How to Start / Open A Gym Business in Kenya

Gym (Fitness Centre) Business Plan (Kenya)

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This guide focuses on the Gym business. Though we touch on many aspects of the business we will be biased towards a standard modern gym as to be found in urban estates.

Overview and Trends

The traditional gym in Kenya had been a place to pump, build muscles, get the six pack and well become a bouncer. This was the biggest motivation for the rise of gyms in the late 90s and 2000s. Mainly these were hardcore gyms focused on building muscles.

Muscles were the end and the means didn’t matter. So we had gyms which had nothing else but some weights, mark you these were not always professionally made weights. In many of these you would find two building stones with holes drilled at the center and a stick stuck between them. Another version of the weights had five liter paint cans filled with cement and joined with a stick or metal bar. The more advanced of these had professionally made weights and dumbbells and a flat bench, that was it. Going to the gym meant lying on the bench lifting weights as your colleagues cheered you on. It was a male affair.

Starting the mid 20s many professional gyms emerged; though still biased towards muscles they had a variety of equipment.

Fast forward to the present. The hardcore gym is fast going out of fashion. Building muscles is not the only reason to go the gym. And there are more women using gyms than ever before. There are several reasons for this.

To start with consumers have become more health conscious; wholesome exercise is seen as part of “taking care" of yourself. And though for men building muscle is still a thing there are many who are not obsessed with it; the muscles are a ( by) product of exercises, and not necessarily the other way round.

Men and women appreciate exercise for health’s sake and not always for the sake of looks. Thus the modern gym will have equipment which is not just for building muscles but which “strengthen” the heart, “work out” the back for good posture and such other goals.

Secondly with a more connected world, competitive urban spaces, exposure of all kind, consumers are under social pressure to look good; “cool”. This could mean many things. For instance having the famed six pack, less tummy fat for both men and women, less weight, thigh gap for women, strong shoulders for women and other such trends. Although there are many consumers who don’t succumb to the pressure and are comfortable in how they look, there is a significant number who seek to improve themselves, and the major way to do it is by visiting the gym.

The above reasons have contributed to the fast growth of modern gyms since 2008 with an extremely quick growth since 2013. Despite this the percentage of consumers in Kenya using gyms is still small; we estimate it, from our research, to be about 4 %.

The Modern Gym

The modern gym is defined by the variety of equipment, services, aura and professionalism in it. It’s important to note though gyms can be found all over growth had been greatest in major urban centers. Think county headquarters. Gyms are also picking up in fast growing peri urban towns which have opened due to devolution and infrastructure development. (See more in Location)

Major Types of Gyms

It’s not entirely possible to classify modern gyms in Kenya in very definite categories. This is because the market is still maturing. That said gyms in the Kenyan market can be loosely grouped into:

1.Muscle/ Strength Gyms – These are focused towards strength. Their equipment and their marketing too are geared towards building muscles. But unlike the hardcore gym they have modern equipment and even trainers.

2.Aerobics Gyms – These specialize in various forms of aerobics. Their edge is in the kind of aerobics exercise they offer (Zumba, Taebo, Insanity etcetera), and the quality of the trainers. As much as they are targeted at everyone their core customers are women.

3.Combo – This is a combination of the above two plus other fitness equipment and services. Thus in addition to the strength and aerobics they will have cardio equipment for the heart and various other form of exercises for the general fitness of the body.

Beyond these gyms can further be classified by size, facilities, location and branding. The business model is standard without much innovation.

Location & Premises

Where To Locate Your Gym

Urban areas are the best to start a modern gym. The advantage of targeting urban consumers is that they are already aware of the concept of exercising. But more important is that they are conscious of themselves health wise and physically so feel the need to keep fit.

Other good locations are peri urban areas that are fast growing. These have attracted an urbane consumer who is more likely to use a gym. The more rural a town is the more difficult it so to profitably attract members to your gym.

Factors to consider when picking the location of your gym

Population – It’s a fact that only a very small percentage of the population use gyms to exercise, and although the numbers are increasing and all those who don’t exercise are potential clients, ask yourself whether you have the ability in time and resources to wait to convert, or you want to start in a location with some consumers who already exercise so as to jump start your business.

Picture this standard gym in urban estates in Nairobi has an average of 22 members on monthly subscription and about 18 members on daily membership. So the bigger the population that is likely to convert, the bigger the population that is already exercising, the more of the mid income health conscious kind, the better for your business.

Though there is a growing trend of joining gyms, it still takes more effort for consumers who have never visited a gym start exercising. So it’s better to set up where there are more of the potential customers and consumers already using gyms. If there is a gym(s) already and it’s performing well then it’s a good indicator. This does not mean you should not set up in virgin areas with no gyms; you can and should if there is enough of the right kind of consumers. There are many estates and gated communities coming up which would be a perfect fit for a gym.

Economic and Social Indicators – Most of the working population visit the gym in the evening or morning. An area where due to infrastructure or distance the population has to leave very early for work and are be back quite late may not be the ideal for a gym. As much as consumers may want to use a gym time is against them. Yes they will sign up but the turnover rate will be high; they will not have time to attend. They will opt to attend perhaps near their place of wok or cancel membership until they move out.

You need to consider this using a longterm and wide perspective: is there possibility of improvement in the near future. Are there developments or social factors of the kind that could mean there are enough of the right consumers within the area to sustain the business as much as many are not signing up? What are the growth prospects of the area? Some peri urban towns are growing fast ad with them attracting businesses which employ the kind of professionals that are likely to use a gym.

Setting up in such a town may not be appealing at first but a year or two down the line the numbers could be more than you can handle.

Competition – While the presence of gyms which have existed for over a year are an indicator that the business has promise you should not be blind to the intensity of competition. If the competition is intense then it means you will have to work more to capture a share of the market. And if the population of target consumers is not growing then it means you will be competing for a limited number of customers. If you are going to set up in a location where there is intense competition then you must have a strategy to win over customers. This could include facilities and trainers, strategically located and easily accessible premises or fast growing consumer population.

What to consider when picking the premises

Size of the premises – You need a room big enough to at least fit the basic equipment. Or all the equipment you plan to have based on your marketing strategy. Customers also need space to move around and exercise. If you plan to have aerobic exercises in addition to muscle and cardio equipment then you’ll need even bigger space. Avoid congestion; such that equipment is too close to one another and customers’ bump into each other when exercising.

Accessibility and Visibility – A gym is best when it’s very visible; where potential customers can easily spot the gym. This attracts consumers already using gyms and those planning to do so. If it’s hidden then you have to do more to market it, and you lose on the impulsive consumer who is likely to join a gym because it’s very near his house. The gym should also be easy to access. Seventh floor accessed by stairs is not the best.

Renovation Required – The renovation required and what you are allowed to do or not do. If there are many limitations say of what modifications you can make to the floor or things like partions and such then you might have to compromise on standards. If the building is so down trodden then you will also need to invest more in things like paint. Look at this in terms of the capital and market plan you have.

Parking – Parking will become a factor depending on where you want to locate the business. For instance if a gym is “along the way” you know a midpoint then it’s good to have a parking space. Even in town centers and estates it’s advantageous, though, not a must for you to have to have parking space available in the area.

Ventilation – If there is not enough air circulating in a gym it becomes stuffy and uncomfortable to work out. So make sure the premise is well ventilated. ‘

Rent vs. Returns - Consider the rent that you will be paying and the capacity of the gym. Can you fit enough members and equipment to make a profit? Will you have to charge existing members a premium simply to meet your business costs? Ensure the rent matches the potential of the business.

Layout

The most common layouts in a gym are for the customer to get into the reception area, then the changing rooms then the exercise area. This works alright but you can modify based on the shape and design of the room.

For instance in some gyms customers pass through the workout areas to the reception and changing room. Or reception – workout area – changing rooms. The key thing is to make the flow is smooth and customers know where they are going. Label properly. Combine aesthetics and practicality.

Also decide on the feel that you want to create in the gym. The colours, writings, posters and the general interior design. The aim should be to make the space feel friendly, encouraging and depending on who your customers are feel modern and clean.

Design the layout of the gym with the customer in mind. What will give the best experience? Be practical rather than theoretical. Some gyms owners want to create a very ideal environment which sometimes is not practical. Think in terms of the simple day to day usage.

Changing Room

A changing room is a must. The gym should be such that one can come from anywhere change and start working out. And the changing room is good enough to offer decent privacy to both men and women. Where space allows you can have separate changing rooms for both men and women. However at times the space is not big enough and one changing room has to be shared between the two of them.

Licenses

Single User Business Permit – This is issued by the county government to all businesses operating within a location. For a premise big enough to fit a standard gym budget at least Kshs. 20,000 per annum for the license.

Performers Rights Society of Kenya (PRiSK) and Music Copyright of Kenya (MCSK) License – These are artist collection organizations. Anyone playing music in a commercial setting is required to pay a fee which is in the form of have these licenses. Both organizations claim to have the right to collect money from businesses. You can survive with just the license of one of these organizations. However at times the field officers of both will insist you acquire licenses from both organizations. Prices will average Kshs.3000 based on the size and the kind of entertainment you have.

Fire Clearance Certificate – This is issued by the fire department of the county government. The general process is you go to the fire department, they will ask for the size of your premises in square feet and based on that advice on the number of fire extinguishers you need. There are many gyms which survive without a fire extinguisher but it doesn’t hurt to have one not simply for the count government but for your own safety.

Signboard License – This is issued by the county license to anyone putting up a signboard. The cost will depend on the size of the signboard and county. The license averages Kshs.2500 per annum.

Equipment

In reality there is hundreds of gym equipment. No gym has each and everything. It wouldn’t be practical considering the variety of equipment that is available, the space that you would need and the value some of the equipment would add to your business and customers.

Thus what many gyms do, and which is the wise thing, is to settle on a number of essential equipment aimed at their target market. There are equipment considered a must have for any gym. And it’s those and others that we detail below. We will, for purposes for this guide, focus on a combo gym that has the strength part, cardio and aerobics.

Commercial vs Home Equipment

You should understand that in the gym equipment market there are home equipment and commercial equipment. Home equipment are made for use in the house by an individual or family, while commercial equipment are heavy duty equipment made for intensive use by many users. Home equipment are always cheaper than commercial equipment.

Either attracted by price or for lack of knowledge some entrepreneurs in the gym business start with home equipment. The downside of this is that after a short while, sometimes as short as a month, the equipment breaks downs or has defects that make them unusable. This negatively affects service not to mention that the entrepreneurs have to go back and purchase replacements for some of the defects can’t be repaired. Woe unto you if you make the mistake of purchasing home equipment once more.

For a commercial gym always go for commercial equipment notwithstanding the higher price.

New vs Second Hand

In the market are to be found new and second hand equipment. The new equipment are straight from the factory and have not been used previously. Major sources of new equipment are Europe, US and of course China. US brands have a good reputation not just locally but globally. China being a relatively late comer in the gym business has yet to establish any powerful or well recognized brand.

The general view among gym owners, and supported by some anecdotes, is that Chinese equipment though functional and cheaper are weaker compared to American and European brands.

Second hand equipment in the market are of two main types: Local second hand equipment which are sourced locally. Say a gym closes down and decides to sell equipment. And as is common nowadays an individual could have bought items for home use then for a reason or another decides to sell it.

The other group of second hand items are those that are imported as second hand. An entrepreneur imports goods from developed markets (gym wise) like the US and resells them. These secondhand imports have a fairly good reputation in the Kenyan market. There are gym owners who swear that imported items say from the US or parts of Europe though relatively expensive are still good enough to be used for over five years in addition to being better than some cheaper newer items.

Jua Kali vs. Factory (Professionally) made

Jua Kali items are those that are made by local artisans with varying degrees of quality. The artisans could be jack of all trades or specialists in gym equipment. Most of them start by replicating until they get it right. The disadvantages of jua kali items is lack of quality control which could mean items are not uniform, are at times not very well finished or efficient.

Another drawback is that many artisans lack the technical theory behind body exercises. This knowledge should guide them when making equipment. Thus once in a while you will hear complaints about some of the juakali items making a user tired more than he should, not being balanced or causing aches.

This does not mean that you should dismiss all jua kali artisans. Some juakali equipment work alright. It’s good to have a skilled artisan make them for you, and if you get one who works out and has experience with similar equipment the better.

Factory made, as the name suggests, are made in factories in a professional environment and meeting some standards. Still not all factory made are of high professional quality. Some are replicas; just professionally copying. Others though are made by specialist gym equipment companies who invest in research, with the result being high quality items and reputable brands.

Classification by use

Gym equipment can further be classified by their use such as:

Strength Equipment – These are used for strength exercises to build and work out muscles.

Cardio Equipment – These are used for “cardio”; exercises to make the heart healthier.

Aerobics Equipment – These are used for aerobic exercises.

Types of Equipment

Flooring

The floor of a gym should be comfortable and safe for consumers. And where the gym is in an upper floor then it should absorb noise made by the various activities like dropping weights and jumping.

A cement floor in the gym would also quickly chip again because of constant dropping of heavy equipment. Cement floors also lack a grip meaning a customer is more likely to slide and fall. But even more risky is that equipment can roll much more easily.

Again if equipment, especially weight equipment, keeps falling on a hard floor, as cement is, then its life will be shortened. This is because when equipment such as a dumbbell falls on cement surfaces it, rather than the floor absorbs the impact. And this is what actually reduces its life.

A cement floor in a modern gym looks crude rather than ‘hip’. It hints at the traditional hardcore gym despite the modern equipment.

Because of all the above factors that’s why it’s recommended that the floor in a gym should be covered with special material. The most common are rubber and wood. Others are foam and special non slip tiles. Wood used to be the standard but with the relatively high cost and maintenance then rubber has become the sort of norm. Foam is considered weak and not commonly used.

Some gyms will have the strength equipment area covered with rubber and the cardio area with wood. You can have different kinds of flooring for aesthetic reasons and based on the various activities and equipment that you have. The floor in the strength equipment area should be thicker.

Rubber flooring is usually sold in form of sheets or rolls. Such flooring can either be specially made for a gym or for general purposes. Rolls are sometimes preferred because they give a smooth continuous feel with few or no joints. Poorly fixed sheets and tiles can peel off or have ‘ugly gaps’.

Flooring is usually sold per square meter. Rubber sheets (mats) can be of various sizes such as

1.5meters by 0.5 meters or 1 meter by 1 meter. The quantity that you require will depend on the size of the gym. For example if a gym covers an area of 10m by 10m then the total area is

(10m x10m), 100 meters squared. If you buy a roll, you require at least 100 meters squared.

Don’t buy flooring exactly equal to the area, buy a little more. This is because when fixing there

will be some wastages from cutting and so forth. There are also areas of the floor that could require reinforcing with an extra layer.

Rubber flooring comes in various thickness, but mainly half inch and one inch. Thicker flooring is used where there are more heavy equipment or activity.

There are also many colours and designs. Pick one which fits the theme of your gym. If you don’t plan to clean your gym everyday then you can go for darker colours. When you pick colored rubbers go for good quality so that they don’t fade and became ugly after a short time. When in doubt go for plain colours.

Look for flooring which does not absorb water and has some grip so it’s not so slippery putting users in danger

Specially made rubber sold by the commercial gym equipment shops range from Kshs.3000 to Kshs. 6000 per square meter. The price range is because of the different qualities and suppliers. Meaning that even at the lowest if say your gym is covering 100 meters squared then you will pay Kshs. 3000 x 100 =Kshs.300,000. There will also be installation charges. This will depend on the fundi and the area. At the lowest budget at least Kshs. 15,000 for the installation.

Some gym equipment suppliers can also do the flooring for you in a very professional manner. They will come look at your premises, take measurements, understand the services you will offer suggest the type of flooring then install it, certainly at a fee.

Independent importers get rubber and wooden flooring largely from China. Often they sell gym flooring (at times this is just general purpose non slip rubber) at between Kshs.3000 and Kshs.4000 per square meter.

Because of the relatively high cost of flooring some gym owners have opted for other forms of rubber and not necessarily gym specific or branded. One of such sources is Gikomba market, where second hand rubbers can be found. The rubbers are sold in a roll and comes between Kshs.1000 and Kshs. 1500 per meter squared. The rubber is imported without any particular use in mind so the supply is not consistent: sometimes it’s available; sometimes it’s not.

There are also entrepreneurs who in an effort to cut costs have started with carpets instead of rubber or wood. Carpets can only last for a short time before they start tearing and puncturing. The flooring should last until break even and a return on your investment. Good quality flooring should last at least 3 years, but can last up to 7 years.

Can you start a gym without the flooring? Yes but the above stated risks are always there, and for a modern gym it snatches something big from the feel of it

Strength Equipment

Benches

Benches are very basic equipment used in weight training. There are many types of benches. The most common and basic are flat, incline and decline. There is also an adjustable bench which combines all these.

For a long time benches used in most gyms in Kenya were jua kali made. Even now you will find many modern gyms using juakali made benches. They serve the purpose. The attraction of jua kali was and is still is the cost, which is lower. Basic benches are not so

Flat Benchcomplicated, thus a professional jua kali artisan can make one that just works fine.

The alternatives are factory made benches. These are more aesthetically appealing. And where they are a reputable brand they are designed professionally with the human body in mind.

The poor ones develop problems with adjustments; some are made of weak metal, while others just wear out fast. So ensure the bench is commercial grade. Again depending on the space decide whether you will have a multipurpose adjustable bench or each on its own say flat, incline and decline.

 

If your budget is low and you don’t have many options you can

 

settle for a flat bench and add the rest with time. How many you

 

need depend on the space you have, potential customers and of

 

course your capital. You could start with one. There are many

 

standard gyms with just one of every equipment and customers

 

are encouraged rotate.

 

Jua kali benches range from Kshs. 15,000 to Kshs.25, 000

Incline Bench

depending on the blacksmith, design and add-ons.

Decline Bench

Professional factory made benches will range between Kshs. 35,000 and Kshs. 45,000.

Other common types of benches found in local modern gyms are:

Olympic Bench – This is used for various bench weight exercises. Basically an Olympic bench is a flat bench but with a barbell rack attached (see barbell below) for holding weights. In some cases the Olympic bench could be adjustable so that it can be incline or decline. Olympic benches range from Kshs. 30, 000 to Kshs.70, 000. The exact will depend on what

features it has, juakali or otherwise.

Preacher Bench – The preacher bench is mainly used for bicep exercises. It’s so called because it has what looks like a crude pulpit. A good factory made preacher bench will cost at least Kshs. 150,000. Prices could go as low as Kshs. 90,000 depending on where you source it, the brand and whether juakali or not.

Presses

Leg Press

Leg presses are used to exercise the legs and build leg muscles. There are different types but two main categories. 45 degrees which is also known as angle or sledge leg press. Then there

is the upright leg press which has a pendulum. Leg presses are often plate loaded to imply that you control the weight by adding or subtracting plates.

Leg presses can also be jua kali or factory made. For this we recommend the factory made. Users and even gym owners say these are smoother with less friction. There are also safer (no fear the weight will roll back to you) and comfortable with the back. More important they are at the right angles for the specific exercise. This means that they are unlikely lead to unintended consequences due to position or unhealthy bending of the

knees.

A good leg press will start at Kshs. 200,000 with prices going all the way to Kshs. 300,000 depending on the dealer, brand and features.

Racks

Squat Rack – These are used for lifting weights when squatting. It’s basically a structure with hooks for placing the weights (barbell).More important it has two arms to hold the weight if in the process of lifting your energy fails with the weight on your shoulders while you are squatting.

Squat racks can also be used for a variety of other exercises such as dead lifts; lifting weights from a standing position without support of a bench or other equipment. Squat racks can be factory made or jua

kali. Good quality squat racks start at Kshs. 100,000 although jua kali racks could be as low as Kshs.50, 000. Again like with everything else consider whether it’s made for commercial

purposes and the strength of the steel used to make it.

Power Rack - A power is a combo, a station combining equipment that can be used for many different weight exercises. These include dip bars, pull up bar and adjustable arms. Power rack average Kshs. 200,000.

Bars and Barbells

These are the metals bars to which weights (plates) are attached during weightlifting exercises.

The bars found in Kenya can be generally classified into two: First are Normal/ Juakali bars which are basically metal bars which are relatively lighter and made without much professional

considerations. As long as they can have weights attached to them then nothing more is needed.

Secondly are what professionally are known as Barbells. They are heavier, wider and have bigger holes. Many weightlifting enthusiasts in Kenya have now known the difference between the normal bars and barbells. They prefer barbells. Barbells weighing 20 kilograms and seven

feet long are considered the best.

Barbells are many types with some of the major ones types, Olympic barbells, pro lifting barbells and the general multipurpose. For a gym where training is for healthy and as a hobby, and where there are beginners and exerts then the general multipurpose is good enough

Barbells can be fixed or plate loaded. Fixed barbells have fixed weights such as 5 kilograms, 20 kilograms and so forth until 45 kilograms. While plate loaded barbells are loaded with plates of different weights as need be.

The other common bar is the EZ-Curl Bar which is curled. This bar is used for curling exercises more so for biceps. Weightlifters say the curl makes for a more natural grip which helps them lift more weights. There are also people who develop wrist pains when they use straight bars, and thus prefer the curl bar.

Among the factors to consider when purchasing a barbell are the strength of the material, who are likely to be the majority of the users; In Kenya men make the majority of the users in the strength equipment, where there are women have lighter barbells, say 15 kilograms and below, same applies when you have younger users, finishing of the barbells, this for aesthetics and comfort in use.

Does the bar have a nice grip? Does it have protection against rusting? Bars can either be plain steel which is likely to rust, zinc coated, black oxidized coated, chrome and stainless steel. Many weightlifters say the plain steel bar feels the best on the hands, but then it’s likely to rust. Chrome coated is more expensive.

Barbells range in price between Kshs. 3,000 and Kshs.6000 depending on the quality and source. Have a minimum of 10 bars.

Weights:

Dumbbells

A dumbbell is weight equipment with a small bar and weights which can be lifted using one hand. They can range from 1kg to 50kg. The advantage of having different weights is to be able to accommodate everyone. Adjustable dumbbells

can add or reduce weight. Dumbbells are a must have. Dumbbells are often sold per weight. But there also sets. Prices start from Kshs. 250 per kilogram.

Weight Plates

These are affixed at the ends of barbells in plate loaded barbells. They are the actual weights. They come in different sizes. Weights are sold per kilograms at prices between Kshs. 270 and Kshs.450

Pulleys:

Cable Machine

A cable machine is equipment largely used for weight training though it has many other uses. It’s made of cables connected through a system of pulleys. Modern cable machines are pre loaded and come with weighted equipment. By adjusting the pin of the machine a user is able to select different weights to pull. A user pulls the weight which in this case is called resistance.

A preloaded cable machine is maintenance free. A more complex pulley machine not only does it occupy a bigger space but also requires regular greasing. Pick a machine based on the space you have and your target market. The cable machines come with different features and weights but more or less they perform the same function. A 200kg machine is good enough for a standard gym. Budget at least Kshs. 300,000 for the machine.

Cardio Equipment

Exercise Bikes

This is a stationary bike which has resistance created to make it fit for exercising. There are many types of spin bikes with the most common being upright bikes, spin bikes, and recumbent bikes. Spin bikes are the most widely used followed by upright bikes and then recumbent bikes.

Factors to consider when purchasing a spin bike:

Resistance – The purpose of resistance is to make the bicycle harder to spin and in the process exercise the body. There are two main methods to create resistance: magnetic resistance and friction resistance. Friction resistance uses pads, think brake pads in a regular bicycle. With time the pads wear out and just like with the regular bikes they need to be replaced.

Magnetic resistance works by placing a strong magnet near the wheel. Bikes using friction as a source of resistance are cheaper compared to those using magnets. However because of the need to replace pads now and then, friction resistance bikes are not the best for commercial use. Eventually they end up being more expensive.

Flywheel - Spinner bikes have a flywheel attached which creates the feeling of riding an actual bike on a road. The flywheels are of different weights. The heavier the weight the more it feels like the rider is on an actual road. They range in weight from 14kg to 20kg. The flywheel is not used to create resistance so a heavier wheel does not mean more resistance. One of leading spin bike brand Startac has a wheel weighing 17.2 kilograms.

Handlebars – There are different ways to ride a Spin bike like seated or standing. Each position requires the handlebars to be in a different position. Thus you should go for the bike which accommodates different hand bar positions. Related to this is the seat position which should be adjustable.

Drive Train Mechanism – This means what connects the crank and the pedals. There are two main types: chain and belt. Belts make less noise when compared to chains, however in the long run belts stretch and this makes them to slip off the crank. This becomes a nuisance and uncomfortable. For commercial purposes it’s advisable to go for a spin with a chain mechanism.

Q Factor – Q factor is basically the length of the gap between the two paths a user’s feet follow when cycling. So as to get a more natural experience as possible a lower Q factor is preferred. Often spin bikes will have Q factors of between 155mm and 175mm.

Other features to consider include extras like clock, display to show distance and calories burned water bottle holder and such.

Spinning bikes are positioned as cardio exercise equipment. However they have many uses like toning legs, abdominal workout, and lower body workout and generally for burning calories.

Again there are many bikes available out there. But always make sure you buy commercial quality equipment. A commercial spinner is capable of withstanding 6 hours of use every day for years while a homemade cant withstand.

Commercial bikes of the known brands average Kshs. 120,000. There are many Chinese brands which range from Kshs. 50, 000 to Kshs. 80,000.

Cross Trainer / Elliptical Trainer

A cross trainer is an equipment that is more like a treadmill and bike and simulates climbing stairs at the same time. It’s largely used for cardio exercises though as with many cardio equipment it can be used for general workout. It’s specifically said to be friendly to the joints as it does not cause them to wear and tear. It’s also positioned as being used for leg exercises and burning calories. Some gym owners say it requires less maintenance as compared to a treadmill. That’s debatable.

New and good quality commercial cross trainers start at Kshs. 90,000. However you will find less cross trainers going for between Kshs. 50,000 and Kshs. 70,000. Go for the best quality which can withstand the rigor of a gym.

Treadmill

Basically treadmills are equipment which simulates running or walking while at the space position. Treadmills have become a common and one of the most recognized equipment of modern gyms. Treadmills though grouped as cardio equipment can be used for the general body workout and burning calories. Actually burning calories is one of the most common uses of treadmills in Kenya.

There are various types of treadmill. A relatively recent addition is the curved treadmill which does not use electrical power but rather depends on the momentum of the user to turn the treadmill belt. In the local market the normal electrical powered treadmill is the most popular among users and gyms.

There are many people selling treadmills. Perhaps more than any equipment the treadmill has the most dealers. From supermarkets to individual importers. A key consideration is to make sure that it’s made for commercial purposes. A home use treadmill can’t last long in a gym especially considering its mechanism.

A robust commercial treadmill starts at Kshs. 400,000. There are also many lesser brands and some imports from China, and also second hand items imported from Europe which will range between Kshs. 80,000 and Kshs. 200,000. If you want to go for new commercial treadmill from one of the better known brands budget at least Kshs. 300,000.

Rowing Machine

A rowing machine is used for general body workout and also for cardiovascular exercises. It’s also used to burn calories fast. Increasingly rowing machines are becoming an essential part of modern gyms. A good commercial rowing machine will go be at least Kshs. 250,000. In the market you will find rowing machines going for as low as Kshs. 50,000. Often the

low priced are for home use or not to made to last. Be careful when buying from individual

importers who perhaps themselves don’t know the difference between commercial and home use equipment.

Aerobics Equipment

The main equipment used in aerobics are:

Exercise Mats – These are used for one of the various aerobics exercises. The mat can be local tailor made or one of the branded factory made. Exercise mats average Kshs. 2500 per piece.

Jumping Ropes – These are for jumping and warm up exercises. Prices range between Kshs. 400 and Khs.700. Depending on the quality and the supplier. Budget at least Kshs. 500 per rope.

Steps – These are used for step exercises during aerobics. They can either be juakali custom made or ready factory made. Jua kali made will average Kshs. 1500 while factory made will range between Kshs. 2500 and Kshs.5000 depending on their quality and brand.

Cardio Dumbbells – These are used during aerobics. They are mostly colorful and made of plastic. They range from 1kg to 5kg.

Exercise Balls – They are also used for one of the various aerobics exercises. An exercise ball costs an average of Kshs. 4000. It’s good to buy balls from reputable specialist suppliers. Gym owners say the ones sold in supermarkets tear very easily.

Other Equipment

There are other ‘smaller ' equipment that are not used in exercising per se but are nevertheless important. These include:

Mirrors – People like looking at themselves while exercising, so it’s good to have mirrors all around the gym. Look for large mirrors at least one meter in length. Prices will start at Kshs.1500. There will also be extra costs for installation. The numbers you need will depend on the size of the gym.

Fittings – There are small fittings here and there that you WILL need. These could include things like hooks, power sockets (you need to have enough of these for equipment and also for customers to use if need be).Fan, Water Dispenser and the like. Budget at least Kshs.30, 000 for these.

Music System – A music system is for entertainment but also for playing music used in exercises such as aerobics. A good music system and an amplifier are priced from Kshs.30, 000.

Television and DVD Player – A television is for entertainment purposes. Some customers might be interested in watching football, news or something. A DVD player can be used for exercise videos. Budget at least Kshs. 40,000 for this. Of course exact prices will depend on the size and model of the television.

Counter – A counter or reception is area is important to create a point of reference and welcome. It The counter is also a place to display any extras such as t-shirts, DVDS, water or other items that you are selling or giving away free of charge. If you are limited in space a small neat counter could do just fine. Budget at least Kshs.50, 000 for the counter.

Lockers - Lockers are used by customers, and especially the regular members, to store things like tracksuits, t-shirts and exercise shoes. Lockers are of different types. What you settle on will depend on your capital and space you have available. If space and capital allow then you can go for bigger more sophisticated steel/ aluminum lockers with locks. Alternatively you can do with wooden lockers. Some gyms will do with simple lockers without a lock. And if space is so limited you can have the lockers in the changing room. At least budget Kshs.70, 000.

Dumbbell Rack - This is not a must but is handy equipment that is used to hold dumbbells so that they are not lying all over. You can get have this custom made by a jua kali artisan at an average price of Kshs.10, 000.

Equipment: Things To Keep In Mind

The images above are meant to give the exact look of an equipment. Equipment comes in various designs, shapes and colours.

The gym equipment space has been attracting an increasingly high number of players both companies and individuals. This means in the market are equipment sourced from tens of overseas and local suppliers. The equipment are of different qualities and sourced at various prices. The rise in competition, the need to make a quick sale and the lack of knowledge on both the side of some suppliers and consumers explains the very wide price range.

The number of equipment you need, like we have hinted above, will depend on your capital, the physical size of your premises, your target market and positioning in the market. At the very least, and for the major “bigger” equipment like racks and benches, you can tart with one of each. Of course for items kike dumbbells and weights you can’t start with one.

Again it’s not a must you have each and every of the above listed item. Items like rowing machine and cross trainers are missing from many gyms. Some don’t have treadmills and even exercise bikes, as much as these seem basic. Use your capital and target market to make the consideration of what to buy. If capital allows have as many different types of equipment as is possible. If capital is on the low and you are targeting the strength exercises market then you can do without the treadmill, rowing machine, bike and such.

If you are targeting the aerobics customer then the cardio equipment becomes important. Remember you need working capital to keep the business running at you break even. Then there will be small things coming up here and there. For instance you might find you need more lockers, you need to put a signpost somewhere, the turnout in the aerobics classes is bigger than you could have imagined and you need to buy more steps, or you get a crucial items at a discounted price. So don’t invest everything in equipment and you are left with no money to run the business.

Though new is preferred good quality second hand equipment are as fine. This is more so for the recognized brands and imported from the US and Europe.

Beyond the stated prices of the equipment there will be other costs of transposition and installation for items like flooring.

Whenever possible it’s advisable to buy the equipment in the company of an experienced gym trainer.

Among the leading gym equipment brands are Hammer Strength, Startrac, Lifefitness, Tecnogym

Suppliers

There are many suppliers of gym equipment. Some are individual importers doing one time deals, others bring a couple of equipment from China and sell through internet avenues. There also many second hand items importers from the US and Europe. Then there are the big shops specializing in all manner of gym equipment, think Nairobi Sports House.

The list below is not exhaustive but will jump start you. Shop around for suppliers offering the best prices and support.

 

Supplier

Contact

 

Details

 

 

 

Shamsher Ltd

Mombasa Road, Behind Vision Plaza,

 

-Imports both new and

 

 

 

Godown 3

 

second hand

 

 

 

 

020 826253

 

equipment mainly from

 

 

 

 

 

the US, and parts of

 

 

 

 

 

Europe.

 

 

 

 

 

 

-Prices considered fair

 

 

 

 

 

keeping in mind the

 

 

 

 

 

quality.

 

 

 

 

 

 

-Helps in purchase

 

 

 

 

 

decisions. For instance

 

 

 

 

 

you can go and say

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

you have Kshs.2m,

 

 

and they will put a

 

 

“package” of

 

 

equipment to fit your

 

 

budget. Even where

 

 

such options are

 

 

available don’t be

 

 

coerced into picking

 

 

things that may not be

 

 

of value to your

 

 

business.

 

 

-They also do gym

 

 

flooring.

 

 

-Great reputation in the

 

 

market.

 

 

 

Ultra Equipment

2nd Floor, Sound Plaza,Woodvale Grove,

Specializes in gym

 

 

equipment both for

 

0724 253 598 / 020 4441347

home and commercial

 

 

use.

 

 

 

Nairobi Sports House

Several Branches: Moi Avenue, Nairobi,

One of the most

 

Yaya Center, The Mall, Muthithi Road

recognized and oldest

 

Nairobi.

names in sports

 

 

equipment.

 

0721 201142

Sells a wide range of

 

 

equipment that can e

 

 

used in a commercial

 

 

gym.

 

 

Stocks well recognized

 

 

brands.

 

 

Prices of some items

 

 

are higher than

 

 

average.

BSR Engineering

Nairobi, Diamond Plaza,2nd Floor opposite

Importers of ex UK

 

Nakumatt Highridge

gym equipment.

 

Tel:0722353403/0728077772/8,0722600310

Prices are very fair

Capital Breakdown

 

Item

 

Breakdown

Total

 

 

 

 

 

(Kshs.)

 

 

 

Licenses

 

 

 

 

 

 

 

 

 

Single User Business Permit

 

1

20,000

 

 

MCSK/ PRISK

 

1

3,000

 

 

Signboard License

 

1

2, 500

 

 

Fire Compliance License

 

1

1,500

 

 

Sub Total

 

 

27,000

 

 

 

 

 

 

 

 

 

Equipment

 

 

 

 

 

 

 

 

 

Flooring

 

100m2 @ Kshs.3500/

350,000

 

 

 

 

m2

 

 

 

Flat Bench

 

1

20,000

 

 

Incline Bench

 

1

20,000

 

 

Decline Bench

 

1

20,000

 

 

Olympic Bench

 

1

35,000

 

 

Preacher Bench

 

1

110,000

 

 

Leg Press

 

1

190,000

 

 

Squat Rack

 

1

70,000

 

 

Power Rack

 

1

180,000

 

 

Barbell

 

10 @ Kshs.4000

40,000

 

 

EZ Curl

 

[email protected] Kshs.5000

15,000

 

 

Dumbbells

 

300kg @ Kshs.300

90,000

 

 

Weights

 

400kg @ Kshs.300

120,000

 

 

Cable Machine

 

1

300,000

 

 

Rowing Machine

 

1

150,000

 

 

Exercise Bike

 

1

120,000

 

 

Jumping Ropes

 

15 @ Kshs.700

10,500

 

 

Steps

 

15 @ Kshs.3000

45,000

 

 

Cardio Dumbbells

 

All

40,000

 

 

Exercise Balls

 

5 @ Kshs.4000

20,000

 

 

Mirrors

 

20 @ Kshs.1500

30,000

 

 

Fittings

 

All

15,000

 

 

Music System

 

1

30,000

 

 

Dumbbell Rack

 

1

10,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Signboard

All

16,000

Other Marketing Material

1

7,000

Fire Extinguisher

1

5,000

Miscellaneous

1

60,000

Sub Total

 

2,118,500

 

 

 

 

 

 

Premises

 

 

 

 

 

Rent

2 months deposit + 1

90,000

 

month rent. Will

 

 

depend on location.

 

 

(@ Kshs.30,000 per

 

 

month)

 

Renovation and Remodeling

Repainting,

180,000

 

partitioning, fittings,

 

 

counter (

 

 

Kshs.30,000) lockers

 

 

(Kshs.45,000) and any

 

 

branding

 

Sub Total

 

270,000

 

 

 

Working Capital

 

 

 

 

 

Salary

3 months @

135,000

 

Kshs.45,000 per

 

 

month for all

 

Electricity

3 months @

6,000

 

Kshs.2000 per month

 

Miscellaneous

 

25,000

Sub Total

 

166000

 

 

 

 

 

 

Grand Total ( Adding all the above sub totals)

 

2,581,500

Notes on Capital

The above figures are based on a number of case studies and actual figures from suppliers.

The figures above are for commercial quality equipment. Actual prices could vary depending on the brand of item, features, supplier, new or second hand and other such factors. Prices could be lower especially if you are purchasing ex UK (Europe). We have decided to work with higher range of prices to help you budget and not underestimate the cash you need. For instance you can get treadmills as low as Kshs. 70,000.

The figures should give you a pretty accurate picture of prices. However as the market opens up and more independent importers bring in equipment then the price ranges are becoming really wide. As a matter of caution there are many selling equipment for home use, and although it’s often several thousand shillings lower it’s not the best for a commercial gym, and in the long run becomes expensive. Still don’t just use price to gauge; the prices of second hand equipment from Europe and the US has fallen in big way. Shop and compare. Ask for some warranties and guarantees.

If low on capital you can start a gym without all the above equipment. You just pick on what suits you based on your capital, type of gym you want to start and target market. For instance a gym offering aerobics only and cardio will not need most of the strength equipment. A gym focusing on strength can survive comfortably without the cardio equipment. A gym offering spinning classes will need more bikes. So base the equipment you pick on your capital and target market.

Rent and remodeling will depend on the location of the gym, status of the premises, what additions (type of lockers, shower, changing room) you prefer to have.

Operations

Opening and Closing Hours

The peak hours of most of the modern gym found in middle class urban estates are during the morning hours (5 a.m to 8 a.m) and evening hours (5 p.m to 9 p.m). Thus among the first things to decide once you are ready for operations are what will be your opening and closing hours.

Ideally 5 a.m should be the opening time for a gym in an estate; there are people who want to exercise before going to work. Some of them will work out, and then go back to the house for a shower and breakfast before leaving for the office. There are also those who are building muscles and follow some sort of program; these too might need to work out in the morning.

So the earlier you open the better for them, and for your business. 5 a.m is reasonable time. When you can’t make 5 a.m then settle for 6 a.m. Later than that there is likelihood you are losing some would be customers.

Will there be customers that early? Well from the above there should be, but the only sure way to know is to experiment until you get the ideal hour. Start by opening as early as reasonably possible, see whether in a month you attract enough customers to make it worthwhile.

Then you should look at your immediate competition. If they are opening 5 a.m or such other time, and attracting good enough numbers then you should match them. And how will you know

about the operations of the competition? There is no soft way to this. You go there personally or send someone to collect the information. You could also ask their customer.

If none of the gyms around opens early then go ahead and be the first to try it out. Of course not blindly. For instance there are areas where due to insecurity no one leaves their house before 6 a.m.

It also advantageous to close a little bit late to cater for those who have been at work all day. The standard time is 9 p.m, but it could be a slightly later with a cap say at 10 p.m. Again this should be a business decision. Are you able to attract numbers to make the extra stay say from 9 p.m to 10 p.m worth it? If yes then go ahead and do it. Remember that you will spend almost another hour after you close down to tidy and clean up in readiness for the early morning customers.

Opening and closing hours are one of the ways used to differentiate and get an edge over the competition. An hour early or late can have an impact bigger than you could have imagined.

Signing In

Now what happens when a customer walks into the gym? The first thing is to check in by signing the check in book at the reception or counter. Signing in help you keep track of the attendance; you get to observe any trends, know who is attending and who is not.

Where subscription is monthly you get to know who is attending but perhaps has not paid, and you gently remind them. Where a customer pays for daily access he could have paid for several days in advance but his attendance is not consecutive. By signing in you are able to know how many more days he should attend.

Signing in is also important if you are not physically present at the gym to manage it. You get a very good idea of revenue and revenue trends. You are able to tell, at least on the book, how many have attended for the day, check their membership and then get an idea of expected revenue.

Self Training and Personal Trainer

For strength training there are mainly two types of customers: Those who train on their own whether they have a clue of what they are doing or not. And secondly those who need a personal trainer. Often the latter are beginners with a very specific goal that they want to achieve. For instance “I want to make my biceps bigger and chest wider”. The first group could also be having a very specific goal but they want to achieve that on their own or by trial.

Now a customer in the first group will just go to the equipment of choice and start working out as he pleases. And although he is working out on his own, and the gym is a free zone it helps,

especially if he is a beginner in the gym, that there is someone keeping an eye on him. This is to protect other users and also prevent from hurting himself.

Thus its good practice to have a trainer to assist anyone who needs help. Even those training on their own could need a tip here and there or help lifting some weight. So don’t practice a hands-off policy. Little things like that kind of support are what make customers loyal to a gym.

For the second group of customer then a trainer has to be present when he is training and give attention and guidance. For this privilege he pays an extra fee. The fee should be reasonable but enough to cover the salary of the trainer and a small profit for the gym.

There are also customers who will come with their own external personal trainers. This is no problem as long as the trainer also pays for membership. It’s always good to build relationships with such trainers because most of them tend to have influence in their circles in matter fitness. Thus they can refer consumers to your gym, or as in some cases use your gym for their classes. In such cases you can offer him free or subsidized rates if he is helping attract a good number of customers. Often the number of people training on their own is more than those who need a personal trainer.

For the aerobics classes the same process is more or less followed. The user comes in signs, changes ad goes to the class. For aerobics there will always be a trainer leading the classes.

Sanitization

Its good practice to have a sanitizer in the gym. There are customers who find it important to sanitize equipment before using it. And for some equipment like bikes it’s important to sanitize. In some gyms a customer is required to sanitize equipment after use, in others sanitizers lie around and a customer can sanitize as need be. The best practice is not to force customers to sanitize rather encourage it as a good practice. Trainers or other staff can randomly sanitize equipment. And here we are not talking of high tech sanitization but basic which involves spraying the equipment with a sanitizer.

Reserving Equipment

When buying equipment for a gym the assumption, and rightfully so, is that all customers will not attend at the same time. It’s not practical to have equipment equal to the number of customers that you have or expect.

Nevertheless you should have enough equipment and space such that even when the gym is packed no customer is idling because of lack of equipment or some activity to do. But it so happens that a certain customer prefers particular equipment over others and so wants to spend the whole session working out on that equipment alone. This inconveniences other customers and makes the whole gym experience not wholesome.

One option to avoid this is to buy extra equipment, but then how many equipment will you have to buy before everyone is satisfied? And then how many days in a week is the gym packed? The best practice whether you have a few or tens of equipment is to encourage rotation. Nudge

customers keep moving from one equipment to another say within 10 min to 20 min depending on the equipment.

Some define the time one can spend on an equipment in the rules but a better policy is for the trainer to find a way of encouraging customers who stick on one equipment longer than maybe fairly so and to the to the inconvenience of other users to rotate.

Nonetheless rotation is no excuse not to have adequate equipment. Because on the other hand if the customer cannot spend some beneficial time on the equipment before there is a waiting line and him feeling direct and indirect pressure to move over then the experience is less than fulfilling and he could opt for the competition.

Operation - Aerobics

Aerobics have become an important source of revenue for many gyms. Women are the major customers for aerobics classes, however nowadays there are a significant number of men participating. The increasing popularity of aerobics and gyms offering aerobics classes have made the space competitive and innovative. Thus the market moved from the ‘plain’ aerobics to internationally recognized sets such as Zumba. Presently there is quite a variety in the market; from the ‘plain’ aerobics to Zumba, Taebo, Hit Aero, Tabata, Insanity and many others.

Some gyms will specialize in one of the regimes while others will offer a variety so as to differentiate and also attract diverse customers. It’s safe to start with two. Many new customers will prefer one over the other because of what they have heard from friends or trends. Ideally the different regimes should have various results but most customers don’t exactly distinguish the benefits of each, and its more about keeping fit.

Success of aerobics depends not so much on the regime/ style being offered but on the trainer. If the trainer is good; and good means professional, a sense of humor, a sense of motivation and encouragement then word spreads around and many more join the class. A good trainer will also make customers attend everyday rather than sparingly. Because aerobics classes are often paid for on a daily basis it helps if there are more people coming in daily.

Aerobics trainers are paid per session. Standard charges range from Kshs.500 to Kshs.700. Well known trainers with big classes often get paid between Kshs.1500 and Kshs.3000 this is often in high end gyms or very popular and big classes. The amount you pay the trainer will depend on how much you are changing per class and how many people are attending. If there are many customers in a class then logically the trainer will ask for more. Agree on a fee that will also make you profit. As much as the trainer is important remember it’s your facilities and marketing that initially attract customers; so don’t let a star trainer bulldoze you into getting less than you deserve.

Trainers are rarely employed on a permanent basis; they come for a particular class then leave say to another gym. Still you want someone who is committed, who if you have classes

everyday of the week will be available. . Whenever possible look for a trainer who is not part of the neighborhood gym cycle. This means those who circulate from gym A to gym B all within the same estate sometimes within a radius as short as 200 meters. This way you protect your gym from being an also run, you are able to attract those who are not satisfied with a trainer in other gyms, so if they come to your gym and find it’s the same person they might be reluctant to sign up.

At times gyms poach trainers from each other, of course by offering better terms. But beyond poaching you can put small ads, or as usually happens trainers will come knocking once they have a hit that a gym is coming up. The only proof of their capability is to see them work.

Aerobics unlike strength exercises happen at scheduled times this is because they require a trainer and a number of participants big enough to pay the trainer and make profit for the gym. (See more of the session in A Note on Aerobics). And just like with activities in the gym there has to be some best practices. What happens when one participant is late? How long can you keep others waiting before starting the session? The sensible thing is to start the session and not keep all waiting because of one or two participants; it doesn’t matter whether they had paid for the session. Participants should know the time allowance within which the aerobics sessions should start.

Shower

The training session over the customer can either take a shower and change, or just walk out and go take a shower elsewhere. Some gyms due to limitations in space, drainage or even water will not have a shower, and the user has to go clean themselves elsewhere. Others will have a shower just for men and women have to do it in homes. If possible it’s a big plus to have a clean shower for both sexes. This will attract a group of consumers who for instance want to work out and then leave for the office without having to go back to their homes. Then there are those who want to work out and then leave the gym fresh for some other social event. In modern gyms a shower and toilet are such an important component but sometimes due to space limitations are not always possible to have.

Cleaning

It’s good to keep a gym clean .Dirty gyms can be a turn off both to men and women. Some gyms have the trainers clean up. But this negatively affects morale. Gym trainers carry themselves with a prestige of sorts and are not happy when given jobs that are not within their professional skills. The best thing is to have a person come on a daily busy to clean or one of the general assistants at the receptionist to do it.

Rules

Gyms have some basic rules to govern the operations and the behaviors of members. Often the rules are not enforced strictly but act as guidelines. The most common rules have to do with

signing in on arrival, Returning equipment say, Hygiene, No Food and Drink except water, Returning Lost and Found items, keeping time, Safety, no intoxication and such other guides.

Membership

Monthly and Daily Membership

Gyms use a membership business model. There are various forms of membership. The most common are daily and monthly membership. Monthly membership are usually priced lower and positioned as being of more value; that is if a consumer was to pay the daily fee for the whole month instead of paying the monthly membership then he will end up paying much more.

For instance a gym could have its daily membership fee set at Kshs. 150, while the monthly membership is Kshs. 2500. So if a customer was to opt for daily membership, and attend the gym everyday for 30 days he will end up paying Kshs.150 *30 = Kshs.4500. This is Kshs. 2000 more than he would have paid if he chose the monthly membership.

The monthly membership is used to lock in the customer. A customer who has a monthly fee is unlikely to shift to the competition. Monthly fees also provide some stability in the business in the sense that you are able to plan more confidently say for rent and salaries. On the other hand daily membership seeks to attract consumers who are not able to raise the month fee, or consumers who are not sure of their commitment for the whole month. Customers who are very sure they will not attend the gym everyday of the month and so only want to pay for the days they are present. Even rarely do monthly members don’t attend the gym every day.

Daily members are an important source of revenue, and you should take them equally good as the monthly members.

Flexibility is a plus business. It will disadvantage your business if you stick to the standard one month like a few do. In addition to the daily and monthly membership some gyms have a weekly membership which is cheaper than the daily membership but higher than the daily membership. There are some studies which claim that keeping everything constant, and giving consumers such three choices; they end up signing for the cheapest option

You should aim to lock in as many customers as possible to the monthly membership. Bigger gyms (clubs) have an annual membership. These is mostly aimed at upper class consumers and corporate which pay for their staff. For the standard gym in the estate annual membership does not attract many subscribers. Few are so sure they will be in the same neighborhood a year down the line.

Let us look at some of the key things that are important when thinking of membership

Monthly Members Turnover

This refers to the number of members who don’t renew their membership at the end of the month. Of course every month there will be members not renewing for a variety of reasons like work, motion, forgetting, losing source of income and related. But if the number of members not renewing is high then you should seek to find out why; is it the service, poor equipment, bad trainers or any other reason.

Perfectly you should aim to have more customers signing up than those not renewing their membership. That’s will be net growth and have a positive impact on your revenue. If there are more customers leaving than coming your revenue will go down. Technically this is called the attrition rate.

Don’t take it for granted when a member does not renew; reach out to them as the owner to find out what could be the reason. Also if a member signs up and two weeks down the line has not come to the gym you should seek to find out why. Long absence is always a bad sign; such a member is unlikely to renew membership.

From our survey an average 45 % of members don’t renew their membership month to month. Some will skip one month, renew the next and so forth. You should have enough new members to make up for those that leave members. Try to have rates below the 45%. You should always try to find out why a customer is quitting; if it’s within your control then you should change or improve. With competition rising and things not so clear economically it’s much easier to maintain a member than to recruit one.

Non – Renewal: Common Reasons

Lack of time – Too busy

Insufficient or poor equipment

Poor customer service

Poor trainers

Lack of parking

Too busy

Shifting from area

Bad timings

Financial reasons

Members’ Goals

Whenever possible understand the goals of your customers (the members) and help achieve them. And although achievement of a physical goal, say losing weight or getting a certain

physical shape, depend so much on the effort and discipline of the customer, you have a stake in it.

If a customer is not able to achieve his goal over a significant period then she will likely not renew membership. Trainers can build friendly and professional relationships with customers so that they know what goals they are aiming for and thus nudge or push them, whichever works with the customer, towards achieving them.

And because often consumers have unrealistic fitness goals compared to the time they want to achieve them, you can help moderate their expectations that so that they don’t crush if it takes longer than they wished for.

Fitting In

There are gyms which could be intimidating to new members. This is especially so when there are some loyal members in relatively good shape, who know their way round and are friends. A new ‘weaker ‘member could feel intimidated in such an environment. The member could skip sessions and perhaps opt for another gym where she feels more comfortable.

A trainer should come in to avoid such a situation. They should make all members irrespective of their status or physical well being feel comfortable and confident.

Keeping up with the trends.

At times members quit a gym because it’s not keeping up with trends in terms of equipment and (or) exercise regimes. For instance you could be stuck with Zumba while all the range is Insanity. This does not mean you have to keep chasing the trends, not necessarily so, but you should have your ear on the ground, observing your competition and the trends at the national level , and if something is significant enough to attract customers then implement it. For instance if Insanity is the range, and all the gyms in the neighborhood are offering Zumba, then it pays to start offering Insanity classes.

Keeping It Fresh

Customers could get bored going to the same place month in month out. As much as they are achieving their goals and enjoying their experience some ennui sets in. Because of this they could decide to check out other gyms for a month, but the month becomes two and then disappears completely. So once in a few months find ways of ‘refreshing ‘the gym: perhaps new equipment, rearranging the equipment, a new exercise regime or something just to give a fresh look and feel.

Revenue

Fees & Sources of Income

Major sources of income in a gym are membership fees. Whether daily, weekly, monthly or otherwise.

The charge for a monthly membership will vary. In standard gyms found in urban areas the price ranges from Kshs. 2000 to Kshs. 4500 per month. Kshs. 3000 and Kshs. 2500 are the most common monthly membership fees.

Daily membership fees range between Kshs.100 and Kshs. 500 with the average, and most common fee being Kshs. 150 per day.

Aerobic classes are charged at between Kshs.100 and Kshs.250 per session with Kshs. 200 being the most common.

Other sources of income are a registration fee which often is annual and averages Kshs.1000. There are some gyms which don’t charge a registration fee at all. Some gyms also have a pro- shop where they sell t-shirts, supplements, gloves and workout videos.

Often aerobics are not included as part of the membership.

Major Expenses

Rent

Trainers

Other expenses include

Electricity

Water

Security (where applicable)

Marketing

Receptionist

In standard gyms monthly members contribute an average of 40 % of the income while the rest comes from daily members including aerobics.

How much money you make thus depends on the number of members, monthly or daily, you have in a month and how you manage your expenses.

Case Study

To get a better understanding of the business side here is a case study of a gym in Nairobi Eastlands

Year started – 2013

Average rent of a one bedroom house – Kshs. 15,000

Services: Strength and various aerobics

Facilities – Basic but high quality. Benches, power racks, leg press, cable machine. Notable is there is no treadmill and only one spinner bike.

Competition – 14 other gyms within a radius of 1 kilometer. Many are standard facilities with only one exception in terms of number and variety of equipment. Many other have the basics including treadmills.

Staff – Two trainers who are employed on a permanent basis. Aerobics trainers paid per session.

Expenses

Rent – Kshs. 30,000 per month.

Trainers – Kshs. 28,000 for both

Aerobic trainers – Kshs.500 to Kshs.800 per session. Depends on the turnout and agreements with various trainers.

Aerobic classes – Two sessions per day; morning and evening.

Operating Hours 6 a.m – 9 p.m. Open even on weekends.

Cleaner – Kshs. 6000 per month

Miscellaneous – Kshs.12, 000

Total – Kshs. 115,000

Income

Monthly membership @ Kshs.2500 per month.

23 Members (September 2016) (Monthly memberships ranges between 21 and 33) Income from monthly membership: Kshs. 2500 x 23 = Kshs. 57500

Daily membership @ Kshs. 150 per day

Aerobics @ Kshs.150 per session.

Average total income from daily memberships: Kshs. 4000 (Ranges between Kshs. 1600 to Kshs. 5000)

Monthly total: Kshs. 4000 x 30 = Kshs.120, 000

Profits from sale of workout videos, t-shirts and supplements – Kshs. 13,000 Total Income – Kshs.190500

Profit: Kshs.190500 – Kshs.115, 000 = Kshs.75, 500

Profit oscillates between Kshs.60, 000 and Kshs. 110,000 per month.

Breakeven: A Scenario

To get an idea of how many members you need to break even, let’s give an example of a small gym in Nairobi.

Rent – Kshs. 20,000

Trainer – Kshs.18, 000

Other Expenses – Kshs.11, 000

Total – Kshs. 49,000

Now say you are charging a monthly membership of Kshs. 3000, and a daily membership of Kshs.150.

If you are relying on monthly membership to breakeven you need 17 members. (49000/3000)

If are relying on daily members then you will need 49000 / 150 daily sessions = 326.7 sessions, that’s an average of 11 members every day.

However rarely will a gym operate with a daily or monthly membership only. Often as we have stated under ‘Membership’ it’s a combination of the two types.

At the start consumers are reluctant to sign for monthly membership. Most start with daily then they upgrade to monthly. So in the first month you could only sign up 6 members. That will amount to Kshs.3000 * 6 = Kshs. 18,000.

Still not enough to pay the rent but can at least pay the trainers salary.

Your deficit at this point is Kshs.49, 000 – Kshs.18, 000 = Kshs.31, 000.

If the deficit has to be met by daily members then you will need 207 daily sessions (31,000 /150). That’s an average of 7 people per day.

These numbers are based on some case studies and for guidance only. Attendance peaks over the weekend.

If you are charging less then you will need more members. The numbers (even at a big scale) are achievable, but you have to be realistic. However good your gym is, irrespective it will be tough to attract say 50 monthly members in the first month, at least in the estates. We are not saying it’s impossible but it’s the exception rather than the rule, and, well, will require some intense amount of marketing or luck. Be realistic and plan accordingly.

Daily membership provides a significant source of income, and it’s much easier for a new gym to sign up daily members than monthly members. From the above you can see the stability that monthly membership offers; it cushions against the unpredictability of daily members and helps meet the fixed costs.

Revenue: Things To Keep In Mind

As much as consumes are health conscious and want to look great they are also price sensitive. Pricing way above what is considered the normal for the target market will make customers keep away. Case in point is a gym in Eastlands opened and with state of the art equipment charging a daily membership fee of Kshs. 500 and monthly of Kshs. 11,000. They had to adjust downwards.

It takes an average of 18 months for you to recoup your investment

The above case study is representative of the revenue of gyms in urban estates. We observed quite a number of loss making and low revenue gyms.

Losses: Common Reasons

-Paying extremely high rent for a supposedly prime location which does not attract enough customers.

-Starting at level far much lower in terms of facilities than the competition and still charging the same price.

-Paying very high for poor quality equipment or home equipment which then starts breaking down after a short while.

-Poor marketing which leads to low number of customers.

-Mismanagement, a very casual and unprofessional attitude in the gym. This is more so where the owner is not physically present and whoever is in charge is poor at it.

-Investing much money in state of the art equipment and many in number and very little in marketing. Related to this is also spending capital on equipment and remaining very little as working capital, so that if the gym stays for say for four months without attracting enough customers then it struggles to meet fixed costs.

-Poor location.

-Intense competition and lacking a way to differentiate or simply attract customers.

-Low quality trainers.

Breakeven point in Nairobi averages 7 months.

Accounting in a gym is not complicated because the number and types of transactions are very limited. Still it’s important to keep proper records, to calculate the monthly revenue and observe the revenue trends.

No special taxes.

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