To satisfy the growing public demand for well-being and fitness services, gyms and fitness studios require significant financial resources, which often involves lending. The fitness industry is also in dire need of dedicated fintech solutions to help gym managers cope with subscriptions, loyalty programs, payrolls, and inventory maintenance. Here is what the market has to offer.
How Much Does It Cost to Open a Gym?
Depending on the size and location, the startup cost of a small fitness facility might range from $5,000 to $50,000. However, the upfront investment for a large commercial gym is much higher, about $90,000 – $250,000. In some areas, the costs might surge as high as $400,000.
The price range is true both for standalone fitness businesses and investing in an existing gym franchise. The estimated budget includes one-off costs such as permits and licences, and also ongoing costs like monthly rental fees, employee wages, gym equipment lease, daily necessities, utilities, etc.
While financing a small fitness studio might be affordable for many entrepreneurs, creating a full-scale gym space might require a loan or external investment. In most countries, there is not much angel investor activity in the fitness segment, though they might be interested in high-tech fitness innovations like AI-driven gyms and virtual coaches.
If that’s not the case, a person or a team behind a new gym business might need to resort to a loan. Traditional bank lending might be tricky and slow, so the fintech industry has a few nice solutions to assist aspiring fitness entrepreneurs.
Digital Lending Tools for Fitness Equipment
To start a gym, one should not only create a unique concept and vision but also figure out ways to finance their business ideas, gym equipment, and potential growth. When it comes to extra money, there are always business loans available. However, only a few digital lending platforms have offers specifically curated for the needs of fitness studio owners.
ChargeAfter
ChargeAfter is an embedded lending platform for sports and gym equipment sellers. It offers personalised financing choices, post-sale management capabilities, and advanced analytics. The platform’s end customers include gym owners and fitness enthusiasts who purchase equipment for home use. It integrates with multiple lenders and is available at every point of sale through APIs, SDKs, and e-commerce extensions.
Fleximize
Fleximize is a digital business lender dedicated to providing UK SMEs with flexible finance options. For gym, studio and health club owners, this fintech offers loans of £10,000 – £500,000 to be paid over 3 – 60 months. These flexible financing solutions may cover various gym needs, not only the equipment purchase or rent but also refurbishment or personnel-related costs. Approvals of loan applications and fund deposits might take as little as 24 hours. Business owners in need of some extra commercial gym equipment can also access Flexiloan Lite to get an instant cash boost for smaller, upfront investments.
Rigquipment Finance
Rigquipment Finance specialises in custom financing solutions for gym owners, applying a consultative approach to lending. The flexible payment plans allow clients to obtain a loan from $5,000 to $250,000 and a business model consultation. The firm’s term loan product can be used for expenses relating to an expansion, renovation, relocation, business acquisition or other special project. Rigquipment Finance also offers equipment lease options.
iCapital Funding
The online lender offers long-term loans, equipment financing, merchant cash advances and micro-loans for gyms, with funding available within 24 hours of approval. In the case of equipment financing, the newly-purchased equipment serves as collateral. If the borrower is unable to make timely payments, the lender will repossess the purchased equipment and sell it to recoup the value.
LifeFitness
Life Fitness specialises in the production and distribution of cardiovascular and strength training equipment. However, the company offers numerous other fitness-related services, including financing and leasing options. Besides, the fitness equipment provider partners with BNPL company Affirm to enable individual customers to finance their home workout facilities at flexible terms.
How Fintech Solutions Facilitate Gym Management
The global gym management software market size was $222.5 million in 2021. It is projected to reach $545.68 million by 2032, growing at CAGR 8.4% during the forecast period.
By adopting fintech solutions, gyms can improve operational efficiency, enhance member satisfaction, and ensure robust financial management. Besides, automation of financial processes means less manual work for gym employees who can instead concentrate on improving customer service.
The use of fintech solutions in gym settings:
- helps automate billing cycles, ensuring timely payments and reducing the risk of missed or delayed membership payments;
- provides customers with various payment methods such as credit/debit cards, digital wallets, direct bank transfers, or even crypto, increasing convenience and accessibility of fitness services;
- ensures a steady cash flow and minimises administrative work;
- enables members to sign up, renew, or cancel memberships, as well as pay for services, classes, and merchandise online or through mobile apps, enhancing the overall user experience;
- helps gym managers track revenue, expenses, and profitability;
- assists in analysing member behaviour, preferences, and spending patterns, enabling personalised services and targeted marketing;
- enables the detection and prevention of fraudulent activities via built-in security features, protecting the gym’s financial assets.
All the above-mentioned benefits and more are offered by many fintech providers.
Mindbody
Mindbody is a cloud-based club management and appointment scheduling solution primarily used by gyms, fitness and personal training centres, wellness centres, spas, beauty salons, dance schools and yoga studios. It offers scheduling services, waiting list management, appointment booking, membership management, marketing management, etc. As for staff management features, those include check-in and check-out management, role-based permissions, payroll management and calendar integration.
bim
The virtual gym network startup offers an all-in-one management, video communication and fintech platform to support online coaches. The platform enables home exercise sessions in real-time multi-user video format for up to 20 participants. Using a single bim app, coaches can create virtual gyms, organise live fitness sessions, publish content, communicate with their clients, receive and manage their revenue.
Eversports Manager
This firm offers finance and accounting software for gyms and fitness studios. Its tech stack enables business managers to seamlessly create end export financial reports, overview the studio’s finances, manage payroll and invoices, set up flexible compensation plans, receive on-site payments via a built-in cash register module, keep track of all merchandise sales, analyse business and revenue data and customer insights, adapt pricing, and drive revenue with on-demand online classes.
ZarMoney
This payment software enables gym owners to manage their operations effectively while enhancing the client experience. Its main benefits include support of multiple payment methods, e.g. credit card payments, direct deposits, and digital wallets, real-time inventory management, a system for staff management with fitness classes scheduling and performance metrics tracking, advanced access control systems, automated payment processing, membership management, online booking, and advanced reporting and analytics.
Fintech Solutions That Incentivise Fitness Activities
Besides direct application in gym management, fintech solutions can also motivate potential gym goers to transit to more healthy and active lifestyles. We all know the struggle between visiting a gym and watching Netflix on your home couch is real. Without additional incentives for the general public, both online and on-premises fitness coaches will have less work.
However, fintech apps can easily promote well-being and fitness. They meet clients where they are, e.g. on the couch, and push them for more activity with notifications and rewards.
Paceline
The company offers an app that motivates you to live a healthy life, and a credit card for health & wellness rewards and cash back. By partnering with various fitness platforms and wearable devices, Paceline tracks users’ physical activity, enabling them to earn rewards for maintaining a healthy lifestyle and reaching their fitness goals. Partner brands provide exclusive offers and great deals as a reward, while users’ Pacepoints can also be redeemed for gift cards, giveaways, and more.
HealthyWage
The company provides weight loss and fitness challenges with cash prizes either directly to consumers or through many large employers in the U.S. Through its “HealthyWager” program, participants can “wager” on how much weight they aim to lose within a certain time frame, and the program will offer cash prizes based on the outcomes of those goals. HealthyWage step, jackpot and team challenges all provide an opportunity to win a prize along with getting healthier.
IncentFit
This fintech provides corporate wellness solutions for companies through gym reimbursements, corporate gym deals, and fitness challenges. With the help of IncentFit, businesses can engage and reward their employees for making healthy choices. The solution can track individual health state, increase team engagement through meaningful fitness activities, and ensure that employees comply with regular vaccination or physical checkup schedules.
Sweatcoin
Sweatcoin is a blockchain-based app which rewards users’ daily steps with cryptocurrency that can be redeemed on selected products and services or donated to charity. Possible rewards include fitness gear, workout classes, and Amazon gift cards. The startup operates on a move-to-earn (M2E) model, where users receive compensation for being physically active. Besides redeeming, SWEAT crypto can be used for savings and participation in the on-chain NFT game.
Conclusion
Fintech solutions offer multiple benefits to gym management and business performance. To begin with, fitness studio owners can access digital business loans in a quick and seamless way, without excessive paperwork and bureaucracy. Many fintech providers also offer equipment purchase loans to individuals wanting to set up home workout stations.
Once the gym is settled, fintech solutions help in running the business. They automate the workflow, membership payments and payrolls, provide business insights for marketing and pricing strategies, help optimise the equipment use, and enable virtual workout sessions.
Finally, many fitness and wellness apps use fintech tools to provide rewards for people for working out and making healthier lifestyle choices. That promotes an overall fitness-friendly agenda and places emphasis on wellness, driving potential clientele to fitness centres.
