What to Consider Before You Buy a Gym or Fitness Center

COVID-19 hit gyms, health clubs, and fitness clubs hard, pushing towards the demand for more virtual workout classes. As many business owners tried to stay afloat, others decided to exit out of the industry altogether. Fortunately, gym participation is expected to pick up despite the temporary pushback due to an increasing need for fitness and sport participation. If you’ve been holding off or have recently considered entering into this 35 billion dollar industry, now be your chance. Below, we’ll cover the essential questions you should ask yourself and the current owner before you buy a gym.

Questions to Help You Purchase a Gym or Fitness Center For Sale

Gym ownership isn’t for everyone. Although there are plenty of opportunities to purchase a gym or fitness center for sale, a lot of work goes into a business startup. Before investing your time into gym ownership, ensure you’ve addressed the following questions.

1. Why is the current business owner leaving?

Whether your plans include purchasing a full-service fitness franchise or an independently run fitness studio, knowing why the seller is exiting the business is imperative. Experts typically regard selling a gym due to financial hardship as a red flag. However, due to the pandemic’s negative impacts, it doesn’t necessarily need to be a deal-breaker. If this is their reasoning, you may be able to negotiate a lower asking price.

2. What gym equipment and other essentials are included in the sale?

Startup costs can add up quickly in the gym and fitness industry. Any new gym or fitness business owner can tell you that a fully-functioning gym needs more than exercise or body workout gear! Therefore, you should look into everything that comes with the sale. That includes strength training fitness equipment, cash registers, storage lockers, etc. What is or isn’t included will help you determine how much money you need to budget aside for purchasing startup essentials.

Other Essential Aspects to Take Into Consideration

In addition to what we’ve noted above, other important considerations can factor into your success as a new owner, such as:

• Gym Location: Nowadays, fitness and wellness centers can operate as home-run businesses. However, many still require rented storefronts or large free-standing franchise buildings. If the sale includes real estate, make sure that it’s in close proximity to the primary demographic you intend to target.
• Customers/Membership Base: New customers can be hard to come by for any new business. While you’re thinking of ways to attract new gym memberships, take a look at the existing base. Note what type of fitness activities they routinely participate in, including cardio, CrossFit, Pilates, barre, or personal training sessions.
• Employees: Almost every gym or fitness center requires fitness instructors and staff to run classes and manage daily operations. Keeping even a small percentage of the existing team on board can help you transition into business ownership more smoothly. Plus, it helps cut back on costs associated with hiring new employees.
• Cash Flow: A gym’s current financial health can signal how well it may perform in the near future. Make it a priority to look over tax documents, accounts receivable, payroll, and profit margins. If you need help reviewing this paperwork, seek out the assistance of a professional business broker or accountant.

Ready to start your venture into gym ownership? Consider working with the experts at Sunbelt Business Brokers. Our team has years’ worth of experience matching qualified buyers with sellers. We’ve helped countless franchisors and small business owners land their ideal business opportunities. Locate your nearest Sunbelt office and start on your path towards gym ownership today!