Running a successful gym or fitness club comes with its own set of expenses, just like starting any business in Canada. But the good news is, there are countless options available to help you get the financing you need to expand, grow, and create the type of fitness center everyone will want to join.
Types of Fitness Clubs Eligible for Business Financing
There are many types of fitness clubs that are eligible for business financing in Canada. Here is a list of some of the most popular fitness clubs:
- Yoga studios
- CrossFit gyms
- Running clubs
- Dance studios
- Aerobic studios
- Zumba studios
- Pilates studios
- Country or golf clubs
Regardless of the type of fitness center you own, finding financing is possible for any Canadian small business. Getting approved depends on a wide variety of factors, keep reading for everything you need to know about finding the right financing for your fitness club.
Best Business Loans For Gyms and Fitness Centers
How Business Loan Can Help Your Gym or Fitness Center
There are countless ways a business loan can help you grow your gym or fitness center. Improvements, renovations, and even the day-to-day upkeep of a gym can be pricey and a business loan can help cover it all.
Equipment
- Fill your gym with the best equipment on the market
- Cardio and weightlifting machines
- Multi-purpose/core training stations
- Manual weight sets
- Climbing ropes
- Punching bag and other boxing equipment
- Install any specialty areas
- Boxing ring or martial arts practice room
- Astroturf section
- Yoga/Pilates/ dance studio
- Parkour gym
- Running track
- Squash courts
Marketing
- Pay to have promotional items manufactured
- Duffel bags, hats, jump-ropes, t-shirts and sweaters, wristbands, etc.
- Invest in online or social media marketing
- Improve your website
- Hire a social media coordinator to run your social media accounts
Staff
- Hire the best professional
- Certified personal trainers
- Trainers to teach group classes
- Specialized trainers
- Dance instructors
- Yoga instructors
- Physiotherapists
- Massage therapists
- Nutritionists
- Maintenance workers
- Service technicians
- Support staff
- Marketing professional
Insurance and Legal
- When starting a business it’s important to insure your business in case of customer injury or property damage. In general, you may require commercial property insurance, general liability insurance, business income insurance and more. In addition to that, you’ll need to get all the permits and business licenses required to operate your business.
Renovations
- Renovate your fitness areas however you’d like
- Hardwood floors for studios
- Padded flooring for weightlifting areas
- Large mirrors
- Televisions and a sound system for the cardio area
- Build a swimming pool, jacuzzi area, or sauna
- Build and furnish a safe daycare for the children of employees and members
- Install water fountains, air conditioning, heating, ventilation and other amenities
Maintenance
- Daily upkeep and cleaning of all equipment
- Technicians for specialty equipment
- Extra sanitation throughout the day
- Hand sanitizer stations throughout the facility
Calculate Your Business Loan Payments
Alternative Financing Options For Your Fitness Club or Gym
Whether you’re trying to finance your gym, yoga studio, CrossFit club, etc., you’ll notice that there are a variety of options available. Besides business loans, you can also use equipment loans, merchant cash advances, invoice financing, microloans, and a number of other credit products to cover your business’s expenses. Let’s look over some of these options and how they can help your business.
Looking for more options? Check out government financing and grants for businesses.
Merchant Cash Advance
A merchant cash advance allows you to receive a lump sum of cash in exchange for a percentage of your future credit card sales. When running a gym or fitness club, a merchant cash advance can help you access cash quickly to cover any immediate expenses like replacing old or broken equipment.
Equipment Loan
In order to run a successful gym or fitness club, you’ll need a lot of equipment such as training weights, yoga mats, elliptical trainers, treadmills, etc. Unfortunately, this can be very expensive, but with an equipment loan, you’ll be able to spread your equipment costs over a set period of time.
Business Line of Credit
A business line of credit is a revolving loan that allows you to borrow money up to a certain limit and you only pay interest on the amount you use. This makes it a good alternative for short-term and small unexpected expenses your business may occur. For example, it can be used to inject cash into the business during seasonal cash flow shortages, it can also be used to fund your marketing campaign or even simply to help increase your business credit score.
Invoice Factoring
Gyms and other fitness clubs usually rely on a monthly or yearly subscription from their clients. This means you have to wait a couple of weeks or months to receive payment, especially if your client is late. This, in turn, can lead to cash flow shortages. However, with invoice financing, you’ll be able to curb any disruptions to your cash flow by getting an advance on your outstanding invoices.
Canadian Businesses Who Sought External Financing in 2018
Business Loan Requirements For a Gym
When it comes to applying for a business loan to help grow your gym or fitness center, the specific requirements will depend on the financing option you choose and the lender you’re working with. But, there are several things that all business owners should have ready when submitting a business loan application.
- Completed application
- Personal information (contact information, SIN, etc)
- Business information (address, email, phone number, etc.)
- Annual revenue
- Bank account information
- Loan amount
- Purpose for loan
- Supporting documents
- Business and personal tax records
- Business bank statements
- Revenue statements
- Balance sheet
- Business plan
- Personal financial details and credit score (maybe not be required)
It’s important to note that if you’re looking to get financed as soon as possible, it’s crucial that you work closely with your lender and provide them with all the information and documentation they need. The longer it takes you to send everything they need, the longer it will take them to approve you.
Watch out for these common business loan application mistakes.
Business Financing For Any Industry
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Factors That Affect the Cost of Your Gym Business Loan
In addition to your interest rate, you should also consider any fees and the length of the term when determining the cost of your business loan.
- Fees – When applying for a business loan for your gym, yoga club, or fitness club, you should be aware of potential fees such as origination fees and administrative fees. You should also evaluate what kind of fees are involved for prepayments as well as late payments.
- Interest – When evaluating your interest rate, you should look at the APR as it represents the true cost of your loan. Unlike the interest rate, the APR is the percentage charged over the year and includes any other fees included with the loan such as origination fees.
- Term Length – While a longer business loan term provides more affordable payments, it’s also more costly as you pay more interest. Similarly, while shorter terms can lead to higher payments, you end up paying less in interest.
How Term Length Can Affect Your Business Loan Cost
Business Loan Amount | $20,500 | $20,500 |
Interest Rate | 12.5% | 12.5% |
Term Length | 36 months | 60 months |
Monthly Payment | $685.80 | $461.21 |
Total Paid | $24,688.78 | $27,672.46 |
Interest Paid | $4,188.78 | $7,172.46 |
Frequently Asked Questions
How do I ensure I’m getting the best rate on my business loan?
Can I get a business loan for my gym if I have bad credit?
Should I get a business loan or an equipment loan to finance my gym?
What interest rate can I expect when applying for a business loan for my gym?
Get the Money You Need, Hassle-Free!
When you’re looking for a reliable business loan, Loans Canada can help you find the best business financing option and provider based on your needs. Some of the advantages we offer are:
- Financial relief from your loan troubles, so you can spend more time concentrating on the health of your business and patrons.
- Fast approval times, usually within 48-hours.
- Freedom from the complicated screening process of banks and credit unions
- Sensible rates and repayment schedules that are easy to keep up with
- Online applications that are simple to complete on your home or work desktop, laptop, smartphone, or tablet
