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Competitive and marketing analysis for a Gym

Info: 3878 words (16 pages) Essay
Published: 1st Jan 1970 in Marketing

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Optimize gym will be a private business. The reason it will be a private business is because it has benefits. The benefits are that the gym will have limited liabilities and will be separate the business from the owners, which means that if the gym goes bankrupt, creditors cannot go after the owners personal assets. Another reason will be that the gym can have some shareholders which will increase funds. The gym should only have one owner to avoid dispute between multiple owners. Optimize gym will be located in Greenacre because there are no other gym’s for both men and women. There will only be about 5 employees (Two inside the main gym area, and the other two to conduct boxing and circuit classes). Funds will be obtained from creditors such as a bank and will need an accountant to handle the funds.

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Purpose of plan

The purpose of a business plan is to guide a business to achieve its goals and to prevent failure. It provides a design and sets targets for a business which enables it to evaluate its progress against identified reference points. A well devised business plan provides a business with clear direction and a path for the future, how the business could perform in the future and the priorities that are set for the business. A business plan outlines:

A description of the business (Name, address, organisation and management)

The goods and/or services the business provides

The business’s goals

A market analysis – Customer needs and size of the market

The industry in which the business operates

Marketing/production/financial/employment relation strategies.

The goals of Optimize gym include:

Making a profit (Financial goal, short term)

Expanding to a few gyms around NSW (Financial goal, long term)

Satisfaction in work – self achievement (Personal goal)

Long term security – Financially (Financial goal, long term)

Sponsorship (Social goal)

Successful business (Personal goal, long term)

Increasing market share (Financial goal)

Help people achieve their physical goals (Personal goal)

Give men access to a gym since there are no gyms for both men and women in the are (Personal goal)

Situation analysis

SWOT analysis


Skilled and qualified Workers

Experienced managers

Great location

Good use of technology

Great reputation (over 100 members)

New and upated equipment

Large area inside gym so that equipment isnt squashed

3 rooms (One used for boxing classes, one for circuit classes, and one for main gym area.)


High costs for personal service (Personal training)

Low amount of staff

Average financial position


To expand

A growing market means more people will participate

Can attract couples because it is a gym for males and females.


Increased rent costs

Competitors (fitness first)

Competitor Analysis

Fitness first


Great reputation

Qualified and experienced managers and workers

Many workers

Trained personal trainers

Large amount of equipment

Good finance


High membership costs

Gym could be filled with members at certain times



Buying out competitors


Competitors (Such as other big gyms – World Gym)

Market Analysis

Customers (Target Market) / Market Research

Optimize Gym is located in Greenacre where there is only one other gym. There are also local sporting teams which means that they would want to keep fit if they are going to pursue that sport. Optimize gym will focus mainly on:

– Men and Women who would like to get the body they always dream of at a low cost.

– Couples who like to train together.

– Teenagers – The trend recently is for teenagers to go to the gym to keep fit and get good bodies for summer.

– Groups of friends – People would rather go to the gym with friends because it will be less boring and will keep them coming back.

– Housewives due to them being at an age where it is hard for them to maintain their figure

Market Segmentation

There are four key business functions which are Operations, Marketing, Accounting and finance, and Employment relations. All of these interrelate, which means that they all rely on eachother’s success to be successful.

The term operations means the physical production of a good or the provision of a service. Since Optimize is a gym, it means that it is service based. There are many positive qualities for opening a gym which can include:

Not being worried about being over stocked

Not having to think of ways to innovate products

No need to always have stock

Being service based also has down sides which can include:

If the business is not performing well, you cannot improve on anything other than the service unlike selling products, you can just innovate & improve.

Replacing broken equipment

Marketing is the sector which aim’s to find out what consumer’s look for in a product/service and implement them. With Optimize gym, people come to the gym to achieve the bodies that they always dream of and marketing needs to be able to attract customers by creating a good atmosphere and giving them a great experience. Marketing needs to be able to research competitors to find out what is making them good and what is making them bad, also researching the prices of competitors to be able to compete with them. The marketing sector mainly relies on the accounting and finance sector to be able to provide the funds needed to advertise etc.

Accounting & finance is the sector which provides the financial information needed for decision making by the other sectors. No matter what type of business you are in, you need this sector to be able to keep track of what is being spent and what money you have. This sector is also important because it gives owners information about what is making money in the business and what is losing money which will help them improve on the bad parts of the business. Business use various tools to keep track of the money which include financial records, balance sheets, break-even analysis’, budgets etc.

Employment relations is the last sector of the four business functions. It is basically the relationship between the employer and the employees. If the relationship is good between them, then the employees will like their job which will motivate them to work hard and not slack off. Having good employment relations will help achieve the business’ goals by having qualified, trained and skilled employees who are right for the job.

Objectives and strategies

Objectives are merely goals, but are not like normal goals. They need to be S.M.A.R.T which means that they must be Specific, Measurable, Achievable, Realistic and Timed.

The objectives of Optimize gym relate to the four key business functions which are Operations, Marketing, Accounting & Finance and Employment relations (As mentioned above)

Objectives of operations for Optimize gym include:

Increasing participation of members in circuit and boxing classes

Increasing how much the fitness professionals help the members, that is improving the quality of service from employee’s.

Some strategies to accomplish these objective can be:

Offer occasional trial classes to show members how the classes are run and how beneficial they can be.

Offer rewards for employee’s that you see actually approaching members and giving advice and help on nutrition and teaching about how exercises should be done.

Training staff

Objectives of the Marketing sector for Optimize gym include:

An increase in members by 20% within 12 months

Some strategies that can be implemented to achieve this objective include:

Offering free trials of the gym

Offering free circuit/boxing classes

Group discounts on starting memberships

Discounts for referring friends (friends must become members for the discount to apply)

The objectives of the accounting & finance sector for Optimize gym include:

An increase in profit by 20% within 12 months

Becoming insolvent

Having liquidity

Having a surplus

Some strategies that can be implemented to achieve these goals include:

Improving stock control

Decreasing expenses

Tighter credit policies

Finding alternative suppliers (Cheaper stock)

Accounting & finance interrelated with Marketing because if marketing is good then Optimize gym will have more members which means more return and makes it easier to achieve these objectives.

Employment Relations also has some objectives which include:

Keeping at least 90% of employees after 3 years

Strategies that can be implemented to achieve this objective include

Motivating employee’s to work by offering rewards

Increase in payment each year to all employees

Offering prizes to employee of the month

Job Description

Qualifications include:

– Completion of personal training course

– At least 2 years experience

Staffing requirements

Rostering is the process of allocating particular staff to complete particular duties.


– Jessica – Personal trainer (Completed personal fitness course – Worked as a personal trainer for 3 years – Sert 3, Sert 4 Diploma fitness)

– Therese (Bachelor of exercise science)

– John (Level 1, Level 2 strength and conditioning)

– Bob (Level 1, Level 2 personal trainer)

– Anthony Ishac (Boss) (Physio therapist)


Shift (9am-4pm)


Shift (4pm-10pm)





Main Gym Area

Main Gym Area



Anthony Ishac

Circuit Room

Main Gym Area

Main Gym Area




Anthony Ishac

Main Gym Area

Main Gym Area

Massage Room



Main Gym Area

Main Gym Area




Main Gym Area

Main Gym Area



Anthony Ishac

Boxing Class

Main Gym Area

Main Gym Area




Anthony Ishac

Main Gym Area

Main Gym Area

Massage Room



Main Gym Area

Main Gym Area




Main Gym Area

Main Gym Area



Anthony Ishac

Circuit Room

Main Gym Area

Main Gym Area




Main Gym Area

Main Gym Area

Bob (4pm-8pm)

Anthony Ishac (4pm-8pm)

Main Gym Area

Main Gym Area




Main Gym Area

Main Gym Area

John (4pm-8pm)


Anthony Ishac (4pm-8pm)

Boxing Class

Main Gym Area

Main Gym Area

Price / Promotion

The prices at Optimize gym is a price in which the gym is willing to make and what the consumers will be willing to pay. Optimize gym will also use competitor prices as a guide to what the prices will be. The gym is going to have promotions that will help attract customers such as free boxing/circuit classes and also free massage sessions with each 3 month membership or longer. Optimize Gym product strategy should be to attract and keep business coming back. The main goal is to try keeping a positive atmosphere and letting members have a great experience that helps them lead a healthy lifestyle. Optimize gym should try to become separate from other gyms and try to become better. Some ways to separate themselves would be by providing exceptional exercise equipment and having professional trainers conducting classes and giving nutrition advice. By having these, Optimize gym will have a high standard compared to other gyms. Some promotions may include:

– Advertising on billboards

– Making facebook pages

– Television

– Radio

– Door-to-door visits offering one day free entry

– Providing 1 month free membership for members who have been with us for 12 months+

– 10% discount when you refer 5 friends

Membership Fees

Casual Visit: $10.00

10 Visit pass: $75.00

1 month membership: $49.95

3 months membership: $119.95

6 months membership: $199.95

12 months membership: $350.00

1 month membership + Boxing/Circuit class (Any time): $70 (Must choose ONE class)

3 month membership + Boxing/Circuit class (Any time): $170 (Must choose ONE class)*

6 month membership + Boxing/Circuit class (Any time): $300 (Must choose ONE class)*

12 month membership + Boxing/Circuit class (Any time): $400 (Must choose ONE class)*

*These memberships will include one free massage session.

Class Fees (Boxing / Circuit)

1 Class: $10

1 Month: $40

Monthly Recurring: $35

Massage sessions: 1 hour = $40 (includes any part of the body)

Product Prices

Optimize Shirts: $25

Optimize Singlets: $20

Weight lifting gloves: $30

Weight lifting belt: $40

Supplement Prices (Approximate prices)

Protein Jar: $70

Creatine Jar 200g: $30

Weight loss supplement: $40

Weight gaining supplements: $40

Muscle bulk supplements: $60


The products that Optimize gym offers are in great condition. The equipment in the gym are all brand new and are from big trademark brands. The gym area is very big so the equipment are all spaced out. The products that will be sold include gym shirts and singlets, weight lifting gloves, weight lifting belt, proteins, weight loss/weight gain supplements and creatine. The gym shirts will have various sizes with Optimize written on the front with a slogan on the back. They will be black in colour with lime green writing.

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Place refers to how a product is distributed. With Optimize gym, the only products that are sold are the ‘Optimize’ T- shirts and singlets. They are made by the manufacturer then sent a retailer (Optimize gym) then sold to the consumer. The degree of distribution will be exclusive distribution, which means that only one retailer (Optimize gym) will be able to sell them.

Description of the product/service

The services Optimise gym offer include: In the main gym area, Optimize gym has trained staff members who have completed various courses in training and fitness and also nutrition and are able to provide excellent information and motivation for members. Optimize gym provides exceptional service inside the gym with the state of the art equipment that the gym owns. It also has trained staff to conduct circuit classes and also boxing which help members increase fitness levels and also learn some self defence along the way.

Equipment inside the gym

Fitness step x 2 – $200

Barbell set (10kg – 70kg) – $2500

Bodyworx Deluxe Mid-width Weight Bench Press x 2 – $1000

Seated preacher curl bench x 2 – $500

Smith Machine x 2 – $10000

Cable equipment (Shoulder press, lat pulldown, chest)

45 degree leg press – $1000

Multi station x 2 – $10000

45 degree back extension – $500

Dip / pull up assist machine – $1000

Wall Balls (Medicine balls) x 4 – $200


Rowing machines x 3 – $2000

Treadmills x 3 – $5000

Exercise bikes x 12 – $3000

Power racks

Weight plates (1.25kg, 2.5kg, 5kg, 10kg, 20kg) x 2 – $1000

Rubber floors

Boxing bags x 4 – $400

Boxing ring – $1000

Protective gear


Boxing gloves

Focus Pads

Personal Trainers

– Jessica – Personal trainer (Completed personal fitness course – Worked as a personal trainer for 3 years – Sert 3, Sert 4 Diploma fitness)

– Therese (Bachelor of exercise science)

– John (Level 1, Level 2 strength and conditioning)

– Bob (Level 1, Level 2 personal trainer)



Wednesday 7pm-8pm

Sunday 7pm-8pm


Monday 5pm-6.30pm

Friday 6pm-7.30pm

Boxing Class

Includes self defence training and sparring

Circuit Class

Includes pushups, Situps, knee lifts, squats, fitness stepping, skipping, tuck jumps and treadmills.

Massage Session

Must book with Anthony Ishac on the available days (Tuesday and Thursday)

Trading Hours

Monday – Friday: 9am – 10pm

Saturday – Sunday: 9am – 8pm


Equipment sold on front counter


Optimize t-shirts

Optimize singlets


Weight lifting gloves

Weight lifting belt (back support)

Power bars

Protein shakers

Boxing gloves/pads

Optimize gym is a great choice compared to its competitors because it provides excellent equipment at a low price also combined with the quality of the service.

Offers and Discounts

Group discounts

Discounts on referring friends

Free trials of boxing/circuit classes/Gym membership

Discounts on members who have been part of the gym for a long period.

Financial Forecasts

Optimize Gym Pty Ltd

30 June 2011

Current Assets

Cash $6000

Accounts Receivable $50,000

Inventory $50,000

Current Liabilities

Overdraft $150,000

Accounts Payable $60,000

Total $106,000

Total Current Liabilities $210,000

Non Current Assets

Equipment $1,000,000

Land $500,000

Building/Property $300,000

Non Current Liabilities

Mortgage $1,600,000

Total $1,800,000

Total Non Current Liabilities $1,600,000

Other Current Assets

Good Will $200,000

Owners Equity

Shareholders funds $296,000

Capital $100,000

Retained Profits $100,000

Total Assets $2,106,000

Total Liabilities + Equity $2,306,000

Liquidity = Current Assets .

Current Liabilities

=$106,000 = 0.5


Executive Summary

I will be opening a gym called Optimize. Optimize gym is a private business and i will be a sole trader due to various reasons. The major goal of the gym is to create a profit and make members dream bodies reality. Optimize gym offers many services such as nutritional assistance, assistance in exercise, state of the art equipment which are brand new, and will sell various products such as supplements, T-shirts, singlets, training equipment, boxing gloves/pads. Optimize gym conducts boxing and circuit classes to any member, each twice a week and also physical therapy and massage sessions. Optimize gym is located in Greenacre because in that area there is only one other gym which is just for women and all major competitors are located away from this area. The trading days are Monday – Sunday. The trading hours are 9am-10pm (Monday – Friday) and 9am-8pm (Saturday – Sunday). Optimize gym offers a lot of discounts such as group discounts, Referrer discounts and loyalty discounts. The set out of Optimize gym and the services / offers that are available are good for the business at the growth stage because it is able to make enough revenue to pay off debts and have a profit.

Critically review the plan and process

Over all this assignment was very long. Luckily it asked me to write a plan of approach otherwise i would not have completed all aspects of the report. Overall i worked well in completing each part of the assignment to the date in which it was due, everything was completed as planned. In class i listened to all the tips Mr Fares gave me and also Miss Jones in the past term. I asked the teacher many questions before i went home and completed each part of the plan. I had some strengths and weaknesses. Some strengths were that i knew the content previously which made it easier for me to know what to talk about in the plan, and also had the help of the teacher in areas which i didn’t know much in. Some weaknesses were that i was distracted very easily because of the environment i was in (The room i worked in had my Tv, Xbox and stereo) and was also distracted from friends and was thrown off task easily. Overall i met all my deadlines and was happy with the way i completed the plan but the assignment was very long! I think that we needed more lessons in class to learn the content a bit more before starting.

Revenue statement for Optimize Gym Pty Ltd

for the period ending 30 June 2010


Total $

Sales Revenue


Less Cost of goods sold

Opening stock


Closing Stock






Gross Profit


Less Expenses


Bank charges


Interest paid to bank


Salaries and wages



Accountancy fees










Net Profit (Before Tax)


Financial Requirements

$500,000 – To buy equipment, re-stock and pay for damages.


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