Not all membership revenue is equal
A gym’s member count is a vanity number; what buyers price is how those members pay. Recurring EFT (electronic funds transfer, i.e. auto-draft) memberships are predictable, sticky revenue that carries forward to the new owner, the recurring floor a buyer can underwrite. Pay-in-full and paper-punch-card revenue is one-and-done and evaporates on renewal. So two gyms with the same headline revenue can be worth a full turn apart: the one where 70%+ of membership is on auto-draft with low monthly churn is a subscription business, while the pay-in-full-heavy operator is re-selling its membership base every year. Monthly churn of 4 to 7% is industry-standard; below 3% is exceptional and shows up directly in the multiple.
What buyers check first
- EFT / recurring membership percentage. The recurring-revenue floor, 70%+ is the premium threshold.
- Member churn. Monthly cancellation rate; the lower and more stable, the higher the multiple.
- Ancillary revenue mix. Personal training, retail, and supplements above ~25% of revenue separate platform-grade gyms from membership-only ones.
- Owner dependence and equipment/lease. Whether the owner is the head trainer and rainmaker, plus equipment age and lease terms.
Members on auto-draft are an asset. Members who paid in full last January are a memory. The multiple knows the difference.
A soft 2025, and the ancillary edge
The fitness market repriced in 2025: BizBuySell data showed median revenue and earnings down sharply as a wave of smaller gyms came to market, pulling headline multiples toward the low end. That makes revenue quality even more decisive. The gyms holding value are the ones with diversified income, personal training, retail, and supplement sales above roughly 25% of revenue, because ancillary revenue is higher-margin and less commoditized than membership dues alone. Active acquirers include the big franchise systems (Anytime Fitness/Self Esteem Brands, the Xponential portfolio, Orangetheory consolidators), which pay up for units that fit their model; independents priced like a job get repriced hardest.
Read the billing report, not the sign-up sheet
Ask for the EFT vs. pay-in-full split and the monthly churn report. The recurring, low-churn portion of revenue is the part with real value, everything else is a renewal you have to re-earn.
Sources
- BizBuySell, Gym & Fitness Center Valuation Benchmarks
- Peak Business Valuation, Gym / Fitness Center Multiples
- Two-Brain Business, How to Value a Gym
- Raincatcher, How to Value a Gym Business
Gym valuation multiples, FAQ
About 2.4× SDE on average, with most independent gyms between 2× and 4× SDE and many smaller ones trading at 1×, 2.5×. Single-unit franchises and ancillary-rich studios can reach 3×, 5×. Median gym values fell in 2025 as more small gyms came to market.
Because recurring auto-draft (EFT) membership is predictable, sticky revenue the new owner inherits, while pay-in-full memberships evaporate at renewal. A gym with 70%+ of membership on EFT and low churn is a subscription business; a pay-in-full-heavy gym re-sells its base every year. That difference can be worth a full turn of SDE at the same revenue.
A high recurring-EFT membership percentage, low monthly churn (below 3% is exceptional), and strong ancillary revenue, personal training, retail, and supplements above ~25% of revenue. Low owner dependence, modern equipment, and a favorable lease also help. Revenue quality, not raw member count, drives the number.
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