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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 12-12-2010, 09:05 PM   #1
Jay Hanson
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Cost of opening an affiliate

I'm currently exploring my options in terms of opening a new affiliate. I know what kind of money it costs to buy equipment. But what kind of total overall costs can I expect to run into to get my affiliate up and running? I'm sure I am overlooking some of the costs. I know there is the annual affiliate fee, equipment, rent, insurance, web hosting, advertising, etc. How long before I can expect any profit? Or how many clients are necessary to turn a profit if they are paying roughly 120/month? Any help/advice/tips would be greatly appreciated. Thanks
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Old 12-12-2010, 09:15 PM   #2
Eric Montgomery
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Re: Cost of opening an affiliate

It's not magic, it's just basic business accounting. Your profit will be how much you take in minus how much you spend. If your monthly expenses total $12,000, you'll need 100 clients at $120 a month to break even. How fast you get that many clients will depend on how good you are at helping people reach their goals and how good you are at advertising that fact.
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Old 12-13-2010, 12:54 AM   #3
Ian Nigh
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Re: Cost of opening an affiliate

Check out the tutorials at Again Faster under Mic'd instructor. There is a whole series on how to create a spreadsheet to explore different scenarios and come up with exactly how much cash you need before your business starts paying.

If you just want wild guesses without knowing your exact particulars, here ya go: around 60K dollars should do it and you should be profitable after 8 to 12 months (assuming you are good). Your mileage, of course, will vary and there are many ways to skin a cat.
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Old 12-21-2010, 06:46 AM   #4
Yahya Kohgadai
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Re: Cost of opening an affiliate

dumb question but.. until you start profiting, how do you pay for your own personal expenses like rent, food, etc?
34/m - 5'8" - 170lbs - 18%bf
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Old 12-21-2010, 07:16 AM   #5
Renee Lee
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Re: Cost of opening an affiliate

Originally Posted by Yahya Kohgadai View Post
dumb question but.. until you start profiting, how do you pay for your own personal expenses like rent, food, etc?
"catapultam habeo. nisi pecuniam dabis, ad capitem tuum saxum mittam."
Translation: I have a catapult. Give me your money or i'll throw a rock at your head.
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Old 12-21-2010, 07:18 AM   #6
Casey Raiford
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Re: Cost of opening an affiliate

Small business loan, grant or investor backing.
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Old 12-23-2010, 08:49 PM   #7
Steve Rakow
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Re: Cost of opening an affiliate

You suck it up and don't get paid until you profit. Even then, getting paid is a relative thing. Do you mean W2 wages, or just draws from the company coffers when there's bit of extra cash and pay the taxes later?

We opened in 2006 and didn't profit until 2008 - but only a few thousand. In 2009, we were able to hire a couple of part timers and began receiving payroll ourselves albeit a small amount. Last year was not profitable. This year, our fourth in business, will be profitable and sustain us (i.e. we can live off of what we're making).

Start off right by staying out of debt as much as possible. If you can't afford to live off of savings, make sure you have another income stream. Set up your business as either an s-corp or LLC from the beginning. Get a good accounting program - like Quickbooks Pro to keep the money straight. The gov't wants it's cut and your books need to be solid. And expect slow and steady growth as you start out. Whatever market you're in will determine that as small market's will take longer to develop than, say, a large one like LA.

As to actual cost, it all depends on how you start. We started out of our garage with 4 bars, some bumpers, pullup bars, abmats, 1 rower, and dumbbells. We had about 12 clients. As we grew in number, we put every dime we made back into equipment. Now, we have zero debt, 120 regular members, and a great 3500 sf training space (2nd commercial box) with additional sf devoted to bathrooms, kitchenette, lounge, and an office. We use the company credit card sparingly and pay every bill when it's due.

Not sure I answered your question, or just got philosophical.
Steve Rakow
CrossFit Ocean City Maryland
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Old 12-23-2010, 11:19 PM   #8
Theo Tsekouras
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Re: Cost of opening an affiliate

I love hearing these stories! Garage gym turns big. Dedication, savvy, and programming. I have just solidified our new space from the garage. We have 35+ in the 300sf place and going to a 4000sf place is euphoria. Savings a def. No debt here: yet but loving every minute of it.
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Old 12-26-2010, 07:58 PM   #9
Randy Tarasevich
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Re: Cost of opening an affiliate

More than you think and more than the CF community at large would lead you to believe. It all depends on the size of the operation you want to have. the biggest mistake we made was not having enough start-up capital, and it's one of the top 10 reasons small businesses fail.
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Old 12-26-2010, 11:06 PM   #10
Tommy Alfinito
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Re: Cost of opening an affiliate

I know the dollar amounts are different for everyone but I would put the order of expenses as
1. Rent
2. Equipment
3. Affiliation
4. Insurance

Honestly these are the biggest fees, add these 4 up and you should get a ballpark figure for your expenses. Now take this number and add 5-10k more to cover every little odd thing that comes up like pvc, chalk, webhosting, registering as an llc, buyign a credit card reader. Its really crazy the things you don't even think about that pop up when you are putting it all together. Like you may have rent costs figured out but then theres a security deposit. It will cost you money just to register your business with the state. I guess the reason you are getting such varying answers is because you never really know the cost until you do it.
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