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TABLE OF CONTENTS
CREATING A FINANCIALLY FIT AFFILIATE GYM 3
DEMOGRAPHICS 9 COUNTRIES 10 GENDER 11 BUSINESS SIZE 12 TIME IN BUSINESS 13
FINANCIALS 14 PROFIT & LOSS STATEMENT 15 AVERAGE REVENUE AND EXPENSE 16 PERCENT OF TOTAL MEMBERSHIPS GIVEN DISCOUNTS 18 DISCOUNT PERCENT BY DISCOUNT TYPE 19 PERCENT OF DISCOUNT TYPE OFFERED 20 HOW OWNERS PAY THEMSELVES 21 STARTUP CAPITAL 22
FACILITY SIZE 23 MEDIAN FACILITY SIZE 24 MEDIAN SQUARE FEET PER MEMBER 25 AVERAGE RENT PER SQUARE FOOT 26
MEMBERSHIPS 27 TYPES OF MEMBERSHIPS OFFERED 28 AVERAGE MONTHLY PRICE OF MEMBERSHIP 29 PERCENT OF MEMBERS ON AUTOPAY 31 AUTOPAY CONCERNS 32 METHODS OF PAYMENT COLLECTION 33 MEMBER RETENTION 34
CLASSES 35 AVERAGE CLASS SIZE 36 WEEKDAY CLASSES PER DAY 37 TYPES OF CLASSES OFFERED 38
STAFF 40 MEDIAN NUMBER OF COACHES 41 MEDIAN MEMBERS 42 MEMBER-TO-COACH RATIO 43
COMPETITIONS 44 TYPES OF COMPETITIONS HOSTED 45 CROSSFIT® OPEN PARTICIPATION 46
ABOUT THIS SURVEY:The following findings represent data provided by 378 individual survey responses.
Leaders are defined as affiliate gyms that generate at least $7,000 in monthly profit.
3
For the second year in a row, I’ve had the pleasure of reviewing business metrics from a
large group of affiliate gyms located throughout the world. One thing still rings true and the
numbers don’t lie: a financially strong business is the cornerstone to running a successful
affiliate gym. Regardless of the energy of the coaches, the structure of the classes or the
correlating workout and meal plans, if the money isn’t there, the gym won’t be either.
We explored several of the same topics and themes this year that we did last year, and also
asked some new questions this year to dig deeper into various financial, operational and
emotional aspects of owning a business. We again created two financial groups from this
data. Group 1, the Leaders, is classified as financially thriving, generating at least $7,000 per
month in net income. Group 2, the Laggards, is at the other end of the spectrum and contains
affiliate gyms that are losing money each month. To qualify, each affiliate gym needed to be
in business for at least 12 months. This eliminates the startup period required to get a business
up and running.
If you participated in the survey, thank you; I hope this data simplifies the countless business
metrics you could be tracking and puts into perspective how gyms like yours operate. For those
who didn’t have the opportunity to provide data this year, I hope you take the initiative to compile
your financials and take steps towards making your business financially fit in the coming year.
Here is what I found…
I am lucky that I get to speak directly with affiliate gym owners
from around the world on a daily basis. Not only do I get to learn
about their passions for their industry and community that surrounds
them, I also get to learn about their software needs. It never ceases
to amaze me the multitude of ways owners choose to operate
their business within the same general industry. While a lot of the
terminology and equipment might be similar, each box seems to run
with its own set of plans.
CREATING A FINANCIALLY FIT AFFILIATE GYM
FROM PHIL STERN, GENERAL MANAGER, ZEN PLANNER
4
Leaders charge for the value of their service and don’t discount
In the prior year we pointed out that Leaders charge higher prices. I want to modify this
statement slightly by saying this has greater meaning than simply charging more. This is
ensuring you are charging for the value of the service you are providing. You are not a “big box”
gym with members you’ve never even met. You are in the business of relationships, providing
one-on-one and group training catered to the needs of your members. You deliver the best
possible results so members of your community are able to achieve their personal goals.
With that said, Leaders charge higher prices across the board for all membership types. Leaders
charge a median price for unlimited memberships of $165 per month versus $128 for Laggards.
While this is slightly less of a range than we saw in the prior year ($172 vs. $133) the value can
add up. With even 100 members, that is a monthly variance of $3,700 and an annual variance of
over $44,000.
Another key factor of effective pricing is how much you’re discounting your original membership
prices. When we look at the average revenue per member for Leaders as compared to Laggards,
the variance becomes astounding. Leaders get, on average, $145 per member each month
where Laggards only get $66. Members remain loyal because of the results you generate and
community you’ve built, not the discounts or deals you throw their way.
CHARGE MORE & AVOID DISCOUNTS
Median unlimited membership
Revenue per member
$165
$128LAGGARDS
LEADERS
$145
$66LAGGARDS
LEADERS
5
Leaders efficiently manage overage costs
Last year I focused primarily on the importance of managing personnel costs and I want to
reiterate this point. Staffing needs and those associated costs is by far the most emotionally
driven expense you will encounter in your business. You want to retain the right people and
to do so, you need to pay them well. This is also consistently one of the highest costs in the
business with roughly 20-30% of your monthly revenue allocated to covering this expense. I
do, however, want to take a step back. While personnel costs are a large chunk of the monthly
budget and one of the toughest to manage, they are again, just one of many necessary
expenses for your business. While this may sound obvious, one thing I’ve come to realize in my
position is that not all business owners are finance professionals. What do I mean? The concept
of balancing revenue coming into the business with expenses going out is not always as simple
as it appears. This requires maintaining financial records and detailed expenses which is a
crucial step that many busy gym owners do not make time for.
For example, this means knowing exactly what you spend on your business on a monthly basis.
Remember, this is actual spend, not “ideally I would like to only pay…” This requires you to keep
an ongoing record of your expenses broken out by category, such as classes, retail, personal
training, etc. Likewise, how much revenue are you bringing in? Again, this is not “I have 50
members and I advertise that I charge $170 a month.” This is how many members you have
for each membership type you offer and how they actually pay you for that membership on a
monthly basis. This is where you’ll need to look at all of the discounts you’ve offered. Leaders are
profitable and Laggards are not, and in large part it can be attributed to this simple fact:
I realize, too, that businesses are not going to be profitable the moment the ribbon is cut off
the door; there are expenses that need to be paid and members that need to be acquired.
However, knowing your numbers and where you stand on a monthly basis will drive the
business decisions you need to make to put your gym in the green.
UNDERSTAND YOUR FINANCES
Leaders know their numbers.
6
Leaders make great use of their space
The second largest cost, next to personnel, is your facility costs. Again, we found that Leaders
make better use of their space. Last year we uncovered a key metric in determining the health
of your business: median space per member. This essentially means how big your gym is versus
how many members you have. Last year we found that Leaders have fewer square feet per
member than Laggards. This year, that trend remained consistent with Leaders averaging 26
square feet per member and Laggards averaging 49 square feet per member. For reference,
last year Leaders averaged 26 square feet per member and Laggards averaged 42 square feet
per member.
We know that a brand-new business is not going to fill its classes immediately. But for any
business, space to member ratio is a critical indicator of the health of your gym. You need to
determine the specific amount of space you can comfortably own or rent to provide enough
room for your members to get the best workout possible. You must also take into consideration
that larger spaces cost more to rent, heat and maintain, and that you will not have all of your
members in every class.
OPTIMIZE YOUR SPACE
Median square feet per member
49 sq ft 26 sq ft
LAGGARDS LEADERS
7
Leaders have more members
Last year we found that the average member base for Leaders was 215 while Laggards was
around 140. This year Leaders have an average of 189 members, where Laggards have 61 members.
While the median numbers for both groups are lower than they were previously, it is important
to understand the relative nature of this metric to your overall business. In other words, getting
more members isn’t always the answer. Balancing your membership and your expenses is more
important to ensuring your success. And it’s important to remember that the cost to market
and acquire a new member is always going to be more expensive than keeping the members
you already have. Listen to the needs of your members, make your class times convenient, keep
your programming up to date and remember that variety is key to keeping your members
motivated and coming back.
BUILD A STRONG COMMUNITY
Median number of members
189
61LAGGARDS
LEADERS
8
FINAL THOUGHTS
Although it is easy to get caught up in the complexity of running your own affiliate gym,
if you focus on the fundamental business drivers outlined above, you will be well on your way
towards achieving financial success. I, and the rest of the Zen Planner team, would love to
answer any questions you may have to help you with your business needs. We look forward
to hearing from you.
Sincerely,
Phil Stern
General Manager, Zen Planner
Phil Stern is the General Manager of Zen Planner. He has three main
passions in life: family, mountain sports and building teams of great
people to grow businesses.
Phil cares deeply about small business success and works closely with
Zen Planner’s customers, partners and team members to ensure our
customers hit their business goals and achieve wild success. To this end,
Phil is an advisor and mentor to startups in Denver and Boulder. Phil also
blogs and delivers webinars about how fitness business owners can grow
their businesses without employing hard sales tactics and discounts.
Phil lives in the foothills of Colorado’s front range with his wife, son and
dog. He earned a BA from Bowdoin College.
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DEMO
GRAPHIC
S
10
10%CANADA
7 1%UNITED STATES
10%AUSTRALIA/NEW ZEALAND
4%EUROPE
5%OTHER
COUNTRIES (percentage of respondents)
11
GENDER (percent of members)
45%MALE
55%FEMALE
12
BUSINESS SIZE Business size is a designation determined by Zen Planner based on member count and its
relation to facility size and Profit and Loss Statements.
Throughout the remainder of our findings we have referred to facilities with 1-75 members per
location as “Small” (31% of respondents), 76-200 members per location as “Medium” (56% of
respondents) and 201+ members per location as “Large” (13% of respondents).
S M L1–75 76–200 201+
Respondents
Total number of members
S: 31%
M: 56%
L: 13%
LMS
13
S
M
L
<1 YEAR
<1
<1
<1
1-2
1-2
1-2
1-2
3-4
3-4
3-4
3-4
5-6
5-6
5-6
5-6
6+
6+
6+
6+
TIME IN BUSINESS(in years)
32%
6%
8%
2%
27%
21%
24%6%
9%
23%
37%
33%
17%
19%
9%
14%
9%
22%
51%
31%
14
FINA
NCIALS
15
Small Medium Large LEADERS
Revenue
Memberships $4,487 $12,121 $27,843 $23,628
Drop-ins $122 $193 $430 $505
Merchandise $243 $733 $1,650 $1,779
Events $98 $82 $125 $185
Personal training $402 $923 $2,718 $2,395
Other $93 $184 $826 $757
Total Revenue $5,445 $14,236 $33,592 $29,249
Expenses
Rent/mortgage $2,270 $3,738 $6,865 $5,060
Payroll $972 $4,167 $11,612 $8,880
Utilities and building expenses $278 $603 $963 $639
Equipment $184 $288 $458 $452
Certification/professional fees $100 $164 $232 $229
Marketing expenses $130 $275 $463 $344
Insurance $108 $183 $546 $296
All other expenses $223 $741 $1,246 $1,096
Total Avg Expenses $4,265 $10,159 $22,385 $16,996
Avg Monthly Profit $1,180 $4,077 $11,207 $12,253
PROFIT & LOSS STATEMENT (monthly average in $USD)
16
$109REVENUE
EXPENSE $85
REVENUE $116
EXPENSE $83
REVENUE $121
EXPENSE $81
REVENUE $155
EXPENSE $90
AVERAGE REVENUE AND EXPENSE(per member)
S
M
L
17
Rent/Mortgage as a Percentage of Revenue
Payroll as a Percentage of Revenue
Sum of All Other Expenses as a Percentage of Revenue
S: 42%
M: 26%
L: 20%
: 17%
S: 18%
M: 29%
L: 35%
: 30%
S: 19%
M: 16%
L: 12%
: 10%
LMS
LMS
LMS
18
PERCENT OF TOTAL MEMBERSHIPS GIVEN DISCOUNTS
S: 31%
M: 28%
L: 26%
: 30%
L
M
S
19
DISCOUNT PERCENT BY DISCOUNT TYPE(average discount on standard membership cost)
Fire/Police/EMT
16%OFF
Other
25%OFF
18%OFF
Student
14%OFF
Teacher
15%OFF
Military
20
PERCENT OF DISCOUNT TYPE OFFERED(percentage of affiliate gyms that offer the following discounts on their memberships)
67%
Student
Teacher35%
76%
Military
Other
76%
32%
Fire/Police/EMT
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Fixed Salary
Profits
Both
25%
42%
33%
27%
13%
60%
HOW OWNERS PAY THEMSELVES
AVG
AVG
AVG
22
STARTUP CAPITAL(average startup capital is $56,543)
4%FINANCE COMPANY
17%BANK LOAN
24%FRIENDS & FAMILY
8%OTHER
47%SAVINGS
23
FACILIT
Y SIZ
E
24
MEDIAN FACILITY SIZE
2,500 sq ft
6,000 sq ft
S LM
3,900 sq ft
5,000 sq ft
25
MEDIAN SQUARE FEET PER MEMBERThis has been determined by the median facility size divided by the median number of members per business size.
S LM
50 sq ft
32 sq ft
22 sq ft
26 sq ft
26
United StatesS: $4.61
M: $12.28
L: $23.58
CanadaS: $1.56
M: $19.24
L: $15.20
AVERAGE RENT PER SQUARE FOOT(average in $USD)
EuropeS: $7.06
M: $10.75
L: $34.75
OtherS: $21.32
M: $32.19
L: $21.10
Australia/New ZealandS: $19.59
M: $21.46
L: N/A
27
MEM
BERSHIPS
28
UnlimitedS: 57%
M: 66%
L: 63%
: 61%
2x Per WeekS: 6%
M: 4%
L: 5%
: 5%
1x Per WeekS: 3%
M: 1%
L: 0%
: 1%
TYPES OF MEMBERSHIPS OFFEREDBelow you will find the percentage of total members that are on each type of membership option.
BeginnersS: 3%
M: 3%
L: 1%
: 3%
Drop-InS: 3%
M: 2%
L: 2%
: 1%
3x Per WeekS: 20%
M: 16%
L: 21%
: 21%
OtherS: 4%
M: 2%
L: 2%
: 3%
Punch CardS: 4%
M: 6%
L: 6%
: 5%
L M S
L M S
LMS
LMS
LMS
LMS
L M S
L M S
29
$59
$42
$55
1x Per Week
$37
S
M
L
AVERAGE MONTHLY PRICE OF MEMBERSHIP(in $USD)
$132
$176
$136
Beginners
$162
S
M
L
$88
$90
$123
2x Per Week
$97
S
M
L
$124
$115
$140
3x Per Week
$143
S
M
L
30
$18
$18
$19
Drop-In
$20
S
M
L
$118
$133
$129
Punch Card
$141
S
M
L
AVERAGE MONTHLY PRICE OF MEMBERSHIP
$168
$135
$156
Unlimited
$159
S
M
L
$59
$104
$80
Other
$140
S
M
L
31
PERCENT OF MEMBERS ON AUTOPAY
United StatesS: 76%
M: 90%
L: 94%
CanadaS: 61%
M: 79%
L: 84%
EuropeS: 44%
M: 47%
L: 51%
OtherS: 0%
M: 33%
L: 32%
Australia/New ZealandS: 85%
M: 76%
L: N/A
LEADERS: 87% AUTOPAY
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AUTOPAY CONCERNSWhile the majority of the member base at Leader gyms is on autopay, here are the reasons members have declined to enroll in this popular payment method.
8%DON’T SEE THE BENEFIT
12%SECURITY CONCERNS
16%OVER-DRAFT CONCERNS
64%OTHER(preference, forget to update cards, autopay not offered in region)
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METHODS OF PAYMENT COLLECTION
United StatesCredit card: 75%
ACH: 33%
Cash: 7%
Checks: 10%
CanadaCredit card: 73%
ACH: 25%
Cash: 12%
Checks: 11%
EuropeCredit card: 51%
ACH: 72%
Cash: 31%
Checks: 0%
OtherCredit card: 45%
ACH: 76%
Cash: 48%
Checks: 5%
Australia/New ZealandCredit card: 42%
ACH: 62%
Cash: 9%
Checks: 0%
34
MEMBER RETENTIONChurn is the percentage of total members lost each month, while Net is the percentage of total members added each month minus the percentage of members lost each month.
10%
7%
7%
5%
ADDED
ADDED
ADDED
ADDED
CHURN
CHURN
CHURN
CHURN
4%
3%
3%
3%
NET
NET
NET
NET
6%
4%
4%
2%
S
M
L
35
CLASSES
36
AVERAGE CLASS SIZE(average number of members per class)
S
M
L
6
10
14
11
37
WEEKDAY CLASSES PER DAY(average number)
5
7
7
7
S
M
L
38
TYPES OF CLASSES OFFERED
BeginnersS: 72%
M: 73%
L: 66%
LMS
Boot Camp(Community WOD)
S: 33%
M: 40%
L: 49%
LMS
WODS: 81%
M: 87%
L: 77%
LMS
Olympic LiftingS: 33%
M: 52%
L: 53%
LMS
Open GymS: 67%
M: 67%
L: 74%
LMS
KidsS: 22%
M: 36%
L: 47%
LMS
39
TYPES OF CLASSES OFFERED
KettlebellsS: 10%
M: 10%
L: 15%
LMS
Mobility(Yoga/Stretching)
S: 26%
M: 36%
L: 40%
LMS
GymnasticsS: 8%
M: 16%
L: 21%
LMS
EnduranceS: 14%
M: 17%
L: 30%
LMS
Competitors(Advanced Class)
S: 13%
M: 27%
L: 38%
LMS
Non-Barbell (BodyFit/HIIT)
S: 17%
M: 16%
L: 38%
LMS
40
STAFF
41
MEDIAN NUMBER OF COACHES
S: 2
M: 4
L: 5
: 5
42
MEDIAN MEMBERS
S: 50
M: 123
L: 278
189 :
Equals 10 members
43
MEMBER-TO-COACH RATIO
S: 25 : 1
M: 31 : 1
L: 56 : 1
38 : 1 :
Equals 1 member
44
COM
PETITIO
NS
45
TYPES OF COMPETITIONS HOSTEDPercent of businesses that host competitions as compared to other businesses their size.
WOD competitions
Weightlifting competitions
Percentage of gyms that do not host competitions
S: 18%
M: 40%
L: 37%
: 40%
S: 5%
M: 13%
L: 19%
: 16%
S: 77%
M: 47%
L: 44%
: 44%
LMS
LMS
LMS
46
CROSSFIT® OPEN PARTICIPATION(average percent of members who compete in the Open)
S: 33%
M: 40%
L: 30%
: 34%
L
M
S
47 zenplanner.com
Lead your box to success with Zen Planner.
Zen Planner makes affiliate gyms wildly successful. Our comprehensive, customizable
box management solution provides you with the necessary tools to take your business to
the next level, enabling you to spend less time behind the desk and more time with your
valued athletes.
To learn more about what Zen Planner can do for your business, schedule your demo today.
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