How To Sell Your Health Club Business.

As a professional Gym equipment appraiser for 11 years I also have experience with brokers who value and sell the complete fitness business. 

The 3 parts of a Health Club business that buyers review closely are.

1) Monthly EFT. 

The amount of automatic ‘bank account transfer’ revenue that is generated monthly and over the last 24 months.

      
   2) The fitness equipment asset appraisal. 

   The professional gym appraisal plays an important factor in the value of the Gym business.  The current market value is added right on to the price of the business sale.

    3) The terms of the building (facility) lease.

  

    When the buyer is comfortable with the accuracy of the Gym equipment appraisal then the negotiating factors are the MULTIPLE of the ETF and other revenues.  I have heard of 10 times multiple earnings and I have heard of 1 times the yearly revenue multiple plus the fitness equipment current market value.   Depending on how bad the seller wants to sell or the buyer wants to buy, the selling price can fall in between these 2 values. This is my opinion only and is freely given to you as a gift of knowledge.  I do not broker or value the complete Gym business.  I only charge a fee for completion of a professional fitness equipment appraisal that can be trusted.

                           Get Gym Appraisal Pricing click here

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What Factors Determine A Fitness Center Appraisal?

I am often asked what percentage of the new equipment purchase price is used gym equipment worth?  And my reply is that many factors determine the current market value of professional fitness equipment inside a Health Club.  But percentage of new price is not one of them.

The most important value factor is the Manufacture’s brand and the model.  If you purchased the Cybex cordless total Body ARC trainers three years ago you retain much of the value because of popularity and demand.  This machine has proven itself to hold up well under heavy use and maintenance and repairs are minimal.  And it is very popular among gym members.   But if you purchased the Star Trac elliptical crosstrainer ELITE model 6230 then you have lost 95% of its value.  Because it is a maintenance nightmare and does not have very high member demand.   So the first thing an appraisal establishes is brand and model.  Does the Fitness center have TRUE brand treadmills or Life Fitness brand treadmills?  This makes a big difference.

Current physical condition is also an important factor.  If the fitness equipment has been beat up by members, rusty from sweat and in need of repairs then it has lost a good portion of its value.  The cosmetic condition is determined by the video and photos provided.

How well the manufacture supports repair parts of the equipment being appraised is important.  Years ago Cybex was the worst at this.  They would make it so difficult and expensive to get replacement parts to keep their gym machines in good condition that it made their brand a bad buy.   Today Cybex has figured it out and does a better job of supporting their used machines out in the field.   Now today, 2011, MATRIX brand cardio is a bad buy for this reason.   If you have MATRIX cardio machines you have lost a big portion of the value.   Now if you own Life Fitness cardio then you retain a big part of the value because getting repair parts is the cheapest and easiest of any professional gym brand today.

Color can be a neutral factor or really make it worthless.   So before you buy purple frame machines with yellow arm movements consider the re-sell value.   White and platinum metal are the 2 colors that hold the most value.

Age matters, but only because older machines have an outdated look and function.   And it’s too hard to get parts to do repairs.  The difference between 3 year old equipment and 5 years old only matters based on brand, model and cosmetic condition.  I have given more value to 5 year old machines than 3 years old.

Present market conditions can make a difference on value.  From 2008 to 2010 I noticed many gyms had gone out of business.   This dumped a lot of good condition, newer model gym equipment on the market.  So this depressed values for used fitness equipment.  This in turn lowered the value of the used equipment inside a fitness center that was up for sale to a new owner.

fitness center equipment appraisal

What Is Needed To Get Your Appraisal Started

As a professional Gym equipment appraiser I do not need to physically enter a Fitness Center to get the information I need.  Flying into your town and spending the day in your Gym doing an appraisal would make the appraisal very expensive.

I do need to see all the fitness equipment, lockers, and sports flooring in a video or photos. (I do not give values for Stereo equipment, Computers and software, alarm systems or office equipment.)

My favorite way is for the Gym owner to do a simple walk through video and post it to YOUTUBE.   Then send me the link to the video.   I can also get the appraisal completed with photographs.

The important information I need to view is color, vintage, brand and model, and cosmetic condition.  When taking a video just go through the Gym like you are giving a tour to a member.   The photos can be group photos as I do not need a picture for every machine.   I just need to see every machine in full that is part of the appraisal.

Then I need a complete inventory list with quantity in an excel spreadsheet format, or a Word document.   This inventory list must be in digital format and not a Scan or PDF.   The reason for this is I use your list to create my appraisal documentation and I don’t type very fast.   If you send me a copy of your original sales invoice then I will refer to it as *See List Attached, and I will not have each item priced.  It will just be the total value.

Payment needs to be sent along with this information.   

*See Gym Appraisal pricing click here

Payment by check payable to Steve Paterson  and mail to my appraisal office

Steve Paterson

206 East Indiana ave. suite 204

Coeur D’alene Idaho 83814.  

Email the inventory document, photos or video link to me at  gymappraiser@gmail.com and be sure to include your cell phone so I can call you directly with any questions.

I will start the appraisal after the check has been received.  I request at least 7 business days to complete an appraisal.  A rush request can be added in some cases.

health club appraisal

Gym Appraisal Pricing

Getting a professional gym appraisal can be different things to different business’s.  So here are the explanations and pricing for the different needs.

I donated Gym / Fitness equipment to Charity and I need the IRS Form 8283 completed for my tax return by a qualified appraiser. (Approved IRS 8283 appraiser click here to see why.)

A)     100 gym machines or less.   $489.00

B)     101 gym machines up to 300          
          machines.                                $ 589.00

C)      Over 300 gym machines.    $ 650.00

I am selling my Health Club and I need an appraisal to show my buyer what my Fitness equipment’s current market value is. I need an itemized inventory with a $ value given to each machine.

A)     100 gym machines or less.   $389.00

B)     101 gym machines up to 300          
          machines.                                $ 489.00

C)      Over 300 gym machines.    $ 550.00

I am closing my Gym and I need to know what my gym equipment is worth to a used gym broker who will haul it away. I need an itemized inventory with a $ value given to each machine.

A)     100 gym machines or less. $ 250.00

B)      101 gym machines up to 300
           machines.                             $350.00

C)      Over 300 gym machines.  $ 411.00

I am buying a Health Club and I need an appraisal of the current market value of the gym equipment to show the seller. I need an itemized inventory with a $ value given to each machine.

A)     100 gym machines or less  $389.00

B)     101 gym machines up to 300
          machines                               $489.00

C)     Over 300 gym machines     $550.00



What is needed to get your Gym appraisal started?  Click here.

gym appraisal

Gym Owners Lose Money Without A Professional Gym Appraisal

If you buy a Fitness Center and the current gym owner valued the used fitness equipment at $125,000.   And you find out later the fair market value was actually $68,000, you lose $57,000.

When you are refinancing your Health Club business at the bank they want to use your current gym equipment as collateral.   If the bank says your gym equipment is worth $125,000 and it’s really worth $250,000 then you wont get as much of a loan as you need.      

When buying Health Club Insurance you need to know the current value of what you own to purchase the correct amount of insurance coverage.

When you are buying brand new gym equipment an your sales rep tells you your trade-in equipment is only worth $20,000.  And an accurate gym appraisal confirms it is really worth $60,000.   What is that worth to you?

Gym Appraiser will complete an accurate current market value appraisal to make sure your gym business does not lose money.

gym appraisal click here

    

How to get an accurate “real market value” Health Club appraisal

The auto industry has the Kelly Blue book but the Gym industry has nothing of the sort.  So how does a fitness business owner, Bank, or Insurance Company get an accurate appraisal?

Go to the biggest used gym equipment transaction database the World has ever seen.

Steve Paterson is the owner and founder of UsedGymEquipment.com since 1989 and has bought and sold over 75 million dollars of professional fitness equipment.  So you can be confident that the fitness equipment current-market values are grounded in reality.

Real transactions from American business people that actually happened.   With 10’s of thousands of transactions in this computer database from completed deals is how the statistical values are created to give an accurate gym appraisal.

There are so many variables to consider when placing a value on gym machines that are not brand new.  And a percentage of the purchase price is not one of them.

Age, brand and model, field reliability, color, current physical condition, manufactures replacement parts product support, quantity, and present market conditions determine the real world market value.

Steve Paterson will complete your gym equipment appraisal accurately by using the used gym equipment transaction database and almost 20 years of experience.

By getting statistical data and add to that all the other variables Steve Paterson personally values every piece of fitness equipment on each appraisal.

Get a real world health club appraisal by a real professional using real information.
How to get started with a gym appraisal click here!