Knowledge is power, and you need to keep eye on the health of your fitness business. So, which essential business statistics should you keep track of? In this article, we’ll focus on monthly statistics, to get you started.
The number of gym memberships you sell reflects your total active, or current members. This doesn’t include those who use the gym casually, or drop-ins.
Your number of total active members forms the baseline for calculating your monthly recurring revenue.
Membership income drives your monthly recurring revenue. It’s the most stable and reliable source, and helps you to predict future cash flow, and budget for business growth and maintenance.
You get this figure by multiplying your number of paying members by the average cost of a membership.
Your gross or total revenue is your sales from all revenue streams. These include memberships, products (like retail and merchandise), and services (such as events, drop-ins and personal training). This goes towards calculating your net revenue.
Net revenue is your gross revenue, but minus, fees and refunds. Your net revenue tells if your business is making a profit, or making a loss.
Your profit is what’s left after you take away business costs and expenses from your net revenue.
Your profit margin (profit divided by net revenue) tells you how much your sales exceed your business costs by, or if they fall short.
If you have a high profit margin, this means you have more to put away and towards developing your business. If it’s low, or in the negative range, you may want to hold off on expensive purchases for the moment, or find other ways to bring in revenue.
New memberships increase your total active memberships and can tell you how successful your marketing strategy is. Gym management software, combined with marketing data and statistics, can track which particular marketing campaigns were effective, and when.
If your cancelled memberships exceeds new memberships, this will affect your total active memberships, and your monthly recurring revenue.
Calculate your average customer value by dividing your total revenue by your total active members.
Your average customer value tells you how much each customer is worth, how much to spend per member, and how to structure your pricing models.
You can create membership and training packages that meet this value, with cheaper or more expensive options on either end.
A new lead is someone who is interested in joining your gym — a prospective membership. They may come in through referrals or word-of-mouth, through enquiries via your website or social media, or through other marketing channels.
In general, the more leads you get, or generate, the better. The key is identifying what makes a quality lead, then turning, or converting, that lead into memberships.
A good way to identify leads is to know your ideal customer, and target them where they’re mostly likely spend their time.
Tracking your monthly leads against new memberships each month is a good way to tell if your marketing strategy is paying off.
You can use our quick fitness business calculator tool to cover the basics.
However, proper gym management software can take care of these calculations for you, and more.
Contact Clubworx today to find out how our specialised gym management software can power your fitness business and save you time.