The ways to finance your fitness equipment for your new gym are as flexible as your imagination. Each financing option has its pros and cons; your goal is to find the finance solution most compatible with your specific needs.
Generally, a new gym owner has 4 main ways to acquire the gym equipment to make their fitness centre whole. These options are:
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- Buying the gym equipment with your own money
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- Buying the equipment using equity raised from investors
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- Taking out a loan
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- Leasing
Having helped hundreds of start-ups find their financial footing for the past 30 years, First Capital Leasing Ltd. is uniquely positioned to walk you through your financing options. As a premier leasing and leaseback company in Canada, First Capital Leasing Ltd. also offers fitness equipment loans and leases at exceptionally flexible rates. Call us today 1-888-251-3644 or fill out the online contact form to experience how it feels to work with a leasing company boasting a 95% approval rate!
4 Ways To Finance Your Fitness Equipment For Your Gym
Your gym is not much of a gym if it lacks a fleet of treadmills and ellipticals, an assortment of arm and leg training machines, a couple of benches for bench presses, and a few pull-up bars. All these goodies do not come cheap.
Given the high start up expenses of opening a gym, you are probably wondering about the most cost-efficient ways to acquire your fitness equipment. Your priority is to obtain the machines you need so you can start attracting customers right away. However, you should try to frontload your payments as little as possible so that you have sufficient working capital to fund other aspects of your gym operations, such as hiring fitness coaches and support staff.
With that said, here are 4 of the most common ways new gym owners procure their fitness equipment:
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- Buying fitness equipment with cash: Owning your fitness equipment is intrinsically appealing. Few gym owners get to say that they own everything they use. But ownership, in this case, is not always financially sensible. Gym equipment does not get more valuable over time, and innovations routinely displace existing technology. Ownership means that you are stuck with the same pieces of equipment for a very long time (unless you can find someone to buy them whenever you are looking to replace them). This is undesirable because you will lose customers by fielding outdated equipment, especially if your competitors upgrade machines every few years. Finally, buying your equipment outright also means that you will have less capital to work with. Keep this in mind if you expect your finances to be erratic for the first few months following your opening.
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- Buying with equity raised from investors: This financing option can be attractive if you do not have the funds to pay for your equipment but do have investors who have put equity in your enterprise. Using equity to buy equipment shares the same downsides with paying for it out of pocket, but with the added risk of losing some control over your business.
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- Taking out a loan: Borrowing money from a bank to fund your fitness equipment can be an interesting alternative to the options above.
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- Because you are still buying your equipment, you will still be stuck with it for years to come. This is the main drawback. Another negative is that you might not get your equipment right away, as the loan application process can drag on. However, as you are not using your own money, you will have more capital to put aside for other uses. Financing your gym with a loan can be an effective solution if you want to own your equipment while retaining capital for when you need it the most—the first few years of your business.
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- Leasing: A lease is often considered a worse financial decision than ownership, but this does not hold true when you are running a gym. Leasing your fitness equipment can be beneficial in multiple ways.
First, it frees up significant capital that you could put to other uses during the first years of your business. Second, lease terms are shorter than the lifecycle of the products, which allows you to regularly upgrade your gym equipment. Trotting out the latest technology every few years is a great way to retain customers and attract new ones. Lastly, a lease, depending on its structure, can grant various tax benefits.
Should You Buy Or Lease Your Fitness Equipment?
At the end of the day, procuring your fitness equipment can be simplified in 2 approaches: buying or leasing.
There are many financing options for buying, including using equity and taking out a loan, but the risk of being saddled with outdated equipment down the road is very real. A lease, on the other hand, actually allows you to improve your offerings. This is the reason 80% of Canadian businesses lease rather than buy their equipment.
If you plan to upgrade your fitness equipment every few years, work with First Capital Leasing Ltd. to lease the latest products at competitive interest rates and terms. Our 95% approval rate means that you are almost sure to find a payment structure that fits your budget. Call us at 1-888-251-3644 or fill out the online contact form to kick-start your gym!
FAQs
Why can’t I lease my gym equipment directly? Why work through First Capital Leasing Ltd.?
You certainly can lease your equipment by yourself, but your supplier may not be as flexible as we are. We offer tailored financing solutions at superior rates that perfectly align with your budget and timeline.
What if I want to lease my equipment after having purchased it?
First Capital Leasing Ltd. offers multiple sale-leaseback plans. You sell the equipment you own to us, and we lease it back to you at advantageous rates. This frees up significant working capital which can be invested in expanding your business.
Does First Capital Leasing Ltd. offer financing or leasing solutions to start-ups?
Yes. We have worked with start-ups and Fortune 500 companies (and everyone in-between) since our establishment almost 30 years ago.
