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Gym invoice pdf for Planning

hey if you're looking to create a set of financial projections for a Planet Fitness style gym or maybe an Anytime Fitness or Gold Gym or one of these kind of large scale High number of members maybe a lowcost monthly membership type of gym model then you've come to the right place because we have built a financial projection template built specifically for this type of gym model and I'm going to walk you through how this template Works how to fill it out and how to get it ready to present to an SBA lender or potential investor and and really kind to uh talk you through that step by step uh before I do that just a couple of things one we put a link to the template in the description of the video below so you can grab that and follow along also if you stick around to the very end and and hear me kind of drone on about maybe not not the most exciting uh topic here Financial projections I know that's that's not the most exciting thing but if you stick around to the end is our thank you to you we're going to give you a discount code so we'll give you access to that at the end of the video also just a little bit about background on me my name is Adam hooka I'm the co-founder of projection hub and we help uh Founders and business owners create Financial projections for raising capital from SBA lenders from uh private investors and really kind of anything in between and so uh my background I spent a little over a decade as an SBA lender where uh during my time at that SBA lender we approved over 1,500 SBA Loans so I'm I'm taking that experience from the SBA perspective and using that in my work here at projection hub and helping clients create their financial projections so with that let's go ahead and dive into the details of this particular template all right so I am starting here kind of with the end in mind we are on the add a glance tab here this is kind of the end of the process so after you have created all of your projections entered in all of your assumptions this is where you're going to to show up here and you'll see some key performance indicators here average number of members whether you're breaking even that month the annual turn rate of members you're also going to see your profit and loss at a glance some key ratio some graphs and charts that you can pull into a business plan or a pitch deck you're also going to get a fiveyear income statement summary a 5-year cash flow summary 5year balance sheet and then your income statement and cash flow and balance sheet all broken down by month for each of the five years now in order to produce all these rep reports we have a little bit of work so we're going to come back to our input assumptions tab here I'm going to walk you through so every cell that's highlighted in blue is an assumption that you can change without breaking anything in the model so we've we've got our big box gym here we're starting on January 1st now you're going to likely need to put in some Equity into the deal whether that's your personal investment or raising Equity from outside investors but you're probably going to need some Equity so we've assumed here 350,000 in this example invested in in month one or the beginning of the model for accounts receivable terms where I would just keep this at 100% you are going to uh receive payment for uh your memberships or classes that you're providing upfront right you're not going to let someone utilize a gym and then invoice them later so you're going to get paid UPF front now on the accounts payable side this is when you pay your expenses now this is a little different you might have some of your expenses on a credit card so you might pay for the expense now you incur the expense today put on a credit card but you might have 30 days to to pay that card so you have some kind of cash flow relief here and so we usually put kind of that 8020 rule 80% of expenses you pay in the month incurred 20% maybe in the following month now you might have a little bit of inventory if you have if you sell you know uh protein powders or uh merchandise or drinks snacks at the gym you can include some opening inventory there and then we usually just keep like 10% average inventory carried uh on the balance sheet so that what that's going to do is just replenish uh your inventory balance automatically on the balance sheet so I think again you could probably just leave that at a at a small percentage there now for fixed assets this is where we're going to spend probably spend some money especially for one of these kind of big box Style gyms you're you're going to have probably substantial leasehold improvements so let's say you're renting a space say you put half a million dollars into to building out the space and getting it ready and then another half a million dollars in gym equipment and then maybe a if it is a franchise if the model you are are participating in as a franchise you may have a franchise fee here as well we put the life expectancy for all these items at at 10 years that just means we're going to depreciate or am amortize those um expenses over the useful life or over that 10 years always put month one here again if it's a startup putting month one for those expenses and then we have an SBA loan here for uh 1.5 million at a 10% interest rate over a 10e term now this green box down here is going to tell you whether it thinks you have sufficient cash based on your projection so it's going to look at this first thing here is it's going to look at the mons until you reach a break even or positive cash flow so it's going to calculate that automatically and then and this is all based on the assumptions that you're putting in and then it's going to say okay if you're if it's going to take you 13 months to break even on this model you're going to need x amount of dollars in working capital to cover losses during those first 13 months so in this example thinks we need a half million dollars in working capital we have a million 30,000 in Need for fixed assets and and then it recommends a buffer it kind of rounds that up so it says our total cash need here is just under 1.7 million and we've got cash from Investments of$ 350,000 and a $1.5 million loan giving us a total of that 1.85 so it says Hey starting cash is sufficient so what I would recommend you do don't worry too much about this table until you're done once you have completed the projections come back look at this table and see you know if it thinks your starting cash is sufficient all right let's look at the revenue model here so we're going to set again I'm kind of have a Planet Fitness style gym in mind so a very large High number of potential members so we're going to say maximum number of members here is 12,000 we're going to have a heavy advertising spend here so you can set your ad spend per month here you can set an annual growth rate on that ad spend and then a cost to attract a new customer so so let's say we're spending you know down here once after kind of our opening advertising we're spending 10,000 bucks a month in advertising cost to attrac attract a new customers around 50 bucks that's going to bring us you know roughly 200 new gym members a month from Paid ads but we're also going to have new gym members from Word of Mouth social media organic sources as well and so we can set those here in in this row now now a gym is going to be very seasonal in terms of getting new members right we all know January 1st comes around everyone says get back to the gym you know New Year's resolution and so what we give you the ability to do here is set the expectation of new members for the first 24 months we figure the first year is kind of an anomaly it's going to be its own its own thing based on it being the first year and the second year then is where we kind of start the pattern the seasonal pattern so in this example since we have a January start month it's at month 13 is January again of the following year we say hey we're going to get a big influx of new members so we're going to have a th000 new members in January 250 in February and then we're going to get back down to just the norm 200 new every every month maybe until November December no one's starting a new gym membership in November December and so we've got very few and then it ramps back up again and it follows that same seasonal p pattern in the next year now the what what we're doing here then for those future years is we're actually applying a negative growth rate here and so it's going to take the the number of members you had in January of the previous year and you can see here 950 at the beginning of year three so it's taking that a th000 decreasing it by that 5% because we actually think it's going to be harder over time to get new members in this kind of model you're going going to you know over time everyone that has heard about everyone's already heard about the gym everyone's already checked it out so it's going to be harder and harder to get new members is is kind of the the reasoning for why we put a negative growth rate there so here's how you calculate your total new members and then an annual turn rate so what percentage of those members do you think are going to cancel so we have a 25% annual turn rate giving us a total number of active members or regular users here next next we have our membership plans and classes so let's say we have a monthly membership plan A Drop in so maybe there's just a an option for someone to just drop in for a workout and pay a onetime fee and then maybe an an annual fee so this is different than an annual membership we're saying this is a annual onetime fee that uh that a client would pay and again this is kind of following that Planet Fitness model in this situation so let's say we've got a monthly membership here for a single location is priced at 12 bucks a month we're saying 75% of users are subscribing or members at that level and on average we think they those those users are going to use the gym 5 times a month and then we're going to have another monthly membership the premium option where you get access to all the locations if it's a chain of gyms and then that price could be uh 25 a month with a with with 25% of customers using that level and then we've got a drop in pass that you can get for 10 bucks 5% of users of that active users are going to be drop in members and then this annual fee that would be charged to 100% of the the members are going to have to pay that one once a year annual fee of $39 and you can set a price increase here annual price increase now this section is really important so you're going to notice total cash collected here 45,000 in the first month versus total membership and class revenue is only 15,000 so what what's the big difference right well this is an accounting thing so uh if you don't want to know accounting details or generally accepted accounting principles fast forward here but I think it is important from a cashlow perspective to understand this so you are going to uh get paid paid upfront these the the annual fee right this this $39 and you have a bunch of new members in that first month right and so they're all getting charged at annual fee and then and but you're only going to earn a portion one 12th of that annual fee every month for the next year so you don't get to count all of that as Revenue you get the cash right away right so it's good for cash flow but from a what's actually recognized as earned Revenue only 12th of the $39 is going to be recognized each month going forward so that's why you're going to get that big difference now eventually you kind of see that kind of levels out here it's very apparent when you have a big influx of new uh customers because they're all paying that annual fee at the beginning and then it uh so you'll see it again in month 13 right so we see a big influx in total cash collected because you get a bunch of new members in January paying that annual fee so all right that's it probably enough on the on the uh accounting here but you have the ability to put in other Revenue here as well so you could have food and drink or merchandise other Revenue sources you can put in what percentage of members are going to purchase how many times a month will they purchase what's the average purchase amount when they do purchase and then the what's a cost of good sold percentage for those items that you're selling that's really it on the revenue and cost of good sold side so uh we are we are almost done here this is our operating expenses now this is pretty straightforward um you can set your various expense categories up here and you can set up to 10 different expense categories and then select those expense categories from this box here you can set the specific expense line items here and then you're able to set whether the expense is a fixed dollar amount a percentage of Revenue or a per employee expense so in this example I thought hey for the first 3 months let's say the landlord uh gives us no rent so we don't have to pay rent for the few first few months as part of signing a long-term lease perhaps and then and then you start your rent you can have your monthly utilities equipment and so on now again for assuming this is a franchise model let's say the franchise royalties are a percentage of Revenue so we selected percent of Revenue here we set that to 007 or 7% of total revenue will go towards franchise fees you'll also notice in years two and Beyond the expenses increase that is applying this 3% annual inflation rate now if you think it's going to be a higher inflation rate or a lower inflation rate you can change that assumption as well all right now onto our last input tab this is our salaries tab we can set a general manager assistant manager you can also set their salary their employer taxes any benefits you're offering what month that position is starting and ending and then how many of that particular employee you'll have and what the annual raise might be so for example let's say we start with a general manager but we don't hire this assistant manager until the beginning of year two or month 13 and then the front desk staff let's say you have several front desk staffs you could actually have you can set that to four we have four front desk staff all at this same salary level level um and so on right so you can see the different salary positions we have in there now that really brings us back to our add glance tab so uh we we've filled everything out now the thing I want you to make sure to do at this point once you've filled everything out I would always make sure you take a look at the cash flow statement here take a look at this cash at beginning of period each month just make sure that never goes below zero if it goes below zero you're out of money you don't you don't want to go there that you know so that's a good thing to always check make sure um that stays positive and really I think that is everything I wanted to share so if you have any questions or if you kind of watch this video and you're like know I just want somebody fill to fill this thing out for me based on my plans I want to describe my plans and have someone fill it out we are here for you to to offer that service if you would like that um we have a template fill out service so uh just reach out to us at support projection hub.com and we can help with that also um if you have any questions you bought the template have any questions as you're going through it we offer free email and video support so let us know how we can help answer your questions and then finally as a thank you for sticking around to the very end if you go to the description of the video below there's going to be a link to a form if you fill out that form we are going to email you our most upto-date coupon code so that you can get a discount on this particular template is our thank you for sticking around to the end uh and finally if you if you thought the video was helpful at all I'd love it if you gave us a thumbs up subscribe to the channel helps helps us a lot get the word out to other folks so we appreciate that and let us know how we can help thanks [Music]