Buy a Franchise gym vs Going Independent?

When entering the fitness industry — or expanding within it — one of the biggest decisions you’ll face is whether to join a franchise system or build an independent brand. Both models can be successful, but there are significant in how they operate, grow, and generate value.

Drawing on insights from experience, the International Health, Racquet & Sportsclub Association (IHRSA), Fitness Australia, and leading business research, this article explores the advantages and trade-offs of each approach so you can make a decision aligned with your goals, risk profile, and local market.

1. The Case for Franchising

The key selling point of any Franchise is that they offer a structured, proven pathway into business ownership — particularly valuable for those entering the fitness industry for the first time or looking for a lower-risk entry point.

Proven Business Model & Brand Recognition

When you buy a franchise, you’re investing in a tested business model. Systems for sales, marketing, staffing, and operations have already been developed, refined, and validated across multiple sites. According to IHRSA’s Health Club Industry Overview (2023), franchise models such as Anytime Fitness, Snap Fitness, and F45 accounted for over 30% of club openings globally in the past decade, demonstrating their scalability and market confidence.

Brand recognition is another significant asset. Members already know the name, trust the reputation, and understand the product — giving new locations a faster start-up curve and stronger initial sales if that brand recognition is strong.

Support, Systems & Training

Franchisors should provide comprehensive onboarding, staff training, marketing support, and operational systems. For first-time owners, this infrastructure can reduce uncertainty and speed up profitability. Fitness Australia’s Club Owner Support Guide (2022) notes that franchise owners generally reach operational breakeven 3–6 months faster than independents.

Group Buying Power & Technology

Franchise systems should leverage collective scale for equipment purchasing, software, and marketing tools and both additional national and local advertising. This could result in lower setup and running costs. Technology integration — member management, billing, performance tracking — is typically included within franchise fees.

Drawbacks to Consider

Franchising requires ongoing royalties, limits on local decision-making, and adherence to brand standards. Creative flexibility is restricted and exit terms may be complex.

In addition to these drawbacks, it is important to do significant due diligence into the background and operations of the franchise.

Items that are positives in my experience can also become negatives if the franchise is not being managed well. For example, if trends change, or the industry shifts franchising makes it very difficult for a brand to pivot or to be flexible especially on a local level. Additionally, franchisees are relying on employees of the franchise for their expertise, knowledge and experience which may not up to speed with the current needs. Furthermore, despite buying power perceivably creating premium pricing, keep in mind franchises make additional income from suppliers which could inflate certain products. This in turn goes hand in hand with initial capital outlay for fitouts as the franchise will have minimum standards regardless of cost, as well as upgrade requirements

2. The Case for Going Independent

Operating independently offers the freedom to build your own brand — but also demands more responsibility and strategic vision.

Creative Control & Brand Identity

Independent owners have the ability to define every element of their business:

• Facility layout and equipment mix

• Brand identity and target audience

• Pricing models, marketing voice, and community engagement

This freedom allows faster adaptation to local market needs, seasonal trends, and niche opportunities. For example, boutique independent operators often capitalise on gaps in franchised models — such as premium functional fitness, women-only gyms, or integrated wellness spaces combining Pilates, sauna, and recovery services.

Higher Margins & Capital Value

Although independents carry greater startup risk, they often achieve higher long-term margins because there are no franchise fees or royalty obligations. All intellectual property and brand equity remain with the owner.

In the resale market, a well-branded, profitable independent can command strong multiples — particularly if it has proven systems and local market dominance. According to IBISWorld’s Gyms & Fitness Centres in Australia (2024) report, well-established independents can sell for 3–6x EBITDA, compared to 3–4x EBITDA for franchise resales with stricter operational constraints.

Local Partnerships & Community Positioning

Independent clubs can integrate deeply into their communities — partnering with local sports teams, schools, allied health providers, and corporate wellness programs. This kind of authentic local connection is often harder to replicate in standardised franchise systems.

Challenges of Independence

Without centralised support, independents must develop their own systems, manage compliance, and handle marketing from scratch. Initial capital can be managed, but are reliant on your own vision and existing supply network across many assets including fit out, equipment, and IT.

Due to the increase in digital capability and demand from members, IT systems such as booking platforms, home workout apps, member communication can be costly and time consuming to set up.

3. Financial Considerations

A key difference between the two models lies in cost structure:

• Franchise setup costs while on the outside may seem lower upfront due to negotiated equipment and fit-out packages they will include franchise royalties and strict guidelines. In my experience Franchise capital for these is higher longer term compared to independents.

• Independent gyms face higher setup costs for some resources including IT systems, operation systems and potentially equipment. But they also require much more marketing investment or brand positioning cost initial to get brand recognition.

From a risk perspective, franchise models can provide lower variability in early revenue, while independents have higher potential upside once established.

4. Choosing the Right Path

When deciding between franchise and independent ownership, consider:

• Experience: New entrants benefit from franchise support; seasoned operators may prefer independence.

• Risk tolerance: Franchises mitigate startup risk but limit autonomy; independents assume full control and responsibility.

• Market conditions: Highly competitive or urban markets may benefit from a known brand; smaller or niche markets may reward a tailored, local approach.

• Exit strategy: Franchise agreements often define resale terms; independents control their own valuation path.

Conclusion

Both franchising and independent ownership offer viable routes to success in the fitness industry — the right choice depends on your goals, experience, and desired level of control.

Franchising provides security, structure, and proven systems — ideal for those seeking a faster, lower-risk start. Independence offers creativity, flexibility, and the potential for higher long-term returns — ideal for experienced entrepreneurs or those passionate about building a unique brand.

Whichever model you choose, success ultimately depends on execution — maintaining service excellence, community engagement, and operational discipline.

References

• International Health, Racquet & Sportsclub Association (IHRSA). (2023). Health Club Industry Overview.

• Fitness Australia. (2022). Club Owner Support Guide.

• IBISWorld. (2024). Gyms & Fitness Centres in Australia Industry Report.

• Harvard Business Review. (2023). Franchise vs. Independent Business Models: Balancing Control and Scale.

• Deloitte. (2022). Global Fitness Market Outlook.