Having my own digs is something I've wanted for quite awhile now but for a variety of reasons it hasn't been feasible. With the recent move and having taken in a little snapshot of the industry here, I'm thinking it's on the table again - not in the next year, but perhaps within the next 18 months to two years.
Where the industry and market is right now:
NZ is a very active country compared to the US. It's a cooler climate with a culture that involves a lot of outdoors activities. As a percentage, it would appear that more people here are involved in recreational sports and general activity than in the US (though I haven't done any real research yet to back up that claim).
As far as "normal folks", there's several chain gyms that are very popular, and these aren't dissimilar to the US. They target the expected groups, ranging from the typical skinny teenagers and Bros that go for the weights to the overweight folks that gravitate to cardio to the women that come for the various cardio/"shaping" classes.
The same business model applies, right down to the sales scripts and client-retention techniques; income is reliant on volume of members. In general (though again lacking hard data), the willingness to pay for gym memberships and personal training seems to be at least on par with what you'd see in a larger city in the US.
There's definitely a culture of "real lifters" here as well, with a small but thriving group of OLers, strongmen and powerlifters. As expected most of these groups tend to hang out in their respective environments because of the specialized requirements.
There are two CrossFit gyms in Auckland city as well that by all appearances seem to be doing fairly well.
The strength & conditioning field itself seems to be in its infancy compared to the US. There's one company here that's comparable to EliteFTS (though on a smaller scale), and the Institute of Sport handles most of the actual strength-coaching type of stuff; there's little in the way of the private-type facilities for athletics you'd see in the States.
What I'm considering:
I've had some experience in a commercial gym setting, both as sales staff and as management, and frankly one of the big-boy production-line commercial gyms is not what I'm after. I have no desire to run that kind of club environment, nor do I want to compete with the big boys.
On the other hand, the small dungeon of rage that I'd like to lift in isn't really going to be profitable, either, though it'd appeal to that niche of hardcore lifters.
So I'm looking at a compromise, something roughly halfway between the two. The focus would be centered on personal and group/team training, ranging from the traditional one-on-one to small-group and large-group (probably some variation of CrossFit - and yes I'm being serious).
I would also like to offer a comprehensive setup - such as having an in-house physio and/or massage therapist, something of that nature to complement the "training" aspect.
In terms of my target market, I'm seeing a few groups that stick out to me: the beginner-types that just need some direction those first few months to a year; the "just want to have fun" types that would enjoy classes and group-training stuff even if they aren't that "serious"; and then the serious athletes that need to train for their sport/activity (and I wouldn't be snotty about it; this could apply to PLers and strongmen just as easily to any bodybuilders, marathoners, or anything really).
Based on some crude number-crunching I'm thinking I could get away with a pretty modestly-sized facility and a relatively small amount of equipment, especially at first. The core will be built around say 2-4 high-quality racks + OL platforms (probably from Elite FTS's line) and the associated equipment (bars, plates, benches, boxes), with a few extras like a GHR bench, cable tower, DBs and KBs, and strongman implements.
I'll go top of the line as far as some decked out rack/platform setups, but I won't really be looking to go for a lot of (or necessarily any) machines or cardio equipment. Some may be useful, but it'll be lower priority, which I hope will keep equipment costs reasonable.
Space for running and outdoors area would be very nice, if not 100% mandatory.
Where I'm getting stuck:
Obviously I didn't make this thread to just share my book report, so I do have a few questions that I hope some of you more experienced in this area can help out with.
The big problem as I see it is that to compete with some of the Globo-Gym giants around here, I'd have really hustle the marketing angle. I would already be offering the edge to clients and I know it; the trick is getting that across to the client. I can't just bully them from behind a computer screen like I do online (sadly), and having the goods vs. making them believe it is two different things.
Having already done my share of sales in a gym, I know what's involved there, but it does not come naturally to me. I feel like it'd almost be to my benefit to either hire, or find a partner, that's a natural marketing/sales type of personality.
The other thing is location. At what stage of the process should you go looking for real estate?
There's a few confounds here that make the decision interesting. Auckland city has no parking, but going to one of the suburbs would of course remove some of the centrality.
Building from the ground up is just not feasible with the scale I'm looking at and the startup costs I'm hoping to hit. Monthly rent I obviously want low, but not so low that I have to sacrifice location.
Cost-wise I haven't done a ton of research but depending on the area rents for 100-200 m^2 of space seem to range anywhere from 15K to 80-90K per year. Obviously I don't want anywhere near the high-end of that spectrum.
General advice on real estate would be helpful, is what I'm trying to say.
And of course my big stumbling block: marketing research and financial forecasts for the business plan. I don't want to just make things up, so anybody got any good ideas on how to make some reasonably-accurate estimates and pull down data for fitness-type stuff in particular?
I can get access to pretty comprehensive stats on a wide range of demographics from the NZ government, but any more specific help would be great.
NZ has its own tangle of laws, taxation, business requirements and such that I don't expect anybody here to know about; I'll talk to a lawyer and accountant when that becomes necessary.
Any general advice/help/input would be appreciated muchly.
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Oh I forgot to add, part of the business plan would involve putting on seminars/clinics to teach form, programming, and so forth, with the eventual idea being to offer CEUs and whatnot through the national certification system, so that'd tie into having the facility as well and be another potential income source.
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The big problem as I see it is that to compete with some of the Globo-Gym giants around here, I'd have really hustle the marketing angle. I would already be offering the edge to clients and I know it; the trick is getting that across to the client.
I run a small gym in a place where such things don't exist and I don't even try to compete with the big boxes. In fact, I set myself up deliberately as "not them" and that's what gets me clients. So you shouldn't be competing with the Globo-Gyms at all. BTW, I have one about a 10:00 walk away. It's no problem.
To me, one of the most profound things he's said there is, "The same but smaller doesn't work." In other words, if you're going to offer the exact same thing as the Globo-gym but you're smaller, you will lose. Just another place with free weights, machines, and a sauna won't cut it probably.
Second, it sounds to me like you're trying to offer too much with the spa, etc. I would focus on selling the main product -- workouts and classes -- and then add as you get bigger if you want. Get one product to market first -- your main one.
I say that because I hear a lot of big plans that never get off the ground. they're too complicated. If you can't turn a profit in a small, simple business you won't be able to in a bigger one either. But the risk in the smaller is so much less.
Anyway, sorry to preach. Opening my small place was the best thing I've ever done. Good luck.
I would also like to offer a comprehensive setup - such as having an in-house physio and/or massage therapist, something of that nature to complement the "training" aspect.
That's what it sounds like to me. I was simply saying you might want to add stuff on later. But maybe that's just me.
Wish I could help, Matt. My partner and I didn't do research to the degree you're looking at. Earlier this year we opened our own spot and it was pretty much along the exact same lines of what you want.
We simply scoped our location until we found something that was a) affordable and b) prime in terms of visibility and traffic.
Once we found it, it was simply a matter of smart marketing, if you want to call it that.
We decked the place out with top of the line stuff... some elitefts, some power lift. We happened to get lucky in that we have an indoor baseball facility located in the same parking lot/building as us.
Building a relationship with the coach gave us the in to discuss the importance of strength and conditioning and if it's anything like the U.S. over there, parents will throw money hand over fist if they believe their kid has a shot of a scholarship or beyond.
From there we started strategically marketing to local school districts (athletic directors and coaches alike) and it naturally progressed.
We're also doing one-on-one and group training for the gen pop. Hoping to build out the supervised/group training angle much more going forward since we like that model much more considering the "bang for your buck" per hour.
On the gen pop side, I'll tell you what helped us beyond belief. My partner had a full book of business at a local club. I had clients I trained a few local clubs here. Neither of us had non-competes in place. Once we opened up shop, they naturally followed.
So dabbling in the local club scene as a trainer just to get a "following" might be worth your while given your time line, as much as that scene sucks. For us, getting the people in the door was all about strategic relationships. In our area there's just too much competition to rely on flashy marketing, which I wouldn't want to do anyhow.
Putting on some free seminars for specific groups or athletes would be a start.
You have one helluva talent when it comes to writing. I bring it up b/c we started putting out a bi-monthly newsletter strictly to educate. Once the relationships were in place, we were able to distribute the newsletter in a couple of spots which definitely increased our visibility.
In general, for us on the athlete side is was all about showing coaches and athletes what they're missing out on.
On the gen pop side, is was all about selling the intimate relationship with seasoned professionals, which they're not going to find in the big box gyms.
Probably not what you're looking for, but like I said... we sort of jumped in feet first and worried about the rest later. Not the wisest thing, but it worked.
Damn, Matt, why can't you open up that place by ME? I'd come work for you and market the hell out of it for ya!
Seriously, though, getting the word out to schools and their sports coaches would be great. At my gym, there is a separate sports conditioning center (which is where I was able to hire a coach for OL training). They are SO busy they can hardly keep up with all of the baseball, soccer, football, and track kids that want to join for sports conditioning. And, the above poster is right....those parents will pay! Most of the kids appear to be broken into groups either by age or sport, or maybe both. So, let's say groups of 8 appear to be training at one time. Vigorous sports conditioning, OLing, etc. I've even seen coaches from the various schools bring their entire teams in for a beating (um...workout) to see what's being done here. It seems to be a model that's working very well.
Good luck to you, Matt. I know you will do well...I just wish you were closer.
Steve: Why didn't I know you'd opened a place? LOL You gotta keep me informed, bro!
We opened the doors in January.
It was something my partner and I had hoped to do in two years or so. He was training full time at a club outside of Philadelphia and I was training in a couple of local clubs near me. I'm not sure we would've been able to do it without the existing client bases. It would've been too big a hit to income if we started from scratch.
I'll tell you what though... best thing we've ever done. It sort of stopped me from caring about my site but that's fine for now. Clients loved it compared to the chain gyms, too.
Eventually we'd like to upgrade in terms of size and get more equipment but for now we really can't complain given our proximity to the baseball facility. Plus we have a huge parking lot with plenty of room to train clients.
The facility itself is small... literally for two trainers training one-on-one or supervised training where we have 5 or so athletes in at a time.
It's a start.
Have some crappy photos up here. No platforms yet, but we're talking about leasing more space which is when the platforms will come into play. Tons of bumper plates though so we can get away with throwing some weight around.
Neither my partner or myself are sales guys. Not in the least. We figure we'll do one helluva job with the clients and teams we're working with now (including all the touchy-feely stuff no chain gyms are doing) and rely on referrals. Seems to be the ticket so far.
To boot, we weren't training any teams before we got in. Individual athletes here and there, but not whole teams. You can tell from the marketing of our website it's more for gen pop clients. In truth though, most of our time is spent on athletes and teams now. The content of the website simply hasn't caught up yet.
Let me know if any questions come up. Though I'm sure there are plenty of better people to ask given the trial and error approach we're taking. If you ever haul your ass back to the states and you're in the NE... look us up.
Well damn, that's awesome Steve. Looks like you've got a nice spot there, too.
I've been scoping some places out around here, and the good news is that I can get a fair bit of space, say 200-300 sq. m or so, for a "reasonable" price and without compromising too much on location, so that's awesome.
I'm really really seriously leaning towards the "CrossFit" model, as crazy as that may sound; I think they do good things as far as reaching out and appealing to the general public, and the group setting could be easily applied to sports teams as you say.
I got a look at how Rip's doing his Crossfit, and it's actually pretty damn smart - not far off how I've said I'd do it with people, so there is hope for making it non-retarded. Plus the "functional" type of training fits in with the strongman stuff we've been up to lately, so it'd really cut costs by not having to rely on a ton of machines.
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Sounds fine and dandy to me... we actually do some similar stuff at our place in some instances. The global application *is* retarded but undoubtedly there are specific instances where people are applying CF models sensibly.
Anytime you mix a training concept with a good trainer/coach who isn't blinded by "the program" I think things will be fine. It's when you have these guys who throw a total random assortment of exercises and methods with next to no rhyme or reason, individualization, or progression that things get ugly.
Unfortunately I think this happens more than it doesn't.
That's great pricing for space... I'm anxious to see what becomes of this.
Take my advice with a grain of salt. I sold my place after 16 years with many successes and failures. I wouldn't really want to open another one at this point. Mostly because I am training in a very elite little niche and making good money, and I'm thankful that I have little to no overhead.
Along the lines of a CF model, you don't have to go quite as dungeon as they do. I like Go Performance and Fitness personally. Great business model, good training, and very high-end. You are obviously more than qualified to do performance training so I think following the suggestion of missjane is a brilliant idea. The ultimate leveraging of your time... You can train dozens of people at the same time, they get a discount but still get high quality training, and you make about 10X per hour what you or your trainers would make doing 1-on-1 training.
GO is a new franchise so they aren't so expensive yet. If you have read any of my past business travails, you have seen that the one regret I have was not going with a franchise. Not that there was one like this around when I started my business. But the one thing I will say in favor of a franchise like that is that they have worked out the whole package and everything is systematized.
The guy who owns the the franchise is a really good friend of mine. Read about them and if you are interested, let me know and I will give you his cell phone and other contact info. If I ever do it again I am going to open GO franchises.
I think that you are fortunate to have some big box gyms around. They always have frustrated cast-off... People with good income who don't like feeling like just a number. They are actually willing to pay more just to have that personal touch, just to get some attention and some assistance. Your best bet is to locate right between a couple of them.
Echoing what Chesser said, read Thomas Plummer. The guy's a genius. He's made so much money off of small high-end gyms catering to various niche markets, and now he lectures and sells books. They are VERY good though. He's a dynamic speaker and he will not pull any punches with you. He's not a blow-hard trying to sucker you into opening a gym.
I caution against catering to the power-lifting crowd, and it appears that you understand why already. People who are "hardcore" and looking for a hardcore gym almost all share one thing in common. They're fucking BROKE! Don't build a business model that caters to broke people. You'll never make it. You can have that stuff available though. My last gym looked like a typical yuppie gym with machines and treadmills, smoothie bar, TV's hanging from the ceiling, and a group fitness room where classes like Yoga and Pilates were taught, but it also had substance. I had a 50' track for dragging sleds or flipping tires, I had power rings and sledgehammers and kettlebells and resistance training bands and LOTS of squat racks (where I made all my clients do their curlz ).
Either way, good luck with your endeavor. I may be able to spare you from many mistakes if you read all the stupid mistakes I made and try to avoid them.
Great thread, and thanks for the info JP. I'm thinking about heading in that direction sooner or later.
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Awesome, I was hoping you'd chime in JP. Thanks for that.
I've been reading through Plummer's blog after Dave linked it, and I really like his thought process. I can see a lot of what he's saying about the club side of things from my own time doing it. Imma have to buy his books.
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Looking at the Go Fitness page brings up an important point that's relevant to the thread and those of us with small gyms. The Go Fitness studio model is basically a Crossfit-looking facility with some sort of related programming. A few pics and short clips aren't enough to figure out the programming being used, but it looks pretty similar.
But if you're going to look like Crossfit and work out mostly like Crossfit, then wouldn't it be of benefit to actually be either Crossfit certed or affiliated? That way you could at least benefit from the association.
I say that for a number of reasons. Obviously Crossfit has hundreds of affiliates and has name recognition. Not so sure about Go Fitness. And if you're going to use squat racks, kettlebells, wall balls, plyo boxes, etc. for metcon workouts, then why not be associated with the organization that spearheading that movement?
I understand the drawbacks very well and not saying I love everything about Crossfit. But for small gym owners looking to offer an alternative, maybe it's a more surer route to success?
Actually Dave quite a few CF joints are dropping their affiliation. Lawsuits and bad PR + being uninsurable (recently spoke with a local CF guy about this) the fact that some affiliate owners who actually know something about fitness have been ostracized and/or unwilling to drink the kool-aid.
What does it say about the industry that facilities using more athletic styles of training are branded CF-esque? Pays to be loud I guess.
Anyway, Plummer is a great resource. His keynote at the last PB Summit touched on this very topic. He mentioned that 2-3,000 square feet with small group training is the facility of the future.
I'd also look at CATZ, Monkey Bar, and Results Fitness, and DiLuglio's place as good models.
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Working "hard," or the perception of working hard, doesn't really mean anything. Sweating, vomiting, and breathing hard could be a good workout or a tropical disease kicking in.-Dan John
But yeah, when I say CrossFit I'm only using it as an example - the whole concept of "functional" (ugh) training in groups.
Rippetoe's approach to that model is actually really sound and very close to what I've suggested to others in the past (mainly, separating the strength sessions from the conditioning sessions and use a more methodical progression).
Obviously I'm not going to copy most of the details, but the basic theme is more what I'm looking at - it'll bring in the bling and serve as the financial underpinnings so I can do what I really want the rest of the time.
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Actually Dave quite a few CF joints are dropping their affiliation. Lawsuits and bad PR + being uninsurable (recently spoke with a local CF guy about this) the fact that some affiliate owners who actually know something about fitness have been ostracized and/or unwilling to drink the kool-aid.
So the consensus of you guys in the US is that we're moving into a post-Crossfit era in which small functional fitness places can make it?
God I hope so. I'm betting on it, afterall. I know Mountain Athlete, Gym Jones, MonkeyBar Gym, etc. are all doing well with functional fitness but being in Asia, I can't always see the trends in the US so clearly.
This is important for the OP and guys like me in Asia. Crossfit hasn't even made it here (but it has to NZ I guess) and I'm already moving past that model.
I was thinking of holding my nose and going CF (anything to feed my kids) but I'd rather just stick it out. That may be the way for us smaller gyms.
Yeah there's two here in Auckland and they're in 'straya too. One opened up in Darwin a few months before we left, and I know there's several others, in Brisbane and Sydney for sure and a few more around.
Plummer seems to think that's where things are heading going by his blog, and I can't say I disagree.
Some of the guys we do strongman with train their clients with what amounts to strongman-meets-Crossfit, and they seem to be fairly popular. I could easily rig up something with that kind of spin on it, throw in a little OLifting and PLing to round it out, and you've got a winner.
I'm gonna take a look at that GO franchise as well. That could be worthwhile.
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I'm in the process of opening up my first facility that basically fits exactly what you and stroutman are doing/going after. The main things I am building my facility and marketing are 1)the ability of workouts to be fun/different while getting better results than a globo-gym trainer 2)cheaper price since my overhead is really low, 3)individualized programming for each client.
I have prowlers, chains, different bars, ropes, that help me make workouts fun, challenging, and different than what any client can get at a globo-gym.
I'm also promoting it mainly (the adult side as I'm running a sports performance S&C side as well) as small group 4 or less personal training to help with motivation and intensity. This helps me lower the cost per client (I'm still offering 1-on-1 training but only during certain hours) while making sure each client in the group gets better results than they would at a globo gym. It doesn't hurt to market it as "x% cheaper than local gym personal training with guaranteed better results".
Also don't worry about becoming a CF affiliate but do worry about getting your website optimized to if someone types in "Crossfit NZ, or Crossfit (specific location)", your gym will pop up in the search. I am designing mine to pop up when people type in Crossfit Houston, Crossfit Cypress, Boot Camp Houston, and Personal Training Cypress.
I have also hit up many of the local health spas, hair salons, tanning salons, high end clothing boutiques in my area to drop off brochures since those are the types of clientele that has the money (and cares about their body to actually make changes) to pay for sessions and stick with it.
Then on the sports performance side I have approached the local high school football coaches and athletic directors to talk about helping set up their off season training programs free of charge. This way I can go back and push letting me run their off season/summer S&C camps because they will get a continuation of their off season training for better results. Then running the camps gives you a chance to go promote your facility more and more to individual athletes whose parents you know already are willing to pay for sports performance training.
I hope this helps and I have some other ideas as well that I haven't tested yet so I don't really want to say them and have them totally blow up in my face and anyone elses to tries them
Good Luck in your venture and just try to keep it as different, motivating, high energy, and results driven (instead of financially driven) compared to globo-gyms and word should spread quickly about what you have to offer.
David,
Going the cheaper route didn't work for me and I wonder if it will for you either. I know it's hard to believe but what the marketing books say about perceived value is true, at least in my experience. When my prices were too low, people didn't seem to value what I offered. I raised prices and more people stayed. My privates increased, too.
Low prices also were leading me to burnout. I couldn't be motivated to show up and train people knowing I couldn't make a living off of it, ever.
Third, I've heard of some of the big box gyms charging as little as US$15 a month for unlimited access. I would seriously doubt you could compete with that long term and still offer high quality.
Yeah, looking at what I'm after - a smaller training-oriented facility - I don't think there's any point in trying to compete with the big-boxes on price, because they'll always beat you on that.
I'd be after a different clientele from the outset, so I'm not sure I see any point in running a price-war like that. The people I want to train aren't going to be after the cheapest price, for one thing (meaning, if they're concerned about price over quality, I have no time for them).
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David,
Going the cheaper route didn't work for me and I wonder if it will for you either. I know it's hard to believe but what the marketing books say about perceived value is true, at least in my experience. When my prices were too low, people didn't seem to value what I offered. I raised prices and more people stayed. My privates increased, too.
Low prices also were leading me to burnout. I couldn't be motivated to show up and train people knowing I couldn't make a living off of it, ever.
Third, I've heard of some of the big box gyms charging as little as US$15 a month for unlimited access. I would seriously doubt you could compete with that long term and still offer high quality.
But please let us know how it goes.
It's not really the cheaper route though as I'm taking 4 clients all in the same session @ 300 a month/12 sessions compared to 1 client @ 500 a month/12 sessions(which is what the average globo-gym around here charges).
For me I'm still making plenty of $$ hourly but its still individualized enough that I can represent it as personal training and total personalization.
I'm not talking about totally undercutting everyone, but it makes it a lot easier saying personal training rates are 40% cheaper than the big gyms in my area.
I guess I misworded what I meant and came across as trying to concentrate solely on price battles.
Yeah, looking at what I'm after - a smaller training-oriented facility - I don't think there's any point in trying to compete with the big-boxes on price, because they'll always beat you on that.
I'd be after a different clientele from the outset, so I'm not sure I see any point in running a price-war like that. The people I want to train aren't going to be after the cheapest price, for one thing (meaning, if they're concerned about price over quality, I have no time for them).
I got really worried when the big box down the street cut their prices to nothing recently. I was even more afraid when a student mentioned those prices in my class because that price included yoga classes, aerobics, etc. Much more than I can ever include. I couldn't breath for about a minute after he said that.
But another student brought up that the classes/training is very impersonal, the trainers there are rarely in shape (I practice what I preach), and there's almost no correction given at the big box.
And I've noticed that about the big boxes: they always cut prices but NEVER increase service or offer anything the least bit innovative.
As a small gym, I can reverse directions on a dime. And they will never offer the kind of service I can offer.
So yeah, just like to reinforce the idea of not getting into a price war, or ad war for that matter, with the big boxes. You'll lose for sure.
Man...I've been dreaming about this, too. There's a building right across the street from my apartments that looks to be vacant. It looks like a nice size for a training facility... big enough, but not too big. Tall ceilings and lots of room. It sits next to the street, right in front of -and sharing a parking lot with - an ice rink that people jam into every evening to train for hockey. And right next door is the Peoria Sports Complex where the Mariners and the Padres do spring training.
The people I want to train aren't going to be after the cheapest price, for one thing (meaning, if they're concerned about price over quality, I have no time for them).
I had a GM at Gold's in Oregon that would blow people right back out the door when they started talking about what another gym cost or trying to negotiate price. He would say, "We're not the WalMart of fitness, and with the quality facility we have here, we don't need to be. If that's what you're looking for, then you'll probably want to go somewhere else."
I had a GM at Gold's in Oregon that would blow people right back out the door when they started talking about what another gym cost or trying to negotiate price. He would say, "We're not the WalMart of fitness, and with the quality facility we have here, we don't need to be. If that's what you're looking for, then you'll probably want to go somewhere else."
Almost identical to what I told prospects who tried to negotiate our price down to the competition. I would say that if they were shopping price then we may not be what they are looking for, but if they were looking for quality training and world class customer service then they were in the right place.
So let's talk business (or, opening a facility)
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