May 22, 2025
Adam Hoeksema
Are your gym startup projections grounded in reality—or guesswork? Whether you're pitching to SBA lenders or investors, aligning your assumptions with actual franchise benchmarks is essential. In this post, we break down real data from 10 leading fitness franchises, including Planet Fitness, Orangetheory, and F45. Use these insights to calibrate your revenue goals, margin expectations, and startup costs—and build more credible, fundable projections.
How to Use This Report
The purpose of this report is to help you determine whether your revenue, margin, and start‑up cost assumptions are reasonable compared with industry peers. We compiled Item 19 Financial Performance Representation data from ten leading U.S. fitness franchises. Use these benchmarks as directional guardrails; always tailor projections to your specific concept, market, and execution plan. Results vary by location, lease terms, staffing, and operating efficiency.
⚠️ Reminder: Every business is unique. These figures are historical averages or medians from franchised units. They are not forecasts. Use them as a sanity check, not a guarantee.
Individual Franchise Benchmarks
Key Benchmarks by Segment
Rules‑of‑Thumb for Your Pro Forma
• Pre‑sell at least 150‑200 founding members for boutique studios; each +50 members can cut payback by ~6 months.
• Target rent ≤15 % of mature revenue; >20 % erodes margins quickly.
• Add 2‑3 months of working‑capital to Item 7 costs—SBA lenders will.
• Run a Year‑2 Debt Service Coverage Ratio (DSCR) ≥1.30; most lenders require it.
• If you model top‑quartile revenue, be prepared to defend your pricing, marketing, and retention strategy.
Primary Data Sources
• Planet Fitness 2024 FDD, Item 19 & Item 7
• Crunch Fitness 2024 FDD
• Orangetheory Fitness 2024 FDD
• Anytime Fitness 2024 FDD
• Snap Fitness 2024 FDD
• F45 Training 2024 FDD
• Burn Boot Camp 2025 FDD
• Club Pilates 2024 FDD
• Pure Barre 2024 FDD
• 9Round 2024 FDD
📘 Making Sense of the Numbers: Strategic Insights for Gym Franchise Founders
After reviewing the benchmark tables above, you may find yourself asking: “What do these numbers mean for my financial projections?” That’s the right question—and the answer isn’t simply to pick the highest performer and plug in their numbers. Whether you're pitching to SBA lenders or private investors, your financial assumptions need to be defensible, tailored, and contextualized. That’s where data-driven benchmarking earns its keep.
🎯 Why Financial Benchmarking Matters for Gym Startups
Gym franchises span a surprisingly broad range in terms of startup investment, revenue potential, and breakeven timelines. The gap between launching a $250K owner-operated kickboxing circuit and a $6M Crunch Fitness location is vast—not just in capital, but in operational complexity and risk exposure. Yet many founders approach their forecasts with vague or overly optimistic numbers that fail to reflect these nuances.
Benchmarking acts as a reality check. It helps you avoid red flags in your model—like projecting margins that are double the industry average or ignoring the cash runway needed to reach breakeven. By aligning your pro forma with known market data, you reduce friction during due diligence and gain credibility with lenders or investors evaluating your plan.
🔍 Tip: Lenders often reject projections not because they’re too aggressive, but because they lack supporting context. Citing this benchmark data, even briefly in your business plan or loan application, positions you as an informed operator.
🏋️ Segment-Specific Insights: Not All Gyms Are Created Equal
Our data shows a wide variation in performance depending on the gym model. Here's how to think through the trade-offs:
- High-Value / Low-Price Big Box (e.g., Planet Fitness, Crunch): These clubs boast some of the highest Average Unit Volumes (AUVs), reaching up to $3.2M. But they come with hefty startup costs (midpoints of $3.3M to $3.7M) and require sophisticated operations at scale. Their appeal lies in strong EBITDA margins (up to 35% for Planet Fitness) and equipment-heavy buildouts, which often work well for SBA lenders looking for collateral.
- Boutique Studios (e.g., Orangetheory, Club Pilates, Pure Barre): With startup costs generally between $500K and $700K and breakeven periods in the 4–9 year range, these concepts thrive or fail based on member acquisition, pricing power, and retention. Operators in this space must focus relentlessly on community, brand consistency, and marketing execution to justify a 15% EBITDA margin.
- Niche Concepts (e.g., 9Round, Burn Boot Camp): These models appeal to first-time operators or those seeking a lifestyle business. Startup costs can be as low as $200K, but AUVs may also be limited ($140K for 9Round). The low overhead means break-even is still feasible, but owner-operator involvement is often essential.
- HIIT / Functional Fitness (F45): This category offers one of the most interesting ROI profiles. With modest startup costs (~$510K) and strong 30% margins, F45 represents a capital-efficient way to scale—if you can ramp quickly. However, saturation and competition in some markets may compress future margins.
Each segment has its own operational logic. Your financial model should reflect that reality, rather than attempting to force-fit a one-size-fits-all assumption across line items like revenue per member, churn rate, or labor cost structure.
💰 Payback, Breakeven, and SBA Lender Expectations
Breakeven periods are especially important in SBA lending contexts. As a rule of thumb, lenders like to see models where the business turns cashflow-positive within the first 12–24 months and achieves a DSCR of at least 1.30 by Year 2. Our benchmark data shows that the majority of gym models—even successful ones—take 4 to 8 years to fully pay back the initial investment. This means you must clearly distinguish between monthly operational breakeven and full investor/lender payback in your model.
To improve lender confidence, consider strategies like:
- Pre-selling memberships: Particularly for boutique studios, securing 150–200 founding members prior to opening can drastically improve early cash flow and compress the breakeven window. Every 50 additional members pre-sold may shorten your payback timeline by 6 months.
- Showing working capital coverage: SBA lenders routinely add 2–3 months of operating costs to your startup cost assumptions. If you haven’t included that buffer, your model may appear undercapitalized.
- Stress-testing top-line assumptions: If you’re modeling top-quartile revenue performance, be ready to justify it with concrete details—lease terms, traffic patterns, pricing tiers, marketing spend, etc. A beautiful spreadsheet doesn’t close loans—a defendable narrative does.
🔍 Avoiding Common Pitfalls in Gym Pro Formas
Based on years of experience reviewing SBA-ready gym projections, here are some common modeling issues to avoid:
- Ignoring seasonality: Gyms often see major revenue shifts around New Year’s, summer, and fall. Build those patterns into your ramp-up assumptions.
- Overestimating early retention: Don’t assume 95% retention from month one. Allow time for your systems and team to stabilize member experience.
- Underpricing rent and labor: These two costs are highly variable by market. Use conservative estimates—if rent exceeds 15% of revenue, margin erosion can be dramatic.
- Omitting debt service or owner salary: Models that show high EBITDA but ignore loan payments or founder compensation don’t hold water with lenders or investors.
🧭 Building a Better Forecast (and a Better Pitch)
Your financial model is more than a forecasting tool—it’s a storytelling device. When structured properly, it should tell a lender or investor:
- What it takes to launch your concept
- How long it takes to stabilize
- What cash it generates (and when)
- Why your assumptions make sense in context
Using real-world benchmarks to answer those questions helps you build a plan that isn’t just optimistic—it’s investable.
📌 Helpful Tools to Build a Lender-Ready Gym Model
To help founders like you go beyond benchmarking and into strategic forecasting, we’ve created two powerful resources:
- 🧾 Download Our Free SBA Projection Review Guide — A checklist to help you meet all lender requirements for gym concepts
- 📈 Use Our Gym Financial Projection Template — A fully customizable, investor-ready Excel model tailored to fitness franchises (includes SBA-compliant formatting and breakeven logic)
