Business Question for Ya

Off Topic
61

[quote]LankyMofo wrote:

[quote]Hyena wrote:
Whoever said “gyms are overall money losers” is a moron. It may not be the case for the particular type of gym this guy is talking about, but as far as a typical gym goes, they are massive money makers.

What do you need for a gym? A building, and equipment. Equipment is a one time expense for the most part, so once you get that paid off, all you have is overhead (rent, power, water, toilet paper). Anything you make over that is gain.

I go to 24 hour fitness, and that place is a fucking cash cow. The only thing that place pays for is the aforementioned overhead. None of their equipment is properly maintained, things break all the time, and then sit there for 2 months, just being broken. Pulleys get caught and drag (a problem remedied by something as simple as a can of WD40), and cables aren’t the correct length for the stations.

The rubber pieces on most machines (to make it quieter when the weight is dropped onto a rack) is completely gone. They rarely run the AC, and for about a month, there were no muscle clamps in the entire gym (because somebody stole them, so they were gonna “teach us a lesson” by creating a massive liability).

Then at the end of the fiscal year, with the rest of their budget (so it doesn’t get cut next year) they’ll buy a couple dozen new flat screen TV’s for the fatasses on the treadmills. The moral of the story is, they have very few expenses, simply because they are cheap bastards, but they are still raking in $30/person with at least a couple thousand members. Income > Cost = Profit. That’s as simple as it gets.

As for your gym, I salute you for trying. I don’t know shit about LCC’s and LLC’s and S-corps or whatever the fuck you guys were talking about, and I don’t pretend to, but I wish you the best. Running a business takes a lot of work, and a lot of money, but if it means one more hardcore bodybuilding gym in the world, you have my full support.[/quote]

Sounds like a shitty run business. Do they not have any competition in the area? Normally shitty run businesses are put out of business. I go to a retro fitness for only $20/month and they maintain everything rather well.[/quote]

oh yeah. the manager is a complete douche…like if you looked up douche in the dictionary, BAM, this guys pic. Just ask Akuma, our gym is shitty, and the manager is an asshole.

62

[quote]LankyMofo wrote:
I just wrote up a whole post outlining my thoughts and deleted it by mistake. Essentially it was just a long winded way of agreeing with beans.

WF - just out of curiousity, what do you think the hold up is considering what you learned from this thread?[/quote]

Man, target audience, amenities, cost/cost effectiveness, honest timetable, all kinds of shit. My plan sounds pretty similar to Adam’s. I want[ed] to cater to the “athletic” population having only weights, conditioning equipment [prowlers, kb’s, ropes, etc…] and a 40 yd or so turf track. Reading through this though has opened my eyes on a lot of things. Guess there is a reason these gyms are so few and far between. Also, right now I have a decent little nest egg saved up, but opening something within the next year would pretty much wipe me out. I’d still like to do it, and plan on doing so but am going to have to reconsider the layout and equipment, not to mention all of the legal steps I honestly thought I’d be able to skate around. Not that I was planning on having no insurance or anything, but I figured having an LLC and simple liability would be enough, to start with at least. I’ve got several lawyers in the family who can and will help with all of the legalities.

63

[quote]WhiteFlash wrote:

[quote]LankyMofo wrote:
I just wrote up a whole post outlining my thoughts and deleted it by mistake. Essentially it was just a long winded way of agreeing with beans.

WF - just out of curiousity, what do you think the hold up is considering what you learned from this thread?[/quote]

Man, target audience, amenities, cost/cost effectiveness, honest timetable, all kinds of shit. My plan sounds pretty similar to Adam’s. I want[ed] to cater to the “athletic” population having only weights, conditioning equipment [prowlers, kb’s, ropes, etc…] and a 40 yd or so turf track. Reading through this though has opened my eyes on a lot of things. Guess there is a reason these gyms are so few and far between. Also, right now I have a decent little nest egg saved up, but opening something within the next year would pretty much wipe me out. I’d still like to do it, and plan on doing so but am going to have to reconsider the layout and equipment, not to mention all of the legal steps I honestly thought I’d be able to skate around. Not that I was planning on having no insurance or anything, but I figured having an LLC and simple liability would be enough, to start with at least. I’ve got several lawyers in the family who can and will help with all of the legalities.[/quote]

Ok cool. If you’re now being more realistic, that’s awesome. And you definitely don’t want to be wiped out by opening a gym which may or may not be able to pay for your bills when it first opens, it’s too risky.

I just wanted to make sure you weren’t allowing the legal aspects (setting up an LLC, etc.) to stop you because of how daunting it all sounds.

64

UPDATE:

I got in touch with the guy that owns the building. The short of it is: 800/month and repairs we make cover rent. Pics to come as construction begins. For now, how about some Zuzana?

Repairs to be made:
10 or so holes in the roof.
possible plumbing issue we might see once we turn the water on there.
HVAC may not work, the owner never turned it on.
Since there’s been roof leaks I’m sure there’s a lot of mold everywhere so we’re gonna have that to deal with.

That’s all that we know of as far as repairs go but, I have a buncha buddies that do roofing, HVAC, plumbing, and carpentry. With the amount of repairs to be done, I could easily not have to pay rent for a good little while. Plus, a few of the guys I currently train with are willing to volunteer their time to take care of labor.

We’re dangerously close to this working out.

65

Oh…forgot to mention, this place is A LOT bigger than I thought. Its nearly 5k sqft.

66

awesome man, best of luck

67

WF - What is your educational background?

68

[quote]admbaum wrote:
UPDATE:

I got in touch with the guy that owns the building. The short of it is: 800/month and repairs we make cover rent. Pics to come as construction begins. For now, how about some Zuzana?

Repairs to be made:
10 or so holes in the roof.
possible plumbing issue we might see once we turn the water on there.
HVAC may not work, the owner never turned it on.
Since there’s been roof leaks I’m sure there’s a lot of mold everywhere so we’re gonna have that to deal with.

That’s all that we know of as far as repairs go but, I have a buncha buddies that do roofing, HVAC, plumbing, and carpentry. With the amount of repairs to be done, I could easily not have to pay rent for a good little while. Plus, a few of the guys I currently train with are willing to volunteer their time to take care of labor.

We’re dangerously close to this working out. [/quote]

I think it was stated earlier in the thread but make sure that whatever lease you sign covers your ass regarding those repairs. You don’t want to repair the building to have the lease run out and have them not renew it or increase rent significantly, they’ll have you caught with your pants down.

69

[quote]LankieMofo wrote:

[quote]admbaum wrote:
UPDATE:

I got in touch with the guy that owns the building. The short of it is: 800/month and repairs we make cover rent. Pics to come as construction begins. For now, how about some Zuzana?

Repairs to be made:
10 or so holes in the roof.
possible plumbing issue we might see once we turn the water on there.
HVAC may not work, the owner never turned it on.
Since there’s been roof leaks I’m sure there’s a lot of mold everywhere so we’re gonna have that to deal with.

That’s all that we know of as far as repairs go but, I have a buncha buddies that do roofing, HVAC, plumbing, and carpentry. With the amount of repairs to be done, I could easily not have to pay rent for a good little while. Plus, a few of the guys I currently train with are willing to volunteer their time to take care of labor.

We’re dangerously close to this working out. [/quote]

I think it was stated earlier in the thread but make sure that whatever lease you sign covers your ass regarding those repairs. You don’t want to repair the building to have the lease run out and have them not renew it or increase rent significantly, they’ll have you caught with your pants down.
[/quote]

Another interesting thing about making improvements to a rental property, is the landlord can call this “waste” and treat it as a breach of the lease agreement, if it isn’t spelled out as permissible in the lease.

70

[quote]pumpmefullofdick wrote:

[quote]LankyMofo wrote:

[quote]admbaum wrote:
UPDATE:

I got in touch with the guy that owns the building. The short of it is: 800/month and repairs we make cover rent. Pics to come as construction begins. For now, how about some Zuzana?

Repairs to be made:
10 or so holes in the roof.
possible plumbing issue we might see once we turn the water on there.
HVAC may not work, the owner never turned it on.
Since there’s been roof leaks I’m sure there’s a lot of mold everywhere so we’re gonna have that to deal with.

That’s all that we know of as far as repairs go but, I have a buncha buddies that do roofing, HVAC, plumbing, and carpentry. With the amount of repairs to be done, I could easily not have to pay rent for a good little while. Plus, a few of the guys I currently train with are willing to volunteer their time to take care of labor.

We’re dangerously close to this working out. [/quote]

I think it was stated earlier in the thread but make sure that whatever lease you sign covers your ass regarding those repairs. You don’t want to repair the building to have the lease run out and have them not renew it or increase rent significantly, they’ll have you caught with your pants down.
[/quote]

Another interesting thing about making improvements to a rental property, is the landlord can call this “waste” and treat it as a breach of the lease agreement, if it isn’t spelled out as permissible in the lease.[/quote]

That’s a good point.

71

[quote]LankyMofo wrote:

[quote]admbaum wrote:
UPDATE:

I got in touch with the guy that owns the building. The short of it is: 800/month and repairs we make cover rent. Pics to come as construction begins. For now, how about some Zuzana?

Repairs to be made:
10 or so holes in the roof.
possible plumbing issue we might see once we turn the water on there.
HVAC may not work, the owner never turned it on.
Since there’s been roof leaks I’m sure there’s a lot of mold everywhere so we’re gonna have that to deal with.

That’s all that we know of as far as repairs go but, I have a buncha buddies that do roofing, HVAC, plumbing, and carpentry. With the amount of repairs to be done, I could easily not have to pay rent for a good little while. Plus, a few of the guys I currently train with are willing to volunteer their time to take care of labor.

We’re dangerously close to this working out. [/quote]

I think it was stated earlier in the thread but make sure that whatever lease you sign covers your ass regarding those repairs. You don’t want to repair the building to have the lease run out and have them not renew it or increase rent significantly, they’ll have you caught with your pants down.
[/quote]

No doubt man, the guy that owns the building is a property and tax lawyer so I gotta be on my P’s and Q’s. He’s into boxing though, so I have that in my favor I guess. We got into about a 30 minute convo about the dirty side of boxing and how he represented a few athletes back in the day. I’m having my sister and some of her lawyer friends in Austin look at everything before I sign on anything.

72

[quote]pushmepullme wrote:

[quote]LankieMofo wrote:

[quote]admbaum wrote:
UPDATE:

I got in touch with the guy that owns the building. The short of it is: 800/month and repairs we make cover rent. Pics to come as construction begins. For now, how about some Zuzana?

Repairs to be made:
10 or so holes in the roof.
possible plumbing issue we might see once we turn the water on there.
HVAC may not work, the owner never turned it on.
Since there’s been roof leaks I’m sure there’s a lot of mold everywhere so we’re gonna have that to deal with.

That’s all that we know of as far as repairs go but, I have a buncha buddies that do roofing, HVAC, plumbing, and carpentry. With the amount of repairs to be done, I could easily not have to pay rent for a good little while. Plus, a few of the guys I currently train with are willing to volunteer their time to take care of labor.

We’re dangerously close to this working out. [/quote]

I think it was stated earlier in the thread but make sure that whatever lease you sign covers your ass regarding those repairs. You don’t want to repair the building to have the lease run out and have them not renew it or increase rent significantly, they’ll have you caught with your pants down.
[/quote]

Another interesting thing about making improvements to a rental property, is the landlord can call this “waste” and treat it as a breach of the lease agreement, if it isn’t spelled out as permissible in the lease.[/quote]

umm…I dont quite understand what you mean here PMPM. We havent signed anything yet. What should I make sure is in the lease…permissible waste???

73

Make sure that the lease states you are allowed to make repairs,

74

[quote]LankyMofo wrote:
Make sure that the lease states you are allowed to make repairs,[/quote]

Yeah, basically “waste” is any permanent change to the property, so things like taking down internal walls could be considered “waste,” even if the walls aren’t load bearing and need to be removed to make the gym. Just make sure your lease allows you to remodel, repair, or whatever needs doing.