Planet Fitness - how do they turn a profit?

[Grape Ape]

12k square foot gym

$12k/month rent
$3k electric
$30k salaries
$1k insurance
$2k cleaning crew

=4800 members at $10/month just to cover their nut (that's including 30k/month in salaries.. assuming the 'owner' takes a salary)

for a planet fitness, 4800 isn't an un-attainable membership goal. considering that when the local Golds gym's dropped their rates to 10$/month, they went from 6000-something members to over 14k members

... and remember, the membership dues are just what covers the bills. the REAL money is in the personal training sales, which can book anywhere from 2k-45k/month

Aren't there franchise fees and/or payments on equipment, etc in addition to what's above?

[pissant]

Aren't there franchise fees and/or payments on equipment, etc in addition to what's above?

yes and they usually are a percent of revenue i believe.

[TheGrinch]

12k square foot gym

$12k/month rent
$3k electric
$30k salaries
$1k insurance
$2k cleaning crew

=4800 members at $10/month just to cover their nut (that's including 30k/month in salaries.. assuming the 'owner' takes a salary)

for a planet fitness, 4800 isn't an un-attainable membership goal. considering that when the local Golds gym's dropped their rates to 10$/month, they went from 6000-something members to over 14k members

... and remember, the membership dues are just what covers the bills. the REAL money is in the personal training sales, which can book anywhere from 2k-45k/month

except PF offers FREE personal training, free tanning, free pizza/bagels/tootsie rolls..


there is NO upsell other than from $10 to $19 for the black card membership

[El Diablo Blanco]

12k square foot gym

$12k/month rent
$3k electric
$30k salaries
$1k insurance
$2k cleaning crew

=4800 members at $10/month just to cover their nut (that's including 30k/month in salaries.. assuming the 'owner' takes a salary)

for a planet fitness, 4800 isn't an un-attainable membership goal. considering that when the local Golds gym's dropped their rates to 10$/month, they went from 6000-something members to over 14k members

... and remember, the membership dues are just what covers the bills. the REAL money is in the personal training sales, which can book anywhere from 2k-45k/month

You left out the thousands in franchise fee and marketing.  Those PF commercials on TV aren't free.

[Earl1972]

except PF offers FREE personal training, free tanning, free pizza/bagels/tootsie rolls..

that's what bothers me the most, the purpose of a gym is to improve your appearance or health

offering free junk food at a gym is like offering shots of jack at an alcoholics anonymous meeting

E

[Montague]

that's what bothers me the most, the purpose of a gym is to improve your appearance or health

offering free junk food at a gym is like offering shots of jack at an alcoholics anonymous meeting

E

Excellent analogy.

[Mothballs]

Truth be told the planet fitness in my area isnt that bad I went into one with skepticism from years of reading this site but I worked out like normal and nobody blinked an eye my biggest complaint is the dumbbells dont go over 65 lbs but if anything its good for cardio if thats your thing

[Robgun1]

They make most of their profits off of the dreamers.

[Carlton G. Long]

They make most of their profits off of the dreamers.

Just like every supplement company in the world.

[The Grim Lifter]

12k square foot gym

$12k/month rent
$3k electric
$30k salaries
$1k insurance
$2k cleaning crew

=4800 members at $10/month just to cover their nut (that's including 30k/month in salaries.. assuming the 'owner' takes a salary)

for a planet fitness, 4800 isn't an un-attainable membership goal. considering that when the local Golds gym's dropped their rates to 10$/month, they went from 6000-something members to over 14k members

... and remember, the membership dues are just what covers the bills. the REAL money is in the personal training sales, which can book anywhere from 2k-45k/month

Also make money off;
Supplement sales
Advertising on their Television sales
Other advertising in the gym sales

[ChuckleHead]

Have a good friend who wants to open a planet fitness franchise.. but I keep telling him it makes no sense..


I know nothing about business but charging $10/mo membership fee? how can you afford to pay even the electricity bill let alone all the other business expenses??

i'm guessing planet fitness is a franchise.

try to get an idea of how many close down per year. that is going to be a very hard thing to find out because if it's a high number that's bad for business.

like many franchises, the parent company makes money off the investor. they sell franchises knowing you will eventually go under, until that time they bleed you dry and then start over.

one of the best rules of thumb to get an idea if the business model is viable is to find out how many of the franchises are owned by the parent company themselves.

if planet fitness has 1000 franchises but only owns a few, like 5, then it's bullshit, they themselves don't make money from the model but from selling the model.

if they own a high percent of their own franchises then it says they are invested in the same business as the franchise owners and have confidence in the model, so their fates are tied together.

[TheGrinch]

i'm guessing planet fitness is a franchise.

try to get an idea of how many close down per year. that is going to be a very hard thing to find out because if it's a high number that's bad for business.

like many franchises, the parent company makes money off the investor. they sell franchises knowing you will eventually go under, until that time they bleed you dry and then start over.

one of the best rules of thumb to get an idea if the business model is viable is to find out how many of the franchises are owned by the parent company themselves.

if planet fitness has 1000 franchises but only owns a few, like 5, then it's bullshit, they themselves don't make money from the model but from selling the model.

if they own a high percent of their own franchises then it says they are invested in the same business as the franchise owners and have confidence in the model, so their fates are tied together.

VERY much appreciate the great info!!


looks like they keep adding to their own portfolio