A story about hitting a ceiling in the 'box-type business' of 24-hour gyms + personal training

Feeling like you've hit a ceiling in what you're doing is a bit of an unpleasant sensation. But lately, I've honestly started to feel that way.

We operate in Mitsuke City, Niigata Prefecture, which has a population of 30,000, by combining a 24-hour gym with personal training. It's a relatively orthodox model in rural areas. In terms of industry standards, a common benchmark is around 20,000 yen per month, which includes the monthly membership fee for a 24-hour gym and four personal training sessions.

I still think the reasons for starting this model were sound. Having experienced the fear of being 'reset to zero every month' for a long time during the internet business era, I wanted a revenue structure that would accumulate. As long as members continue their subscriptions, the monthly revenue for a 24-hour gym builds up. Personal training increases the average customer spend. I thought that by combining them, I could create a 'business with endurance'.

It wasn't wrong. But I've started to see the ceiling.

What lies beyond '20,000 yen per month x number of people'?

The structure of a box-type business is simple. Revenue is determined by 'average customer spend x number of members'. At 20,000 yen per month, 100 people equals 2 million yen, and 200 people equals 4 million yen. It takes a fair amount of time and effort to reach this scale in a city like Mitsuke with a population of 30,000.

However, this formula has a physical limit. The size of the facility, the number of staff, and the density during peak hours. If you want to expand further, you need another box—in other words, a second location.

But multi-location expansion has a kind of trap; it's relatively easy to open, but difficult to withdraw from. While fixed costs continue to pile up, the phase where the profits from the first store cover the losses of the second store can last a long time. In rural areas, the market size is limited to begin with, so the options for 'how many stores to open in which trade area' are completely different from those in Tokyo.

If you look up, there's the risk of multi-location expansion; if you look to the side, there's the entry of competitors. Box-type businesses have low barriers to entry. If you have the land, you can just put in equipment and open. In Nagaoka, which is near us, there are plans for new gyms to open. In a structure where it's hard to differentiate, it's only a matter of time before you get dragged into a price war.

A structure where it's hard for staff to be happy

There is one more, more fundamental thing that bothers me. The problem of being labor-intensive.

Personal training is a job where trainers sell their time. A one-hour session incurs one hour of labor costs. If you want to increase revenue, you have no choice but to increase the number of sessions, raise the unit price, or increase the number of staff.

Increasing staff raises management costs. Increasing the number of sessions makes the trainer's workload heavier. Physical and mental limits are reached quickly. Raising the unit price carries the risk of losing customers.

I believe part of the reason why trainers at rural gyms don't last long comes from this structure. It's a job where the harder you work, the more your body wears out, and that doesn't necessarily correlate with an increase in income. My fundamental belief is that 'the world should be a place where people who work hard are properly rewarded,' but with the current box-type model, it's difficult to create that situation for the staff.

This isn't just a matter of management efficiency; it's a feeling that what I want to achieve with my business and the structure of the model are starting to drift apart.

Why didn't I notice this until now?

To be honest, I hadn't thought this far ahead when I first opened.

I found the answer of a '24-hour gym' to the initial question of 'creating a mechanism that accumulates.' Once a certain level of stability was born from that, I think I was slow to ask the next question.

While the business is small, the top priority is 'first, generate revenue,' and structural problems tend to be put on the back burner. Only after reaching a certain level does the question of 'what will have accumulated in 5 or 10 years if I keep doing the same thing' become realistic.

Now is that time.

I haven't found the answer yet.

So, does that mean I'm quitting the box-type business? Not at all. Breaking what I have now and starting from scratch doesn't align with my sense of risk.

However, I have started asking myself if I can create something outside of the "20,000 yen per month x number of people" model. Can I redefine the value a trainer provides from "time spent training the body" to something else? Is there a way to keep the revenue structure from being confined only to the inside of the box?

A structure where personal training serves as the front end, connecting to other value offerings beyond it. It's still vague, but I believe this idea wouldn't have emerged if I hadn't questioned the current model.

Feeling a ceiling is the trigger for asking the next question. At least, that's how I'm interpreting it for now.