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Why Gyms Barely Make Any Money

Most people assume gyms are highly profitable businesses. Memberships renew automatically. Equipment lasts for years. And many members barely show up. Yet despite all of that, most gyms operate on thin margins - and many struggle to stay profitable long term. This video breaks down why. It explains how the gym industry actually makes money, where the economics break down, and why scale, pricing, and utilization work against operators more than most people realize. It looks at fixed costs like real estate and staffing, variable costs tied to churn, and the structural tension between growth and retention. Using a real-world gym operator as a case study, the video traces a key inflection point that highlights why volume alone doesn’t guarantee profitability - and why the business model relies on behavior that can’t be fully controlled. The story isn’t about bad management or declining demand. It’s about an industry built on assumptions that quietly limit how much money gyms can reliably make.