In the fitness world, change is the only constant. Over a decade ago, big-box gym chains were the primary choice for fitness seekers, offering all-in-one workout options for around $50 a month. But today, the industry has shifted toward boutique studios specializing in activities like indoor cycling, barre and yoga. More than 5 million people in the U.S. are active members of boutique fitness studios, according to the 2024 edition of Research and Markets’ Boutique Fitness Studio Market report, and the industry is expected to grow at a compound annual growth rate of 8.23% from 2023 to 2030.

Hoping to capitalize on this trend, Chandler Eldreth Rossi left a role at investment management firm T. Rowe Price in 2022 and opened The Pilates Laboratory in Towson, Maryland’s Ruxton Towers, which has 144 apartments and 33,000 square feet of commercial and retail space. Starting a boutique studio presented different challenges from opening a franchise, which is why Rossi spent four years as an instructor first, building up her client base. She taught at multiple studios, even traveling more than 50 miles to Bethesda, Maryland, to work at Equinox.

Rossi spoke with ICSC Small Business Center contributing editor Rebecca Meiser about competing with larger brands, attracting clients, the lessons she’s learned and her vision for the future.

Was there a specific number of clients you felt you needed before you were comfortable opening a Pilates studio?

It wasn’t necessarily about reaching a specific number. Based on the clients I had, there were around 10 to 15 people I could imagine would follow me. Some of them wanted private one-on-one sessions, which, from a financial and time standpoint, provided a different level of compensation. With those commitments, I knew I could at least break even.

How did you choose your location?

I was focused on finding a spot that was easily accessible. The biggest [advantage] of this location is how connected it is to the surrounding Ruxton/Towson area in Baltimore County. Two major highways intersect just outside, so once you exit, it’s like two turns in to the studio. It’s very easy to navigate. As for the building itself, I knew it was undergoing a significant renovation. I knew there was going to be a tremendous turnover of tenants and an influx of a younger demographic, but I wasn’t necessarily expecting clients from the apartment building right away. That was fine with me because the location’s visibility and easy access were the most important factors.

Have you drawn in those younger residents as they’ve moved in?

Some of them, but not a large percentage. The renovations really just stopped not too long ago. So slowly. Probably five or 10 have tried it, but there are always people knocking on the door and just kind of poking their head in. That’s really the biggest indication [of future clients.] When people don’t know what the reformer is [a Pilates machine], they like to see what it is before they commit to something.

Do you offer free classes as an incentive to get new members?

We don’t offer free classes, but there’s a new-client intro package which discounts the regular drop-in rate. We offer five classes for $125. Typically, in the Pilates world, [owners] offer packages of five and 10. That’s because after your first class, you’re always a little bit like: “Whoa. This is different. I’ve never felt anything like this.” It’s the second class that gives you a little bit more perspective. People are like: “Oh, this is actually very rewarding. It’s enjoyable, and you also get a workout.” So you want to encourage people to invest in more than just one class.

Is it hard to compete against franchises?

I position myself far differently as a business in relation to the world and scope of Pilates than a franchise-owned studio. The individualized experience we provide goes a really, really long way. I teach a lot of the classes myself, although I do have other instructors. This means that when clients come into the studio, I know them personally. I remember who they are, if there’s a problem area or if they have an injury, [and I tailor workouts to them]. The second component that really differentiates us is the boutique nature of what Pilates is intended to be, which is not a franchise or a big-box gym. It’s founded on the concept of smaller and individualized focused attention. In my opinion, the scope of Pilates has been kind of diluted in the process of franchises coming in and opening locations.

How do you keep customers’ loyalty? Do you have different incentives?

When I was choosing my software, I wanted it to be really client-side-minded. The system [I chose] helps keep track of milestones. When clients reach different milestones, they’re rewarded with different perks and incentives. At your 25th-class milestone, you get a PL branded tote, at 50 is a PL water bottle and then it goes further from there. When people hit 100, we give out a long-sleeve shirt or hoodie. But typically, the people who come to Pilates Lab love Pilates. They’re not necessarily in it for the perks or the incentives. They love the way it feels and how they feel after. It’s truly that experience that keeps them coming back.

What was the biggest challenge your first year?

I knew it was going to be just me doing all the business side, as well as the teaching. It was very draining, but I knew that investment in PL would allow it to breed the climate I wanted in terms of future growth. After Year 1, I introduced an instructor training series into PL. That’s one way I’ve started to grab hold of additional instructors and create a little bit of a team underneath me. I will continue doing that annually and ultimately, biannually. That first year was very draining. Thankfully, a light at the end of the tunnel did exist.

Can you share a memorable success?

My proudest moment was getting recognition from a brand I’ve chosen to use at Pilates Lab. All the props in the studio are from Bala, a high-end [fitness] brand. Having them recognize Pilates Lab through their Studio Edit program was very cool because it’s a nationally recognized company. The Studio Edit features collaborations with studios like mine on social media [that use Bala props and equipment.] It includes a dedicated spot on the Bala website. In addition to that, they sent out a large email campaign to all their subscribers. It was a multitiered marketing event that really amplified our visibility. It immediately had a big impact. It not only furthered the retention of my clients but also helped attract new clients. I now have clients who travel from Northern Virginia to the studio, which is wild to me. That’s like an hour, hour-and-a-half away.

Do you have advice for other people who might be looking to start a wellness or fitness small business?

There are tremendous hoops and hurdles and industry changes. It requires a certain level of grit. If you have that [tenacity] in your DNA, you can surpass the challenges and pursue growth and learning. Passion for what you’re creating is also essential. If you possess the business capacity to adapt and evolve, that passion will naturally follow. However, be prepared for the reality: It’s a tough go. It demands your time, energy, heart and soul every day, every minute.

Where do you want to be in five years and 10 years?

Within five years, I would really like to be at capacity, and I want to expand that square-footage base and have additional pieces of Pilates apparatus. Within 10 years, I’ve certainly thought about expanding beyond my current location. Additionally, I’m excited about the potential of enhancing the online aspect of Pilates Lab. I’m developing streaming options for mat classes and other accessible workouts that clients can enjoy from anywhere. [This digital expansion] is one major component that I’m focusing on to help grow the PL presence outside of brick-and-mortar.