Our 2021 “State of the Industry” report gave me a lot of clarity—and a lot of hope.
Today and tomorrow, I want to highlight a few data points and provide analysis that will help you improve your business in 2022.
Gyms: Where the Money Comes From
Check out this table showing how various kinds of gyms generate their revenue.
Analysis: Most gyms in our data set are supported primarily by group training revenue. The most common supplementary service is personal training. In two segments, nutrition coaching has a small but significant effect; in all segments, online coaching, supplements sales and kids coaching contribute small amounts.
Reliance on group coaching can create issues: See the COVID Crisis, with bans on group training in some areas and limitations on class size in others. Further, group training is a gym’s “discount option.” Two-Brain gyms that have worked hard to sell premium services—personal training, hybrid online/in-person packages, and hybrid nutrition/fitness packages—report very different breakdowns.
Here’s a sample revenue breakdown from an actual Two-Brain gym:
- Group training: 42 percent
- Personal training: 29 percent
- Nutrition coaching: 2 percent
- Online coaching: 4 percent
- Kids classes: 14 percent
- Sport-specific coaching: 7 percent
- Retail/supplements: 2 percent
When you look at the breakdown above, don’t consider it a “checklist.” You don’t have to do “all the things.” In fact, you’re probably better off doing just a few things very well until you have the resources and stability to expand.
That said, this “balanced breakdown” shows one way to reduce your reliance on group training. I hope it inspires you to review your own breakdown to see where you might be able to generate more income.
For example: One Two-Brain gym owner’s revenue relied heavily on group training in 2020. After COVID, she focused on PT, and it now generates 76 percent of revenue. She makes almost $300 an hour from her business.
If you analyze your numbers and find that group training provides 75 percent of your revenue, you definitely have an opportunity to add a revenue stream that doesn’t require new equipment or skills—just different marketing.
It’s likely personal training provides that opportunity. This isn’t to say you must forget about group training altogether. It’s just a reminder: PT can be a very important revenue stream that can make your business “antifragile,” generate more profit and help clients accomplish goals sooner.