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Home Business Loans How Much Does It Cost To Lease Gym Equipment?
Operating a gym or other wellness venture can be a fulfilling—and profitable—decision for a motivated small business owner, but be sure to understand the nature of the business and the costs of following this fitness dream. If you are enthusiastic about health, though, opening a gym can become a fantastic way to turn your passion into a business.
There is a good reason to explore the field, no matter how often you hit the gym yourself: The global fitness industry earned an estimated $54.2 billion in 2021, according to Wellness Creative Company. Though this figure is down from 2019 earnings, the experts at Wellness Creative Company expect revenue to rebound strongly as COVID-19 becomes more of an endemic disease and restrictions loosen.
The cost to lease gym equipment will depend on how much equipment you plan to lease, the brand of equipment, and the type of machines. It might also be impacted by personal factors, such as your personal credit score and borrowing history.
Depending on the size of your gym, you probably need to acquire at least $30,000 worth of new equipment. And while the final numbers will depend on your credit score, you could be able to lease $30,000 worth of equipment for roughly $1,000 to $2,000 per month—perhaps even less.
According to gym equipment manufacturer Primo Fitness, the average commercial gym ranges in size from about 3,000 to 4,000 square feet. As we noted above, filling this amount of space with gym equipment will cost a budding owner roughly $30,000 to $50,000.
Expect to pay $60 to $100 per month per item to lease common gym equipment like commercial treadmills, stationary bikes, and ellipticals. These items usually start at around $2,000 to purchase, and heavier equipment—like weight machines—can cost between $4,000 and $7,000 outright. If you pay an average of $80 to lease each piece of equipment every month, and you have 20 pieces of equipment, this amounts to a monthly payment of $1,600.
More modestly, Primo Fitness estimates that it would cost about $10,000 to fill a small 1,500-square-foot personal training studio—this includes about 4 treadmills, a pair of ellipticals, several strength machines, and dumbbells. If the average lease of each piece of equipment costs $80 per month, the total monthly payment for 10 pieces of equipment is $800.
Leasing gym equipment can be a smart play for your small business because it doesn’t require nearly as much upfront capital as it does to buy equipment—and lease terms are typically less restrictive than financing terms. Also, when a lease is done, you can often choose to lease brand-new equipment, so you can keep your gym up-to-date through the years.
While the obvious benefit to buying gym equipment at the outset is owning the equipment, leasing doesn’t require a large infusion of startup capital—a key advantage. Additionally, gym equipment can become obsolete fairly quickly, but when you finish repaying a lease, you often get the option to lease new equipment.
Gym equipment financing is usually cheaper over the years than leasing, and you’ll own the equipment when the loan is repaid. Lendio’s calculator shows that, to finance $30,000 to $50,000 worth of gym equipment over a 2-year period, you should expect monthly payments ranging from about $1,309 to $2,200. This estimate assumes you’ve been in business for 3 years or more and that you have a credit score of 620 or above. Lendio estimates that $10,000 worth of equipment financing will cost you $438.75 per month, assuming you’ve been in business for 3 years or more, you have a credit score of 620 or above, and you are on a 2-year repayment plan.
Your gym members will probably expect you to replace obsolete equipment over time—leasing allows you to do this much more easily than buying or financing.
According to Entrepreneur, the average startup costs to open a gym range from $10,000 to $50,000. Opening up a franchise requires quite a bit more—the start-up costs for a Planet Fitness, for example, can range between $1 million and $4 million.
If you operate a gym, you can expect to pay about $60 per month to lease a lightweight, basic commercial model treadmill. The same piece of equipment would cost about $2,000 to buy.
Gyms both buy and lease equipment. Many gyms opt to lease equipment because it requires less money up front and the equipment will get regularly upgraded over time as leases expire. Other gyms buy equipment because it is cheaper over the longer term.
Generally, you can deduct lease payments as “ordinary and necessary” business expenses on your taxes, although there might be deduction limits.
You might be able to claim depreciation on your leased equipment based on your borrowing agreement. Technically, only the “holder” of the equipment can claim depreciation, but this holder might be you if it’s reasonably likely that you will acquire the equipment when the lease ends.
Applying is free and won’t impact your credit.
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