Growth
Do you work tirelessly in your gym every month, yet struggle to predict whether you'll have enough cash to make a profit? You're not alone.
In this article, we’re sharing the simple formula that helped our clients grow from just a few dozen members to hundreds of EFTs without spending thousands on advertising—and never worrying about making rent, paying trainers, or turning a profit.
The biggest challenge for most gym owners today is consistently acquiring new clients without depleting their cash reserves.
Imagine for a moment that you had unlimited money at your disposal. You'd probably invest heavily in advertising—Facebook, Instagram, local TV, radio ads, Hulu, YouTube TV, TikTok, maybe even dating apps. With that kind of omnipresence in your market, your gym would almost certainly grow.
As Arnold Schwarzenegger once said about his movies: "Whenever I finished filming a movie, I felt my job was only half done. Every film had to be nurtured in the marketplace. You can have the greatest movie in the world, but if you don't get it out there, if people don't know about it, you have nothing."
The same principle applies to your gym. But here's the problem: none of us have unlimited money.
Let's look at some sobering statistics:
So why are most gyms broke? Because they don't understand this simple formula—the 30-Day Cash Model.
This model is unique to each gym and tells owners exactly how much they need to make from each new client to cover all expenses, acquisition costs, and still make a profit.
The fitness industry often pushes the idea that gyms just need to offer free trials and low-barrier offers, hoping people will stay. That might work for Planet Fitness or Gold's Gym with their millions in backing, but what about independent gym owners?
Here's the formula, developed from Alex Hormozi's framework and adapted slightly to ensure profitability:
30-Day Cash Model = (CAC + COGS) × 2
Let's break it down:
This is everything you spend to get a new client to sign up:
Take your total monthly marketing spend and divide it by the number of new clients who signed up that month.
For example: $3,000 in marketing costs ÷ 15 new clients = $200 CAC
This is how much it costs you to fulfill one client per month:
Take your total fixed expenses and divide by your total number of clients.
For example: $15,000 in fixed expenses ÷ 150 clients = $100 COGS
So your all-in cost to acquire and fulfill a new client in their first month is: $200 (CAC) + $100 (COGS) = $300
But we don't just want to break even—we want to make a profit. That's why we multiply by 2:
$300 × 2 = $600
This means you need to collect $600 from each new client in their first 30 days to scale profitably.
You have three main options:
Sell a program worth at least $600 at sign-up, such as:
This is the simplest approach and our preferred method at Gym Launch.
Break it down like this:
With Prestige Labs, our affiliate-based supplement company built for gym owners, you can earn up to 40% commission on sales. Our affiliates regularly collect $80+ in commissions by selling just four products.
Remember, your clients are buying these products somewhere—they might as well buy them from you.
Have a percentage of new sign-ups pay for the full year upfront:
All three options get you to profitability each month with new client sign-ups. As you continue scaling, it compounds, giving you more money for advertising, which means more leads, more appointments, more clients, and more revenue.
Remember the 30-Day Cash Model: Collect double the amount it costs to acquire and fulfill one client in 30 days, and gym owners can massively scale their business.
