Fitness is your passion, and you're tired of working for someone else.The idea of striking out on your own and opening your own studio isgetting harder to ignore. Before you convince your clients to follow youto the new space, here are eight things you need to know to become asfinancially fit as possible:
Pinpoint Your Audience
Like in any business, you need to figure out to whom you want to cater.Will it be parents who need to work around their children's school andsports schedules? Will it be professionals who will work out before andafter their jobs? Will you be a studio focused on one discipline orseveral? Your audience will influence where you set up shop.
One of your biggest expenses is rent. So choose wisely. It took
franchise creator Kimberly Fowler more than a year to findthe right space. First, she researched the studios that already existedin the area for possible conflicts. She also had to find a location thatallowed for lots of people to come to and fro.
"You're a mass assemblyplace," she explains. "We have 100 people going in and out at one time"for the 120 spinning and yoga classes each week. For 3,100 square feetin Venice, Calif., she pays $13,000 a month.
To make the most use of the space, she closes it down for only two hoursin the early morning so it can be cleaned.
Keep a Tight Ship
For most fitness companies, the next biggest overhead cost is staff. Youwant to attract the best teachers. That in turn brings in the most loyal-- and best-paying -- clients. But paying employee benefits can take ahuge chunk of your profit.
To cut her overhead in this area, PamelaWarshay, owner of
, treats her Pilates andGyrotonic instructors as independent contractors. It is theirresponsibility to find their own clients and set up their own hours.They simply rent her studio for the hours they need.
She says she structured her business this way because she alsorecognized that students tend to follow their teachers. So why wastemoney on training only to have the instructor eventually leave, takingtheir clients with them?
Gregory Florez, CEO of
, agrees, adding thatif they're not staff, then you aren't responsible for their training,certification and ongoing education.
"Although you have less control, ifyou are good at spotting talent and offer good incentives, I recommendstarting out with contractors because it's less risky. You can always,as the cash flow starts, change from contractors to employees. It isharder to do it the other way around."
To Lease or to Buy?
The cost and maintenance of equipment is the third-largest overhead costyou'll have. Deciding whether to buy or lease equipment depends on yourbudget and your goals. Warshay opted to purchase her Pilates andGyrotonic equipment over time, as her studio got bigger. Price tag:between $3,500 to $5,500 each. To keep the machinery running smoothly,she does most of the maintenance herself. For the heavier lifting, shehas a handyman on speed dial.
Fowler, meanwhile, recommends her franchisees sign a three-year leasingcontract. "After three years, you don't want those spinning bikes," shesays. "You don't want to lose your reputation because your bikes arecrappy."
Whichever route you choose, be sure to shop around, says Florez. Themarket for exercise equipment is very competitive and you may find somesteals.
Because injuries may happen, experts advise that you sign up forinsurance. Make sure the policy covers the studio space and, if you havestaff, the instructors. If your teachers are contractors, they must havetheir own policies.
How to Grow
A studio can only hold so much equipment and juggle so many classes. Andyou can only teach for a certain number of hours before being physicallyburned out. So how can you keep the momentum going? You can invest inanother space, add a retail space and sell clothes, or develop DVDs andwrite books.
Another option is to franchise, like Fowler. For Warshay,the answer was to branch into training golfers and holding clinics atthe golf hotspots. "That way, I am not married to a physical space," sheexplains. "I'm trying not to put all my eggs in one basket."
Know the Bottom Line
Starting your own fitness studio is not a cheap endeavor. If you dreamof being the state-of-the-art, go-to studio for your market, expect toshell out $500,000, says Florez. But if you're creative, it could be aslittle as $30,000. How creative? Florez says when looking for a space,consider a mixed-use building and then barter with the landlord: You'llteach the tenants for free or at a discount for no or low rent.
If you have a story idea, email Lan.email@example.com.
Lan Nguyen is a freelance writer based in New York City. She has written for the New York Daily News, The Wall Street Journal, Worth magazine and Star magazine.