How to Start a Gym: Complete Guide for Aspiring Gym Owners

If you’ve ever fantasized about starting a gym, now’s your moment! As of 2024, the fitness industry is worth over $102 billion worldwide, and growing by 8.7% annually. 

But before you start ordering rowing machines or building climbing walls, let’s go through the practical details of how to start a gym. Costs, business models, and a step-by-step guide for getting your business off the ground.

TL;DR: How to start a gym

Here’s the need-to-know info if you’re learning how to start a gym business:

How much does it cost to start a gym:

• Small personal training studio: $30k - $80k
• Mid-size boutique gym: $50k - $100k
• Traditional big-box gym: $200k - $500k+
• Gym franchise costs: $500k - $4mil+

Tips on how to start a gym business with no money:

• Start as a personal trainer
• Open a small group studio
• Get creative with business financing (leasing, partnerships, etc.)
• Start small, get stable, then scale over 2-4 years

How to start a gym from scratch: 

1. Create your gym business plan
2. Choose your business structure and register
3. Secure financing
4. Lock in the perfect location for your needs
5. Obtain key licenses, permits, and insurance
6. Purchase or lease equipment
7. Hire and train your gym staff
8. Set up operations and systems
9. Market and pre-sell memberships
10. Open your doors and keep optimizing!

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Is opening a gym right for you?

Opening a gym is the dream for fitness lovers who want the freedom of building something of their own. It’s a business that doesn’t go out of style, and can grow a tight, supportive community.

But the reality is tough: 20% of small businesses shut their doors in the first year, and 50% don’t make it to five years. Passion alone won’t keep the doors open—you’ve got to cultivate business-savvy if you want to last. That means scoping out the right location, building a rock-solid business plan, and keeping a sharp eye on the numbers.

Use fitness logic: prioritize consistency over speed, and adapt to meet your goals. 

How profitable is owning a gym?

With an average profit margin of 10-15%, gym businesses are relatively profitable compared to other small businesses. For more boutique-style fitness studios, that number can go up to 40%.

However, gym owner income varies widely depending on location, the type of gym, and its business model. In the United States, the average gym owner makes a median salary of about $49,000.

Most profitable gym types

On average, here are the types of gyms with the best profit margins:

• CrossFit: 20-25%
• Boutique fitness studios: 25-40%
• Yoga studios: 20-40%
• Big-box gyms: 15-20%
• 24-hr franchises: 10-15%

Revenue streams beyond memberships

If you want to amp up your revenue, consider offering:

• Personal training to nurture 1:1 relationships with members
• Group classes like zumba, yoga, or pilates
• Retail goods like branded apparel, protein powder, or foam rollers
• Ancillary services like tanning, massages, or nutrition coaching

Break-even timeline and first-year reality

When you’re working out how much it is to start a gym, expect to hit your break-even point somewhere between year one and year two.

Think ahead about first-year challenges, especially scheduling headaches and cash-flow crunch. A solid pre-sales push, like selling memberships before you open, can boost your nest egg and give your community a running start

What impacts profitability

Profit comes down to a few key factors:

• Location and demographics
• Strong member retention
• Additional revenue streams
• Efficient operations and staff management
• Marketing and community building

How much does it cost to start a gym?

It can cost anywhere from $10,000 to $1 million dollars to start a gym, but the final cost really depends on the needs of the model.

Some gym expenses, like rent and equipment, are obvious, but others can sneak up on new owners, like:

• Monthly utilities
• Operations software
• Music licensing
• Cleaning supplies and services
• Maintenance
• Insurance bumps
• Staff turnover (which costs more than you might think)

Here are what more specialized costs look like based on different types of gyms:

Small personal training studio: $30,000-$80,000

What you get: Lower square footage in exchange for lower upfront costs. These studios are smaller than big box gyms, and require less custom equipment than boutique set ups.

Cost breakdown:

• Modest equipment package
• Basic flooring and mirrors
• Light branding and simple tech setup
• Early marketing to make a splash
• Insurance

Best for: Trainers ready to step into ownership without massive overhead, and anyone who prefers deep client relationships over big crowds.

If you’ve got the space, opening a home-based studio is a low-cost way to get started. You won’t need more than simple equipment—the real value is the skilled, 1:1 training you can give to your clients.

Mid-size boutique gym: $50,000-$100,000

What you get: A specialized studio with a clear identity (think HIIT, yoga, CrossFit, or cycling). Most of your costs will go towards getting your equipment and making an attractive space. 

Cost breakdown:

• Branded buildout
• Specialty equipment
• Coaching your staff
• Member management software
• Intro marketing and signage

Best for: Owners who want strong community energy and higher revenue per member while keeping operations relatively lean.

Traditional big-box gym: $200,000-$500,000+

What you get: A large full-service facility designed for steady foot traffic. There should be options for self-guided exercisers as well as people seeking classes.

Cost breakdown:

• Large equipment purchase
• Extensive buildout
• More staff members
• Locker rooms and amenities
• Heavier insurance and utilities

Best for: Owners with access to significant capital who want scale and volume.

Gym franchise costs: $500,000–$4 million+

What you get: A branded facility that follows provided structures and systems. Less guesswork lets you jump into managing the gym itself. 

Cost breakdown:

• Franchise fees
• Required equipment package
• Approved buildout
• Grand-opening marketing
• Monthly royalties

Best for: Owners with very significant capital who want a playbook and name recognition rather than building from scratch.

Typical franchise fees + total investment:

• Anytime Fitness: Franchise fee around $42k; total investment often ranges from $350k to $600k+
• Orangetheory: Franchise fee around $60k; total investment commonly runs from $500k to $1.5mil+
• Planet Fitness: Franchise fee around $20k; total investment typically starts near $1M and can exceed $4mil

How to start a gym with no money (or very little)

Let’s be honest—in reality, it’s not possible to start a gym without some capital backing you up. But if your pockets are feeling light, that doesn’t mean it’s impossible! You can start small, prove the concept, and grow at your pace.

Here’s a look at how to open a small gym that scales over 2-4 years:

• Phase 1: Start as a personal trainer and save, save, save! If you’ve got room for some home training, you can build loyal clientele without paying extra rent.
• Phase 2: Small studio with 10-30 members ($15,000-$30,000 investment)
• Phase 3: Add equipment and expand to 50-75 members (reinvest profits)
• Phase 4: Move to larger facility with full equipment (profits + small loan)

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With every member you add and dollar you save, you open up the opportunity to scale. And if you’d rather keep things tight? That’s more money to invest into improving the quality of your business.

Step-by-step: How to start a gym from scratch

Starting a gym from scratch means harnessing your passion for some serious planning. At times, the work might feel tedious or intimidating, but every step brings your vision closer to becoming a sustainable business.

Step 1: Create your gym business plan

A solid business plan is what creates gyms that last. This tool helps you stay grounded and show potential investors that you know what you’re doing.

Your starting a gym business plan should include:

• Executive summary
• Description (mission and vision, structure, concept)
• Market research and competitive analysis
• Cost analysis and financial plan
• Services overview
• Marketing plan
• Execution timeline

Step 2: Choose business structure and register

Your business structure shapes your taxes, liability, and how you pay yourself.

There are a few different models to choose from:

• Sole proprietorship: You own the business, you run the business, you are the business. Everything is reported on your personal tax returns.
• Partnership: If you have a business partner (not an employee), then you both share equal legal and financial responsibility for your gym. The financials show up on both of your tax returns.
• Limited Liability Company (LLC): Think of this as an in-between structure of sole proprietorships/partnerships and corporations. It separates your assets from the business’s, and is the most common model for small to mid-sized businesses.
• Corporation: This is a rigid structure that’s owned by shareholders who are investing in and profiting from the company. Unless you’re planning to grow big or look into venture capital, you likely don’t need to dive headfirst into this model.

Once you’ve picked out your model, complete your state and federal registrations, grab your EIN, and open a dedicated business bank account.

Step 3: Secure financing

Like we said, you need some capital to start a gym, but don’t stress if you don’t have a huge savings account.

Here are a few options to keep down costs early on:

• SBA loans for fitness businesses
• Equipment financing and leasing
• Partnership structures with complementary businesses
• Buy used commercial equipment

Step 4: Find and secure the perfect location

Location will make or break your gym. Not only do you need to bring in your target members, but you also need to build a sustainable space that keeps them coming back.

As you shop around, consider:

• Demographics and market fit: Does the neighborhood match your audience?
• Accessibility and visibility: How easy is it to find your gym? How easy is it to get to?
• Space requirements: Is there enough room for equipment without things getting overcrowded?
• Lease negotiations: Do you have an idea of rent escalations and your responsibilities?

Step 5: Obtain licenses, permits, and insurance

It’s not glamorous, but you need to have a handle on the legal requirements for opening a gym. A lot of that comes down to staying on top of your permits and having appropriate insurance.

Required licenses and permits:

• General business license in your city or county
• Health club license issued by the state
• Zoning permit to verify commercial fitness is allowed
• Building permit if you’re renovating
• Fire safety permit including occupancy, fire exits, and sprinklers
• Music licensing like ASCAP, BMI, SESAC for playing music
• Sign permit for exterior signage
• Sales tax permit for retail sales and some services

Essential small business insurance coverage for gyms:

‍General liability: Covers member injuries on premises ($1M-$2M coverage)

• Professional liability: Covers trainer errors/omissions
• Property insurance: Covers equipment and facility damage
• Workers' compensation: Legally required if you have employees
• Equipment breakdown: Covers expensive equipment repairs

When you’re building your budget, expect to spend at least $5,000-$12,000 for permits and first-year insurance. Just know that if you’re looking into how to start a climbing gym, your insurance is going to be a whole lot higher.

Step 6: Purchase equipment

Once your space is secured, it’s time to outfit it with tools that match your model and your budget. You can buy new equipment, but there are also options for leasing or buying pre-owned machines.

Check out how many machines similar gyms have on the floor. Quantity matters here—you don’t want to stuff your space with things you don’t need, but you also don’t want members to be waiting around when they’d rather be working out.

Step 7: Hire and train your gym staff

A gym is a community, and its staff set the tone for members. Hire a team that shares your vision, and invest in training that keeps your service top-notch.

A small personal studio won’t need a huge staff, but as you grow, consider:

• Front desk staff
• Personal trainers
• Group fitness instructors
• Maintenance/cleaning staff
• Manager(s)

Homebase Tip: Let’s be real: you’ll already have a lot going on as a gym owner. Employee scheduling apps take away the stress of managing shifts, and give your team what they need to show up on time, every time.

Step 8: Set up operations and systems

Killer spin bikes aren’t the only tech to invest in.

Here are a few ops tools and systems that keep your gym running smoothly and safely:

• POS systems for small businesses take payments for membership fees, bonus services, and retail goods
• Security/access systems controls entry and protect the facility
• Gym management software handles billing, member check-ins, and class bookings
• Employee management software streamlines scheduling, time clocks, and payroll

Step 9: Market and pre-sell memberships

On average, gym memberships are about $65 per month. While people pay less than $50 per month on average, higher end facilities easily run over $100 per month.

But no matter the price point, preselling memberships gives you immediate cash flow and a motivated early community. Treat these members well, and they’ll tell their friends.

Step 10: Open your doors and optimize

An energetic grand opening helps you say hello to your community, but the work doesn’t stop at launch. Keep getting feedback from members and staff alike, and listen to your own instincts about what you can handle as an owner.

It’s not just okay to adjust your offerings and systems, it’s essential to creating a long-lasting business that you can be proud of.

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Managing your gym staff and operations

Reliable staff and rock solid daily operations are key parts of a stable business. Solve the usual problems before they show up, and you’ll be a step ahead of your competitors.

The staffing challenge gym owners face

For gym owners, juggling different types of employees is no joke: Full-timers, part-timers, contractors, per-class instructors, oh my! Without solid systems and payroll software for small businesses, payday can end up a nightmare.

Between hours that shift with the seasons and class times changing based on instructor availability, managing staff is rarely simple. You and your team need to be adaptable, but fitness roles often attract short-term employees. Realistically, you have to invest in them before they invest in you.

Staff scheduling best practices

Owning a gym means owning the schedule rather than letting it own you. Consistent schedules (where possible), helps staff plan ahead to avoid callouts. Replace your spreadsheets with automated scheduling software, and you can prevent double bookings and flag conflicts early.

Time tracking for payroll accuracy

When payroll mistakes add up, it costs you trust with your team and can even land you in legal trouble. For gyms, missed punches and confusing contractor hours can create a headache, but all-in-one payroll software captures time data cleanly and cuts late-night spreadsheet mistakes.

Team communication challenges

With instructors coming and going, cleaning crews rotating, and trainers on shifting schedules, comms bumps happen fast. If a class shows up with no instructor, it doesn’t look good. Clear team communication tools help prevent the stumbles that frustrate staff and members alike.

Staff training and retention

Think of your trainers and instructors as entrepreneurs building their own mini-businesses inside your gym. They should be trained on your systems and able to clock in without trouble, but real retention comes from great management.

Giving these team members consistent schedules (or even a bonus structure!) makes them want to stay by your side. As they grow, their clients show up more often, and your gym grows right along with them.

Consider these common mistakes before opening a gym business 

Here’s how to open up a gym business without stumbling into common first-time owner mistakes:

• Underestimating your working capital needs
• Skipping membership pre-sales that boost income and community
• Choosing location based on cheap rent rather than accessibility
• Staying in "trainer mindset" instead of the "business owner mindset"
• Poor staff management and high turnover (new employee cost is higher than you think!)
• Focusing on acquisition above retention
• Inadequate insurance coverage (calling you out again, climbing gyms)
• Not tracking key metrics like member growth, conversion, revenue per member, or average member lifespan

FAQ: How to start a gym

How to start a gym as a beginner?

You start a gym as a beginner by choosing a realistic model and creating a business plan. If you’re trying to figure out how to open a gym business with limited capital, beginning as a personal trainer can help you grow clientele alongside your savings.

What certifications do I need to open a gym?

You don’t need any certificates to be a gym owner, but if you’re a trainer, you should hold credentials like the NSCA-CPT, NASM, or ACE certifications. The legal requirements for opening a gym include business licenses, permits, and proper insurance.

How long does it take to open a gym?

Most gyms can be opened within a few months to a year. The actual timing depends on financing, location, buildout complexity, and hiring. Larger facilities or locations that need heavy renovations often take longer.

Your path to gym ownership starts here

Starting a gym is a bold move, and you’ve already shown you’re willing to bet on yourself. Knowing the business basics of how to start a gym is the first step—follow those guidelines, adjust as you need, and you’ll see the power of consistency.

Want employee management covered from day one? Connect with us to learn how Homebase has you set from scheduling through payday.

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