The Ultimate Guide to Gym Funding

With 2021 here, there has been great headway made towards ending the pandemic. Experts estimate that this summer could be when our first return to normalcy happens, but what does that mean for your business?

Consumers will hopefully be out in droves, spending more than ever. To capitalize on this, your gym will need to have the newest gear, technology, and other resources to get consumers to come to your gym instead of a competitor.

Investing in your business after a lengthy recession may not be the first thing you are thinking about. If you aren’t sure about how to go about Gym Funding in 2021, keep reading this guide to ensure your business is able to expand safely and efficiently.

First, Identify Why You Need Funding

Most businesses that need funding need it for one of two reasons:

New funds will help them shore up a threat.

New funds will help them capitalize on an opportunity.

Sometimes in life, things happen, and we need money to bail us out. As a business owner, this can be an extremely scary situation to navigate.

Businesses that are in need of funding to get out of a precarious situation should really be looking for low-risk financial solutions that are intended to help business owners who are struggling.

This year, the SBA rolled out new low-risk, low-interest loans for businesses that needed a lot of financial assistance, quickly. If you find that your gym is in need of cash just to remain open, it may be time to apply for an SBA-backed loan.

For businesses that are not struggling, outside funding is often the best way to capitalize on a new trend or business opportunity within an industry.

If you are a business owner that is in need of funding to expand, there are steps to take to help make certain that you apply for the right capital solution for your business.

Pinpoint Areas of Opportunity

Before you can go out and apply for a grant or loan, you will need to identify where and why you need funding.

Within the fitness industry, there are plenty of opportunities available to help propel growth. These opportunities include, but are not limited to:

  • Showcasing gym safety
  • Investing in fitness technology
  • Diversification of the product offering
  • Business Expansion (new location)

Opportunities are truly endless within the fitness industry. Consumers are always looking for new ways to exercise, and as a gym owner, it is your job to provide these opportunities.

The financial aid that your gym chooses to leverage will be entirely dependent on the route of expansion that your business decides to pursue. Some gyms may only need a small technology purchase to hit their goals, while others may need to purchase a whole new building for a second location.

Whatever it may be, identifying the opportunity will help you better plan for the type of financial assistance that your business will need.

Choose a Funding Source

Now that you know how much money you need and what it is for, it is time to choose a funding source. Again, the capital solution that you choose for your business should be dependent on how much money you need and what you need the money for.

With that said, let’s take a look at some of the pros and cons of some of the most popular gym funding sources.

Small Business Loans

Taking out a business loan from a certified financial institution is likely the first funding option that comes to mind when thinking about business expansion, and for good reason. Lending companies today offer an array of loan options that are helpful for owners in any industry.

The advantages of applying for a small business loan are:

Guaranteed Funds — Not every funding solution will guarantee you delivery of your funds. When you agree on a loan amount with a business lender, you know that you are going to receive that amount.

Clear Repayment Plans — Anytime you go through a certified business lender, they will work with you to create a transparent payment plan that fits your needs.

Flexible Loan Options — A business loan can be as small as a few thousand dollars and can go all the way up to hundreds of thousands of dollars, meaning you can use them for

almost any business opportunity.

Some drawbacks of using a business loan are:

Strict Requirements — Certified lenders will have stringent lending guidelines that you must meet to qualify for a loan. Having a good credit score, healthy cash-flow, and a sound business plan will improve your odds of approval.

Cash-Flow Issues — Anytime you take out a loan, there is more stress to be financially responsible. If you take out a loan that is too big, your cash-flow can be disrupted, and paying off the loan can feel like your main business goal.

Crowdfunding

Crowdfunding has become an increasingly popular way to raise money. When crowdfunding, business owners take to online marketplaces where they can pitch their new business initiatives directly to consumers, in an effort to receive donations.

The advantages of crowdfunding are:

Zero Financial Risk — Unlike with a loan, crowdfunded efforts will not have to be repaid. This will allow you to test a new initiative with little risk attached.

Word Of Mouth Advertising — Crowdfunding sites can serve as a form of advertising as well. If a certain project begins to gain traction, it is often promoted to the front of popular crowdfunding sites, meaning more consumers will see and hear about your business.

Common issues associated with crowdfunding are:

Non-Guaranteed Funds — Crowdfunding sounds perfect in theory, but in reality, only 1 out of every 3 crowdfunding campaigns actually receives funding.

Time Commitment — Anytime you are asking people to give you money, there has to be some sort of presentation or call to action that explains why they should. Producing a crowdfunding campaign that sticks out amongst the crowd can be time-consuming and costly.

Grants

Grants are non-repayable funds that support specific industries and initiatives, that often come from the Government or another legitimate organization. Grants typically will be used for a specific purpose or effort.

The benefits of applying for grants are:

Zero Financial Risk — Grants will not need to be repaid.

The main problems associated with Grants are:

Difficult to Find — Finding a grant within your industry that you qualify for can be nearly

impossible. This makes it difficult to rely on grants for guaranteed funds, especially in a time of need.

Time-Consuming Process — Like any other initiative the government leads, applying for a grant can be very time-consuming. The time taken from the application to grant funding may be longer than you can wait.

Competitive — Chances are that you are not the only business applying for a specific grant. Others will be vying for the same limited amount of funding.

The funding avenue you go down will be extremely important in determining the success of your gym’s new efforts this year. Make sure that you do your research into each and every financial solution that is available to you.

No matter what camp you find yourself in, growing or surviving, I want to make sure that you have the financial knowledge to be able to be successful. If you have any other questions about managing your gym or fitness brand, I am here to help — give me a call anytime.

AnOutsourced 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 overcome obscurity, improve sales, build teamwork and market fitness programs and products. In addition, his company will buy gym equipment from gyms liquidating or closing. Visit his Web site at: www.fmconsulting.net or www.youtube.com/gymconsultant.

Serving the United States, South Africa, Eqypt, Canada, Australia, Puerto Rico, Turkey. India, Asia, Serbia, Ukraine, Mexico, England, Norway, United Kingdom, Nigeria, Spain, United Arab Emirates, Quatar and Saudia Arabia.

Do You Operate Your Gym with a Sense of Urgency?

A quick check showing the definition of urgency to be; 1) to act promptly; 2) act with intention to make things happen; 3) doing what needs to be done immediately.

So, here’s what I see frequently in gyms…many time there are lots of good things going on but the business and staff have become stagnant because of a lack of urgency. Here’s the deal, without urgency, it simply doesn’t matter when something is done…it could be tomorrow, the next day, next week, next month or even next year. By simply acting with urgency can make all the difference in getting your business back on track or maximizing the opportunity.

Here are some things to consider if your gym needs a kick-start with urgency:

  1. As an owner, manager, department head, sales person…make your own smart, quick decisions with confidence. It all starts with you, right? This is a way of thinking you want to act on immediately and your behavior will help train your team to act accordingly.
  2. Identify obstacles to your staff’s progress and quickly remove them. Take a look around for obstacles that are getting in your way of acting with urgency. In many cases, I have seen the commission schedule or the lack of one being an obstacle. In the end, a simple process is usually a successful process.
  3. Establish a culture that is focused on outcomes, not individual tasks. Here’s the bottom line on this, effort without results is meaningless.
  4. Communicate consequences for inaction; clarify what happens if desired outcomes aren’t met. Too many managers think consequences mean they fire someone, not so. My favorite is to role play the telephone inquiry script in front of the group — if we’re not setting phone inquiries or not getting shows….that will normally get them to memorize the script. Or in the sales process, many times we will roll out a Love at First Sight Offer.
  5. Identify what systems work for your gym and eliminate the systems that no longer serve you. Don’t keep old, tired ways of doing things in place just because “that’s the way you’ve always done it.”
  6. Announce and celebrate small success to demonstrate what happens when desired outcomes are met. For example, break a sales record; the entire team goes out to dinner together to celebrate. Or celebrate when members sponsor in a new members and receive their gift before the deadline.
  7. Agree on deadlines and provide reminders. Final day for a membership special. Final day to sign up for a class. Final week on the referral contest. You get the idea — then be sure to communicate across many different platforms….in club signs, email, phone, social media….
  8. Keep meeting short by always providing an agenda. Always have a planned, crisp agenda for each meeting. Don’t allow the meeting to drag from the original intent.
  9. When speaking, get to the point quickly; encourage your team members to communicate in a similar manner. Say what you want, when you want it and get to work — no long drawn out explanations necessary.
  10. Demonstrate leadership by example by meeting your personal deadlines. This one should be simple enough; leadership by example.
  11. Hold one-on-one meetings to secure each staffer’s buy-in to the team. Meet with EVERY team member and communicate the expectations and their understanding of each — you must get 100% acknowledgement and buy-in before you can get started…..and then be sure you follow-up.
  12. Follow up. It will not be good enough just to express your expectations, you must continue to follow up and train where necessary. The culture of urgency will never be important to you staff until its first important to you.

Now, go get it done…now!

AnOutsourced 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. In addition, his company will buy gym equipment from gyms liquidating or closing. Visit his Web site at: www.fmconsulting.net or www.youtube.com/gymconsultant.

Preparing Your Gym for a Comeback

As of this writing many gyms across the USA are slowing beginning to relaunch their business and others will be conducting a relaunch in the coming weeks. One thing for sure, we’re not going back to the same place we left a few weeks ago. It’s a different marketplace and it’s a different economy. We will need a plan. Here are a few questions to ask yourself before you begin; 1) what are you willing to give up to hit your goals? 2) What will you have to change to hit your goals? 3) What will you have to learn to hit your goals? Now, here are some things to consider:

1. The need for certainty. This is where it all starts. We need to be sure we get our head right. Of course, we need to understand the problem, but we need to give power to the solutions and what we’re trying to accomplish. Owners, managers and staff all need to work with a high level of certainty and confidence if they want the customer to have certainty. People will still buy.

2. Over communicate. Keep your members in the loop on what is happening and continue to provide them with valuable information on how to get the results that they are seeking. Create signage throughout the clubs on washing hands, cleaning equipment, social distancing and even consider arrows letting people know what direction they should go. Use all forms of communication to let everyone know what is happening with your gym

3. Provide unprecedented value. Give more than ever before. The goal here is to keep all your members and sign up new ones. You will need to provide an unprecedented level of value. Continue your digital programming with hangouts, expert Q&A, lives streams, private sessions, etc. Continue to focus on the member experience and celebrate success stories during the break; celebrate member anniversary dates, etc.

4. Prepare for member health and safety. I suggest doing more than what is required by your state. Temperature screenings for members, guests, employees and any vendors. Increase the number of cleaning stations throughout the gym. Prepare a FAQ to help address any potential issues of members not social distancing, coughing, sneezing, etc. Depending on your member base, consider a specific time for those 60+ to come in and workout. Have plenty of signage throughout the club as well as directional signage moving member down the right path form proper social distancing.

5. Prepare for staff health and safety. With all the talk about member health and safety, let’s don’t forget about our staff (not that anyone would). There will be some staffers that are simply not comfortable returning just yet and that’s okay. Perhaps they can help work on your digital product. The key thing here is to educate everyone on what you are doing to keep them safe. Many clubs are conducting temperature checks on staff twice per day. Two a day cleanings, rubber gloves, masks if desired.

6. Marketing to your members. This is one to start doing right now. Prepare videos to walk your members and guests what they can expect upon entering. You need to let your members know what you’re doing to keep the gym clean, healthy and safe and what you’ll be doing to keep your member healthy and safe. Social media and email marketing is ideal here. Showing new protocols and what to expect will ease potential fears your members and guests may have.

7. Marketing for your business — advance into the marketplace. You won’t be able to use just one or two things and get the results you want. The plan should be to show differentiation and market to an uncontested marketplace. You want EVEYONE to know who you are and what you are doing. Start writing your plan of action now. A press release is a great way to start. This is a great time to conduct a membership drive or a re-grand opening.

8. Prepare to be ready to sell in a new marketplace and a new economy. Include your health and safety standards in your process, but stay on point. Business and sales fundamentals will be more important than ever. You will likely have fewer inquiries and fewer prospects for a while. A good habit to get into…is to treat each guest like it’s the only one you will see that day and work to bring them up to your level of certainty. Get your staff trained and follow up to be sure they are on track. You can’t afford not to. As mentioned, conduct a membership drive, have referral contest, host a re-grand opening, etc. Revenue is the oxygen of your business, let’s keep it flowing. In addition, looks for ways to increase the amount you collect per new membership sale with additional added value. Consider new membership offering to accommodate a new economy.

9. Continue with Digital Programming. Digital programming is here to stay and is something you should continue even when you open your doors. Remember, you want deliver unprecedented value to your customer. Initially, this should be continued at no additional change, but as you move forward this should may be included as part of a premium membership offering or even sold online through your web site.

10. Develop existing profit centers or create new ones for ancillary sales. Since many people have poor diets which lack the vital nutrients the body needs, consider selling supplements online. Investigate selling gift cards online, meal planning, etc. You want to find ways to encourage additional sales to your current customer base.

11. Not every gym will return. Some gyms will not return because of financial reasons and other simply will not want to continue, which is okay. This presents an immediate opportunity to grow your business. In nearly every case, this will be done with no money out of your pocket and you will be able to increase your recurring dues, perhaps your personal training, email lists, renewal lists, have URLS and phone numbers pointed to you and more. This is something to investigate immediately.

Now, let’s make this the greatest comeback ever!

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. In addition, his company will buy gym equipment from gyms liquidating or closing. Visit his Web site at:www.fmconsulting.netorwww.jimthomasondemand.com.

a message from Jim Thomas

While all of us in the gym business settle in and wait for the pandemic to pass, we need to recognize that this could end up being a significant opportunity for your gym if you choose to expand and advance into the market place. But, it will require work. Don’t just sit and wait, develope a strategy, so that when this is over, you’re prepared to advance.

Here is some impotant information to remember:

  • People will still buy from you, but you will have to ask. Don’t let anyone guilt or shame you into thinking that selling is a bad thing. In many ways, you can treat this like a pre sales.
  • The economy will prosper soon. This is temporary. This will end. Let’s be sure we’re ready.
  • Gyms will re-reopen. There will be pent up demand for your services and products. Be prepared.

Prepare a plan of action and business strategy for the new normal:

  • Keep Selling. For a visual, treat this like a presales, make it simple and easy to get started and add value. Memberships, paid trials, personal training, supplements, etc.
  • Keep your current members. You’re only temporarily changing how you will coach your members (you’re not closing). Help your current members stay with you. Stay in touch with your members. Commnicate, even over-communicate. Such things as online classes, Q&A sessions, sending a work out of the day, check in on them, accountablity sessions, etc.
  • This one is big…be prepared for business after this ends. Don’t find yourself doing nothing and expect to flip the switch. Develope your plan and take action!

Are you ready to keep your members and capture market share?

  • Take control of the current situation and get a grip on things. Write out a plan that allows you to preserve cash, keep your current members, continue to sell, and develope a strategy that allows you to advance, not retreat into the marketplace. Turn off the TV.
  • Leverage an online and remote strategy to serve your members and prospects. Live classes, video, accountabilty calls, coaching calls, have fun with it just like you would inside your gym.
  • Prevent objections and sell during this time; Make this simple. Provide value.

Thank you.

Jim

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. In addition, his company will buy gym equipment from gyms liquidating or closing. Visit his Web site at:www.fmconsulting.netorwww.jimthomasondemand.com.

How to handle a pay raise with gym staff in a challenging economy

I speak with many gym owners and operators who have concerns on how to hand out pay raises when times are tough. Although… difficult times can be nothing more than an excuse not to offer a pay raise even though there’s merit. My answer normally will surprise the concerned gym owner when I tell them my solution to pay raises is the same no matter if it’s good times…or not so good times.

Gyms need talent. There is a shortage of talent. Talent will cost money otherwise you will lose your best people to other industries.

As we all know, sales can have a way of being a moving target…so if you continually compensate your staff around a fixed compensation plan, you are setting yourself up for a fall. I like to see gyms offer some form of a guaranteed opportunity, but with plenty of upside based on production and job description.

· You have a budget, right? Give staffers responsibility for certain line items. Say the budget for towel service is $2,000 per month…any savings they can generate in that line item would result in a 50% bonus off the total savings. So, if they save the club $500, they would receive a $250 bonus. It’s a win-win.

· Additional compensation does not have to come in the way of direct dollars. Work a half day on Friday, but receive compensation for a full day.

· Make childcare available for a reduced cost or even free. This offers a potentially significant savings for the employee plus the added bonus of convenience.

· Where it’s possible, offer flex-scheduling. This is a nice perk for those who have children or simply like the idea of beating rush hour traffic.

· Everyone is in sales…or they should be. Have a commission plan for every employee in your club. And then teach them how to promote and sell.

· Offer more training and continuing education that’s job related. Help make them more valuable to you…and increase their confidence and self esteem at the same time.

· Have a monthly contest. Of course, a sales contest would work in many departments, but you could also have a cleaning contest based on daily inspection scores. How many more memberships would you sell or how many members would you retain with a cleaner facility?

· Combine duties. When someone leaves your company…instead of hiring someone else, take a look around, maybe you have someone who deserves more money and they can pick up some of these duties. The club will save and the employee will get an increase.

· A common mistake in evaluating compensation is to view the employee as an expense…if you can learn to view the employee as your most valuable asset, you’ll be pleasantly surprised.

· A final reminder…the most expensive person you have on staff is the lowest paid person who’s worth it.

Now, go give someone a raise!

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. In addition, his company will buy gym equipment from gyms liquidating or closing. Visit his Web site at:www.fmconsulting.netorwww.jimthomasondemand.com.

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