The U.S. audience is becoming more and more conscious about their health. A countrywide awareness about fitness started during the COVID-19 pandemic, and it hasn’t come to an end. In fact, people are more health conscious now than ever.
As a result, fitness studios are popping up here and there in the States. Currently, the U.S. gym and fitness studio market is evaluated at a market size of $30.6 billion. If you are planning to start your small fitness studio, you can even tap into this big market. The earning potential is handsome, and it offers lots of physical and mental refreshments for people who are into fitness.
But, before you start your journey of building a health and fitness business, it’s important to know about the industry and the possibilities for you to enter. Here’s a complete guide to the fitness industry if you are planning to start a fitness studio business.
Pros & cons
| Pros | Cons |
| This is a great business idea if you are passionate about fitness. The income potential is steady and fair. You also don’t need too many employees to start a business. | The startup cost is high. The market is highly volatile. You may have to keep a long opening hours. |
Industry: Fitness Studio Industry Size & Trends
Fitness businesses are rewarding. As a fitness trainer, you get to help people start and carry on their fitness journey. Keeping the business agenda aside, it’s also satisfying to see your people become fit. But, a good reason to start your fitness club now, is because of its rising popularity. Fitness clubs, studios, gyms, and fitness apps are seeing consistent engagement from the broader economy.
Many companies are offering Recreational sports and recreational gym equipment to attract a massive number of people to fitness studios. Also, affordable membership programs across gyms are making health-conscious people start their health journey.
Industry Overview: Fitness Studio in Recent Times
Fitness studio should be a broader or an umbrella term by now since the concept of a gym or wellness studio. The target market for small fitness studio owners is becoming more diverse, with fitness enthusiasts focusing on weight loss, bodybuilding, calisthenics, yoga, corporate wellness programs, and so on.
In an attempt to make fitness clubs more affordable, monthly subscription plans are more in trend, that too, with low cancellation fees. Also, after COVID-19, global citizens have a heightened sense of desire to stay fit and avoid any risk related to COVID-19 or similar outbreaks.
The fitness studio market is becoming more competitive and will continue to stay that way, thanks to the growing demand for staying healthy and fit. But, tough competition doesn’t go through a warrior out of the ring.
Industry Size And Growth
Size: The health and fitness market size will stay at $124.7 billion in 2024. Compared to the 2022 size of the market, which was around $87 billion, the health and fitness industry has seen a significant boost over the last two years.
Growth: over the last five years, the health and fitness industry has seen a decline in revenue at a CAGR of 6.5%, as per IBISWorld. But, a 2024 market size shows significant growth from the 2022 market size. Also, the fitness studio market size is to transform and uplift itself and reach a size of $ 302.0 billion by 2034. This growth happens at a 9.2% CAGR rate.
The incidents of high jumps and low falls have been quite frequent in the past few years. But, with the acceleration of change, there are more people who will follow that will work, and there are more people who follow that will work that needs to be put into their attention. However, the rapid changes in the demographics and consumer demands are helping the broader industry landscape to adapt to these shifts.
Number of Businesses: The fitness and health awareness industry has more than 113 businesses operating across different U.S. states.
Employment: More than 1 million people are employed in this industry. It’s clear that the health and fitness industry contributes to the country’s economy.
Trends & Challenges
Here are some trends and challenges of a fitness studio
Fitness Studio Trends:
Fitness studios and gyms are changing with the implementation of new technologies, equipment, and dietary techniques. This has a huge impact on the fitness business industry.
Health improvement processes like biohacking, the use of smart wearables, and the adaption of home gym equipment post-lockdown have changed the concept of fitness.
So, there’s a portion of the audience going to the fitness studios, and some are looking for alternatives like mobile fitness apps or A.I. trainers.
Fitness Studio Challenges:
Within the fitness studio, trends also lie the challenges. Especially when businesses aren’t able to diversify and mount trends, challenges start to appear.
Different corners of the streets across the states are bustling with new gyms popping up, and each one is different from the other. Fitness gyms are losing momentum when they aren’t able to carve out their niche and stand apart from the crowd.
Fitness studios with franchises across locations are failing to maintain a standard service procedure. It’s affecting their branding, leading to a loss of customers.
Regulatory challenges can also be potential risks against fitness brands and studios. Different locations have varying levels of licensing requirements, zoning laws, and health regulations. So, it makes compliance difficult for brands. Even within a niche, it’s important to diversify the revenue streams. But, with a straight focus on one revenue model, small fitness studios either have a hit or a miss.
Who Is Working In This Industry?
The fitness and gym business market is heavily populated by men. In fact, 70 percent of the owners are men, and 30 percent of them are women. But, when it comes to employment, the gender ratio varies. In the USA, 60% of fitness studio or gym employees are men, and 40% of them are women. Their average age is 37. Most of them also have bachelor’s degrees.
Startup Cost: How Much Does It Cost To Start A Fitness Studio Business?
A fitness studio is a rewarding business if you manage to step into the high entry barrier market. But the startup cost isn’t unimaginably high. You can start a small fitness studio with only a $10000 budget. However, a fully equipped commercial gym might require more investment, leading up to $50000 or more. However, if you shop around and can manage to cut costs with some used equipment, a fitness studio shouldn’t be too difficult to start. Here’s a list of expenses you have to keep in mind –
| Start up cost | Ballpark range |
| Naming & Incorporation | $150 to $200 |
| Licences & Permits | $100 to $300 |
| Insurance | $100 to $300 |
| Business Cards & Brochures | $200 to $300 |
| Website Setup | $1000 to $3000 |
| Fitness Equipment | $10000 to $50000 |
| Location Rental Security Deposit | $15-30 per sq.ft. ($30000) |
| Average Total | $45000 |
As you can see, the majority of the set-up cost is taken up by gym equipment. Shop around and try to look for old and used gym and fitness equipment to reduce the start-up cost initially. As your business grows and you start to gather profit, you can add new equipment and sell the old ones.
Earning Potential: How Much Can You Earn From A Fitness Studio Business?
Multiple surveys run by leading job marketplaces and experts have revealed different data about Fitness studios from time to time. But, the average earning potential they came up with always doesn’t match what every fitness studio owner is making. On average, the fitness studio owners earn between $4,083 and $6,856. The hourly wages range between $23.56 to $39.56.
A Glassdoor study reveals that the average salary of a gym owner is around $81000 per year. Income also varies if you are a fitness franchise owner. Fitness franchise owners earn around $49,588. Franchise owners don’t have to go through the hassle of setting up the gym. Instead, they can buy a franchise and earn a salary from their fitness business. Your earning potential is also determined by the franchisor you are working for.
For self-owned fitness studios, it’s important to note that the locations play a big part in how much revenue a fitness studio business generates. However, it’s possible for a fitness studio’s revenue to go beyond or stay limited within the said average. Since the fitness industry landscape is too dynamic with constantly changing consumer demand, the earning potential is never constant. But, with the right business plan, you can make your profit soar beyond the average ceiling.
Entry Barrier: What Barriers To Entry Are There?
You can go ahead and think of starting a fitness studio. However, similar to other businesses, the entry barrier to a gym and fitness studio is steep. The market is already populated with lots of competitors leading in several niches. But, overall, the costs associated are high.
A fitness business involves purchasing your location or taking them on lease. It comes with a considerable one-time investment. Plus, business owners have to spend significantly on insurance, equipment, attorneys, and specialized trainers.
The lack of regulation in the fitness industry makes operations hectic. In fact, it can lead to fitness studios having varying levels of services, expertise, and inconsistent quality. Also, the regulations are changing across states. So, it’s possible to have different levels of profit from different fitness studio locations across states (for fitness studio franchise owners).
Since the fitness industry is crowded with competitors, it’s difficult to stand out as a brand. Fitness brands must spend wisely on their marketing. It’s also important to spend wisely on marketing for the right ROI. Small fitness studio owners may also struggle with finding the right IT support for their business.
Both small, individually owned fitness studios and small fitness chains are populating the market. This makes it even more difficult for new businesses to find their spot in the market.
Fitness Studio Opportunities: Who Are Your Potential Customers?
You might already assume that setting up a fitness studio business is difficult. But, despite how hard it is, a fitness studio is a good business idea if you are thinking of making enough money.
Some businesses yield enough money to provide a business owner with enough salary. However, some businesses can go beyond that and allow the owners to make more than $50000 per month. In fact, many businesses make more than $ 300,000 per year.
While money is one side of the coin, running a fitness studio business is also fulfilling as far as its meaning is concerned. Many entrepreneurs start a business to be of service or to provide any help to a particular community.
The yoga instructions that relieve the stress and tension of your clients are motivating. You can help a middle-aged person start their health and wellness journey and help them reach their fitness target. Watching your clients reach their fitness milestones can bring a sense of fulfillment and meaning.
As a fitness studio owner, you will provide your services to people of different ages and genders. Usually, your customers are aged between 25 and 34. 49.5% of gym goers are men, and 50.5% of them are women. So, if you are thinking of starting a business, you will possibly see an equal number of male and female costumes.
Frequently Asked Questions
Here are some common questions people usually ask about a fitness studio business –
Yes, fitness studios do make money. The profit margin, however, isn’t always the same across all places. Usually, the profit margin ranges between 20% to 40% based on locations, operational efficiency, and services offered to the clients. Premium pricing and high earnings are only the result of providing specialized classes and personalized experiences.
Wellness and health aren’t always a necessity to most people – or at least that’s what was the belief before. But it’s changing, and people with some discretionary income are making fitness a part of their lives. That’s why so many health and fitness studios are popping up in different places.
If you are thinking of keeping more profits in your pocket, then you can start a mobile gym business. This business has a lower overhead cost. So, you can keep more of your profit compared to a traditional gym.
Conclusion
A fitness studio, as a small business, can be a real treat for you. Yes, there is a high entry barrier, and the fitness industry is going through massive changes every month. Despite the changes, the changing customer behaviors are also making fitness studio owners sustain and grow their businesses. For a new entrepreneur trying to improve their business, it’s important to identify a niche within the fitness studio industry and solve relevant pain points customers are facing.
Do you think you have the skills to solve the fitness goals of a particular customer demographic? If yes, you may start a business as a fitness studio owner. Let us know if you have any type of queries related to fitness studios. Thank you for reading.
YOU MAY ALSO LIKE:
