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Running a CrossFit Facility Tips and guidance on how to open and operate a CrossFit gym.

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Old 12-26-2015, 06:11 AM   #1
Philip Blundall
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Location: Redditch  UK
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Arrow Selling my CrossFit gym.

I am currently considering selling my CrossFit gym. It has been running for 27 months.
The first 12 I made many mistakes however the last 12 have seen a massive change in the way it is run with 4 coaching staff including myself.
I'd like to sell because I have a new son 12 weeks old. I don't want to miss time with him and running the gym eats into your time.

Facts
102 members
Break even at 72 paying all staff
Average revenue 60 per member
We are growing approx 8 members a month.

If possible can someone point me in the direction where you would sell and also possible valuation as people have different formulas.

Any help would be appreciated
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Old 12-26-2015, 10:39 AM   #2
David Alexander
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Location: Winston-Salem  NC
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Re: Selling my CrossFit gym.

Quote:
Originally Posted by Philip Blundall View Post
I am currently considering selling my CrossFit gym. It has been running for 27 months.
The first 12 I made many mistakes however the last 12 have seen a massive change in the way it is run with 4 coaching staff including myself.
I'd like to sell because I have a new son 12 weeks old. I don't want to miss time with him and running the gym eats into your time.

Facts
102 members
Break even at 72 paying all staff
Average revenue 60 per member
We are growing approx 8 members a month.

If possible can someone point me in the direction where you would sell and also possible valuation as people have different formulas.

Any help would be appreciated
The value of your gym would start with the equipment and what it is worth (minus depreciation). Do you have contracts for your members? If you have 102 members that are under contract for the next year, you could add that to the value of the gym. You have 30 more members than your "break even" point, but if you don't have contracts, they could all leave tomorrow, and you are out of revenue.

So if you look at equipment and the amount of revenue that is "promised" to you, that will give you a good idea of where to start your pricing at to sell your gym. Now depending on the situation, you can start higher or lower than that number. 27 months is not a very long time for a business, so that will also play into when selling it. Also does the gym have any liabilities? In the end, however, it is only worth as much as someone is willing pay you for it.

Good luck.
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Old 12-27-2015, 01:52 AM   #3
Alex Burden
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Location: Stockholm  Sweden
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Re: Selling my CrossFit gym.

Do you rent the facility and what is the contract, how long is left on it, can they Throw you out and so on, what was the rental increase over the past 2 years, what is included, water, electricity and so on.

This is very important for anyone so you need to have this information.

Plus more info about the area it is situated, how big is the town or city, type of people, competition in the area gyms, boxes, other sports, type of members you have today...

This can add value or lower it.
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Old 12-27-2015, 08:06 AM   #4
Sean J Hunter
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Location: North Shore  New Zealand
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Re: Selling my CrossFit gym.

Get a business broker...

No seriously, always get a business broker....always.

Did I mention always?

Some brokers will allow you to sell your business yourself, and just give you advice on valuation structure and contracts, on an hourly basis. I find the value of a good Business Broker always ends up covering the costs of the service. There are way way way to many ins and outs of a business sale, to go it alone. There may even be some liabilities in some jurisdictions.

Imagine back to your first house purchase, would you want to have gone it alone on the contract write up? Now multiple that complexity by about 5, and that's how you should feel about a business SPA.

Hope that helps

Sean
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Old 12-30-2015, 12:26 PM   #5
Brian Diez
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Location: East Meadow  NY
Posts: 217
Re: Selling my CrossFit gym.

You could also try contacting any nearby boxes.

Negotiate a deal whereby they pay you to refer your current members and perhaps buy your equipment at a discounted rate.
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