The Business Behind Owning a Cheap Gym

How can a low-priced gym membership pay for a room full of expensive equipment? Build the business from plan mix and recurring fees, then stress-test it against busy hours, departing members and a tempting price increase. Chapters 0:00 The question 0:22 A small payment becomes a large pool 2:47 The room is expensive even when quiet 5:11 Why the average hour lies 7:29 The members who leave 9:52 The tempting price increase 12:26 What makes a cheap gym work Worked example and scope Illustrative independent US access gym, USD before sales taxes. 3000 paying members: 2000 basic at $15/month and 1000 premium at $30/month. $48 annual fee/member divided by 12 as steady-state monthly equivalent, not a claim about cash receipt timing or GAAP recognition. No joining fees or franchise fees. Monthly operating cost $60000: $24000 staff/working manager, $16000 premises, $8000 utilities/cleaning, $6000 depreciation, $6000 other including marketing. Before interest and income tax. Capacity model: 8 one-hour visits/member/month, 30 days, 16 open hours/day; 40% visits in 3 peak hours/day. Retention sensitivity: 150 departures, $40 acquisition cost. The $6000 replacement acquisition case replaces the base marketing allocation rather than adding it twice; no resulting operating profit is claimed. Price sensitivity is revenue-only and assumes steady-state annual-fee equivalence.