Being a fitness biz owner can be hard.
There are lots of expenses and I understand how it can feel like you’re just spinning your wheels sometimes. Money seems to go out just as fast as it comes in.
There’s insurance, continuing education, rent, and if you’ve moved beyond being a one man show, payroll. Of course, we also want to keep our facilities up to speed and that means buying new equipment.
The good news is there is hope. I believe, without a doubt that you have a vision that can be achieved. You can absolutely do what you love AND be rewarded for it. You can have a nice looking facility and growing business that isn’t perfect but pays the bills and then some.
I’m going to share with you a simple but effective plan that will help you purchase the equipment you desire without going into debt over it.
First, a little background. 10 years ago, my wife and I hit rock bottom financially so I know what it’s like to be stressed about money. It’s not fun. Without going into all the details, that experience taught me some valuable lessons that have served me well. I’m hoping these lessons will serve you also
This isn’t the sexiest idea but it takes time to reach your vision. When I asked my friend Daniel how he got such a beautiful facility, I realized it was an “overnight success” that took 10 years. There were several expansions and upgrades and struggles through the years.
When I first opened the doors of my current business in 2010, I had less than no money. Since I didn’t want to spend money I didn’t have, I relied on innovation. Nice equipment certainly wasn’t our selling point. We highlighted the community as well as the results. Since our budget was so tight, we actually had people bring their own equipment! I had 1 med ball and a jump rope. Other than that, people would bring some dumbbells and we would get after it. I used my background in martial arts to innovate and programmed a lot of body weight exercises. People loved it and were happy to invest $200 per month in this new low budget but passionate business.
I’m not saying I’d do the same thing if I had to do it all over but I just want to drive home the point that we will never be able to compete with the big clubs on equipment. Sure, over time we can and should improve our business but that can’t be our differentiator.
Limitations Fuel Innovation
I was recently talking to a fitness business owner who was planning on purchasing some new treadmills. The ones she had were broken and she felt she needed them to help condition her hockey players.
I explained to her that there was a fine line between wants and needs. Many times what we think is a need is actually a want. It’s perfectly OK to want something but it’s important to understand and acknowledge the difference. In her case, this was crucial because she didn’t have the cash and was planning on financing the equipment.
I asked her what some other options she might have to condition her athletes. She began rattling off everything from body weight conditioning to lateral sliders/skaters. We agreed these would actually be better options for her clients.
I’ve come to understand that being limited can be a good thing. It leads to innovation. Our clients are always saying they love the creative non-conventional things we do as opposed to just having fancy machines.
The Equipment Fund
I used to struggle with being able to pay for the equipment we wanted and needed. Some months would be tight and dropping and extra 1 to 2K just wasn’t an option.
That’s when I decided to open up a special bank account for equipment and other purchases. While it might be difficult to come up with two thousand dollars at the end of the year, transferring $166 into an equipment/stocking fund is much more manageable. While you would feel the 2K, you probably wouldn’t notice the $166 being transferred.
Let Your Clients Fund Your Expansion
Here’s an idea that you would want to be careful with but it’s worth mentioning.
Rather than borrow money from someone or finance equipment, why not partner with your clients?
Your clients believe in what you do and would most likely be happy to help.
Here’s what you can do. Let’s say you have 50 clients paying $200 per month. If you can get just 2 of them to pay you up front for the year, that’s almost 5K cash. Perhaps you can give them an extra month or 2 as an incentive.
Again, you don’t want to go overboard with this as you’ll kill your cash flow. However, in a pinch I think it’s worth considering. You just have to know your numbers.
Never Pay Full Price
When I first started my gym, I saved a ton of money by both negotiating and buying used. Here are some examples:
- I bought suspension trainers off Craigslist
- I bought a squat rack from a private client who didn’t need it anymore
- I bought a used computer for just $100
Many people think they need to have world class beautiful equipment when they open up. Over time, you can purchase nicer things if you want to but never overextend yourself to do so. Apply the power of buying used and negotiating. You and your clients will appreciate your humble beginnings and investing over time.
Being in business and managing cash isn’t easy but it can be done successfully.
It’s important to really think big spending decisions over. Remember, every time you say yes to buying something, you are saying no to buying something else. This is referred to as opportunity cost. Is that $900 rower the absolute best way to spend almost a grand? Perhaps it is and if so, fantastic. I just urge you to not to rush into spending your hard earned money on things that may or may not have the return you’re looking for.
You can have the business of your dreams. It just takes time, discipline, and innovation!