I have the opportunity to purchase a personal training business. In another state. It seems as if I would be purchasing some equipment, taking over a lease and have access to the original owners 50-60 clients. I would hope that at least half of those people would stick with me. The owner is currently running a profit (more than I make currently and I’m in a much larger city). I know you can never get the ‘full’ answer of why someone is selling but the business seems great and I’m not sure why the owner would be selling!
I’ve asked a zillion questions. Can you think of any other questions I should ask other than the obvious ones? Anything I should consider that perhaps I haven’t thought of already? I’ve asked about hours, transferring clientele, equipment maintenance, inventory lists, equipment lists, overhead costs, independent contractors, address, area, timeline, competition,advertising (does mostly free sessions to secure new clients but maintains a full schedule), landlord (is his client), rent, any legal issues with the business or building, no vandal, training style, why the owner is relocating, financing, how long he has been in business, size of studio, no classes.
I’m currently in corporate wellness and have a few private clients. I would love to relocate to this other state and I would love to be my own boss. My fiance works in banking however and is extremely considered about becoming a small business owner as he is seeing many small business owners very very unhappy.
I’ve never purchased a business. I’ve been in the industry since 2002. I have a BS and MS in exercise science. ACE and NASM certified. It would be nice to have some existing clientele when having your own business, instead of starting from scratch. But I’m wondering if it is foolish to ‘buy’ these leads that may or may not be there at the end!?
Hi Nikki. I totally agree with Karin about the percentage of existing clients that you are hoping will stick with the business after you purchased it. Remember that the first word in PERSONAL TRAINING is “personal.” The one identifiable asset that a personal training business has (at least that will give true value to the business) is its clients. So one question that I would ask MYSELF if I were involved in a similar deal is how much would the business actually be worth to me if my ‘hope’ of only half of the existing client base remained? That would be a computation and consideration that I would make/have with myself as I entered into such a transaction.
You mention that the business is currently making a profit. Have you done your computations as to how many of the existing clients would need to remain after your purchase in order for you to continue to make a profit (e.g. all of them, half, a third etc)?
My comments are intended as my own opinion and thoughts that I would have (in addition to the ones you already mention) if I were looking at such a deal or thinking about what things I’d want to consider; they are not intended to dissuade or encourage you to make the deal. However, I would say that if it were me, I’d make sure that I obtained the counsel of an experienced business attorney before moving forward.