HealthyGirl HQ Business Network

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Three reasons why small fitness businesses fail and how not to

Your focus is too broad

Often, when people decide to start their own small fitness business they focus on attracting anyone and everyone in order to get those first clients. Intuitively, this does make sense. New business owners are willing to take on any new clients they can get. However, if you try to please everyone, you often end up pleasing no one and struggle to find traction. Furthermore, it’s much easier to make a compelling marketing message and find the correct communication channels if you build your business with a focus and have a narrow niche in mind. This approach also requires much less capital.

Getting your first clients is also significantly easier when you’re focusing on a single group of people. For example, let’s say you’re starting a high-intensity training group fitness class for women designed to accelerate fitness and weight loss which you will be running from a community hall. It’s relatively easy to find 10 people in your area who will be interested in attending this type of class. It’s clear what you’re offering and who the class will be suitable for. With your first ten clients in class, you will be able to offer a great experience providing exactly what your clients expect and begin to build a community of people around your business with common interests and goals.

If, on the other hand, you start a group fitness class without a clear focus that is open to everyone, you’d have a much harder time finding those first participants. You would also have a much harder time creating a sense of community and satisfying your attendees as the people you attract wouldn’t necessarily have the same expectations, goal or interests.

MumaBubs is an example of a company that has done this really well. They focus on women exercising safely during pregnancy and after becoming a mum by providing small group training and personal training programs for pregnancy, post-natal and the early years of motherhood.

Jody Secker started MumaBubs built on her own experiences and expertise in exercise during and after pregnancy and began with small group and personal training sessions within her local area. She has built a passionate and dedicated community around her focus and has now expanded to an online program.

The niche focus of Jody’s business is what has really attracted her community and empowered her to grow her business into a well-loved brand that resonates with so many likeminded clients.

The lesson:

Launching a small fitness business is a lot easier when your focus is limited. Choose your niche, build a high-quality initial client list, and win over your participants before broadening your scope.

Your business model does not scale

You have a clearly defined and branded business with a dedicate core following of clients. Now let’s talk about how to make your small fitness business profitable .

First, you need to think about what it is that you want from your business. Are you planning to work full time or part time? Do you want to build a large business that can expand into different areas or a smaller local business?

These decision can make a big difference to the goals you set and the way you run your business and each type of business is equally valid. Let’s look at a few scenarios to illustrate the point.

Say you have a passion for health and fitness and want to run one or two classes a week as a hobby business. You don’t intend on making this business your main source of income, it’s more of a passion project. Passion project or not you still need to set up your business in such a way that it’s profitable rather than being an expensive hobby. Despite this type of venture being a small or micro business you still need to cover all of the legal basics including insurance, licences and rent. During the setup phase of your business calculate your total costs for the year including a budget for marketing and advertising and divide it by 52 to get an estimate of the minimum you will need to earn each week to break even. From that figure, determine how many clients you will need each week to cover your costs and provide you with a financial incentive for your efforts. This is a great starting point for setting client acquisition goals.

If you are aiming for something a little larger and planning to earn a part-time or full-time income from your business you are going to need to look at smart ways to scale your business that doesn’t rely solely on you trading your time for money.

The trick here is to know when to start scaling. If you start too early you will waste effort and money on initiatives and marketing that doesn’t attract a lot of attention but starting too late means that it will be difficult to change the mindset of your long standing clients who are used to the ‘old way’ you did things.

One place to start right away is in your pricing structure. Make your classes bookable and encourage pre-booking from all of your clients. You should have a simple yet robust booking system with clear terms and conditions set around cancellations and no shows. Enabling pre-booking protects your income by capturing a higher number of potential participants, reducing last minute drop outs and ensuring you still get paid if your client is a no show. This is particularly important if you offer one-on-one sessions when a no show can mean you don’t get paid that day.

Begin to offer multi-session purchase offers early on. The key here is to make sure that you have a set expiration date on multi-session passes. Your participants should have a fair amount of time to use the passes with possibly one weeks leigh way, however, they shouldn’t be able to pull it out a year later and expect to use it. Structure your multi-session offer to provide your participants with value for money while not undercutting financial requirements to profitably run the business. A good rule of thumb is to include one free session in the cost of a pass. For example, if your class usually costs $12 you could sell a 5 class pass for $60.

Providing multi-session passes in this way provides value for your clients while ensuring upfront payments for you that will ensure you have funds available for your business and is really the first step in scaling your business.

Once you have solid classes in place and regular clients your next scaling step will be to launch membership options. Memberships lead on from multisession passes and further scale your business by creating a reoccurring source of income. Although this is the step most businesses want to reach, it is essential that you have strong business systems in place and can commit to providing all of the services you offer without interruption before launching memberships. This will mean that you need to consider employing another trainer during times that you cannot run a class or need a last minute fill in. At this point you might start thinking about increasing the number of sessions you offer and start employing other trainers in new locations to run your classes. If you do choose to do this you will need to decide if those trainers will be self-employed and pay a licence fee to you to teach your classes under your brand or if you will pay your trainers an hourly rate to run a class.

If you don’t want to increase you class offerings and scale by location another way to grow is through diversification of your revenue streams.

Consider complementary offerings that would be valued by your participants. You might decide to develop a 6 week challenge, recipe book or nutrition guide. Keep in mind you don’t need to create these assets yourself. As a group fitness instructor I worked with a nutritionist to create a nutrition and weight loss plan which I sold to my existing clients in class and to my online followers. This guide still sells today creating a steady stream of income that doesn’t require me to be stood in front of a class giving my time. You might also create an online course or subscription product that provided online coaching, a nutrition supplement like the Healthy Mummy’s shakes or even equipment and merchandise that supports your clients in achieving their goals.

The lesson:

Don’t rely on trading your time for money. Begin to put scale building processes in place early and increase your revenue streams as your community grows.