Last updated Jul 10, 2024 and written by Lauren Felstead

The top 5 mistakes to avoid when opening your own gym

We’re living in what industry insiders are calling “the golden age of fitness”. Close to 10 million Brits have a gym membership, with many of them swapping late nights for early mornings in the studio. 

What’s especially exciting about this £1.8 billion sector is the opportunity it offers to entrepreneurs. Alongside the big chains are plenty of smaller, boutique studios catering to the needs of lots of different sub-groups of customers.

But while emerging into this market can be a successful business venture, it’s not without its challenges; especially when it comes to financial outlay, market positioning and planning. So how do you make your gym stand out among the rest? To help get you on the right track when opening a gym, we’ve compiled a list of some of the traps that new gym owners can run into — and how to avoid them. 

1. Ignoring your market

When starting up your gym, it’s so easy to make false assumptions about the type of fitness experiences customers actually want. Likewise, if you don’t take into account what’s out there already, there’s a danger of mimicking existing businesses or failing to make your presence felt among the overwhelming competition. This is why market research is so important for any new gym owner. Here are some tips for outlining exactly what your target market wants:

  • Survey the current market: draw up a list of gyms operating in your locality, and find out what they offer and how much they charge. This will allow you to discover what’s already out there on the market, and more importantly, help to shape your unique selling point.  
  • Use social networks: this includes the likes of Facebook, Instagram, TikTok, sports clubs and local fitness forums. Who uses a gym? What do they like or dislike about their existing studio? What would make them go more often? What’s most likely to make them switch? If they are not currently a gym member, what could you do differently to make them change their mind?    

For example, there is currently a great open market for women-only gyms which are as well equipped as mixed gyms. Women-only gyms, such as Curves have a great success within the existing market. However, many have critiqued that Curves’ fixation around ‘weight loss’ and cardio-focused gyms is related to an older diet culture to which the younger generations of today no longer adhere too. 

Secondly, more and more young women are taking up weight lifting and there are fewer women-only gyms which have the equipment for this. By identifying a niche such as a women-only gym with a multi-weight section you can tap into a unique market which helps grow your business to dizzying heights. You may also receive early support through crowdfunding from those particularly interested in having a space as such. Of course, this idea can be implemented to any niche such as a gym optimised for boxers, a gym for callisthenics and so on.

Widening your list of social media contacts for the purposes of research can also come in useful a little later on. By seeking opinions at an early stage, you are already raising awareness, encouraging engagement and raising anticipation: the perfect start for promoting your business when it’s ready to launch.

2. Promising your clients more than possible

You may have done your research, but the second pitfall comes when you put those findings to work. In particular, you’ll need to avoid trying to fill a market gap that’s impossible to execute. For example, let’s say that many of the potential customers you have been in contact with are already members of other gyms. Some of these people indicate that they’d be willing to switch for a lower monthly fee – or perhaps for longer opening hours or less crowded peak usage times. At first glance, it might be tempting to model your business around giving these customers what they are looking for. But just be aware, that as a new venture, it’s going to be practically impossible to offer a “better, cheaper” version of the likes of Pure Gym. As a new business, you won’t have the same footfall or the same buying power for things like equipment.

As well as asking “What do people want?” you also need to ask “What can I actually deliver?” This is the essence of business viability. Here are some points to consider to help you with this:

  • Look for areas where you can deliver added value: are there specific groups of potential customers who would be willing to pay a premium for something that’s not easily available already? Examples might include a strong focus on one-on-one attention, or specialising for customers with particular training requirements (triathletes, for instance). By focusing on a premium market, you avoid a race to the bottom, price-wise — something that’s very hard to win against established businesses.
  • Focus on creating a unique experience: chains have to try to be all things to all people. The end result can be a kind of corporate “sameness”; something that the most successful boutique studios tend to reject. Don’t be afraid of being unique in terms of look and feel. It could be just what’s needed to set your gym apart from the crowd.

3. Not weighing up the costs of premises and equipment

Equipment-wise, gym owners don’t generally have the luxury of starting with the bare minimum: keeping the customers satisfied means having a fully equipped studio from day one. To keep your outlay to a minimum, hiring equipment rather than making an outright purchase is a sensible step.

There are plenty of commercial gym equipment hire specialists out there,  but one thing to pay particular attention to is flexibility. If you find in your early days that your cross trainers are lying idle while there’s frequently a queue for the rowing machine, it’s useful to be able to make a swap with minimum cost and hassle.

Rental rather than purchase also makes sense for your premises. However, when considering your options, don’t automatically go for the cheapest option. You’ll need to consider footfall and ease of access if you want your business to grow. Fixed costs (e.g. rental and staff) will need to be paid, even when these exceed fee income. Before opening, you’ll also have fit-out costs to meet. Managing cash flow is essential, which is why it’s definitely worth arranging a small business accountant at a very early stage or using programmes like FreeAgent.

4. Neglecting the admin work

While starting up your own business can be exciting, it’s easy to become swept up in the practical side of the business, that you forget to lay the right legal foundations. If you are moving from a salaried job to self-employment, you’ll need to register for income tax self-assessment.  You will also need to register for VAT and if you plan on hiring staff, you will need to register as an employer. As a gym owner, you are required to follow a host of rules and regulations for providing a safe environment for customers and staff. While this can be a lot to take in, UK Active has a wide range of resources designed to help new industry entrants make sense of it all.

5. Not structuring your business

Whatever look and feel your business eventually takes, you’ll need to reassure customers that you offer a safe pair of hands with the right insurance cover. If you need to apply for long-term funding, it’s also vital to convey a professional image to banks and lenders. And once you’ve established your company name, you may want to think about registering it. Setting up a limited company is the best way to achieve all of this. Best of all, company formation is actually easier, quicker and cheaper than many small business owners think. At Companies MadeSimple, we make the formation process easy — from helping to get your gym name registered to offering accounting & tax consultation.

Despite the potential pitfalls, opening your own gym can be easy with this guide. 

We hope this blog has provided you with some valuable insight into getting your business venture off the ground. 

Are you ready to begin your journey? Form your company today with our company registration package, and start your business journey today.