Very Profitable Fitness & Martial Arts Center!


About the business:  This Fitness & Martial Arts Center was established in 2008, and is a very profitable fitness and martial arts studio located in a suburban Metro Denver area.   

The very first thing to know about this Fitness & Martial Arts Center is that in order to be successful you do NOT need to be an expert in martial arts, although interest and some experience in martial arts is ideal.  The Seller has an extensive background in martial arts, but make no mistake about it, effective marketing is the cornerstone component to success.   

The Seller has precisely built a triangle for success for the business, and the top of the triangle is Effective Marketing that is composed of updating the website, blogging, SEO, and creative digital marketing.  Included in the training with the sale of the business, the Seller will teach all marketing systems to a qualified buyer.  

knee-kick-bagThe bottom two points of the triangle are Fitness Curricula/Classes and Martial Arts Curricula/Classes.  On the fitness side the focus is mostly on adults and there are about 18 fitness sessions taught in a week.  On the Martial Arts side the focus is mostly on kids ages 4 to 12.  There are about 16 Martial Arts sessions taught in a week. 

On the fitness side of the business the Seller has implemented a very popular unique licensed fitness curriculum for adults.  The sale of the business includes an exclusive 3 mile protected territory for the licensed fitness program. 

On the martial arts side of the business there are 4 general components that that include a primary school program (ages 4-6), program for upper elementary (ages 7-12), a unique licensed Martial Arts Program (name not disclosed for confidentiality), and Adult Martial Arts.  This Fitness & Martial Arts Center is one of the few martial arts studios in Denver that licenses this unique Martial Arts curriculum.  The Seller will attest that even though he is a black belt he cannot perform many of the movements taught in the unique licensed Martial Arts Program.  He uses the resources the program provides and this is one of the reasons why you do not have to be an expert martial artist to be successful at this business.   

Knowing that he would someday transfer the business to another owner the Seller has organized all of the content in the curricula so that it can be duplicated and transferred.  The Adult Classes represent the least amount of membership, but this could be expanded if a new owner wished to do this.   

The Martial Arts/Fitness Center has approximately 5 Instructors. The Seller teaches about 2-3 Fitness classes per week, but about 12 of the Martial Arts classes per week.  In total the Seller spends about 15-20 hours per week teaching.  Most of the Seller’s time per week is spent on marketing and administrative tasks for the business.  The Martial Arts/Fitness Center has specific hours that vary each day depending on the classes, but in general the hours tend to be between 4pm and 8pm for most days of the week.

In my opinion as a Professional Business Broker and Franchise Consultant, I feel This Fitness & kettleballsMartial Arts Center is so well-organized that there are many similarities to fitness/martial arts franchises but there are no royalties and there is strong income from Day One. 

The sale of the business includes approximately $11,000 of Furniture, Fixtures, & Equipment and there is very limited inventory that is also included in the sale of the business.  The lease is currently approximately $5,000 per month with CAM charges.  There are two years left on the current lease but the landlord will consider a new lease with options, and in fact if a Buyer utilizes an SBA Loan to finance the business it will be necessary and required to obtain a lease that matches the terms of the loan, which is usually 10 years.  The Seller states the landlord has been good to work with.  

Excellent Prospective Buyers might include a fitness instructors, personal trainers, martial arts participants, or anyone desiring to own a gym/fitness facility with an emphasis in martial arts. Prospective Buyers need not be experts in martial arts, but should enjoy a business revolving around fitness and martial arts, and most importantly have an interest in learning and performing the marketing tasks that are necessary to maintain the interest and membership. This Fitness & Martial Arts Center has been pre-qualified by WellsFargo SBA Division for an SBA Loan, which is great news because a qualifying buyer can put just 15-20% down payment on the business. 

Growth and Expansion: There are several areas for growth and expansion that the Seller is happy and willing to illustrate to a prospective buyer.  There is an excellent possible revenue stream that can be obtained by offering the space and equipment of the studio to personal trainers during the daytime when the space is not in use.  A new owner can add on an afterschool enrichment care program that is better than traditional day care, and could operate during the currently unused 3pm to 5pm time slot.  There are additional time slots to increase the number of summer camps and school holiday camps for school-aged children.  The Seller currently runs 4 very profitable camps and believes you could run as many as 10 camps per year.  In addition, the new owner can sell supplements, nutritional products, and any other type of fitness-related retail products.  The Seller is currently selling some nutritional supplements through a direct marketing company and is experiencing success.  The profit from supplements is not included in the financials or stated in the demonstrated profit because it is classified under different business income. The Seller will discuss in detail this revenue stream as well as any other potential revenue streams to a qualified prospective buyer when they meet in person.  

Competition:  On the fitness side there are competitors such as Crossfit, Kickboxing classes and some big box fitness centers; and on the martial arts side there are a few of the typical martial arts studios that you would expect to find.  However, the differentiating factors between this Fitness & Martial Arts Center and other competitors are the type of fitness programs that are offered, and also the unique Martial Arts programs.  The bottom line is that it can be very difficult to make a 6 figure income in a fitness career and This Fitness & Martial Arts Center can offer that opportunity! 

Training and Transition:  Complete training of 30 days is included in the sale of the business.  30 days should be adequate to transition, however, please note that the Seller is not relocating.  The Seller resides close to the business and would be open if a buyer needed additional consulting or training. It is worth noting that the Seller currently teaches classes and is open to teaching some classes (at the standard instruction rates) during a transition period if the new owner felt it would be beneficial for their success.  In keeping true to the Martial Arts philosophy of honor and respect, the Seller sincerely cares and wishes the new owner to be most successful and consequently is interested in accommodating the new owner’s requirements to make for a smooth transition.   

Reason for Selling:  The Seller would like to pursue other business interests and is willing to sign a non-compete to protect the new owner’s interests.