5 mistakes I’ll never make again running a gym

Gym World,

I’ve made just about every mistake you can make running a gym. Some were small. Others were expensive, stressful, and nearly catastrophic.

If you’re new to our community—hey, I’m John Franklin.

Today, I’m taking the hot mic to share the biggest mistakes I made running gyms in the NYC area—and the lessons they taught me. My goal is to help you avoid them, save time, money, and sanity, and build a gym that doesn’t break you in the process.

The skeletons are coming out. Watch the video below or keep scrolling for the summary.

Lesson 1: Pick people like profit depends on it — because it does

When it comes to partnerships, I’ve learned the hard way that who you work with can make or break your business.

I’ve had great partners. My co-host Mateo has been with me since my gym owner days, and Kaleda Connell joined me when we started Kilo. Both pushed me to think differently and filled gaps I couldn’t cover alone.

But I’ve also had terrible ones. Early in my career, I teamed up with someone I thought was a mentor. He pitched me on opening a series of high-end CrossFit gyms, and I took a chance. Later, I found out he was a fraud who embezzled money from my account, and it felt like I was losing everything I had worked for.

Another time, when I expanded from two gyms to five in the same month, I brought in an operating partner on a handshake deal. I expected him to manage the new locations, but when the time came, he wasn’t ready. That one mistake set off a chain reaction, draining a ton of time, money, and energy to fix.

Business partnership is a lot like marriage. You shouldn’t rush in. You need to know what you’re getting into, and you need to know who you’re committing to.

If you’re considering a partner, here’s my advice:

• Choose for alignment. Values must match, and skills should complement each other. Misalignment creates friction that grows into bad decisions, reputational risk, and burnout.

• Run diligence. Do reference checks, background checks, and a simple litigation search. This helps you spot red flags early.

• Review finances. Look at tax returns and personal stability. Make sure they can invest in your business and aren’t hiding money problems.

• Keep ownership simple. Do not hand over equity or control until a partner has proven themselves with performance.

• Put everything in writing. Handshake deals fall apart. A clear agreement protects you when expectations and reality do not match.

Lesson 2: Location & landlords can kill you faster than competition

A bad location can ruin a gym faster than a bad competitor. Out of the five gyms I opened in Hoboken, one turned into a nightmare because we picked the wrong spot.

First came the zoning issues. I needed a PCE (Physical Culture Establishment) permit just to prove the gym wasn’t a brothel. That process can take up to two years.

Then came the neighbors. When I signed the lease, the building next door was still standing. Later it was torn down and turned into condos. As a CrossFit gym, we were loud, and the new residents sued us. The court put restrictions on how much noise we could make, and if we violated it, the business could be shut down.

Hoboken’s geography made things worse. The gym flooded multiple times, and sewage backed up into the space whenever it rained.

And the biggest mistake? I bought that existing gym thinking I could turn it around. But it had already failed under other owners, and it failed again under me. This was the only one of my gyms that didn’t sell for a profit.

For any brick-and-mortar entrepreneur, you have to protect yourself before you sign any lease. Here’s my advice:

• Disqualify bad spaces. Check the zoning and be upfront about your use and the noise you’ll make. If you’re a CrossFit gym near residential, think twice.

• Build in lease protections. Push for sublease or assignment flexibility so you’re not trapped if things go wrong. This clause saved me when noise complaints made one of my gyms unusable, even with a five-year lease.

• Negotiate with your landlord. Many successful gyms we feature have their landlords cover zoning or build-out costs. Larger landlords will sometimes take on that risk or roll it into your rent if they want you as a tenant.

• Buy proven, not failing. It’s easier to grow a successful gym than to save a dying one. I ignored that lesson, and after two gyms had already failed in the same space, mine failed there too.

Lesson 3: Expansion is a privilege you earn, not a patch for problems

Smart gym owners expand slowly and cautiously because they want to make sure their systems are proven before adding more locations. I did the opposite. I opened my second location just six months after the first, then went from two to five in the same month.

At the time, it felt right. Our second gym was a huge success. We pre-sold almost $250,000 in memberships, it was packed before the doors opened, and we had incredible staff across both gyms. We thought the best way to keep growing was to spread that talent by making our top coaches into operators of new locations.

But going from two gyms to five nearly broke us. Expansion spread me thin, magnified every small mistake, and made running the business stressful instead of exciting. On top of that, each gym had a different concept. That meant nothing was consistent. Every location had its own systems, branding, and problems.

Don’t multiply chaos like I did. Here’s what I recommend if you’re considering expansion:

• Wait until your first gym is rock solid. Two-Brain Business recommends waiting until you are taking home $25,000–$30,000 per month in net owner benefit for at least six months. You should also have a full management team in place.

• Clone systems before you clone spaces. Your SOPs, playbooks, and scorecards should be running smoothly in one location before you add another.

• Prepare for a profit hit. Be ready for your first location’s profit to drop by half when you expand, and make sure you have a large cash buffer to handle it.

• Keep your model consistent. Inconsistent branding and systems confuse members, dilute your marketing, and make operations harder.

• Consider buying instead of building. Paying a premium for a successful gym with staff, members, and systems is often smarter than starting from scratch.

Lesson 4: Never promise “rates for life” — you’ll regret it

I thought the best way to fill one of my gyms fast was to make an irresistible offer. So I promised founding members their rates would never go up.

It worked, and the gym filled quickly. But over time, costs went up—things like rent, payroll, and insurance. And with limited space and no way to expand, the only way to keep the business sustainable was to raise rates.

That meant breaking the promise. I had to go back to those members and tell them their rates were increasing. It was one of the hardest conversations I had as a gym owner. It felt like a breach of trust, and they were angry. Honestly, I understood why.

That’s why if you’re thinking about discounts or promos, I suggest:

• Never promise rates for life. It might help you sign people up, but when costs rise you’ll box yourself in and members will feel betrayed if you change it.

• Make promos time bound. A founding rate can work, but set a clear limit like one year and be upfront about when it ends.

• Build in small increases. Costs rise everywhere because of inflation, and your gym is no different. Tell members from the start that rates will go up by something like three percent each year so it never comes as a surprise.

• Be honest about raises. When rates go up, explain the improvements you have made to the gym since they joined. Transparency builds trust and makes the change easier to accept.

Lesson 5: “Own the dirt” if you can (or choose a market where you can)

One thing I never managed to do as a gym owner was buy the building my gyms operated in. Part of that was because I was in the NYC area, where real estate is incredibly expensive and competitive. But looking back, I wish I had found a way.

Owning your building has big advantages:

• Fixed expenses. Your mortgage stays stable, while rent usually goes up over time.

• Tax benefits. Owning real estate gives you deductions and write-offs you can’t get as a tenant.

• Control. You never have to worry about a landlord or lease restrictions.

• Long-term wealth. The property itself appreciates in value and can be a major part of your exit strategy.

• Extra income. Many gym owners lease out unused space (up to 49 percent) and generate additional revenue.

Buying real estate isn’t always the right move. If you plan to scale quickly across multiple locations, tying up capital in a building can slow you down because that money could be used to fund new gyms, marketing, or staff. But if your goal is one or two flagship gyms, owning the dirt can be one of the smartest investments you make.

Here’s my advice if you want to explore this path:

• Look at SBA loan options early. In the U.S., you can sometimes buy with as little as five percent down. Build a relationship with a banker and get your financials in order before you need the money.

• Connect with brokers. Tell commercial brokers exactly the type of space you are looking for (size, location, price). The clearer you are, the more likely they are to bring you opportunities that fit.

• Negotiate purchase options. When you sign a lease, try to include an option to purchase or a right of first refusal. This means if the landlord ever sells the building, you get the first chance to buy it.

TL;DR

Gym ownership will test you, and mistakes are part of the process. I know because I made plenty and learned these lessons the hard way.

But you don’t have to.

Avoid the mistakes I made: pick good partners, vet locations, expand only when you’re truly ready, set prices you can sustain, and think long-term with real estate.

Do those things and you’ll save money, avoid burnout, and build a sustainable gym you actually enjoy running.

cheers,

j

P.S. These lessons are better shared. Send this article to a gym owner who needs it.