Top Financing Options for your Gym Business

Finding financing for a gym business is always a challenge. In our report, we will show you proven methods for success along with some creative ideas.

$100 Million dollars of funding approved annually (680+ credit score and 50K in income required).

82% of gym businesses that fail do so because of lack of funding. Qualify for up to $300,000 today — → Click here.

Apply for Gym Business Funding Up To $250,000 in Unsecured Lines of Credit — → Click here.

Are you seeking financing to open a new gym or expand your current gym business and wondering where to turn to for funding? As a gym owner, you now have more financing options than ever before — thanks to a number of creative web-based businesses offering new alternatives such as crowdfunding and peer-to-peer lending. Banks? They are just the beginning of the journey.

Here’s our updated guide to gym business financing options you should know about as you seek funding for your gym business.

1. Bank loans and SBA Loans

The first type of gym business financing that usually comes to mind when you hear the term ‘small business loan’ is a traditional bank loan. Bank loans come in many forms (short-term, long-term) and can be used for a wide variety of purposes (working capital, expansion, equipment purchasing, commercial real estate). Sometimes these loans are secured with collateral; sometimes not. The most important things to know about small business bank loans? You are going to need to demonstrate stability (in the form of revenue, for example).

As for the best place to get a bank loan, well, that depends on your business needs — each bank has its own set of offerings and requirements. Regardless of where you go for a loan though, you are likely to encounter the option to apply for a Small Business Administration (SBA) loan. A popular subtype of bank loans, a large portion of each SBA loan is guaranteed by the SBA, a government agency that provides resources to gym owners to help them develop strong businesses.

This SBA guarantee makes the idea of lending to gym business owners more appealing to some banks, but the loans can be difficult to get because of the stringent requirements (in order to qualify for an SBA loan, you need to have a decent credit score, measurable cash flow and a

solid business plan, among other qualifications). Despite that, SBA loans are attractive to many gym business owners because they offer a lot of options and flexibility in terms of how the funds can be used. What’s more, the SBA also offers a variety of loan options for minority gym owners and those that operate in underserved markets.

2. Credit card financing

If you need to purchase equipment or materials for your gym business, credit cards — or, in a crunch, credit card cash advances — are easily-accessible options that save you the trouble of applying for some other type of gym business loan. Credit card financing, however, can be risky and you should strongly consider only using it for short-term needs. If you go this route, consider paying off the card in time to avoid hefty finance charges and look for cards that offer cash back rewards or airline miles.

3. Business line of credit

A gym business line of credit gives you access to a certain amount of capital to use as needed, typically based on your business’s cash flow and credit score (a gym business line of credit functions more like a credit card than a gym business loan, but they are not one in the same). You don’t have to tap into the line of credit until you actually need the funds, and you won’t accrue interest on

funds you aren’t accessing either. Once you borrow from it, though, you will need to start making payments on the amount you used right away. As you pay back the actual funds borrowed, your line of credit will gradually replenish (meaning you once again have access to the money).

4. Equipment financing

Some lending companies specialize in financing the purchase of gym equipment. Another option? Ask the company you’re buying the gym equipment about financing — many offer their own financing programs.]

5. Merchant Cash Advance (MCA)

In this type of financing you get a lump sum advanced in anticipation of future credit card sales. Daily payments are made automatically by ACH transfer, and are typically

based on a percentage of that day’s credit card transactions — so on a day when you make less, you pay less.

6. Invoice Factoring

Factoring is a system where you sell your outstanding invoices to a third party ‘factoring’ company at a discount (typically, around 80 percent of the value of the invoices). The factoring company then takes over the job of collecting payment on those outstanding invoices from customers on your behalf (they return the 80 percent to you and keep the rest as their fee). Factoring can be helpful to gym businesses that operate on a net 30 to net 90 payment system because it allows the businesses to get paid immediately rather than waiting until payment is officially due. The main downside to invoice factoring? You don’t receive your full payment. However, it can help alleviate cash flow concerns in some cases.

7. Purchase order financing

With purchase order financing, a lender provides the funds to buy inventory or materials to a gym business that doesn’t have the cash on hand to fulfill a large order. After the order ships, the lender collects payment from the customer, subtracts fees and transfers the balance of the invoice back to the gym business at hand. Be aware that purchase order loans don’t apply to would-be orders — you need to have actual orders on the books in order to qualify.

8. Peer-to-peer loans

Peer-to-peer lending sites are online marketplaces where gym businesses and individuals can obtain loans from individual investors. The online marketplace manages the transaction, serving as a kind of escrow service, and takes

a fee in return. This can be a good way to get a small, short-term loan if other methods haven’t worked.

9. Crowdfunding

A variation of peer-to-peer lending, crowdfunding sites allow gym businesses to pitch their ideas and seek financing from interested individuals. The difference is that the money isn’t a loan, but a payment in return for something from your gym business, most often in the form of equity in your company to these early investors, or even something as simple as early access to your product or service. If your idea sparks the public’s interest, it’s possible (though not probable) to raise hundreds of thousands of dollars through crowdfunding. And even though it sounds like a long shot, it could be an option for some gym businesses to consider because the crowdfunding market is expected to grow nearly $200 billion by 2025.

The downside? If for some reason you are unable to deliver on your promise to your investors, they are going to be very disappointed.

$100 Million dollars of funding approved annually (680+ credit score and 50K in income required).

82% of gym businesses that fail do so because of lack of funding. Qualify for up to $300,000 today — → Click here.

Apply for Gym Business Funding Up To $250,000 in Unsecured Lines of Credit — → Click here.

An Outsourced CEO and expert witness, Jim Thomas is the founder and president of Fitness Management USA Inc., a management consulting, turnaround and brokerage firm specializing in the gym and sports industry. With more than 25 years of experience owning, operating and managing clubs of all sizes, Thomas lectures and delivers seminars, webinars and workshops across the globe on the practical skills required to successfully to overcome obscurity, improve sales, build teamwork and market fitness programs and products. Visit his Web site at: or

By fitmanagement

Health Club Consultant