Is owning a gym franchise profitable in Australia?

Opening a gym franchise in Australia can be one of the most rewarding ways to break into the booming fitness industry. With the country’s health and wellness market continuing to grow, owning a gym gives entrepreneurs the chance to build a business that not only generates revenue but also helps others live healthier, more active lives.

That said, while franchising offers a head start through brand recognition, proven systems and training support, it’s not as simple as buying into a name and waiting for members to walk in. To make your franchise thrive, you’ll need to understand how to open a gym strategically — from financial planning and legal setup to location, staffing and marketing.

This guide walks you through the essential steps to setting up a gym under a franchise model in Australia, helping you avoid costly missteps and build a foundation for long-term success.

Step 1: Understanding the gym franchise model

What is a gym franchise, and how does it work?

A gym franchise operates on a business model where independent owners (franchisees) buy the rights to operate under an established fitness brand. In return, they receive access to that brand’s marketing, systems, training and operational playbook, effectively giving them a roadmap for how to run a gym business that’s already proven successful.

Franchisees typically pay:

• An initial franchise fee for the right to use the brand
• Ongoing royalties based on revenue
• Marketing fund contributions that support national or regional campaigns

Often, the franchisor provides guidance on layout, staff training and member acquisition as well as technology platforms that streamline management. However, this comes with trade-offs: franchisees must follow brand standards closely and may have limited flexibility in pricing or local marketing.

The advantages of opening a gym franchise

Investing in a franchise can help mitigate the early-stage risks associated with setting up a gym. Plus, if you’re learning how to open a gym for the first time, a franchise can provide the structure, credibility and training you need to scale quickly. Here’s how:

• Brand recognition that makes marketing easier from day one.
• Proven systems for membership management, training and billing.
• Ongoing support from a franchisor who has already refined the business model.

Step 2: Researching the fitness market in Australia

Before signing a franchise agreement, take time to understand Australia’s fitness landscape. The market is competitive but diverse, with opportunities across boutique fitness, functional training, 24/7 access gyms and hybrid health clubs.

Doing your homework ensures you pick a franchise that aligns with your audience’s habits and the area’s market potential. Here are guidelines on how to start your local research:

• Demographics — Who lives or works nearby? Are they families, students or professionals?
• Competition — What other gyms operate within a 5–10 km radius, and what are their offerings and price points?
• Trends — Many Australians now prefer flexibility and technology-driven experiences. Gyms with mobile apps, on-demand workouts and seamless check-in systems appeal to this growing segment.

Step 3: Comparing franchise options carefully

When evaluating which franchise to join, look beyond brand popularity. Focus on long-term sustainability and support. Ask potential franchisors about:

• Startup and ongoing costs — Initial fees, equipment costs, royalties and marketing levies.
• Operational support — Do they provide software, systems and training for running a gym efficiently?
• Marketing and technology Are you given access to automated systems for billing, CRM and access control?
• Franchisee satisfaction — Talk to current owners about their experience with support and profitability.

By doing this groundwork, you’ll choose a franchise that aligns with your budget, management style and long-term vision for growth.

Step 4: Legal and financial setup

Before you open a gym franchise, you’ll need to establish the right business foundation. Choosing your business structure — whether as a sole trader, company or partnership — affects your tax obligations and liability so seek advice from an accountant or lawyer early on.

Franchises in Australia operate under the Franchising Code of Conduct, which protects franchisees and ensures transparency between parties. Before signing, review the Franchise Disclosure Document (FDD) carefully to understand your costs, restrictions and responsibilities. Also, don’t forget insurance. This includes:

• Public liability insurance to protect against member injuries.
• Equipment and contents insurance for damage or theft.
• Professional indemnity insurance for personal trainers.

You’ll also need to secure financing. Franchisors often partner with lenders who understand their model, making it easier to access loans. Factor in fit-out, equipment, franchise fees and a buffer for early cash flow. A strong financial plan will help your gym stay stable through its first critical months.

Step 5: Finding and preparing the perfect space

Location can make or break a gym. When setting up a gym, prioritise visibility, accessibility and convenience. Sites near transport hubs, residential communities or business districts attract consistent foot traffic. Your franchisor may offer guidance on ideal square footage and layout to maintain brand consistency. Choose a space that supports your planned services, from cardio zones and free weights to group fitness or recovery areas.

Fit-out design should reflect your franchise’s identity and member flow. Invest in durable flooring, ventilation and lighting that make the space safe and inviting at all hours. When buying equipment, prioritise quality and supplier warranties; cheap options might cost more in repairs long-term.

TIP: Ask if your franchisor has partnerships with equipment providers. Many do, which is a useful way to save on setup costs and ensure brand compliance.

Step 6: Staffing and operations — building a high-performance team

Even with franchise systems in place, people make the difference. Hire staff who embody your brand’s culture and values: friendly, qualified and member-focused. Typical roles include a club manager, trainers, sales consultants and maintenance staff.

Most franchises provide initial staff training, but you’ll still need to create clear expectations and processes for day-to-day operations. Define responsibilities for sales, cleaning, equipment checks and member support.

To keep shifts running smoothly, use scheduling software to manage rosters efficiently and encourage open communication. A structured operations plan will keep service quality consistent, even as your gym grows.

Step 7: Marketing and member acquisition

Marketing is essential when learning how to open a gym that stands out in a crowded fitness market. Franchises offer the advantage of built-in brand recognition, but local marketing still drives success. Start with a grand opening campaign that combines digital and community outreach:

• Launch social media ads targeting your postcode.
• Host free trial weeks or open days.
• Offer a founders’ fee for the first sign-ups within your pre-sale period.
• Partner with local businesses for cross-promotions.

Focus on retention as much as acquisition — your first members become your ambassadors. Offer loyalty programs, referral rewards and community events that strengthen member relationships.

Step 8: Technology and systems for smooth operations

When you open a gym franchise, technology underpins everything from access to billing. Most franchisors use integrated gym management systems to keep operations efficient. Key tools include:

• Membership management software for sign-ups, renewals and data tracking.
• Access control systems that allow secure entry without staff present.
• Automated billing and reporting for predictable revenue.

These systems save time, reduce manual work and create a seamless experience for both staff and members. The best platforms combine multiple features — CRM, scheduling, marketing automation and performance dashboards — into one dashboard.

Step 9: Compliance, health and safety — meeting Australian standards

Australian gyms must follow specific health and safety laws. This includes WorkSafe compliance, emergency plans and accessibility for all members. Regular equipment checks and documented cleaning schedules protect both staff and clients.

If you’re collecting member data through software systems, make sure your operation complies with Australian Privacy Principles (APPs). Use secure systems for billing and CRM management to protect sensitive information.

A good franchisor should provide templates for incident reporting, safety signage and risk assessments, but it’s your responsibility to ensure these are followed locally. Compliance isn’t just about ticking boxes; it’s about keeping your members safe and protecting your business reputation.

Step 10: Scaling and long-term growth — planning beyond your first location

Once your first site is stable and profitable, think long-term. Many successful franchisees expand to multiple locations, building regional clusters that benefit from shared staff and marketing resources. To prepare for growth, you should:

• Track key performance indicators (KPIs) such as retention rates, revenue per member and occupancy levels.
• Reinvest profits into marketing or new equipment.
• Maintain consistent quality across all sites through standardised processes.

Franchisors often provide pathways for multi-site ownership, helping you leverage existing systems and support to scale efficiently. Growth doesn’t just mean expansion; it means refining your operation for sustainability.

Common pitfalls to avoid when opening a gym franchise

Even with a strong brand, franchisees can make avoidable mistakes. Being proactive helps you stay ahead and ensures your investment performs well from the start. Watch out for these common missteps:

• Underestimating ongoing costs — Royalties, marketing contributions and maintenance all add up.
• Neglecting local marketing — Relying solely on national campaigns won’t fill your gym.
• Overstaffing early — Match your team size to membership growth.
• Skipping data analysis — Tracking attendance and member behaviour is key to smart decision-making.

Franchisors often provide pathways for multi-site ownership, helping you leverage existing systems and support to scale efficiently. Growth doesn’t just mean expansion; it means refining your operation for sustainability.