How to Start a Climbing Gym

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Quick Reference

There’s something captivating about the challenge of rock climbing – it’s a combination of thrilling adrenaline, the endless creativity and precise thinking that the sport demands, and the thrill of pushing your body to its limits. But heading out to climb a mountain isn’t always feasible, and that’s where indoor rock climbing has become popular. Climbing gyms give athletes the chance to rock climb in a more convenient, supervised setting. If you have a passion for climbing, starting a climbing gym can allow you to share that passion with others while helping them train and learn to become better, stronger climbers.

Business Overview

Unlike most gyms, which offer a wide variety of exercise equipment, climbing gyms take a much more specific approach. Catering to rock climbers, these facilities use rock walls and climbing equipment to deliver athletes a full-body workout. Some of these gyms may focus entirely on rock walls, offering a variety of walls suitable for climbers of different experience levels. Other gyms take a more comprehensive approach, offering not only rock walls but also exercise equipment that helps climbers develop their strength and refine their skills.

Climbing gyms are often more expensive than traditional gyms, but they’re also popular and deliver some benefits that justify their higher prices. These gyms offer valuable supervised instruction and training in a controlled environment, which is essential to helping climbers safely develop their skills. Climbing is also an excellent cross-training activity for athletes, so while athletes may not head to the climbing gym daily as a part of their core exercise routine, they may seek this type of gym out regularly for cross-training.

Industry Summary

According to IBIS World, the climbing gym industry experienced significant growth from 2014 through 2019. The industry grew by 5.6% during that time, with gyms bringing in $660.2 million in revenue in 2019. As of 2019, 548 climbing gyms were in business, employing 9,865 staff.

The industry’s growth is due to an increased interest in climbing both as a primary activity and as a cross-training opportunity. That interest has been paired with an increase in per capita disposable income that allows athletes to afford gym memberships. IBIS World predicts that an increased interest in climbing will continue to drive industry growth through 2023.

Industry Trends

Many trends shape the climbing gym industry. According to the Climbing Business Journal, the 2020 Tokyo Olympics were expected to drive interest in climbing, potentially resulting in more gyms opening and increased revenue. While the Olympics won’t occur during the 2020 summer as planned, the rescheduled Olympic Games may still increase awareness and interest in climbing.

It’s also possible that a recession may negatively impact the industry. Some economists have predicted a 2020 recession, and the climbing industry is easily affected by drops in per capita disposable income.

ISPO notes that indoor climbing setups are increasingly departing from the style of natural climbing opportunities. When indoor climbing began, designers tried to replicate the look and feel of outdoor climbing settings. Today, gyms are creating unique, distinctive climbing opportunities. Artificial climbing walls are installed in malls, shopping centers, and even old factories. These setups may resemble Parcours’ experiences or Ninja Warrior setups.

The indoor climbing industry is increasingly catering to new climbers and families with children, but this requires a shift in marketing and business structure. With most new climbers being friends, family, or partners of current climbers, gyms need to find ways to make these climbers feel welcome and offer easy admittance like guest passes or day passes.

Target Market

Most climbing gyms will primarily market to climbers, but general athletes looking for fun cross-training opportunities are a valuable secondary target market. In addition to marketing to experienced climbers, gyms must also market to new climbers looking to try the sport. Most gyms’ target market consists of athletic adults, though some gyms also have setups specifically for kids, too.

Skills, experience, and education useful in running a climbing gym

Starting a climbing gym doesn’t require a business degree, but certain skills and experiences are valuable in both starting and running this type of business.

Climbing experience and knowledge. Experience as a climber and knowledge of the industry are some of the most important and beneficial skills for a climbing gym owner. A gym owner who has not only climbed but who also loves the sport brings insight and enthusiasm to the business that you can’t replace.

Previous experience working in a gym. Experience working in a gym or coaching climbers gives the real-world experience of the operations and challenges of being a gym owner. If you don’t have this direct experience, consider checking out the articles and events from Climbing Business Journal and Climbing Wall Association.

Interpersonal skills. A climbing gym owner needs strong interpersonal skills, which can help to make connections with and build relationships with new clients and current gym members.

Attention to detail. Attention to detail is incredibly important in this business, especially when it comes to monitoring safety.

Creativity. Climbing gyms can face plenty of competition, but a creative gym owner who can develop unique programs, classes, and opportunities can help develop a unique business model and make that gym stand out from others.

Management experience. Experience in hiring, training, and managing employees is important for gym owners since employee management will be a standard aspect of daily gym operations.

Costs to Start a Climbing Gym

Starting a climbing gym does carry significant initial costs, so gym owners may seek out investors or take out small business loans to make these upfront payments. Plan to spend anywhere from $200,000 to $300,000 to start a smaller gym. Most of those costs center around the expense of remodeling and constructing the gym’s interior structures. Larger gyms can cost $500,000 and more to start.

Common startup costs for a climbing gym include:

  • Building renovation costs
  • Climbing equipment, walls, holds, crash pads, and gym equipment
  • Supplies like protective gear, chalk bags, harnesses, and cleaning supplies
  • Furniture
  • Signage

Steps to Starting a Climbing Gym

Step 1: Write your Business Plan

After coming up with the idea, the next step in starting your business should be to write a clothing line business plan. Not only will a bank and potential investors require you to have a business plan, but multiple studies have shown that a business plan helps increase the odds of starting a successful business.

Related:
How to write a business plan
Free sample business plans

Step 2: Form a Business Entity

A business entity refers to how a business is legally organized to operate. There are four primary business entities to choose from, which include the sole proprietorship, partnership, corporation, and Limited Liability Company (LLC). Each type of entity has its own pros and cons, such as liability exposure, costs, and administrative requirements.

Related: Comparison of Business Entities

Step 3: Name the Business

Finding the perfect name for a business can be challenging. Not only does the name have to resonate with your customers, but it also has to be available to use.

Step 4: Select your Location

Some gyms operate out of rented properties, while other gyms run out of properties that are purchased. Each option has its advantages. Buying or building an entire facility allows for more customization, though it’s possible to renovate existing rental properties with some patience, too.

The challenge in finding a location for a climbing gym is to find a facility with ceilings that are tall enough for the walls and boulders. Most climbing gyms will also need space for a retail shop, weight lifting gym, and locker room with showers.

Rent or mortgage costs will vary depending on the property’s size and value, and location. Properties in high-traffic retail areas will have higher costs, but they can also increase awareness of the gym, and their convenience may help drive memberships.

Related: Choosing a business location

Step 5: Apply for Business Licenses and Permits

The types of business licenses, permits, and registrations that will be required to start a business vary on the activities of the business in addition to where it is located. Some of the general local, state, and federal registrations most businesses need include a sales tax permitEmployer Identification Number, Occupancy Permit, among others.

Indoor climbing wall operators will need to be aware of OSHA Compliance for Indoor Climbing Gyms (Occupational Safety and Health Administration). In addition, the Climbing Wall Association (CWA) has guidelines and best practices for the building the operation of indoor climbing gyms.

Related: Common business licenses, permits, and registrations by state

Step 6: Find Financing

Coming up with a good business idea and having the skills to run it are one thing, but getting the funding to start a climbing gym is another. Funding to start a climbing gym business can be difficult due to the costs involved. To get a loan, the borrower(s) will need to have good credit and personally invest 15-25% of their money towards the total start-up costs. Due to the high cost, a Small Business Administration (SBA) guarantee may be needed.

Related: Finding the money to start a business

Step 7: Open a Business Bank Account

Keeping your business and personal finances in separate business bank and credit card accounts makes it easier to track the business’s income and expenses.

Step 8: Get your Marketing Plan in Place

Most climbing gyms kick off with a well-promoted grand opening and then utilize online marketing tactics to bring in new climbers continuously. Common marketing activities include hosting special events, social media outreach, online advertising, print advertising, radio advertising, and even direct mail offers. Marketing costs will vary depending on the type of activity performed. Gym owners who can do some of their own marketing can save money over the costs of outsourcing their marketing to a professional.

Related: Low-cost ideas to market a new business

Step 9: Get Insurance

A climbing gym will need several types of insurance for full coverage:

  • General liability insurance protects the gym if a climber is ever injured while on the business’ property. This type of insurance can help to cover resulting expenses like medical bills and legal fees.
  • Commercial property insurance protects the gym if its equipment or building is destroyed or destroyed in an event like a fire.
  • Worker’s comp insurance protects the business if an employee is ever injured while on the job. This type of policy can cover expenses like lost wages and medical bills.

Insurance policy cost depends on many factors, like the gym’s location, the value of its equipment and building, and the number of employees on staff. To get an accurate idea of insurance costs, request quotes from multiple companies. When comparing the quotes, look beyond how the premiums compare and consider other factors like coverage limits, exclusions, and deductibles.

Related: Types of insurance your business may need

Step 10: Hiring Employees

Even a small climbing gym will need multiple employees. According to Zip Recruiter, gym staff earns an average salary of $32,657 per year. Salaries can range from as little as $16,500 all the way up to $66,000 per year.

Besides covering employee salary costs, a gym also needs to budget for other expenses like paid time off, health insurance contributions, and worker’s comp insurance.

Related: Hiring your first employee

Step 11: Set up an Accounting System

Setting up an accounting system for your climbing gym is critical to the long-term success of your business.

Staying on top of taxes not only keeps the business out of trouble with the government, but the numbers can be used to track and monitor trends and cash flow in the business and maximize profits.

Related: Setting up accounting for your business

How much can you potentially make owning a climbing gym?

Climbing gym profits are affected by many factors, including the gym’s size, profit margins, target market, number of memberships, and more. Current data about the profitability of climbing gyms isn’t available, but gym owners can increase their chances of high profits by identifying unmet needs in the market and delivering unique experiences that climbers can’t find elsewhere.

Things to consider before starting a climbing gym

Because climbing is a high-risk activity, be sure to enlist the help of a lawyer when developing your gym. Your lawyer can advise you about choosing appropriate insurance coverage and can help you create a liability waiver that all climbers must sign before using the gym. Your lawyer will also be a valuable resource when ensuring that the gym holds appropriate business permits and may advise you about what legal signage you need to install in the facility.

While gyms dedicated entirely to climbing are successful, you might also consider branching out by offering other training services. In addition to climbing opportunities, consider adding weight training or yoga to appeal to more potential members and to give gym members a broader range of options. Keep in mind that while you can add additional exercise facilities, traditional gyms can add climbing walls, which adds to the competition.

 

Resources:
Association of Fitness Studios
International Climbing and Mountaineering Federation
International Federation of Sport Climbing
International Rock Climbing Research Association
National Association for Health and Fitness
National Gym Association
USA Climbing

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