I am thinking of buying this local gym. Do you think it is a good idea? ANY help would be great! thanks!?
I do not have the funds to buy a huge business so I’ve started looking small. I want to get my feet wet so to speak with buying, running, and then selling a business.
I have come across a local gym that has been there for 28 years. They have a website and an established brand. The asking price is ,000. The rent is 00 per month and the income for October was 00. There are only two pieces of equipment on lease and they are going to be bought out and included in the purchase price as well as all of the equipment in the gym. I believe the equipment alone may be worth the cost of they gym. That is all of the information I know for certain. I have just sent a follow up email asking for the financial statements for the past 3 years, for the number of employee’s and their total monthly salary, and for the business’s current liabilities and monthly expenses besides rent.
I have also asked very humbly how many hours each week the owner needs to put in and what is the real income of the owner after all of the expenses each month, just to get a better picture. Hopefully that wasn’t too much to ask?
My thoughts are that if it only requires 20 hours or so a month to make 00 a month, it seems a pretty good deal. I would also consider getting rid of an employee and assuming their hours at the gym in order to increase my personal income. I was told that the owners are a husband and wife (owned for 8 years now) and they are selling because the husband is an executive working 60-70 hours a week while going to school at night and that the wife is a stay at home mom and that they do not have the time to manage the gym, although it has pretty much run itself they say.
Sorry to be so lengthy, but that is all of the information I have. I would love to hear what all of your thoughts are on this purchase and how much you really think I’d make here. Of course, if it ends up requiring 50 hours a week to make K a month, I’ll turn it down. I cannot see very many other opportunities though within my price range of -40K. I currently pay 0 a year for my own gym membership elsewhere so that would be a plus of this purchase as well.
Thank you all!
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2 Responses to “I am thinking of buying this local gym. Do you think it is a good idea? ANY help would be great! thanks!?”
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You should factor in a certain percentage of the members who will not be renewing their membership. The recession is going to hit hard next year and going to the gym is not an essential. Work out how much your total costs are going to be going forward (historical financial statements are no good for predictions of the future). Then estimate how many will not renew their membership. See if fees can cover costs AND give you a good enough profit. Also, bear in mind that the equipment is aging and may need extra maintenance. You don’t want a member getting injured when the equipment breaks. Don’t forget to take out public liability insurance.
Im not sure,its your choice but it looks like a good deal