How to Finance Fitness Equipment for Your Gym

Buying fitness equipment outright can put a serious dent in your working capital.

Whether you're opening a new gym, adding a Pilates studio, or upgrading worn-out cardio machines, equipment finance lets you spread the cost over time while keeping cash available for staff, marketing, and day-to-day expenses. You get the equipment now, pay it off in fixed monthly instalments, and the repayments are generally tax deductible.

What Equipment Finance Covers in the Fitness Industry

Equipment finance applies to most tangible assets your fitness business needs. That includes treadmills, cross-trainers, rowing machines, spin bikes, free weights, squat racks, cable machines, reformers, and studio equipment like mirrors, flooring, and sound systems. If it's a physical asset with a usable life of more than a year, it can usually be financed.

Consider a studio owner in Melbourne expanding into reformer Pilates. Ten reformers with all the accessories might run close to $80,000. Rather than paying that upfront, equipment finance lets you structure repayments over three to five years. The equipment starts generating income immediately while the cost is spread across the months it's being used.

Chattel Mortgage vs Hire Purchase

A chattel mortgage is when you borrow to buy the equipment, and the lender takes a charge over it as security. You own the equipment from day one, claim the GST back on the full purchase price straight away, and make fixed monthly repayments that include both principal and interest. At the end of the term, you own it outright. Chattel mortgages suit businesses registered for GST who want to claim depreciation and maximise deductions.

Hire purchase works differently. The lender buys the equipment and you hire it over an agreed term. You don't own it until the final payment is made, but you still get to use it from the start. GST is claimed on each repayment rather than upfront. This structure can suit newer businesses or those not yet registered for GST, though chattel mortgage is more common in the fitness industry because of the upfront GST benefit.

How Repayments Work and What They Include

Repayments are fixed for the life of the agreement, which makes budgeting straightforward. The loan amount covers the equipment cost, and the interest rate depends on the lender, the equipment type, and your business profile. Most fitness equipment is financed over three to five years, though shorter or longer terms are possible depending on the asset's expected lifespan.

In our experience, a commercial-grade treadmill financed over four years at a mid-tier rate might cost around $300 to $400 per month per unit, depending on the model and deposit. If you're financing a full fit-out, repayments scale accordingly, but so does your revenue capacity. The key is matching the repayment term to how long the equipment will stay productive.

Tax Deductions and Depreciation

Under a chattel mortgage, your business owns the equipment, so you can claim depreciation as a tax deduction each year. You also deduct the interest portion of each repayment. If the equipment qualifies for instant asset write-off provisions, you may be able to claim the full cost in the year of purchase, though eligibility depends on your business size and the current threshold. Your accountant will guide you through what applies to your situation.

The repayments themselves aren't fully deductible, just the interest component and the depreciation. But the combined effect usually makes asset finance more tax effective than paying cash, especially when you factor in the opportunity cost of tying up working capital.

What Lenders Look For

Lenders assess your business's ability to service the loan, which means they'll look at trading history, revenue, profit, and existing debts. If you've been operating for at least six months and can show consistent income, you're usually in a position to apply. Newer businesses might need a larger deposit or a director guarantee, but finance is still accessible.

The equipment itself acts as security, which is why fitness equipment is generally straightforward to finance. Lenders understand the asset, it holds value, and it's essential to your business. That's different from something like office furniture, which has limited resale value. A reformer or a commercial rower is a known quantity.

Deposit Requirements and Loan Amounts

Most lenders ask for a deposit between 10% and 30%, though some will finance up to 100% of the equipment cost depending on your circumstances. A larger deposit reduces the loan amount and the monthly repayment, but it also reduces the cash you have on hand. The right balance depends on your cashflow and how confident you are in your revenue forecast.

If you're financing a $100,000 gym fit-out with a 20% deposit, you'd borrow $80,000. Over four years, that might translate to monthly repayments in the range of $2,000 to $2,500, depending on the rate. The equipment starts earning from day one, and if your membership model is solid, the revenue should comfortably cover the repayment.

Flexibility to Add or Upgrade Equipment

Once you've established a relationship with a lender and you're meeting your repayments, adding more equipment later is usually straightforward. You can top up the existing facility or set up a new agreement. That's useful if you're testing a new class format or responding to member demand.

We regularly see gym owners start with core cardio and strength equipment, then add specialty items like assault bikes, sleds, or functional training rigs once they've proven the concept. Finance gives you the flexibility to grow in stages without waiting until you've saved enough cash for the next purchase.

Applying for Fitness Equipment Finance

The application process involves providing recent financial statements, proof of identity, and a quote for the equipment you're purchasing. If you're a new business, lenders may also ask for a business plan or revenue forecast. The turnaround is usually a few days, and once approved, the lender pays the supplier directly. You take delivery, start using the equipment, and the repayment schedule begins.

Working with a broker gives you access to multiple lenders and finance structures, which means you're not limited to what one bank offers. Different lenders have different appetites for fitness businesses, and some specialise in newer operators or specific equipment types. A broker also handles the paperwork and helps you compare options in plain language.

Call one of our team or book an appointment at a time that works for you. We'll walk through your equipment list, talk about deposit and repayment options, and find a structure that fits your business and your cashflow.

Frequently Asked Questions