other than training equipment, such as soundproofing and space creation. If you run a personal gym in a minimum amount of space, you can open it in a one-room apartment. Be sure to take measures against soundproofing so that you do not disturb your neighbors when using training equipment or speaking out loud.
In addition, interior design costs also include creating an atmosphere that customers will want to visit. The interior design is something you will want to pay special attention to when opening your own personal gym, but at first, renovate only the parts that directly affect customer satisfaction.
If you are looking for a mat that is effective in soundproofing and protecting your floors, be sure to check out our gym mats.
Equipment cost: Approximately 3 million yen and up
Equipment costs are the costs incurred for acquiring training equipment such as power racks and training benches, as well as equipment for accounting purposes.
Customers who visit personal gyms expect high-quality service. Make sure to provide the equipment you need to maximize customer satisfaction, within reasonable limits.
High-quality gym equipment is also effective in increasing the number of repeat customers. If you are interested, please check out the equipment at the link below.
≫ List of training equipment for personal gyms
Cost 2: Running costs
Running costs are necessary to operate a personal gym. The reason many store-based businesses go out of business is because they can no longer pay the running costs. In order to spend funds wisely, be sure to check the breakdown of your running costs.
Rent and utility costs
Rent and utility bills are expenses that occur regardless of the business situation. They are probably the first expenses that come to mind when calculating running costs.
Basically, rent is fixed, but utility costs fluctuate depending on the season and the situation. When making a business plan, make sure to make a plan with some leeway so that you don't run out of funds even if utility costs go up by several tens of percent.
When running a personal gym, you also need to constantly strive to find a location that offers the best balance between rent and attracting customers.
Facility maintenance costs
Equipment maintenance costs are expenses for irregular maintenance, etc. Equipment and facilities purchased with initial costs cannot be operated safely unless they are maintained and inspected. When introducing equipment, it is necessary to consider the long-term costs at the same time.
In addition, equipment cannot be used during maintenance. It is also necessary to devise ways to keep customers from leaving during the period when the equipment is being maintained. At the same time, you should also consider the cost of replacing equipment when it becomes worn out, and the cost of purchasing consumables.
Insurance and Taxes
Insurance premiums for insurance you and your employees take out, fire insurance, etc., and corporate tax that you pay based on your profits are also running costs. Since you are also required to pay consumption tax, you need to save the tax discount amount against your monthly sales as a running cost.
The cost of updating and maintaining equipment can be deducted from income and profits as expenses. When expenses are incurred, be sure to properly store receipts so that you can prove that you are paying the correct taxes in the event of an inspection.
Labor costs
Your income and that of your employees are recorded as labor costs. If you run a business by yourself, even if your sales are low, you will only be poor, but if you have employees, you cannot afford to delay paying their salaries.
If you plan to run a personal gym with the assumption that you will hire employees, you need to have a vision to be able to continue paying the labor costs. If you are not confident that you will be able to continue paying labor costs at the time of opening, you will need to design a business where you can manage the entire operation by yourself.
Advertising expenses
Advertising costs are an essential investment for attracting customers when running a brick-and-mortar business. You need to advertise in order to make customers aware of your gym and encourage them to visit.
Advertising costs are not just about content such as flyers and web ads. They also include campaign prices, such as discounts for new customers. Choose a method that matches your store's concept and customer base, such as paid placements in customer-attracting media or commercials.
If you are unable to attract customers by sparing advertising costs, fixed costs such as rent and labor costs will take up a large proportion of your sales.
A strategy to attract customers for a successful personal gym
We will explain customer attraction strategies to maintain your personal gym and stabilize your business. Let's try out methods of attracting customers that are possible for individuals so that customers will recognize your store and purchase your services.
Strategy 1: Website creation
The homepage is the face of the personal gym. Customers searching for a nearby personal gym online will find out about the gym through its homepage.
On your homepage, provide detailed information about prices, services, access, and other things that customers need to visit your gym. If there isn't enough information, customers won't trust your gym and will leave the page.
There are several services that allow you to create a homepage even if you can't program, so if you can use a computer, we recommend that you try making one yourself. If you are not confident in your time or skills, you can also ask a production company to create a high-quality page for you, and consider it as part of your advertising budget.
Strategy 2: Online advertising
In today's world where most people use the Internet, web advertising is increasingly becoming the first point of contact with customers. There are many types of web advertising. For each type of advertising, you can control the destination to a certain extent according to the region and customer attributes.
- Social Media Advertising
- Listing advertisement
- Display Advertising
- Publication in online media
Social media ads are viewed by younger generations, listing ads and display ads by those who use search a lot, and web media by those with a high purchasing intent. Place ads while considering the balance between the demographic you want to attract, your advertising budget, and the effectiveness of your ads.
Strategy 3: Social Media Advertisement
Even before you open your personal gym, be sure to actively advertise it on social media. It doesn't cost anything to attract customers using general posts on social media. You can post as many times as you like, so be sure to highlight all the strengths of your store.
Even after opening, you can increase your customer base by posting images of your services with your customers' permission, and providing information that customers looking for a personal gym want to know.
On the other hand, please refrain from attacking other gyms or badmouthing customers. If your trainer is seen as a scary person, customers who would have come to your gym will run away to another gym.
Strategy 4: Offline customer acquisition through word-of-mouth marketing, etc.
Once customers have visited your store, approach them to write a review. When people buy a product, they trust the voice of the user more than the seller's advertising. By encouraging word-of-mouth on media that lists your store and by setting up referral points, you can attract customers at the grassroots level.
Setting up a point card is another offline way to attract repeat customers. By continuing to make efforts that make customers who have visited your store once want to introduce you to others or want to visit again, your business will become more stable.
Points to note to avoid failure when running a personal gym
Here are five points to keep in mind to avoid failure when running a personal gym. It is important not to compete with the big companies and to increase contact with customers as much as possible.
Note 1: Do not open a store with a concept that overlaps with that of a nearby major store
Even if a newly opened personal gym were to go head-to-head with a large corporation, it would be difficult to win due to its lack of recognition and credibility. By carefully analyzing competitors and offering services that are not yet offered by nearby competitors, it may be possible to capture a new customer base.
Also, even if you try to compete head-on with major companies on price, it is difficult to beat them because of the economies of scale they have.
Create a concept that is unique to your area so customers will visit you without having to consider other options.
Note 2: Start small with one store
A common mistake in store-based businesses is to open multiple stores at an early stage. When you first open a store, there is no certainty that your concept and services are optimal. If you open multiple stores in a hurry because you have received a loan, there is a risk that all of your stores will be in the red.
Start small with one store to stabilize your business, and then add more stores when you find yourself short on staff and space to expand your business.
Point 3: Open a store in an area where you can expect to attract customers
Make sure to find a property in a location that can attract customers. A location that attracts customers is not necessarily proportional to the rent. Generally, the more people there are in a location, the higher the rent. However, a location with high rent is not necessarily a location that will attract customers.
Even if the location seems good at first glance, if it's next to a major competitor, you'll lose all your customers. Carefully consider the concept of your gym and the locations of your competitors, and choose a location that will allow your store to attract customers most efficiently. It's a no-no to choose a quiet location just because it's cheap.
Tip 4: Increase your exposure
Increase the opportunities for your personal gym to be seen by customers. Advertising costs tend to feel like a waste of money until you see results, but you need to think of it as an expense for attracting customers. Identify the places where customers who come to your personal gym gather information and advertise there.
In addition, there are many ways to connect with customers other than paying for media, such as posting on social media, setting up billboards, and dropping off flyers. Combine various exposure methods to increase your customer attraction.
Point 5: Increase the number of payment methods you can accept
Let's respond to the growing demand for cashless payments these days. Young people in particular are increasingly leaving the house with only their smartphones. People who don't carry cash may hesitate to visit a store if they can't make credit or QR payments.
Generally, cashless payments incur a fee of a few percent, but a business cannot survive without customers in the first place.
By the way, methods of avoiding fees such as "cash only for orders under XX yen" violate the terms and conditions of most payment methods and will make customers distrust you, so avoid them.
How to open a personal gym by creating a strategy and financial plan
Opening a personal gym requires detailed competition analysis and detailed financial planning. It is necessary to inject expenses to attract customers, but advertising expenses are a necessary running cost.
The fitness industry, including personal gyms, is a constantly growing industry, so if you have a solid strategy for attracting customers, you have a good chance of success.
If you are looking for high-quality training equipment for your gym, be sure to check out Uchino Gym's equipment, carefully selected by professionals.
