For most people, the idea of starting a business roughly equates
to the idea of emptying your bank account, thumbing it to Vegas,
and betting every penny on one hand of blackjack. You might be a
blackjack guru; you might have even won big in the past. But no
matter how carefully you plan, no matter what your cards looked
like before, and no matter if the dealer tosses you an ace-you
could still go bust.
That alone is enough to halt many would-be entrepreneurs in
their tracks. Factor in the empty-bank-account factor, though, and
many startups don't even make it out of the gate.
Would it surprise you, then, to know that sometimes your careful
planning, meticulous business plan and brilliant marketing ideas
don't have to go to waste-and don't have to cost a
fortune? "I know it can be done. And that's one of the
first things people need to understand," says John P. Hayes,
co-author with Fred DeLuca, Subway's co-founder, of Start Small, Finish Big: Fifteen Key Lessons to
Start-and Run-Your Own Successful Business. "It's
not money that's in the way of you starting your business.
It's a mind-set."
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Even if your startup aspirations are as lofty as a fitness
center, a car rental business or a hotel-not typically the cheapest
businesses to start-you can start small without breaking the bank.
(The big-growth part comes later.) So pull up a chair, and shuffle
your own cards. Your next hand could just hit 21.
Starting a Fitness Center
It's a good thing Tom Hatten was just 21 when he started
Mountainside Fitness in 1991. He needed all the energy
he could muster to put together his Chandler, Arizona, fitness
center-not to mention the energy to wash gym towels at home
'til 2 in the morning for the first year, until he could afford
a washing service. "I worked 100 hours a week and kept my
other job [painting houses] for six months," recalls Hatten.
"As much stuff as I could physically do [myself], I
did."
That self-starter approach is what helped Hatten stretch the
$2,000 he had in his pocket at startup as well as the $15,000 he
borrowed from a friend and another $15,000 from his local bank,
where his good credit on a car loan served him well. That $32,000
covered computers, advertising, and about half of the equipment for
the 4,800-square-foot facility; money for the remaining equipment
was raised through membership pre-sales totaling $12,000.
How did Hatten, 36, manage to equip a gym on a budget? "I
bought all used equipment," he says. "Just clean it up,
get it painted-get ones that have warranties. If it doesn't
look shoddy, members only care if it works."
While cutting costs is important, it shouldn't be your sole
consideration. "Instead of cutting costs, it's best just
to make a wise investment," says Jon Giswold, an author,
industry veteran and founder of JMG Management, a
New York City fitness-center management company. "Do some
research. Investigate what it would [cost] to buy directly from the
manufacturer. They'll tell you if you can get a better price if
you buy directly."
Before you consider buying machines, though, think about your
location. "I put my club where there was no competition,"
says Hatten, who now has five clubs with sales totaling
approximately $7 million, 400 employees, and a membership roster
21,000 clients long. "From there, I tried to give a lot of
service that wasn't [standard] in the industry"-such as no
contracts, no reservations for child care, parents' night out,
free family day on Sundays, and other perks.
Giswold advises you to take a careful look at the space in your
club: "Look at the floor layout," he says. "Do
machines consume the whole space?" Is there enough room for
yoga or ab work? With elliptical trainers being so popular, do you
need a lot of stair-climbers? "Really what people like to use
is a treadmill," he adds. "They're always used-with
the second [most popular] being elliptical machines."
Once you decide on machines, arrange them logically-even novice
users should know what to do. "If you start at one end and try
every machine in succession down the line, [you should get] a good
workout," says Giswold, noting the success of the Curves
concept.
Deciding whether to offer classes, child care and other extras
depends on your available startup funds and your appetite for
growth. Check out the local competition's offerings, and go
from there. Says Giswold, "What I've seen is that the big
clubs are offering services, like certain classes, for additional
fees."
Yes, you will break a sweat getting started. But ask Hatten, and
he'll tell you it's worth it. "You gotta love what you
do, because you're married to it," says Hatten, who hopes
to open three more clubs in Arizona and then expand his business
out of state.
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