Managing finances is a crucial part of running a gym, and yet nobody talks about how stressful it can be if it’s not done right.
Proper management of your finances means that the club remains financially stable and you can pay your bills on time. It also means that your operations are sustainable in the long run; maintaining a healthy cash flow, avoiding excessive debts and planning for future expenses are all ways to make sure your club is around for years to come.
But where do you even start with managing finances and budgeting for success?
In this guide, we’re breaking down the different sources of income, how you can use technology to better manage your finances and offer some quick tips on reducing your expenses so that you can budget for long-term success.
The Different Income Streams for Gyms
Membership and class fees form the backbone of income for most gyms, but there are other opportunities to generate income on top of regular membership payments. Here are some examples of different income streams for gyms:
- Merchandise Sales: Selling clothing, accessories, and other branded merchandise.
- Food & Drink: Selling protein shakes or pre-prepared meals for those on specific meal plans.
- Workshops and Seminars: Hosting special events, workshops, and seminars for anyone wanting to deepen their fitness knowledge.
- Personal Training Sessions: Offering one-on-one personal training to those that want more one-on-one training.
- Corporate Sponsorship: Partnering with local businesses or corporate sponsors for financial support in exchange for putting up an advertisement in the gym, for example.
What about expenses?
Expense management is equally critical for gyms. How can you keep costs low without compromising on the member experience? First, review your expenses to make sure you’re getting the best deal across the board; look at things like electricity, broadband, and even your member management system.
On the flip side, it could be worth investing more into a certain expense for a better level of service, i.e. hire a cleaner to clean the gym floor because it’ll save you lots of time each week (which could be better spent getting more students to join) or invest in an all-in-one management software so you’re not wasting time switching between systems to perform a simple task.
How to Manage Finances In Your Gym
To effectively manage these income streams, gyms must lean into using technology. Using management software specifically tailored for businesses in the fitness industry streamlines operations and ensures accurate record-keeping. It enables clubs to track payments, monitor attendance and generate insightful finance reports for informed decision-making. Centralising this financial data and processes means that you can minimise the amount of time spent on admin and maximise efficiency. Let’s explore this in more detail.
How Gym Management Software Can Help Manage Finances:
Payment Tracking: track membership fees, class pass purchases, merchandise sales, and other income sources efficiently. This minimises the risk of missed payments, ensures steady cash flow, and removes the need to reconcile payments manually.
Attendance Monitoring: monitor class participation and workshops. This data can inform decisions about class scheduling and instructor allocation. For example, you can charge higher fees for more in-demand classes or experiment with your class timetable.
Automated Payment Chasing: chase payments on autopilot with automated communications means that you’ll spend less time trying to figure out which payment matches which member.
Reporting and Analysis: real-time finance reporting provides insight into revenue trends, membership retention rates, and overall financial health. Gyms can use this information to identify areas for improvement and make better-informed business decisions.
To summarise, effective financial management is essential for the long-term success and sustainability of gyms. By diversifying income streams, leveraging software for financial management, and implementing practical cost-saving strategies, clubs can achieve greater profitability while continuing to provide a high-quality service to members and leave a lasting impact on their communities.
ClubRight is the go-to gym management software for hundreds of gyms, clubs and studios across the UK. It’ll help you take care of everything from managing memberships and billing to class bookings and online joining – plus a whole lot more. Give us a call today on +44 (0)203 884 977 or book a free online demo with one of our product experts to find out why we’re trusted by more than 900+ businesses worldwide.
Image source: Canva
