How to open a gym (step-by-step)

Turning your passion for fitness into a business venture can be hugely rewarding, but if you want to hit the ground running, you need to consider several financial, legal, operational, and marketing factors. 

Here’s our guide on how to open a gym, so you can avoid some of the most common pitfalls and give yourself the best chance of success.

 

1. Decide on a niche

According to IBISWorld, there were 4,880 gyms and fitness centres in the UK as of 2023, an increase of 9.6% from 2022.

Considering there are only 1,575 bakeries, this is a huge number, which goes to show just how competitive the market is in its current state.

But don’t worry—you can leverage the fact that it’s such a fast-growing industry by focusing on a niche area of the market.

This should be the first thing you consider when working out how to open a gym. The target market you choose should inform every decision you make throughout the process if you want to run a successful business.

Your market research should look something like this:

• search for ‘gyms in your local area’ (such as ‘gyms in Liverpool’ or ‘gyms in Manchester’)
• look at the Google My Business results at the top of the page, the gym websites that are ranking underneath them, and any articles listing the ‘best gyms’ in your local area
• make notes on each gym you see—are they targeting casual gym members, or do they specialise in other things, such as indoor cycling or yoga classes, for example?
• identify a gap in the market

Perhaps there isn’t a gym catering solely for women aged 40+, or those looking to build their strength through powerlifting—this means you’ve struck gold with an idea for starting a gym in a competitive landscape.

Take Federation Gym in Manchester’s Northern Quarter, for example. It’s the city centre’s first large boutique gym specialising in bodybuilding, powerlifting, and weightlifting. So, it stands out from the crowd for anyone looking for a gym who is also interested in this area of fitness.

Once you’ve identified your niche, the rest of the process of starting a gym will be much easier.

 

2. Scope a location

One of the most important steps in opening a gym is choosing a suitable location. If you get it wrong, you could undermine an otherwise profitable business idea.

But not to worry, we’ve listed each of the factors you need to consider below:

• footfall—if you’re setting up a boutique or specialist gym, this is less important, as you’ll rely on fewer higher paying clients (rather than a general gym like Pure Gym, which relies heavily on busy areas)
• competition—always perform a competitor analysis to determine whether a venue is right for your business (for example, setting up a 24-hour gym opposite an Anytime Fitness gym would be a bad idea)
• accessibility—the easier it is for potential clients to access your facility, the better. Busy roads with good transport links leading into town centres are great, as they’re usually cheaper but provide the same level of access
• parking—this is convenient for clients but can increase your rent significantly (you may want to go for an empty lot on a retail park where the parking is often shared and included in your lease)
• rent fees—be aware of hidden fees such as service charges, business rates, commercial stamp duty, and your initial deposit when browsing venues
• lease terms & conditions—is a short-term lease that allows you to move to a larger venue better for your business model, or would you prefer a long-term lease for greater security if you’re not focused on rapid growth?
• space available—the building’s square footage and layout can impact how many classes you can run at one time or the amount of equipment the gym can house
• council permission—does your chosen venue come with the D2 planning permission that all gyms require, or would you need to apply for it?
• nearby developments—this is easily overlooked but could impact your business if you’re not aware of upcoming development work (you can use this government tool to check for nearby planning decisions)

It’s a lot to take in, but you’ll be glad to know it’s one of the most vital steps in opening a gym and, therefore, one of the most satisfying to tick off your list.

 

3. Name and trademark your brand

Once you have a clear target market and strong knowledge of your competition, you can make things more official by naming, registering, and trademarking your brand.

Not only is this a practical step in starting a gym, but it can help you to grow your dedication to your business idea and remove any mental roadblocks before creating your business plan.

Look at existing gym franchises or boutique gyms for inspiration, and brainstorm names based on the values you want your gym brand to stand for. For help, you can also try articles on naming your gym.

Also, here’s a guide on registering a trademark in the UK if you want to do this yourself and avoid solicitor’s fees.

Depending on your gym’s location and the services you offer, you may need to register your business with your local authority. You can find out more about this via the GOV.UK website.

 

4. Consider the costs of opening a gym

There’s no straightforward answer to how much it costs to open a gym, as every business has different goals for their first year depending on their budget and ambition.

If you’re learning how to open a gym for a niche demographic, then you may have different priorities in your budget than someone looking to compete with 24-hour gyms like PureGym and Anytime Fitness.  

However, here are some of the main costs to consider before creating your business plan:

• building or lease—the cost of purchasing or renting a facility is one of the most important to plan for
• running costs—lighting, heating, water, broadband, cleaning, and general maintenance must be covered
• computer systems and software—investing in quality equipment and software is essential if you want to keep things running smoothly
• equipment—focus on what is most relevant to your target customer base, and consider refurbished gym equipment or leases to cut upfront costs
• decor—you may want to personalise the space to appeal more to your target market, especially if you’re a boutique gym (think a nature-focused environment that moves away from the traditional gym aesthetic)
• insurance—Employer’s Liability cover is a legal requirement, but you may also want to consider cover for your Public and Products Liability, Professional Indemnity, building and equipment, as well as cover for things like business interruption and cash held at the premises
• staff—you’ll likely need a gym manager, receptionists, admin staff, and personal trainers, but you may also require sales and marketing staff as you grow
• employee uniforms—an often-overlooked cost when opening a gym, this is essential if you want to build a strong brand and appear professional to clients
• professional services—you might opt to pay for professional services to manage your books and process your annual tax and VAT returns
• VAT and tax—you’ll need to register for VAT once you’ve surpassed £85k turnover (which can lead to extra costs), and tax is a large annual outgoing to consider, too

 

5. Create a gym business plan

Opening a gym is much easier when you have a solid plan. It’s the best way to protect your business against unnecessary snags and ensure you hit the ground running.

The most important elements of a strong business plan are:

• executive summary—describes your company and what you expect it to accomplish 
• company description—gives an overview of the company, its structure, and the target market it’s going to serve
• products and services—provides insight into the products and services your company offers 
• market analysis—highlights your competitors and how you plan to overtake them, alongside the company’s strengths and weaknesses 
• marketing strategy—details the company’s plan for attracting and retaining clients through promotion  
• financials—includes the company’s funding requirements and financial projections
• budget—designates funding to different areas of the business, such as gym memberships, staff, and marketing costs

Setting your membership price is one of the most important steps in opening a gym. It takes careful planning to ensure that this income stream suits your business structure.

For example, say you’re writing a business plan for a boutique gym in a city centre that targets powerlifters. Your chosen facility is 5,000 sqft, your running costs are £10k per month, and you plan to hit the 500-member mark within 6 months.

Five hundred members paying £20 in membership fees equals £10k per month, which means you will have broken even.

But if your gym only has space for another 100 members and you hit this by the end of the year, you will only have £2k profit per month before paying tax and VAT.

This means the gym membership fee needs to be higher to sustain your business. But if you raise it to £40 per month (which market research indicates you can since it’s a specialist gym), you would make £14k profit per month before tax.

This doesn’t include secondary income streams, which can include selling:

• advertisement space
• locker hire
• supplements
• meal prep services
• specialist coaching

Hopefully, this example demonstrates the importance of calculating your gym’s membership cost and structure. Pick a system that matches your company’s set up, and you can’t go wrong.

Related: What is leisure insurance?

 

6. Know the legal requirements for opening a gym

The legal requirements for opening a gym in the UK vary depending on its location and the services it provides. When you open, it’s important to inform your local authority and ensure you’re running a compliant business.

However, important legislation you should be aware of includes:

• the Health and Safety at Work Act etc. 1974— places a duty on employers to ensure the health, safety and welfare of their employees
• the Management of Health & Safety Regulations 1999—ensures all employees have adequate training, and that there are enough first aiders on-site in relation to the gym’s capacity

Aside from additional licences or permits that your local authority may require, these are the main legal requirements for opening a gym. It’s important to investigate this to ensure you avoid any penalties.  

You must also obtain Employer’s Liability insurance if you employ staff at your facility, butother forms of cover are optional depending on the areas of your business you wish to protect.

 

7. Consider insurance for your gym

Insurance is easily overlooked when researching how to open a gym.

But it could be something you’re legally required to have depending on whether you employ others—Employer’s Liability cover is essential in this case.

You might also want to consider insurance to protect your business against other risks.

For example, say a client slips on a wet floor and makes an injury claim against your business. Public Liability insurance could help you avoid covering legal costs if the claim is successful.

Or, say one of your bikes is damaged by a client during an indoor cycling class. Contents cover could ensure the equipment is repaired or replaced without any cost to your business.

Sporting club, leisure, and community insurance is coming soon to Ripe with a range of cover options, so keep this in mind if you’re opening a gym this year!

 

8. Develop a gym marketing strategy

You don’t have to be a marketing guru to implement a successful strategy for attracting clients to your gym and keeping existing members happy.

However, it‘s a vastly broad topic, so researching the parts most relevant or viable for your business is helpful before diving in. As always, checking what your competitors are up to beforehand is incredibly important, too.

Here are some of the main areas of marketing we’d suggest looking at when learning how to open a gym:

• website—ensure this is engaging, user-friendly, optimised for search engines, and has a strong CTA (call to action)
• social media—Instagram and TikTok are particularly good for gyms and leisure centres, as they’re often used by gym goers and those interested in fitness  
• email newsletters—the perfect opportunity to give members ‘exclusive’ news and offers to keep them engaged with your business
• PR—we’re talking about Public Relations (not your personal record), which can be great for building your reputation both in your local area and online
• retention strategies—targeting current members with offers and perks can help establish loyalty and encourage them to stay at your gym

 

Opening a gym FAQs

How profitable is opening a gym?

While a gym’s profitability depends on many factors, thorough planning can certainly improve your chances of making a higher profit.

Implementing a well-rounded gym marketing strategy can also give you an edge over competitors, especially if it’s aimed at your exact target demographic.

 

How much does it cost to open a gym in the UK?

It will likely cost between £70-£150k in the UK, but it could be more or less depending on the type of gym you’re opening and the equipment you need, among other variables.  

That said, it’s impossible to determine the cost of opening a gym without knowing the context of an individual situation. That’s why it’s important to do your own research based on your circumstances first.

 

Do you need a licence to run a gym in the UK?

Registering your business with Companies House is an essential step in the process of opening a gym. Aside from this, however, the licences you’ll need to operate legally depend on your local authority and its rules surrounding fitness and leisure centres.

 

How hard is it to start a gym?

Researching how to open a gym in the UK will quickly show that it can be challenging.

There are many elements to consider, from finding a targetable niche in your chosen area to ensuring your pricing strategy is viable.

However, as with starting any business, it can also be extremely rewarding if you plan it meticulously and stay consistent.

 

How much does a gym owner make in the UK?

The average yearly salary for gym owners in the UK is around £40-60k, but the earning potential is higher still since bonuses are often rewarded based on profit and performance.

 

Do you need qualifications to open a gym?

Unless you want to run exercise classes or work with personal training clients personally, you don’t require any formal qualifications to open a gym in the UK.

However, fitness qualifications are needed in the following scenarios:

• Level 2 gym instructor qualification—required for leading fitness classes
• Level 3 personal training qualification—required for working with clients on a one-to-one basis

 

Specialist gym insurance through Ripe

If you want peace of mind when running your gym or leisure business, you may want to consider having specialist insurance in place to cover all the bases and protect you in the worst-case scenarios.

Through Ripe, there are many cover options to choose from, including Public and Products Liability to protect your business against third-party claims, and Legal Costs cover for pursuing or defending a claim.

You can also opt for Buildings Cover to protect any buildings your business owns or leases.

Click here to learn more about sporting club, leisure and community insurance coming soon to Ripe.