How to Write a Fitness Center or Personal Training Studio Business Plan
The fitness center or personal training studio industry has been growing quite impressively over the last several years. There are several reasons why entrepreneurs are investing money in startup fitness centers and personal training Studios.
For example, our business plan writer has found that our society has been shifting towards a more healthy living style. Part of a healthy living practice is physical fitness regimens. What is better aligned to meet this need than a fitness center or personal training studio? This is just one of the numerous reasons why we anticipate the fitness center and personal training studio businesses to continue to enter the market at an above-average pace.
In order to best compete in this industry, businesses need to have a sound foundation from which to start the organization and better compete with established competitors such as LA fitness and other national chains. From this, having a well prepared and written business plan is more than an adequate starting point. From this, here are some tips and tricks for writing a personal training studio or fitness center business plan from our professional business plan writer.
Executive Summary for a Fitness Center or Personal Training Studio Business Plan.
The executive summary section of a fitness center should start off by identifying the problem the organization will solve. Based on our research, the main problem that a fitness center solves is that its services are aligned with healthy living, which, again, is a trending concept in the US right now. By showing customers that your business is aligned with their personal needs and views, business owners are able to establish a foundation of trust. Because of this important cornerstone, starting off your executive summary section examining this concept is an excellent practice.
Company Information and Location.
The location of a personal training studio is an important feature that your customers will examine before deciding to buy. Because of the importance of this characteristic, fitness center business owners need to address it in their company section of the fitness center business plan. When describing your location, try to discuss the parking situation, the ease of entering and exiting the location, square footage of the building, and other competitive characteristics that potential members may find appealing. By stressing these aspects in the location section of the business plan, the business owner is able to show competitive advantages through a prime location selection.
Product Description and Competitive Advantages
The product and service description for a fitness center or personal training studio is more than just a membership. This section should also include discussions about amenities and membership options. For example, our business plan writer suggests discussing membership opportunities in relation to payments in this section. Some fitness centers will offer discounts to customers if they pay annually. Whereas personal training studio business owners may offer discounts when customers prepay for personal training hours. Regardless of the payment structure, having discounts available for customers may help fitness center entrepreneurs avoid cash flow issues when starting out.
Target Market for a Fitness Center or Personal Training Studio Business
The target market section of the fitness center or personal training studio business plan may target various demographics based on the company’s business model. For example, a fitness center charging a relatively low monthly fee may target residents within a 10-mile radius of the business. In contrast, a personal training studio that offers industry-leading personal training services may charge a premium for services. From this, the target markets for the organization may shift to executives and healthcare providers. Regardless of the target market for your fitness center organization, make sure to provide specific details about the target market and justifications for selecting the demographic.
Industry research for a Fitness Center Business Plan
The industry research section for a fitness center or personal training studio business plan will be similar. This is because both entities fall within the umbrella of fitness center businesses. Important industry statistics that should be included in either type of business plan should focus on membership growth, industry revenue growth, important amenities, and other statistics in the industry. For example, Statista has found that the fitness center in the US exceeded $96 billion in 2019 for the first time ever. Also, LA fitness is the industry leader, with revenues exceeding $2 billion. Finally, the main revenue generator for a fitness center or personal training studio our membership fees. Finally, based on industry research, approximately 40% of the US population has a gym membership. By providing these facts and more, fitness center business owners are able to show that they understand the current state of their industry as well as that they have their thumb on the pulse of industry trends.
Owner and Management Section
The owner and management section of this type of business plan often starts with a personal statement from the fitness center business owner. This statement often discusses the business owner's passion for fitness OR the challenges faced in their own personal health situation. By adding a personal touch to the management section, the business owner is able to give it a personal feel while showing that their passions or struggles are similar to their current or prospective members. By connecting with members this way, not only are business owners able to increase sales but also better retain members in the long term.
Funding Request for a Fitness Center or Personal Training Studio Business Plan
The funding request section for this type of business plan should follow a specific strategy. First, a fitness center business owner needs to list all of their startup costs. Popular startup costs for a fitness center or personal training studio may include location buildout, operating capital, fitness center equipment, security equipment, deposits for electric and other utilities, and training funds needed for new hires. Once the startup cost is detailed and calculated, the business owner then needs to project their working capital needs for the next several months. Working capital needs for a fitness center may include covering operating costs until membership dues are paid, the money needed for emergency repairs to fitness equipment, and funds available for paying employees. After all of the funding is documented for the business, then the business owner should deduct how much money they are personally investing in the business. The difference between the total funding needed and equity investments will be the dollar amount used in the funding request.
Financials and Financial Projections for a Personal Training Studio.
As noted previously, the main revenue generators for a fitness center or personal training studio are membership fees. Because of the importance of membership fees, this is the main revenue generator that should be shown on the financial statement. Once your membership fees are calculated, deduct variable costs, which may include credit card processing fees. Once this is done, then the business owner may deduct fixed monthly costs like labor, rent, and equipment repair fees from the gross profits. This leaves the business owner with a projected net profit. Once a net profit for the month is calculated, then apply monthly growth rates to the membership fees as well as any variable costs assigned. The end result is a basic profit and loss statement for the year.
Hopefully, these insightful tips and tricks for writing a business plan were helpful. As always, if you need help with a business plan or financial projections, just send us an email or give us a call.
Author: Paul Borosky, Doctoral Candidate, MBA., Author