Is Your Gym a Sellable Asset?

If you want the option to sell your gym one day, start planning for it long before you’re ready to walk away

Selling the business is rarely part of the plan when someone opens a gym. 

In the beginning, the goal is usually just to survive. And when the gym gets through the survival stage, the focus generally then shifts to growing the business to a place where it’s at least somewhat profitable. 

But once the business makes it to five, eight, 10, even 20 years with some degree of success, a different question often emerges: When I am ready to walk away, what will all this be worth?

Some owners then begin drafting what they hope will be an exit strategy. More often than not, though, they’re quickly hit with the sobering awakening that their business might not be worth much more than the depreciated value of their equipment. 

Because the reality is that it is incredibly difficult to turn a gym into a truly sellable asset, at least one valuable enough that the owner can sell the business at all, let alone retire comfortably.

Generally, one of two problems emerge:

• Many (arguably most) gyms simply don’t have the financial performance, predictable revenue, or owner independence that would entice an outside buyer or investor to write a meaningful check.
• And even if the gym has consistent revenue and a decent profit margin, the pool of buyers is often limited to the gym’s head coach, an ambitious member, or a gym owner down the road. Typically these buyers don’t have a lot of cash to put toward an acquisition. 

The result is that many gym owners just eventually close their doors, leaving the founder with nothing to show for years of hard work, or they sell for less than their annual salary.

That said, all hope is not lost. 

Meet John Franklin, Daniel Meng and Jason Ackerman: All three were able to sell their gyms for considerably more than the latter scenario.

• Franklin sold all five of his gyms in the New York City area and was able to take his earnings and buy a home without needing a mortgage. 
• Ackerman sold Albany CrossFit in New York in 2013, for “close to seven figures.”
• Meng cashed out for $950,000 when he sold MUVFit Personal Training in Nashville, Tennessee in 2024.

How They Did It

While their sales stories are all different, Franklin, Ackerman, and Meng all agree that two things are critical when it comes to building a gym you can eventually sell: You need to have scalable systems in place, and the owner needs to step away from day-to-day operations well before a sale.

“The biggest overacting theme is you have to have systems in place that make it so that the owner doesn’t have to be part of the business,” Meng said, adding that technology was a huge driver in helping him streamline systems and processes.

More specifically, the Semi-Private Pro app was key in helping him build a scalable training system that increased coaching consistency and ultimately turned his semi-private training gym into a turnkey business.

“Most gyms that I talk to don’t really have a system in place for training. But you can’t really sell your business and expect your head coach to stay. If any piece of your gym deteriorates when the owner is gone, or the head coach leaves, it devalues your asset remarkably. So you need a training system in place that can be scaled,” Meng said. 

At the time of his sale, Meng was doing “very little” in the business anymore. His general manager was in charge, and his only real job was handling the financials and tracking key performance indicators, which made it a lot easier to sell, he said.

As for Ackerman, he admits a bit of luck went into him selling his gym, as he wasn’t even looking to sell at the time, but the owner of his building made an offer he couldn’t resist. That being said, had he still been heavily involved in the daily operations, he never would have sold for what he did, he insists.

“The most important thing is making sure the owner isn’t doing everything in the gym. The owner needs to be able to step away and the gym keeps thriving,” said Ackerman, who now owns gym business mentorship company Best Hour of Their Day.

Like Meng, Ackerman said turning his gym into a turnkey business came down to, first, getting enough members and having the right coaches in place, but more importantly, to having scalable systems, and standard operating procedures in place.

“Things like how leads are handled and how new members are onboarded, because sales is the foundation. And you need to have clear systems about how to handle a lead who comes in through social media, versus a walk-in, and how to follow up and when to follow up,” he said, adding that client retention and data tracking systems are also non-negotiable. 

“If someone is interested in buying your gym, you need to be able to give them exact information, easily,” he added. 

Finally, Franklin agrees that in order to build a sellable business, it needs to be scalable, but he also brought up another big trap many gym owners face: bad leases.

Though he was able to sell all five of his gyms and buy a house mortgage free, Franklin’s “sub-optimal leases” at a couple of his gyms left $200,000 to $300,000 on the table that he wasn’t able to capture, he estimates.

Two things Franklin suggests gym owners strive for include longer leases with options to extend, as well as an assignment clause to ensure the gym owner can pass their lease on to a buyer. 

In his case, one of his leases didn’t have an assignment clause. The landlord then re-negotiated the lease with the buyer, and Franklin lost out because of it.

A Gym Lawyer’s Perspective

Matthew Becker, a former gym owner, lawyer and founder of gymlawyers.com has worked with many gym owners hoping to sell their business, and says the first thing an owner should do when looking for an exit strategy is to “really understand the value of their gym.”

And while most gym owners just focus on revenue, Becker identified six other key factors that play a huge role in increasing or reducing the value of a gym, including:

1. Owner dependence: Does the gym’s survival depend entirely on the owner managing day-to-day operations?
2. Systems: Are there clear SOPs in place that make it a seamless, turnkey business for a buyer?
3. Leadership hierarchy: Is there a strong team in place that will keep operations running smoothly post-sale?
4. Financials: Can the owner easily provide clean, accurate tax returns, profit and loss statements and balance sheets?
5. Legal compliance: Are membership agreements, waivers, and staff classifications up to state standards? 
6. Lease: Do the lease terms and details allow for a sale without needing extra landlord permission?

“It’s easy to miss the hidden factors that might be holding your business back. At the end of the day, it’s about so much more than just revenue,” Becker added.

The Big Picture

One more piece of advice Franklin, Ackerman and Meng agree on is: If you want the option to sell your gym one day, start planning for it long before you’re ready to walk away.

“Even if your thought right now is, ‘I will never sell this gym,’ which a 27-year-old gym owner might think, you should make every decision with the lens that you will want to sell one day,” Meng said.

Franklin offered: “Most gym owners don’t go into this business thinking they’ll ever leave. That’s a huge issue, because there is no succession plan, and usually by the time they want to sell they’re on the tail end of a lease and it’s next to impossible.”

Ackerman added: “A lot of gym owners, myself included, never consider selling as an option, but I think you need to have that in mind. Do all the right things, put in the systems and operations that are required to build the gym so that you can sell it one day.”

And even if you don’t want to sell, you’ll have a stronger, more viable business because of it.