Last week, I answered this question:
“If you were starting from scratch today, what would you do differently?”
Read my list here (it’s long!).
I started two gyms between 2005 and 2008. One—a personal training studio—went pretty well. The other—a CrossFit box—did not.
Here’s what I learned about location, space and equipment. But before you start thinking about location, space or equipment, you need to think about the things below.
Consider These Things First
Know what you’re selling. In the PT studio, I knew that I was selling fitness. But in the CrossFit box, I thought I was selling CrossFit. Can you see the difference? It’s important to understand the difference between selling a benefit (fitness) and selling a feature (CrossFit, PT or nutrition coaching).
Know who your clients are. Know where they work. Know what they do after dinner. Know if they drive a car or take a train.
Know what those clients need to be successful. Successful professionals need appointments and classes around their workday (usually before their workday starts). They need showers. They need parking. They need to be able to get to their workplace on time. They need to be able to clear their heads while they’re with me. They might not need cheap rates, 60-minute classes or AirBikes.
Know what tools you need to get them there. You’ll need a barbell and a box. Something to hang from. Maybe some space to sprint. You’ll need a way to measure their progress. A way to bill their bank account every month. A way to schedule appointments. And a system to grow your business. You don’t need 10,000 square feet, $50,000 in equipment and a $5,000 website. People are attracted to results, not gear.
Know what you’re actually selling. You sell coaching. Big chain gyms sell access. Knowing the difference is really important.
Know how to scale up, one person at a time. (You can read about that here.)
Choosing a Location for Your Gym
Figure out where your ideal clients live and work.
Choose a location that’s convenient for them—either right next to work (people can’t go far on their lunch breaks) or on their way to/from work. If you’re going to have a large personal training and nutrition component to your business, choose a location closer to their homes. PT schedules are generally more flexible than class times.
If you plan to run large corporate challenges, choose a location closer to office buildings. If most of your potential clients commute in a car, you’ll need more parking. But don’t guess: Let your future clients determine what you actually need.
Then go sit on a park bench in those neighborhoods. Track the peak traffic. When do people generally leave for work? When do they come home? What do they do on their lunch breaks? These will determine your first appointment and class times.
Pick a location with noise-friendly neighbors.
The number one lease problem affiliates have isn’t price; it’s noise complaints.
Pick a location with some private space included.
You need an office for nutrition coaching and consultations. You probably also need a private area for doing 1:1 training and a larger area for groups.
Buy enough equipment to train four people at a time.
Forget the calculations about square footage per client that equipment sellers put on their site. They want you to buy a larger space so you can fill it with equipment. But at startup, your goal is to get to profitability as quickly as possible, not to build an equipment showroom. Great coaches can get their clients results with little equipment—or even no equipment.
Sign the shortest-term lease on the smallest-possible space.
You’ll eventually need more room, but not yet. Don’t try to eat the elephant in one bite. You’ll choke.
Location Selection: Things to Avoid
Trying to build CrossFit Shangri-La or some other equipment paradise.
Many of the best microgyms in the world occupy around 3,000 square feet.
Locations that are inconvenient for your clients.
Many gym owners pick a location that’s near where they live because they prioritize their own convenience instead of thinking about what’s easy for their clients. Will your clients really drive 20 minutes to reach you? Probably not. They’ll find a closer gym.
Looking for densely populated areas or neighborhoods without a gym.
One of the most common things we hear from gym owners is: “We opened in Central City because there was no box here! We figured it was a great opportunity.” But maybe there’s a good reason there wasn’t a box in the area before.
On the first day of my second year in business, we moved our PT studio to a bigger, brighter upstairs location. That night—less than 12 hours after opening the doors—one of my clients dropped a 75-lb. snatch from overhead. No big deal—except it shook all the track lighting loose downstairs. We were one day into a three-year lease and the facility no longer met our needs.
Choosing the Best Space for Your Gym
A cavernous room where you can pack 30 people into a group class? That’s the wrong idea.
Your business is coaching. Every client should have a 1:1 relationship with your business. And every square foot of your space should generate revenue.
That means you need:
1. Privacy for doing body measurements and No-Sweat Intros.
2. Showers and amenities so that professionals can get back to their professional workplaces.
3. The ability to run two sessions at once (two groups or one group and one PT session).
4. A welcoming front-desk area for newcomers.
Spaces: Things to Avoid
“Athlete lounges,” coffee bars and coaches corners. These things cost you money every month forever, and there’s no return.
Athlete lounges don’t improve retention.
Coffee bars are a huge distraction (and almost always lose money).
Coaches corners are irrelevant. Most coaches don’t really want to hang out in your gym after they’re done coaching (unless they’re working out or having an affair on your sweet leather couches).
Buying Equipment for Your Gym
Many people see lack of equipment as a constraint for the coach. But it’s sometimes a positive constraint: Less equipment makes a new gym owner better at programming, better at selling workouts to clients and better at reaching breakeven quickly.
The temptation to “use everything” might be subconscious but will definitely skew your programming. And every new piece of equipment has a ratchet effect: No one cares about AirBikes until you buy one. Then everyone says, “We don’t have enough AirBikes!”
When I opened in 2005, no one had women’s barbells. I resisted buying any until 2010, when I bought three. I immediately had to buy seven more because women who didn’t get a women’s barbell felt their experience was somehow compromised—even though there wasn’t a problem a week before.
Some general tips:
Start with the results you want to achieve.
Then write the programming for your first three months. Then write your on-ramp program to prepare people for your class programming. Finally, buy the equipment needed for your on-ramp programming and nothing else. Like your clients, you’ll scale up in complexity as you go—or maybe not.
Tie every new piece of equipment to ROI.
Will two new rowers really make you more money? Are people quitting because you don’t have enough? These are the two criteria for buying equipment.
Equipment will never attract a new client to your group classes. But if people are waiting around for their turn, you should start planning to buy more. And if purchasing equipment will allow you to sell a different service—at a different price—then it might be a good investment.
Finance your equipment over the longest term possible.
At startup especially, it’s more important to free up your cash flow than to pay down debt quickly. You can always pay it off early if you have the cash, but don’t martyr yourself to save a few bucks on interest.
The best equipment isn’t always the barbell.
The InBody makes us more money than our rig because it shows the clients what they care about: their progress.
Buying Equipment: Things to Avoid
Buying equipment for the sake of owning equipment.
People don’t care about your equipment. They don’t care how fast your barbell spins or how many GHDs you have. They care about results.
Catering to “gear heads.”
If someone comes in and says, “I’m from another CF gym up the road and I just want to see what equipment you have,” there’s a great chance that person is looking to do his or her own workouts instead of receiving coaching. Pass on the person. Your business is coaching, not access.
Ignore the equipment salesperson’s estimates on space.
You don’t need 100 square feet per client per class.
Start Right, Grow Fast
It took me 10 years to make my gyms really profitable. But the real cost was poverty, fights with my wife and missing my kids.
The mistakes I made at startup seemed innocuous at the time but put me in a hole for a decade.
There’s no reason for you to make the same mistakes.
Other Articles in This Series
How to Start a Gym
Starting a Gym: Scaling Up
Starting a Gym: Adding Staff
Starting a Gym Marketing
Starting a Gym: Do You Need a Partner?
Want to start your gym the right way? Download our FREE Gym Business Plan Template here.