DPT-700- Business Management

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By Liyen Mathew

Once qualified as a Personal Trainer, you need to consider what career path you intend to take.

Do you want to work for yourself, with a team, on behalf of an organisation, or a combination of these suggestions? Some of the options are reviewed in this module.

  • Self Employed Personal Trainer
  • Working in Partnership with a Fitness Facility / Club
  • Running Your Own Gym Facility
  • Buying into a Franchise
  • A Career in Leisure Management
  • Branding

Self Employed Personal Trainer

For many, this is the dream. Be your own boss, work the hours your choose, with the clients you love. Whilst this option arguably gives you the most freedom and flexibility, there are still challenges to be aware of.

  • Pros – You get to choose what days and hours you work (to a degree). Flexibility of location without being tied down – indoors / outdoors. If you genuinely love what you do, it won’t feel like work.
  • Cons – You’re reliant on yourself and your brand strength to generate income. Working for yourself means that there’s no back-up for sick days / holidays. It’s all you.
  • Consider – how you’re going to operate – what makes you unique – where will you be based – what’s your target market – work out your rates – how are you going to market and promote yourself – local competition – you may wish to consider partnering with another Personal Trainer to help share the workload (look into legal advice as to how you split the workload and payments, make sure you work with someone you trust and set the expectations from the start). 

Working in Partnership with a Fitness Facility / Club

There are various models available. Some gyms will insist that Personal Trainers are employed by them. Others insist that Personal Trainers are self employed but offer up free hours to help in the gym.

  • Pros – You’ll have a captive audience of customers to reach out to by way of the existing membership base. The facility should support you in terms of marketing and promotions. You’ll have the opportunity to promote yourself during [classes / gym inductions].
  • Cons – Hours may be regulated or capped. There may still be hire costs or income split models involved.
  • Consider – how much you’re willing to give (time / cost) – what restrictions are placed on your operations – who manages the bookings – who handles the money.

Example models: 

– you’re employed by a gym as a fitness instructor (regular monthly salary), completing Personal Training sessions allows you to supplement your income with a higher hourly rate. It is likely that the facility will manage the booking and retain the income. 

– as above but instead of an enhanced hourly rate, an income split arrangement exists between you and the facility.

– you’re self employed, you manage the bookings and take the income, but will be expected to pay either a variable or fixed ‘rent’ to the facility in exchange for you using their gym and equipment. 

– as above but instead of paying them a rent, an income split arrangement exists between you and the facility.

Running Your Own Gym Facility

More responsibility, but more control and potentially more lucrative.

  • Pros – A fixed venue gives you less operating restrictions – you don’t have to worry about room hire costs on a session by session basis. You have the opportunity to expand your client base and maybe work with a team of Personal Trainers to support you. 
  • Cons – Finding a suitable venue can take time. The venue may need renovations to bring it to standard, and equipment purchases could involve expensive start up costs. Overheads (running costs) such as rent, utilities, insurance are fixed regardless of venue use.
  • Consider – location – access – parking – size – renovation costs – equipment purchases – any maintenance agreements for fixed items (air con, heating) and loose equipment – overheads (electricity, gas, water, service charges, business rates, and actual rental costs), look into statutory services and inspections that you have to complete (fire risk assessments, water management contracts). Some items will sit with the landlord, some items will sit with you as the tenant. Equally, it will be advisable to have a solicitor to look over the lease agreement so that you’re clear on what you’re getting into. Understand the where the obligations lie if something breaks down. Remember to try and find a balance between working in the business, and working on the business.

Buying into a Franchise

There are 2 main options which exist if you’re considering this route. Either you buy into a Personal Training business who will have connections with leisure centres and gyms to allow you to be based within a venue (Your PT. The alternative is that you buy into a brand and run a studio as a business owner but under their brand (Anytime Fitness, énergie Fitness, SNAP Fitness, F45 are a few example).

  • Pros – support of some centralised infrastructure – marketing templates, promotional material, uniform etc.
  • Cons – a ‘buy in’ fee and monthly royalties making it harder for you to realise your true earnings.
  • Consider – start up costs and operating restrictions to maintain the required brand standard.

A Career in Leisure Management

Not one to be taken lightly, but with dedication, your Personal Training qualification can take you on the path of senior management within the leisure industry. 

  • Pros – ‘security’ of employment and a monthly salary. Respectable salary for larger areas of responsibility. It can be hugely rewarding when things are going well or if you work with an awesome team.
  • Cons – diminished control, organisational structure and procedures to follow. Accountability and responsibility for the actions and behaviours of staff under your jurisdiction.
  • Consider – your career path (typically: Personal Trainer -> Fitness Manager -> Duty Manager -> Facility Manager -> Area Manager). It’s not a 9-5 job sadly so be prepared for late night call outs or weekend phone calls when staff phone in sick and the facility needs your advice.

Things to Consider:

Tax 

If the intention is to freelance / be self employed as a Personal Trainer or operating a business of your own, then make sure you register with HMRC (or the equivalent in your country if outside the UK). In the UK it’s pretty easy, you can register online. Annually you’ll be required by law to complete a Self Assessment tax return to declare your earnings and profits and pay any tax due to the Government. So make sure that you put some money aside once you’re earning so that you have suitable funds available to pay taxes owed when you come to complete your Self Assessment tax return. Assume around 20% of your income (worse case scenario).

Note – you won’t need to register for VAT unless you’re earning over £82,000 (UK threshold ‘19/20)

Pension 

If employed by an organisation, the company is legally required to make a contribution on your behalf towards a pension scheme. You normally have an input as to how much you as an employee contribute as a percentage of your earnings. If you’re going to be self employed, you need to consider putting money aside for your retirement. This can be as simple as a separate savings pot or you can set up a private pension scheme – research the most suitable option for you but don’t forget to save.

Insurance 

If you’re going to be employed by an organisation, they will hold both Public Liability Insurance and Employee Liability Insurance. Malpractice on your part is likely to be covered by them but they may well seek disciplinary action in the event of something going wrong. 

If you’re working for yourself, you will need to arrange your own Insurance. If you are not employing anyone then Employee Liability Insurance won’t be necessary but Public Liability Insurance is essential. If someone gets hurt while under your care, they may seek compensation so protecting yourself with Insurance is critical. On this topic, a decent waiver may help. In many cases, if you hire a facility or freelance as an instructor they may insist on you providing a copy of your Insurance certificate.

Something else to consider is optional Self Employment Insurance so that if you get injured and can’t work, you have some sort of income cover.

First Aid / Emergency Incident Training

I would recommend you getting a First Aid qualification, especially if you are solely responsible for your client while they train with you. Gyms and fitness clubs will (should) have first aid trained staff but if you’re on your own, you need to know how to deal with an emergency situation should one arise.

If working in a venue, familiarise yourself with their emergency procedures – what to do in the event of the fire alarm being activated, that kind of thing. Request copies of their procedures and make sure you read them.

Bookkeeping / Accounting Software 

If you’re starting out as a self employed instructor, your tax affairs may not be too complicated so if you’re good at spreadsheets, this may suffice for you. However, there are several digital versions available (examples include Xero, TaxCalc, Sage Accounting, Quickbooks etc). Make sure that you keep a record of everything that you spend and any money that you make!

A separate bank account may be useful to help keep personal and business transactions separate.

Accountant

If would be advisable to seek the services of a qualified Accountant in order for you to check, clarify and query anything related to finances, taxes and business structures. Don’t leave this stuff up to chance and it’s not worth guessing your way through. Accountancy fees can be put through as a tax deductible business cost.

Financial Forecasting

It is essential to have a handle on your numbers – both the ones that you’re actually achieving and the ones you hope to achieve! Set up a template with your expected income and costs by month for at least the next 12-24 months. Have a target for where you need to end up, and where you want to end up each year. Update with actual figures as you go. Take action where you’re falling short.

Business Models 

Sole Trader or Limited Company will generally be the two options most suitable for you if you’re not choosing to be employed by an organisation. Setting up as either structure will bring its own benefits and drawbacks, it’s worth seeking specific advice and researching the options in more depth. But briefly, a Sole Trader is essentially a self-employed person who is the sole owner of their business. It’s the simplest business structure out there (probably why it’s the most popular). You can set up as a Sole Trader via the GOV.UK website (you’ll need to do this for tax purposes). A Limited Company is a type of business structure that has its own legal identity, separate from its owners (shareholders) and its managers (directors). This is the case even if it’s run by one person, acting as shareholder and director.

It will be important to weigh up the difference between Sole Trader and Limited Company – the structure you choose could impact on everything from profits to paperwork. Speak to a qualified accountant if you’re unsure, their expertise can be invaluable when it comes to the tax facts.

Sole Trader
Advantages:

Easy to set up with relatively little paperwork, other than an annual self-assessment tax return.Greater privacy than incorporated businesses, whose details can be found via Companies House.
Disadvantages:

Sole Traders have unlimited liability, as they’re not viewed as a separate entity by UK law.
This means that if the business gets into debt, the business owner is personally liable. As such, Sole Traders could lose personal assets if things go wrong.Raising finance can be tricky, as banks and other investors tend to prefer Limited Companies.
This limits the expansion opportunities of Sole Traders.Tax rates on Sole Traders aren’t always as kind as they are on Limited Companies.
When you reach a certain level of earnings, it might not be quite as lucrative to stay a Sole Trader.
Limited Company
Advantages:

Unlike a Sole Trader, a Limited Company has the benefit of limited liability, as incorporation forms a legal distinction between the business owner and their business. This means that personal assets aren’t exposed – you only stand to lose what you put into the company.Broadly speaking, Limited Companies stand to be more tax efficient than Sole Traders (rather than paying Income Tax they pay Corporation Tax on their profits). As things stand this offers a kinder tax rate, meaning forming a Limited Company can be more profitable. In addition, there are a wider range of allowances and tax-deductible costs that a Limited Company can claim against its profits.Once you’ve registered a company name nobody else can use it, in contrast to Sole Traders who aren’t offered the same protection.
Disadvantages:

Life as a Limited Company brings added responsibilities. These come in the form of what’s called the Director’s Fiduciary Responsibilities, which basically outline what a Limited Company director must do legally. You’ll need to file a yearly annual return for one, as well as annual accounts.Thanks to these added responsibilities, going Limited can be costly and time-consuming, as you’ll need to either deal with this extra paperwork yourself or hire an accountant to handle it.In contrast to Sole Traders, information on your business can be found via Companies House, details on directors and your company’s earnings are required to be shown publicly. This sort of transparency may not appeal to all.

* Source: www.SimplyBusiness.co.uk

Licences for Music 

– PPL PRS Ltd = with PPL (Public Performance License) and PRS for Music joining forces in 2018, PPL PRS Ltd was created to provide customers with a streamlined music licencing service “TheMusicLicence”. They license recorded and live music when it is played or performed in public. Previously organisations needed separate licences from PPL and PRS for Music. PPL PRS Ltd collect license fees from UK businesses and organisations on behalf of PPL and PRS for Music (Performing Rights Society). PPL then distribute these music licence fees for the use of recorded music on behalf of record companies and performers, while PRS for Music distributes music licence fees for the use of musical compositions and lyrics on behalf of songwriters, composers and publishers. It ensures that the people who create the music are fairly rewarded for their talent and work. Whether you’re playing music across your gym floor or playing in exercise and dance classes, chances are, you’ll need a TheMusicLicence. With this, you’ll be able to play and PRS for Music for PPL music legally in your gym, leisure or fitness and dance venue, enjoying it’s benefits whilst ensuring that the music creators are fairly rewarded for their work.

Employee Obligations 

If you’re going down the route of employing your own team of staff, be aware that you’ll need to make provisions for contributing to national insurance, employer taxes and pensions, as well as providing HR support, payroll administration and having additional employer liability insurance.

Your Brand

  • Business Name
  • Purpose / Why
  • Logo / Brand Colours
  • Strapline
  • Photographs
  • Website / Social Media
  • Where / When / Who / How
  • Keep Learning
  • Practice what you Preach

Other ways to earn money.

Social Media Presence 

  • Online earning opportunity – you might be able to earn money as part of an online support package with training plans, meal plans and lifestyle guidance. I’d advise that you’ve comfortable with technology if you’re looking at this option. 
  • Having a strong online presence could earn you sponsorship deals and get you invited to be part of brand ambassador programmes – whilst in itself not a money earner, you might get some freebies or at least decent discounts on products, it is likely that you’ll have a referral code that you can share – if your customers make purchases with your code, they may receive a discount and you might get a small referral fee. 
  • A strong online presence may lead to you being asked to contribute to news articles and press releases. Whilst in itself this is unlikely to earn you any direct income, it will lead to greater exposure and should be seen as free marketing.
  • On a personal note, be careful what you post (strong or controversial opinions).
  • Don’t forget to keep it meaningful, genuine and authentic.

Group Exercise Classes 

  • If you have the qualifications, group classes are a great way to network and meet people. Allowing you to market your Personal Training services. Most commonly, instructors will teach in gyms and fitness facilities on behalf of the company running it and they get paid an hourly rate (PAYE or invoiced). 
  • You may also choose to hire a hall in your area (check out the logistics). 
  • Another option is to reach out to businesses, corporate clients, education providers, sports clubs, small private groups. Organisations are now taking a bigger interest in the health and well being of their staff and should welcome an approach from someone who can tick this box for them. Research the going rate in your area. Negotiate a slightly higher price if you are providing the equipment.

Workshops / Courses 

  • These are great if you have an area of knowledge that you’re passionate about for example: nutrition / weight management / bulking up etc. 
  • These can be held as multiple one off sessions / workshops lasting 1-2 hours. If you’re charging a premium rate, consider a ‘goodie-bag’ of relevant items or samples as a good selling point. If you are intending on hiring a large room, ensure that your ticket sales cover your costs and that you have the ability to amplify your voice so that everyone can hear you. 
  • You may also want to consider running a series of related sessions so that customers sign up for 6-8 weeks. Maybe you could combine an education session with a practical exercise session to add value?

Retreats / Bootcamps 

  • Take Workshops and Courses to the next level! Logistically, much more challenging because you’ll be expected to provide accommodation and food, possibly even entertainment on top of your exercise sessions and educational talks.

Last bit of Advice

Find your WHY

What do you do?

How do you do it?

Part of this journey might be to identify your target audience (if you intend to have one), and your speciality (e.g. sporting success, well being, weight management, muscular strength…), as well as your coaching style and character / personality.

Make a Plan 

Have an idea of what you want to do next. Try and figure out what’s really important to you. Consider immediate goals as well as medium and long term ones. Is Personal Training to be your main source of income, or a skill set to enhance your earnings alongside an existing career – how will this fit with your existing commitments? How much would you need to earn for it to be sustainable? How many hours are you willing to put it? Do these two marry up? Set yourself some tangible goals for your business – make them specific and measurable – include financial goals – firm up how you’re going to achieve these and then take action!

Practice 

I cannot stress enough, the more you practice, the more your confidence will improve, the more you’ll relax into your delivery and be convincing as a Personal Trainer. 

In researching venues where you want to work, see if you can get to use the facilities so that you can start to build some connections with the people that work there.

Never Stop Learning 

Research is never ending, knowledge is constantly evolving. Expand your mind and keep learning. Online, books, manuals, more courses, podcasts – there are so many options. Whilst absorbing this new information, don’t forget to question the source – does the information sound legit? There are some crazy claims that results can be achieved with one simple exercise or that a particular exercise is good for [insert unrealistic health benefit here]. It pays to stay a little sceptical.

Be You

To be able to authentically connect with your business, you have to be you. Genuine and authentic. Deliver your work from the heart. You can fake enthusiasm, but only for so long. Take time to build relationships and make connections.

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