The gym business lives or dies off monthly memberships. The more people you can get to direct credit a monthly payment into your bank account, the more profit you will make. But membership doesn’t have to be your only income stream. Adding alternate revenue sources will help to keep your cash flow healthy while also enhancing your member experience.
In this article, we’ll identify nine potential income streams to supplement your gym membership income.
Here’s a preview before we get started …
- Specialty Programming
- Sell Supplements & Fitness Gear
- Establish Your Own Brand
- Sell Information Online
- Events & Challenges
- Boot Camps
- Massage Service
Alternate Stream #1: Specialty Programming
Many of your gym members have specific goals that they are training towards. I came across a guy the other day who was preparing for a nationwide arm wrestling competition. Another group of buddies was throwing themselves, rather haphazardly, into preparing for their first ironman. These people would benefit from a specific, targeted training and nutrition program and many of them would be prepared to pay extra for it.
You can benefit from this need by hiring out gym space by the hour to freelance trainers who provide targeted programming for your clients. You can also provide targeted small group or class programs to train clients for an extra fee. Be sure to identify the need and fill your classes with pre-sign-ups before kicking into these programs.
Alternate Stream #2: Sell Supplements & Fitness Gear
Your members are the ideal market for supplements and fitness training equipment and clothing. Why watch them leave your gym and head to the supplement or fitness swag store down the road when you can sell it to them yourself?
Unlike most retailers, you have established relationships with the people you will be selling products to. That provides you with opportunities to ask them what sort of products, and even what brands, they want to purchase. This will tell you what products to stock and which ones to avoid.
Your members look to you and your staff as fitness experts. As a result, they will feel more confident in buying fitness supplements and training gear from you than from some stranger down the street that they’ve never met before.
Your members will really appreciate the convenience of having a supplement store on site. It can also draw new customers through the doors. For every product you sell to a non-member, you should give them an incentive to use the gym. I used to give people who purchased more than $20 worth of product a free 7-day pass to the gym. I had my sales staff primed to follow up, with the result that around 30 percent of the street purchases ended up with a new member.
Of course, to attract people to come on off the street. You need to have some window and/or street sign marketing to alert them to the fact that you provide the greatest range and the best-priced supplements in town.
In addition to off-the-street and member sales, you have the opportunity to open your fitness store to the world. Sell supplements and merchandise from your website.
When it comes to supplements, your gym is the ideal venue to sell the following product categories:
- Pre-workout supplements
- Muscle growth supplements
- Probiotic supplements
Don’t forget protein bars. They will. if my experience is anything to go by, quickly become your best-selling product.
When it comes to merchandise, here are the proven winners:
- Track pants
- Tank tops
- Muscle tanks
- Athleisure wear
- Workout footwear
- Yoga mats
- Yoga blacks
- Weightlifting belts
- Workout gloves
- Knee wraps
- Ankle and knee sleeves
- Muscle balm
- Water bottles
- Workout journals
- Recipe books
- Bodybuilding books
- Shampoo, conditioner, deodorant
- Resistance bands
Some gym owners I’ve spoken to complain that they simply don’t have time to add retailing to everything else that they do. All I can say is that the increased cash flow that comes from adding a retail arm to your business is well worth the effort.
Here are seven tips I’ve picked up on the subject over my 35 years in the gym industry:
- Start with limited stock – before you order anything in, survey your members as to what they want you to sell. Then work with your staff to come up with six core products that you can test the waters with. If those things sell well, you can add a few more. You don’t, however, want the retail side of the business to get out of hand.
- Make it easy for the customer – think about what you’re selling from your member’s perspective. A busy mom might turn up in a fluster because she’s left behind her earbuds. No problem, you’ve got them right there on the counter. A senior turns up for a yoga class but doesn’t have a mat. Your instructor’s got them right in the class, along with a swipe machine for instant payment. A bodybuilder comes in but hasn’t had time to down a pre-workout. You sell it by the glass and can whip one up before he’s out of the locker room. The more convenient for the customer your retail service is, the more money will end up in your bank account.
- Market your products. Put up posters in the locker rooms encouraging members to try out your new flavor of protein shake. Promote your supplements and gear in your newsletter and emails. You should also do ‘use specific’ marketing. That means promoting earbuds in the cardio area and lifting belts and gloves in the free weights room.
- Mark-up by 100 % – a one hundred percent markup is the standard in the supplement and gym gear business. So if a pair of gloves costs you five bucks, sell it for ten. When you consider that you are not having to pay for any extra retail space and you have a ready-made market, you will soon start to make a healthy profit.
- Add a vending machine – vending machines allow for an even higher mark-up than other products. They also provide a high level of convenience for your members. A vending machine will also allow your sales to tick over during the hours that the gym is not staffed. That’s a big bonus if you are running a 24-hour operation. Vending machines can swell everything from pre-workouts to training gloves.
- Have your staff wear and use the gear that you are selling – there is no better advertising for a line of sports clothing than seeing fit people moving around with that gear on their body.
- Provide education about the need for the products you sell – have information sheets alongside the products. Add information articles about the need for specific supplements, the benefits of training gloves, knee sleeves, and workout belts in your email newsletters and on your blog.
Alternative Stream #3: Hire a Sports Nutritionist
Gym staff and personal trainers are limited in the amount of nutrition advice that they can legally offer to their members. Yet, given that more than half of gym members are usually primarily motivated by the desire to lose weight, nutrition advice is what they need more than anything else.
By employing a sports nutritionist, you will have the ability to provide the nutritional advice that your members are in need of. A general gym membership will come with basic nutritional guidance but for a detailed nutrition program targeted to their goals, they would pay extra.
A well-marketed nutritional guidance service can easily bring in a thousand or more dollars per week, easily off-setting what it would cost to hire a sports nutritionist.
Having a nutritionist on hand to answer members’ off the cuff questions and to guide people in their supplement purchasing decisions is an extra bonus.
Alternative Stream #4: Establish Your Own Brand
Setting up your own brand will provide a boost to your business promotion while also establishing your legitimacy as a fitness identity. Your members will be proud to wear clothing emblazoned with your logo, so it will provide a whole new aspect to your retail business.
The first step to establishing your own brand is to align your products with your image. If you’re an up-market gym, for example, it would be a better idea to sell steel water bottles that have your logo on it than plastic ones. Be tasteful in the way that you use your logo. It should be subtle rather than in-your-face.
When it comes to selecting what products to brand, start with those that have broad member appeal and that are unisex. Examples are socks, hats, and water bottles.
Once you’ve decided on your products, start looking for local suppliers who can add your logo to the products they produce. The fact that the products are sourced locally will be an extra selling point.
Position your branded gear prominently in the foyer of the gym, as well as around the cash register. In addition to selling your branded gear off your website, you should also set up a separate online store. These can be made to order and sent from the manufacturer directly to the buyer, minimizing the amount of merchandise that you have to carry.
You should also take your online store mobile. More consumers are shopping from their phone than a desktop or laptop so if you’re not there, you will be missing out on sales.
Alternative Stream #5: Sell Information Online
Selling fitness information is a huge business. Right now, individuals are making six-figure incomes (some much more) selling weight loss, muscle building, and sport-specific training guides, reports, and ebooks.
Most of those people do not have the legitimacy of a bricks-and-mortar gym behind them. But you do. If you’ve been marketing well, branding your gym through merchandise, and have established a vibrant social media presence, your gym name will have legitimacy in the market. You can take advantage by selling fitness information online.
Selling information online is easier than it may sound. You can team up with an affiliate service such as Commission Junction, which will convert your written material into brochure or Amazon Kindle ebook form and market to their massive audience.
You don’t even have to write the material yourself. You can find fitness experts on platforms such as Upwork who will create premium content for you at a competitive hourly rate. You only pay that person once. Then every time someone buys your digital product, money flows into your bank account.
Alternative Stream #6: Consider Franchising Your Gym
If you’ve been operating for a few years and have built a successful operation with happy members who are serving as your ambassadors in the community, it might be time to consider franchising.
Do you feel that your gym could take new members if you had more room? Or that you could fill a second venue but simply don’t have the hours in the day to manage two gyms? When you franchise the business, it is up to the franchisee to do all the heavy lifting involved in getting a new gym off the ground – and they pay you for the privilege.
Franchising will allow your business to grow while using the franchisee’s capital. The franchisee will also carry all of the risk associated with signing leases and contracts.
As a franchisor you are obligated to establish business structures, models, plans, trademarks, and goals that are transferable to the franchisee. The franchisee is obligated to operate their business under the rules and regulations that you establish. Both parties, however, are obligated to act in accordance with the Franchising Code of Conduct.
Franchising is not a simple process, but it might be the turning point that transforms your local gym business into a fitness empire. You will need to work with a law firm that specializes in franchising. You will have to pay a number of upfront fees, including lease, lawyer, and marketing fees.
The franchisee will pay fees to you for the use of your business name, structure, trademarks, and model. It is for you, in collaboration with your franchise lawyers, to determine what this amount will be. The payment may include an establishment fee and a percentage of profits.
As a franchisor, you owe your franchisee a duty of leadership. That involves providing initial and ongoing training, and documentation of all procedures.
The bottom line on franchising is that you need to have put in the hard yards to build a business that is worth replicating first. When you’ve done that, you must be totally committed to supporting your potential franchisee every step of the way, realizing that their success is your success too. Contact a franchise lawyer early on in the process, understand the start-up costs , and be prepared to invest the time to document all of your processes.
Alternative Source #7: Events and Challenges
Holding local events and challenges presents a great opportunity to get more people coming through your gym doors. Even though you probably won’t charge people to participate in the actual events, the greater foot traffic and the acquisition of contact details will make the effort well worth it.
Local events might include an annual marathon, a fitness challenge, a new product party, or a nutrition seminar. Promote the event to your members as well as within the local community. If you hook into a regular community event, you will probably be able to generate free publicity on local radio and TV stations.
Every time you hold an event, you should have some promotion in conjunction with it that allows you to collect contact information from attendees. My favorite was to have a 6-month membership draw at the conclusion of the event. This promotion would sometimes bring in more than a hundred new contacts. My sales staff was primed to follow up with them, resulting in an average strike rate of 22 percent across all of the local event promotions that I was involved in. In real terms, that translates to an extra 19 members for every event that my gym hosted.
Alternative Source #8: Workshops
A workshop drills down on a specific fitness-related topic and provides expert advice to your members. Here are some workshop topics that have proven popular …
- What is Keto and how do I get started?
- The ins and outs of intermittent fasting.
- How do I prepare for my first bodybuilding show?
- How to select the best exercises to build muscle?
- What is the best cardio to lose weight fast?
Workshops can last anywhere from 20 to 60 minutes. Rather than just lecturing to the audience, make it as hands-on as possible. Include handouts, quizzes, and mini workouts. The more you can get the participants up and moving around the better.
Promote your workshop well in advance with posters, email newsletters, social media promotion (especially Instagram stories), and on your website. Encourage members to bring a friend with them. Offer healthy snacks as an extra incentive.
You should be able to charge anywhere between $10 and $30 per person. If you can have 25 people to attend at $25 per head, that’s an extra $625.00. If you run the workshop yourself,your costs (printing, food, etc) should be less than $50. Even if you’re paying someone else $60 to run the workshop, you’re still going to come away with a profit of more than $500. Hold two seminars per month, and you’ve added $12,000 to your bottom line.
Alternate Source #9: Boot Camps
Boot camps provide your members with the opportunity to train in the outdoors using unconventional methods such as tires. Sledge hammers, hills and tree trunks. It’s also a great way to build cohesion between boot camp members and motivate a small group to achieve a common goal.
You can run themed boot camps based around a specific goal. Examples are winter sports prep, losing the baby bulge, and shaping up for summer. Most boot camps consist of 8-15 members. Each person typically pays between $12-15 for a 45-60 minute session. They may be held anywhere within the local community, such as at the beach, on a fitness trail through the woods or at a public park. Members transport themselves to and from the venue. Your staff member will probably bring some training gear such as medicine balls or kettlebells with them to the class.
Boot camps before work are very popular, providing you with an opportunity to bring in thousands of extra dollars per year for your gym before you even get out of bed.
Alternative Source #9: Massage Service
Your gym is being frequented every day by the very same types of people that local massage therapists are trying to make contact with. So, why not offer space in your gym for a massage therapist to set up shop? This will be a win-win for your members and yourself.
Many people would love to have an on-site professional massage service that they can book immediately after their workout. This type of service will bolster your reputation within the community as a one-stop health and fitness solution. You can either charge the massage therapist a monthly rental or take a percentage of every massage they perform. In my experience, the servicer will prove to be so popular that you’ll actually make more money by taking a portion of every massage.
In this article, I’ve outlined nine realistic, achievable alternative income streams that your gym can implement immediately. Here’s a recap …
- Specialty Programming
- Sell Supplements & Fitness Gear
- Establish Your Own Brand
- Sell Information Online
- Events & Challenges
- Boot Camps
- Massage Service
Not all of these alternative income streams will apply to your situation. But a few of them will. Why not discuss the possibilities with your team and then choose one or two ideas to focus on. Once they are established and proving profitable, you can consider adding another revenue stream. Within a few months, you will have added several profitable new income streams to boost your bottom line and offer more services to your members.