How to start a gym business

The cost of living crisis has hit many UK households hard. With NI increases and rising taxes, consumers are aiming to minimise their expenditure. But not, it seems, when it comes to gym memberships.

Figures from the annual State of UK Fitness Industry Report, published by the Leisure Database Company (Leisure DB) show that, in March 2023, the UK fitness sector increased by 11.5% year-on-year. This was due to a rise in average monthly membership fees, despite individuals apparently cutting back on spending.

The good news is that, if you’re a fitness professional or personal trainer looking to start your own gym business, you will still have a huge share of people interested. But so too will your competitors. New gym owners now need to use smart strategic planning to stand out against rivals and give consumers clever incentives to continue spending money with your firm.

Luckily, we’ve been helping startups to establish and grow for over two decades, and we’re experts in the challenges ahead. In this article, we’ll take you through the top priorities you need to think about when starting a gym business, in areas like finance, marketing, and health and safety.

By the end, you’ll know everything you need to write a commercial gym business plan that would make even Joe Wicks proud.

How has Covid-19 changed the industry?

If you’re considering starting a gym business, you’re likely feeling nervous about the state of the industry and the possible impact that future lockdowns might have.

The pandemic has been difficult for all businesses, but its impact has been particularly harsh on gyms and exercise facilities, as three national lockdowns forced the closure of facilities all over the UK.

For many gym owners, the impact was devastating. The Gym Group, one of Britain’s largest low-cost gym operators, reported revenue losses of 48% as it said goodbye to 200,000 members in 2020 alone.

However, post-Covid, much of this damage seems to have been reversed. Going to the gym topped the list of activities people were most looking forward to when coronavirus restrictions were lifted. As lockdown measures were relaxed, The Gym Group’s shares jumped by 28% in 2021 – recouping virtually all of its earlier losses – whilst ClassPass recorded a 600% week-on-week increase in the number of new members attending fitness classes.

All of this paints a confusing picture of potential negatives, and cause for optimism. So what post-Covid considerations do you need to make if you’re looking to start your own gym business?

How has Covid-19 impacted gym health and safety?

Right now, one of the biggest concerns people have about returning to the gym is the threat of contracting Covid-19, as workout spaces can be a common environment for germs. That means cleaning, disinfecting, and sanitising are three of the top priorities for new gym owners. Things like hand sanitiser stations and face masks have become the norm.

You can create your own cleaning and hygiene routines around these three simples steps:

• Train all your employees to ensure personal hygiene (e.g. washing hands) and disinfecting procedures. Employees should learn how to safely use disinfectants, and wear PPE when cleaning.
• Have a daily cleaning schedule for employees to follow to ensure the facility is cleaned regularly.
• Document your cleaning practices to ensure that all facility disinfecting is being accomplished daily.

You could also hire third-party cleaning staff to manage this area of your business. Most commercial cleaners charge by the hour or by the square foot. For an hourly rate, you can expect to pay anything between £18 – £40, but if the company charges by the square foot, costs average around £0.25 per square foot.

Another important reason for investing in health and safety is to reassure customers that you are making their work out area safe and hygienic. Make sure you shout about the many ways you are working to protect clients from COVID-19 and other illnesses, by putting up flyers and signs. You can also require your employees and customers to wear a mask, unless they are exempt.

What if there’s another lockdown?

It’s impossible to say what the impact of another lockdown would be or might look like. However, judging by previous legislation, gyms will most likely be at risk of closure.

If that happens, you could lose members and start to run out of money very quickly. Surveys estimate that UK fitness clubs lost an average of £470,000 in revenue between March 2020 and April 2021 – or just over £36,000 per month.

Though staff member salaries may still be covered by the government, you’ll still have a lot of overheads to consider, such as rental costs. The best way to evaluate whether you could afford to open your gym is to look at your cash reserves.

Reserves refer to any earnings that can be put aside and used by your business during unforeseen events and emergencies. They can take a lot of different forms, for example, a capital reserve might be any cash you would receive from selling your assets.

Meeting with a third-party accountant is the best way to work out how much money you might have in cash reserves, and whether this would be enough to tide you over in another lockdown.

Can people be tempted back from home exercising?

The Leisure-Net Team’s National Post Lockdown Recovery Survey found that 48% of respondents said they had been more, or the same level of, active during lockdown, implying many respondents had continued to WFH (workout from home).

Changing demand and habits from your gym users will influence your business model. So, how popular has home exercising become? Will your gym be trumped by online fitness classes and YouTube yoga sessions?

Not necessarily. In the same survey, a huge majority of respondents (88%) said they still planned to use gym facilities more or the same amount when they reopened, suggesting that fitness centres remain sought-after.

Daniel Herman is founder and director of BioSynergy, a sales website for fitness products. Herman says: “In the long term, I think Covid-19 will have a positive impact on the sector, as it has increased awareness about the importance of health and fitness beyond sport and aesthetics. I think in future, the industry will have to embrace a multi-channel approach to meet the differing needs and requirements of their members.”

Gyms across the UK had to adapt quickly to the coronavirus lockdowns, doing everything from renting their equipment to clients, to streaming fitness sessions directly into people’s homes.

Take advantage of the change, and look to attract the new home-fitness audience that has emerged during lockdown. For example, you could offer free trial sessions for people who began working out from home and might now be looking to transition to a gym environment.

How much does it cost to launch a gym?

Starting a gym business is an expensive venture. The average initial investment cost when opening a mid-sized, commercial gym is around £80,000-£100,000. If you are only willing or able to invest less than this, you might want to start with something smaller, like a fitness studio.

Purchasing equipment

Gym equipment is an expensive area to invest in. How much you spend depends on the amount and type of equipment you want, but you should expect to budget at least £35,000 for a fully-equipped inventory.

Here’s a handy breakdown of the average costs for some of the most popular commercial gym machines:

A good rule of thumb is to have enough equipment for 15% of your membership list to use in a given hour. So, if you have 200 members, you’ll need to have 30 machines. Based on our above chart, that means an initial upfront cost of £34,800 just for equipment.

If this sounds out of your price range, don’t give up straight away. Some websites, like Powerhouse Fitness allow you to purchase commercial gym equipment on finance.

And be sure to shop around – brand new equipment isn’t entirely necessary if you’re looking to save money. Used commercial equipment websites, like gymkituk.com, can supply second-hand materials at a more affordable price.

Renting equipment 

Another good way to save money upfront on commercial gym equipment is to rent it from a third-party provider. Here’s how the estimated costs compare for buying vs. renting equipment, based on prices given by equipment hire company, Hire Fitness.

For purchasing and owning your gym equipment, we calculated an initial upfront cost of around £39,500 for 200 members. In comparison, one month of renting equipment would cost an estimated £2,048 based on this chart.

However, this might be beneficial in the short term – particularly as you build up your client base – but rental costs quickly become more expensive in the long term. Based on these estimates, if you bought your equipment outright, you would see a return on your investment within 18 months when compared to hiring.

Hollie Grant is founder of Pilates PT, a fitness studio in Fulham. Grant says: “The financial side of the business is always the most important consideration. Whenever I have been tempted to scale the studio up and take on a bigger space or move to group classes, the numbers just do not work. Whatever your heart tells you, you must be able to back it up with financial security!”

Pilates PT studio

Opening a gym via franchising

For a more cost-friendly route to opening your gym, you should use a fitness franchise. There are a number of established fitness chains which offer you the chance to open a gym, or offer fitness services, at one of their existing sites; giving you a headstart on location and market.

Anytime Fitness is one of the leading health chains in this sector and operates over 5,000 franchise gym outlets in seven continents, having initially launched in 2012. It offers a franchise package for minimum liquid capital investment of £170,000, which includes everything from support and training through to access to marketing materials.

Surge Fitness studio

Employing staff

When you first open your doors, you will likely be the primary fitness instructor and oversee most of the training and direct contact with your members. However, you may want to employ personal trainers from the get-go for more specialist fitness areas, like pilates or yoga.

Before taking on new staff, you need to check their training and accreditation carefully. Consider making test classes or personal training sessions a part of the interview process to see how they interact with members before committing to keeping them as an employee.

You should also ask yourself whether you want to hire staff as employees or independent freelancers, as the latter might make more sense budget-wise if you’re only expecting to run classes for a few hours a week per instructor.

To get a full understanding of the different types of accreditation necessary for each fitness trainer role, you can use the CIMSPA professional standards library for a detailed breakdown of every requirement.

How should you price your gym?

Gym membership prices usually have lots of different payment options to suit all walks of customers – whether they use the gym daily, or just for a few weeks after the Christmas period.

Most gyms have payment options for:

• Single-day memberships
• Monthly memberships
• Annual memberships

Depending on what your unique business model includes, you might also choose to offer gym-only memberships or gym-and-fitness class memberships, to suit customers who want access to different areas of your fitness centre. Many brands offer off-peak membership for those who use the gym during working hours (between 9am-5pm).

Tori Porter owns a fitness and wellbeing communications agency, and is also an avid gym user. Porter says: “I recently quit my gym membership because I was going abroad for a few weeks and it felt like a waste to be tied into a rolling contract. I also find sometimes I don’t make the most of a contract, so it’s better for me to find pay as you go or more flexible options.”

Researching your local demographic will help you to decide the best pricing package for your target market. For example, if the average household income in your area is £30,000, you need to ensure your pricing plan reflects this figure.

Market research can take a lot of different forms, but a good jumping off point is to talk to other fitness centre owners about their business journeys. You could also run surveys using social media, to find out what local community expectations are for gym costs, and what they might think is missing from their existing facilities.

You can get basic demographic details from your local authority but there are private companies that will give you a more detailed profile of the local population for a fee. Finding sources isn’t always simple, but you can always start with an ordinary web search.

What is a competitive price for gym memberships?

We’ve picked out five of the most popular gym brands from across the UK, and compared their costs in the below table to best illustrate the average price of a gym membership in the UK. (The price shown is specific to each gym’s Liverpool branch, to ensure a fair comparison.)

According to this chart, the average gym cost is around £37.92 for a monthly membership, billed annually.

Of course, as we’ve mentioned, the location of your gym, cost of your equipment, local demographic, and the prices of nearby competitors are also huge influences on how much you should charge your members. Make sure you consider all of these factors when designing your pricing plans.

Are you qualified to start a gym business?

If you’re going to run a fitness centre, passion for health and wellbeing is an obvious requirement, but here are some other soft skills that gym owners should have:

Personal accreditation is another requirement – and that means more than a medal at your local fun run.

You should have a minimum of a Level 2 qualification as a fitness instructor, which you can complete either in-person or online. YMCA Fit offers this qualification as a part-time and full time course.

Rules and regulations

Starting a new gym business is a potential minefield for injuries and accidents, so it is in your best interests to be rigorous about safety procedures.

There is currently no specific agency that oversees safety guidelines for the industry. However, for your gym to qualify as a safe environment for users and staff, you will need to conform to basic standards set out by the Health and Safety Executive (HSE), a government agency responsible for workplace health and safety and employee welfare.

UK Active (formerly known as the Fitness Industry Association) has an easy to understand code of standards on its website which, if followed, will qualify your gym under HSE guidelines. These are:

• All staff employed within a gym or fitness centre must have adequate safety training. There must be an appropriate number of first-aiders in relation to the size of the club – only HSE approved first aid courses count.
• All fitness instructors must be trained to standards required by the European Register of Exercise Professionals.
• All gym equipment, including lifts, electrical appliances, and boilers, must be kept in a safe condition and regularly inspected by appropriate people.
• All gym equipment must be maintained according to the manufacturer’s guidelines, with all checks documented, and records kept on site.
• Gym owners are legally bound by employer legislation for any instructors or other staff members you take on.
• If you have a café or food area on site you will also need to comply with Regulation (EC) No. 852/2004 on the hygiene of foodstuffs and the Food Hygiene Regulations 2006.

Here are some useful resources to learn more about gym accreditation:

• European Register of Exercise Professionals 
• The British Association of Sport and Exercise Sciences 
• Chartered Institute for the Management of Sport and Physical Activity 
• UK Active
• Health and Safety Executive
• IHRSA

Insurance

If you’re employing staff to work at your gym business then you are legally required to have employer’s liability insurance. This insurance will cover you for any compensation claims made by your employees for injury or damage caused by work.

We also highly recommended that you get public liability insurance. As you and your employees will be interacting directly with the public, this will protect you if someone incurs injury or damage on your site. Buildings and contents insurance, while not a legal requirement, should also be another consideration.

You can use insurance price comparison websites to find the best option for your business, but here are some of the most popular providers:

• Axa
• SimplyBusiness
• Hiscox
• Direct Line For Businesses

Licensing

Depending on the range of activities your fitness centre will offer, you might need special licensing. Common activities in gyms that need a licence include:

• To sell or prepare food on the premises, businesses must register with their local authority environmental health department.
• To use copyright recorded music during gym sessions, you will require an ‘exercise to music’ licence from Phonographic Performance Limited. If you are a member of UK Active, you qualify for a discount.
• To play background music elsewhere in your gym – for example in changing rooms, workout areas or a cafe- you’ll need to apply for a ‘background music’ licence, also from PPL.
• To show television programmes in the fitness rooms or communal areas, you’ll need a television licence from TV Licensing, which you can get easily online.
• To keep computerised records of individuals’ personal details and/or use CCTV you need to fill in an online form, and register as a data user with the Information Commissioner’s Office.

How should you market your gym?

So, you’ve decided on a premise and have honed into what your customer base and pricing costs are. Now, you need to know how you’re going to spread the message to advertise and promote your gym in places where your customer spends a lot of time.

But, as an SME, you won’t have a big budget when it comes to marketing. So how can you communicate with your target audience directly, completely free of charge? Thank goodness for the World Wide Web.

You do need… a website

According to BrightLocal’s 2020 consumer survey, 93% of consumers used the internet to find a local business in the last year, which means you’re missing a trick if you don’t have a website already established and waiting for users to find.

Thanks to the beauty of modern technology, it’s simple to set up your own website and domain. Specialist website builders can do all of the coding and design for you, offering easy-to-use templates that you can alter and personalise.

Here are some popular website builders:

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Best for small business overall
Wix	Squarespace	GoDaddy	Shopify	Hostinger	Jimdo
BEST FOR Best all-in-one website builder	BEST FOR Design flexibility & businesses looking to scale	BEST FOR Ease of use and simplicity	BEST FOR Ideal for growing your online store	BEST FOR Cheap builder	BEST FOR Creating a website in under an hour (thanks to its ADI platform)
Overall Score Based on our in-depth research and user testing 4.8	Overall Score Based on our in-depth research and user testing 4.7	Overall Score Based on our in-depth research and user testing 4.5	Overall Score Based on our in-depth research and user testing 4.4	Overall Score Based on our in-depth research and user testing 3.9	Overall Score Based on our in-depth research and user testing 3.3
Price £9-£119 per month £8.10-£107.10 with code “TAKE10”	Price £12-£35 per month, billed annually Use code “SU10” to receive a 10% discount on all Squarespace plans	Price £7.99-£13.99 per month, billed annually (first term discounts available)	Price £5-£259 per month, billed annually £1 for first month	Price £2.59-£3.79 per month Up to 81% discounted with code “STARTUPS”	Price £9-£39 per month
Try Wix	Try Squarespace	Try GoDaddy	Try Shopify	Get Hostinger	Try Jimdo

We would recommend Squarespace and Wix as the best options for gym businesses. They are particularly good for creating an attractive interface that can sell a service and take booking payments – areas where a gym website should excel.

You do need… social media

Experian reported that 84% of UK SMEs use social media for marketing purposes, and for good reason. It’s free, quick, and lets you target incredibly specific audiences.

Surge Fitness’ social media page

Social networks like Facebook, Twitter and Instagram are also an excellent platform for guerrilla marketing – using weird and often low-cost, viral messaging to sell a product or service.

Olly Randall is co-founder of Social Fitness Co, a digital marketing agency for fitness studios. Randall says: “The biggest challenge for startups is generating brand awareness and attracting new businesses. Social media is a great way to get as many eyes on your product or service as possible. However, people on Facebook aren’t looking for a gym, so you need to find a low-barrier offer to stop them scrolling and catch their attention, like offering a one-week free trial or a foundation membership.”

You might need… third-party advertising

If you’d rather not take on responsibility for marketing your gym, then you should consider hiring a third-party consultant in a marketing, PR or social media management role.

How can you make sure your gym is inclusive?

If you want to attract the largest audience possible, and ensure your gym is a comfortable environment for customers, then you need your business to be inclusive and accessible for every type of user.

The phrase ‘gym culture’ has historically been used to position gyms as testosterone-driven, male-centric spaces. FitRated reports that 71% of female gym goers they surveyed said they had an experience that made them feel uncomfortable at the gym, with 54% saying it had led them to avoid certain rooms or areas.

Thankfully, that image is changing. To craft a more inclusive environment at your gym, follow other, big-name gym brands by introducing safety-conscious, women-only spaces. Other emerging norms, such as parent-and-kid classes, can also contribute to the cause.

Supporting people with disabilities

In 2018, Future Fit Training released their report Raising the Bar, which found that 86% of fitness employees who were surveyed didn’t think most exercise professionals were adequately trained to work with disabled people.

Your business needs to be accessible for customers with disabilities or disorders. If you are hiring staff, invest in training programs to ensure that they are sensitive to the disabilities they might encounter. Make sure that your building doorways are wide enough for mobility equipment, and look into buying specialist disability-friendly gym equipment.

Supporting diversity and body-positivity

Health and wellbeing is all about feeling good in yourself and your body, which is why it’s important to celebrate all body types.

Marketing materials are an important part of showcasing this support. Make sure you represent a wide range of service users in any promotional packages or images.  Train staff in how to handle unacceptable, body-shaming behaviour towards customers.

Remember, inclusivity is about inviting conversations and being open-minded to new issues. You should also signpost communication channels through which people can contact you with any complaints or concerns they might have.

Lisa Grant is owner and manager of Revolution, a female-only gym founded in 2020. Grant tells us: “There is so much competition in the fitness industry, so it’s crucial to find what you are good at, passionate and enthusiastic about. I wanted to create a ladies-only gym which would provide a safe space where women can be who they want to be without judgement, an environment where they are supported. That’s my ultimate goal, the sense of being a part of something.”

Revolution gym

Next steps

We’ve given you lots of action points to consider when starting a gym. So which should you do first? Here’s a realistic timeline for how long each step should take you.