Hi All - I am interested in buying a fully operational gym. It is about 15k sq ft and has a 5 lane lap pool. The revenue is $900k per year and the owner total take home is $ 195k a year.
The whole facility is leased - just signed a new lease this year with a slight monthly increase ( not enough where it makes that much difference ). Lease is 10 years with an optional renewal for another 10 years.
All the equipment in the gym is very very old but it works. I would estimate the book value of the equipment to be zero. I’m sure the next owner would need to make some new equipment purchases.
The owner is not involved in the day to day operations and drops by once per week to check on things.
What do you think would be a fair market selling price for this business??
( I would of course get an appraisal from a professional if I decided to move forward )
The numbers being discussed are a generalization. When buying any small business the diligence phase is a mining expedition. You need to uncover every rock. Sometimes you find debt owed, bad lease terms, or even unreported cash income. You cannot generalize these buys, they are all extremely unique. Push the broker for as much information as you can get, spend the time to try to get to the owner. Ask millions of questions. The more you talk the more you will learn.