In recent years, fitness centers have become increasingly popular. People are much more aware of their health and as a result have begun to invest in things that promote wellness and physical fitness, perhaps most notably memberships to fitness centers.

If you’re interested in learning how much it costs to open a fitness center, this article will outline these expenses including what operating costs to consider. Starting your own gym can be rewarding, but also financially stressful. The good news is that the industry shows no signs of slowing down.

How much does it cost to start a fitness center in Australia?

For those looking to open a medium-scale standard gym in Australia, these are the costs you can expect to shell out for your new business venture:

  • In Australia, you must register your business name through the ASIC. Fees are $34 for 1 year and $80 for at least 3 years.
  • You will need to obtain several licenses and permits including a health department license and business license, as well a fire department permit, air and water pollution control permit, and sign permit et al. As a new business owner, you’ll also need to invest in accounting services (i.e., CRM software, payroll software, P.OS. machines, etc.). All of these costs will add up to approximately $15,000.
  • After filing all of the appropriate paperwork, you’ll need to get the word out about your business. Marketing promotion expenses for the grand opening of your facility can amount to about $3,500. If you get flyer printed as well (let’s say around 2,000 copies at $0.04 per copy), you spend at least $3,580 for this service.
  • You may have attended business school and are capable of writing your own business plan. But for those who need a little assistance, you may need to hire a business consultant to help guide you through the process.You can expect to spend up to $2,500.
  • The cost for insurance coverage (including general liability, theft coverage, workers’ compensation and property casualty) can run you about $30,000
  • Leasing your building in an area that gets decent foot traffic will cost about $350,000
  • Are you planning to remodel your space? Remodeling the facility and constructing a gym and olympic size pool has an estimated cost of about $300,000
  • Be sure to include other start-up expenses like stationery ($500), and phone and utility deposits — gas, sewer, water, and electric ($6,500)
  • Operational costs for at least the first 3 months (employee salaries, expenses) should be estimated to be around $60,000
  • Costs for start-up inventory, gym machines, and equipment (this may include resistance bands, weight machines, weight training, elliptical trainers, dumbbells, medicine balls, gym flooring, benches, etc. will total around $500,000.
  • Store equipment like cash registers, security, signage, ventilation) will cost an estimated $13,500
  • The cost of purchasing and installing CCTVs is around $5,000
  • Furniture and other equipment (including telephones, printers, sound systems, computers, tables, chairs, etc.) are about $25,000
  • Costs for basic website build-out and hosting service on average are around $600.
  • Are you planning to host an opening party for the launch of your new fitness facility? Expect to spend about $8,000
  • Be sure to include miscellaneous expenses, estimated at around $10,000.

If you’re looking to setup a medium size fitness facility, you should estimate spending around AUD$1.5M) to get setup successfully. This includes staff salaries, operation costs for the first 3 months, and an Olympic size swimming pool.

If you want to open a smaller facility without the swimming pool, setup costs can range between AUD$250,000 to $500,000. A larger gym on the other hand, can cost upwards of AUD$5 million. Costs for a larger facility will obviously include expanded offerings like complementary services, and building space that can accommodate more clients.

Be sure to consider human resource costs in your budget as you build out your business plan. The average gym the following professionals on staff:

  • Facility manager (can also be the owner)
  • Human resources and other administrators
  • Accountant/cashier
  • Marketing / sales reps
  • Personal Trainers / assistant trainers with specialities like CrossFit and other functional training
  • Cleaners
  • Security Guards
  • Exercise Physiologists

If you prefer to purchase a franchise over starting a fitness facility from scratch, the average cost is around AUD$200,000. Some of the most popular franchises in Australia include Anytime Fitness, Plus Fitness 24/7 Gym, and Jetts 24 Hour Fitness Gyms.




Financing your Fitness Facility

Be sure that you incorporate a financial strategy that allows you to work within your means, allows for continued growth, and does not include hidden fees. One funding option is to obtain a Small Business Administration (SBA) loan.

These loans usually offer competitive rates and let you allocated funds toward tenant improvement costs and equipment. Keep in mind that the application process for these loans can be time consuming, and may not necessarily work for your business timeline.




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