Salon, spa & fitness
Fitness Membership ROI Calculator
Works the return on a membership offering, where retention does the work.
Result
Simple payback, with no discounting and no financing cost. For anything large or long, money now is worth more than money later and a lender will want interest, both of which make the real return lower than this.
Get a Free Business AuditHow the calculation works
The contribution a membership generates over its expected life against the cost of acquiring and serving it. Because the cost to serve is largely fixed and the fee is modest, the return is almost entirely a function of retained months, which makes the retention assumption the whole calculation.
What moves the number
- Retained months, measured rather than assumed.
- Monthly contribution including ancillary spend.
- Acquisition cost including promotional value.
- Cost to serve, which is largely fixed.
Where this one goes wrong
Any return figure here is a statement about retention, so present the retention assumption explicitly and test a shorter one, because the difference between a six-month and an eighteen-month average member changes the conclusion entirely. The cost to serve being largely fixed also means the marginal member is highly profitable while the facility has capacity and not profitable at all once the peak is crowded, which is a separate consideration the return figure does not capture.
Before you quote
- State the retention assumption and test a shorter one.
- Use measured cohort retention where available.
- Consider whether capacity exists for the marginal member.
Questions
About this calculator
What drives membership return?
Retained months, almost entirely, since the cost to serve is largely fixed and the fee is modest. The difference between a six-month and an eighteen-month average member changes the conclusion completely, which makes the assumption the whole calculation.
Is the marginal member always profitable?
While capacity exists, highly so, since serving them costs almost nothing extra. Once the peak is crowded the marginal member degrades the experience for everyone, which the return figure does not capture and the churn rate eventually does.
How should the figure be presented?
With the retention assumption stated and a shorter case shown alongside. A single confident return figure conceals that most of the output is a consequence of one assumption, and the honest version makes that assumption visible.
The formula
payback = cost / (monthly gain - monthly running cost)
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How to use this calculator
- Up-front cost ($). Enter your own figure; the page starts at $12,000.
- Extra gross profit per month ($). Enter your own figure; the page starts at $1,400.
- Extra running cost per month ($). Enter your own figure; the page starts at $220.
- Period to judge it over. Enter your own figure; the page starts at 36.
The result updates as you type, so you can try a figure, see what it does to payback period, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Up-front cost | $12,000 |
| Extra gross profit per month | $1,400 |
| Extra running cost per month | $220 |
| Period to judge it over | 36 |
What comes out
| Result | Value |
|---|---|
| Payback period main result | 10.2 |
| Net gain per month | $1,180 |
| Net return over the period | $30,480 |
| Return on investment | 254% |
It pays for itself in 10.2 months and returns $30,480 over 36 months, a 254% return.
How sensitive the answer is
Holding everything else steady and changing only up-front cost, this is what happens to payback period. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Up-front cost ($) | Payback period |
|---|---|
| $6,000 | 5.1 |
| $9,000 | 7.6 |
| $12,000 example above | 10.2 |
| $18,000 | 15.3 |
| $24,000 | 20.3 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Up-front cost ($)
- A money amount, starting at $12,000.
- Extra gross profit per month ($)
- A money amount, starting at $1,400.
- Extra running cost per month ($)
- A money amount, starting at $220.
- Period to judge it over
- A number, between 0 and 240, starting at 36.
What the results tell you
| Result | What it is |
|---|---|
| Payback period | The headline result. A decimal figure. |
| Net gain per month | A money figure. |
| Net return over the period | A money figure. |
| Return on investment | A percentage. |
Estimating is the easy part
The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.