Chris Cooper's Blog, page 113

Gym Owner Makes $290 an Hour (and Tells You How to Do It, Too)

Mike (00:02):

What’s your hourly rate? When I started running my gym back in 2009, it was definitely below minimum wage. I was putting in huge hours for little financial reward. Last month, some of the top Two-Brain gym owners posted hourly rates from $200 to over $300. One of our leaders will tell us how she makes more money in less time, right after this. It’s Chris

Chris (00:29):

It’s Chris Cooper here. Your gym’s programming won’t attract new clients, but it can help you keep your clients longer. Good programming includes benchmarks, novelty, skills, progressions, leaderboards, you know all that stuff. But great programming contains something more: a link between each client’s fitness goals and the workout of the day. Your coaches need to tell your clients more than what they’re doing every day. They need to explain why they’re doing it. Gym’s whose coaches could explain the why connection had a 25% better retention rate during lockdowns. Imagine how that translates into better retention when things are back to normal. Now, I want to solve this problem for gym owners. Programming is the service you deliver to your clients. So I partnered with Brooks DiFiore, who had one of the highest adherence rates in the world for his group classes at his gym to build twobrainprogramming.com. We built this for Two-Brain gyms and we give them free access in our mentorship program. But I’m now making this available to the public. Programming proven to improve retention and cashflow in your gym. Visit Two-Brain programming.com to get it.

Mike (01:29):

It’s Two-Brain Radio and I’m Mike Warkentin. Effective hourly rate, or EHR for short: divide your pay from your business by the hours you worked to earn it. You can drive this number up by working fewer hours or by increasing your income from your business. In the early stages, many gym owners have hourly rates around minimum wage as they work big hours, and don’t collect a lot of pay. Two-Brain’s programs are set up to help. Gym owners raise their hourly rates quickly first to $50 an hour, then well beyond it as their businesses generate more and more revenue without the owners’ direct effort. Today, Joleen Bingham of 13 Stripes Fitness is on the air to explain how she drove her hourly rate up and became one of our top gym owners for July. Joleen. Welcome to Two-Brain Radio. Thank you for being here.

Joleen (02:11):

Thank you for having me.

Mike (02:12):

I’m excited about this one. This is such an important topic for gym owners. So I’m going to get right in. I’m going to ask you, how has your effective hourly rate evolved over the years as you’ve improved your business? Like, do you recall what it was the first time you ran the number and how has it gone from there?

Joleen (02:26):

Right. So I actually am, I was curious and I looked back at this and admittedly, it was probably much lower because I was one of those mentees early on that didn’t do my metrics. So it’s one of the reasons why I kind of drill it home for people. But I went back to when I had numbers and it was $10 an hour the first time I ran it. And that was probably spring of 2017.

Mike (02:48):

I have to ask the question now, was it $10 because you were working like 300 hours a week or was it a combination of low revenue and high hours? What was it?

Joleen (02:57):

I think it was, I was working a full-time job, at the same time. So I was a teacher, a full-time teacher at that time. And I had just had a baby 17 days before we purchased our first gym. It might’ve been a combination of low revenue and not having a whole lot of bandwidth to run it the way I should have been running it. OK.

Mike (03:19):

That’s interesting. So starting at $10 an hour, and now we’re up, you’ve driven it all the way up to 290 that, which is, you know, an incredible, incredible rise. What are some of the main milestones along the way, like what we’re going to get to dig into this detail, but right off the top of your head, is there something that stands out as like the major milestone that really got this thing moving on this upward trajectory?

Joleen (03:40):

I might be somebody different than what other people are gonna say. I really think COVID, and that might be something strange that not a lot of people are going to hear or believe, but it made me step up as a leader, into a role that I wasn’t a hundred percent comfortable with prior to that.

Mike (03:59):

That’s interesting. We’re going to dig in a little bit later in the show on that one, but let’s go back to the beginning. So founder farmer transition, from like the first stage of entrepreneurship to the second one. What really helped you get from $10 to $50 an hour, which is kind of one of those benchmark numbers. 50 is a good one for people to target in the early stages. What got you there?

Joleen (04:22):

I started listening to my mentor. And I stopped being stubborn. And thinking that I knew everything myself. No, I did realize, I didn’t know everything, which is why we had reached out to Two-Brain for help. And why I had taken that original call with Chris Cooper is cause we knew we needed help, but you know, you have that little piece of you that’s like, oh man, do I really need to do that? So I did. And that started working. We really worked on things like increasing our revenue, realizing that I didn’t need to micromanage things like cleaning or emails. So taking some of those lower value roles, which my mentor had told me, and finding people to help me do the ones that I needed to pay somebody 10 to $15 an hour for, and actually focus on the things I was good at, which I’m good at sales. I love sales. I love operations. Those are things I really like.

Mike (05:12):

Sales is a great skill to have. Was it hard for you to offload those roles? Because as gym owners, when we wear all those hats at the beginning, sometimes it’s really easy to latch on to things like I have to do the cleaning because no one else does it properly. And other things of that nature. Was that you, was it hard to get rid of that stuff or was it very easy for you to just get rid of it and move on?

Joleen (05:32):

It was hard. And I’ll be honest, letting go of things is still hard. I’ve just learned how to do it. So I honestly, for me, it’s looking at finances and realizing that I can create a great career for somebody who’s really good at that and probably does a better job than me at it, honestly. And then I can focus on things that provide for my family better. So for me, it comes down to does this do more for my family?

Mike (06:01):

You’ve hit on a couple of really interesting things and for listeners who aren’t familiar with the Two-Brain program, we call this climbing the value ladder and there actually is a formula to doing it where you calculate your rates. And you look at the rates of the jobs that you’re doing. Like, you know, you pay yourself four hours of cleaning a week at $12 an hour, and you have about $50 there. And if you could hire someone for that 50 hours or sorry for that $50, you’d have four hours that you could spend on a different task that would make more money. And then it’s on you as the entrepreneur to make more than $50 in that new task. So it becomes very dollars and cents metrics driven calculation, and then offloading that stuff. Like you said, the other key point is having someone do it to your standards or even better than you could do it. And that’s where you start being a true entrepreneur where you’re hiring people who are better at certain things than you are so that you can grow the business. So that’s a really cool, like when you first saw that structure, was it easy for you to start working through it or did it take you a little bit of work to start handing those jobs off?

Joleen (06:58):

I think that’s where it goes back to where I finally started to listen to my mentor. So when we talked about that, the value ladder at first, I was like, no, I’m just going to do it all. You know, I have that mentality. I work really rarely well under pressure and I thrive under stressful situations, but when they got me to sit down and look at it from a dollars and cents standpoint, like, look what you can provide for your family if you give up this role. And that really is what drove it home to me is kind of tying it. And they did a really good job tying it to something that mattered a lot to me.

Mike (07:32):

So you’re anchoring it. Not to just, you know, you obviously have the data in front of you with dollars and cents, but you’re anchoring it to something that’s even more important, which for you is your family, you know, which is a really cool thing where it motivates you. And I think the same thing when there’s hard things that I have to do, I sometimes don’t want to do it. I procrastinate. But then when I look at the reason that I would do it, then I’m pushed through because you find those anchors and it’s up to a mentor to help you see those things and then take the action. And that’s why, you know, you’re obviously worked well as a mentee, but you’re also now one of the mentors who now does that with clients. When you started doing this, did you see that rate? I mean, maybe you didn’t calculate it right away, but did you start seeing financial numbers that right away showed you you were on the right track?

Joleen (08:11):

I did. And then COVID happened. So we started to make a lot of progress. I would say we probably have had about a year of making progress, maybe a year and a half, the dates kind of all run together for me a little bit right now after the last year to half. And then that started, I will say it has exponentially grown because I knew what to do the next time around.

Mike (08:35):

And that’s just it, I mean, Chris has always said, like, you know, if you run a business, learn all the stuff, you could be able to open another business very quickly because you will know all this stuff and you don’t have to make all the same mistakes. So you can definitely, experience counts a lot in the entrepreneurship game. Would you agree?

Joleen (08:51):

Yes. For sure.

Mike (08:53):

So to get above $50 an hour, you generally need to do less yourself and develop team members. And you’ve talked a little bit about that with offloading things and climbing the value ladder, but how did you make that transition to like, you know, you said you like to do everything you like to be under pressure. You’ve got high standards. How did you start to make that transition in your brain to become what we call a tinker, which is that upper-level entrepreneur, who’s now developing like your role as a tinker and a gym owner is often more about developing staff than actually coaching, which is a weird transition for a lot of people in the gym industry.

Joleen (09:24):

I might be a little bit different than some other gym owners in that I’m not the coach. Coaching is definitely not my thing. My husband is our head coach. And so just for the sake of everybody listening, when we did the hours, the effective hours are on mine, but he also gets paid too. So yeah, we actually, as a family make even more.

Mike (09:50):

Who wins between you?

Joleen (09:50):

I do.

Mike (09:50):

Nice, congratulations!

Joleen (09:50):

We do what we’re good at. And he is really good at that. But from a standpoint of developing my general manager and my personal training director, it was realizing that I had to model a lot of things. So I actually went back to my role when I was a teacher, many, many years ago, what we taught our kids to do. You know, you do it, you model it, you do it with them and then you let them do it themselves. And that’s how I looked at developing my staff. I also found a really good general manager who is very motivated, very driven, very much my personality, from operating as a standpoint of, you know, how she interacts and handles things with people. So it was very easy to trust her and trust her with running portions of my business.

Mike (10:42):

So it comes down to, you know, finding the right staff people. And, you know, I won’t say that your husband is your staff member necessarily, but he fills a key role in your business. And if he wasn’t there, you could find a head coach or whatever you want to call it that would be an excellent person, that position you could do that if you’re not working with a partner. When you’re working with mentees, maybe who really love coaching and that was why they got into it, how do you get them to take that tinker step to move maybe from a coaching role into that developmental role that helps them get to the higher EHR?

Joleen (11:13):

Right. So we really sit down and talk about what their goals outside of the gym are. Why are they in the gym? Why do they have this business in the first place? Does it exist for them just to have a job? Does it exist to serve their family? Like, does it exist to create a legacy in the future for their kids to grow up and run the business? What’s that reason for and it really, for a lot of them, it makes them think about it. And it usually comes back to family. And so we talk about, OK, if for some, maybe it means they stay on the coaching schedule once, twice a week, just because they get to do something they love and it continues to fill their cup up and make them happy, but then show them what they actually can do for their family if they take some of those coaching hours and they apply it to sales or marketing, or, you know, finding corporate sponsorships or whatever it is that their next step is, it’s different for everybody. And once they can actually see that, it kind of opens up their eyes to how they make that step.

Mike (12:08):

It really comes down to kind of like a version of motivational interviewing, which we talk about often with gym owners and prospective clients, where you’re asking this gym owner as a mentee, why, why, why, why do you want to do this? Why, why, why? And you get to the deep whys, and then you help them take the steps based on those reasons. And the cool part about being in the tinker stage is that you can kind of do whatever you want. You could choose. And I don’t know if anybody does this, but you could certainly choose to coach, you know, seven classes a day in your gym, because as a tinker, you kind of have that freedom. I think it’s more common that tinkers, maybe coach, like you said, one or two hours a week or something like that, just because they love it so much, but you have the freedom to choose. As Chris has often said, at that stage, you can choose to work in your business if you want, you can offload tasks, you can build another business, you can do all sorts of different stuff. So really that tinker stage is about freedom. And you have the freedom obviously now to delegate roles to your GM and then do other things. That must be an incredible feeling to be able to do that and have that for you.

Joleen (13:03):

It is. And I’ll tie it right back to my why, which is my family. So when I was teaching in the early stages of my business, you know, we’ll go by now, three kids, but this is even prior to my third child. I couldn’t make my daughter’s things, right. I couldn’t go to her school parties. And she was in elementary school because I’d have to take off of work. And I didn’t have the sick days. So having the freedom now, now she’s in high school. She doesn’t necessarily want me at everything, but I am there whether she wants to be there or not. You know, if a kid is sick, I can be there for them. If I wanted to in the summer, I basically worked every other week so that I could spend the weeks that my daughter was home, and not at her father’s house, my oldest daughter, with her and not be working. So that freedom has allowed me to be much more present with my family. And to me, that’s my why.

Mike (13:52):

So, I mean, I’ll draw this line, but it may not be the direct line, but if you’re saying, OK, I’m really, I’m hesitant to give away my cleaning role, but if I do, I can make my daughter’s piano recital. I mean, that becomes a no brainer at that point, right? So your hourly rate is now incredible, creeping up on $300, which is fantastic. And you said your husband has a nice one as well. Give us, give me an idea of like how much work you put in to hit that rate and like, what are the main financial contributors, like, I think I’ve talked to you about this a little bit before, but, and COVID definitely changed things. How has your focus as a gym owner changed in the last month and produced that EHR number?

Joleen (14:34):

So I think, and I briefly alluded to it before some of the work that has gone into getting that was realizing that when COVID hit, we had to adapt and we couldn’t necessarily go back to the way that we were before. Right. So I’ve spoken of this, you know, on some of my calls and I’ve spoken of this in some of the posts I’ve written that my revenue since COVID is now two and a half times what it was before. So we actually shifted the vision of our business more in line with what I wanted, and we really dialed in our avatar, right? So I talk about those hard hours of work. It was really going back and reworking our systems and processes to truly 100% fit in with our avatar. I also, after COVID, I realized that we needed a little bit more leadership.

Joleen (15:24):

People were kind of struggling. They didn’t necessarily know what was going on. I stepped back into the business and I took on a lot of different roles that, you know, maybe a gym owner might have removed themselves from, for a time being, to retrain my staff, right. To show them exactly the way it needed to be done. And I’m guessing my effective hourly rate might’ve taken a little dip, but you can see that from that, where it’s gone, because I wasn’t afraid to step back in and rebuild things and then step back out again.

Mike (15:53):

It’s an investment.

Joleen (15:53):

It is, and I actually think there was something recent, a recent blog post about the difference between abdicate and delegate. I think that was even, you know, a week or two ago, about training your staff, that you’re delegating topics to them. You’re teaching them, you’re being a leader and showing them how to do it. You’re not just handing it to them and saying, here, go do it.

Mike (16:14):

That’s a huge one, because a lot of people are guilty of just like washing their hands of a job and saying, do this, and then walking out. And I certainly was guilty of this. And Chris has written about that. We’ll put that blog post in the show notes, the idea of, you know, teaching someone and mentoring someone in a new role. So you give them this job. And then there’s a feedback loop where you say, OK, this was great. We need to improve this and keep them on the page so that they get to be good at this job, as opposed to you just walking every day and saying, oh, they’re not doing it properly because that’s really, that’s the abdiction. It doesn’t actually work. You know, whether you’re stubborn or not. You’ll learn that eventually. Cause I sure did. And you know, you Joleen you learned it for yourself as well. I got to ask, just as an aside, what is your avatar right now?

Chris (16:58):

Chris Cooper here to talk about Level Method. When it comes to owning a gym, it can be really tough to show your members their progress and keep them engaged long term. Level Method provides experienced gym owners with a visual step-by-step fitness progression system that’s fun, engaging and easy to use. With Level Method, your clients can reach their fitness goals faster and safer than ever before and become raving fans of your gym. Go to levelmethod.com to find out more. I use this product in my gym, it helped with my conversion from my on-ramp program into ongoing group coaching, and it’s also boosted my retention over time.

Joleen (17:32):

So my avatar is middle-age, primarily women, but we do work with men, who are busy, either working or they run their household and don’t have a lot of time to focus on themselves.

Mike (17:46):

And are you focusing on them in a one-on-one setting or a group setting or both?

Joleen (17:49):

So we do have group and one-on-one, we are about this month, I just ran the numbers, 76% one-on-one and then we have nutrition, which is about 4% and then the rest would be group or our youth program.

Mike (18:05):

Wow. So has that percentage changed, like are one-on-one clients a higher percentage now than they were say pre-COVID?

Joleen (18:11):

Yeah. Pre-COVID, I would say it was almost flipped. Maybe not quite to that extent, but we were definitely over 60% group pre-COVID.

Mike (18:21):

You’ve adapted. So this is interesting. You hit, you know, the worst period of the all time, you know, in all of all time in the fitness industry, with the pandemic where people literally couldn’t work out and open their businesses in a lot of places, you completely changed your model. Got it in line with your vision, put in the systems, reinvested yourself in the systems, procedures, staffing, and all the little nitty-gritty parts of the business, created a brand-new avatar, or maybe a variation of your old avatar, but made it more specific and tailored it. And then you’ve driven your revenue up two and a half times.

Joleen (18:51):

Right. And the flip, I would say in the percentages came from dialing in the revenue, or dialing in the avatar. Sorry, because those, what we found is that avatar client, once we were talking about busy people, they might not necessarily have time to make it to our group. And now some do. Like, I think group classes are great. Don’t get me wrong. I’m not trying to like bash group classes at all because I love them. I love being in them. But our avatar, we realized their focus was on getting in and getting out at the times that they want it to be. So instead of expanding our group classes and having seven group classes a day, eight group classes a day, we kind of dialed it in and focused on, OK, well, we’ll do one-on-one during that time.

Mike (19:34):

So this is actually huge. And, you know, listeners don’t gloss over this one because you might not see the link between your effective hourly rate, which is very mechanical and numbers, right. And dialing in your avatar. There is a couple of steps that go into that to connect those two things. But it’s easy to just say, ah, you know, I’m casting a wide net. I want everyone. Joleen on the other hand has dialed in a very specific avatar that she could name for me and describe for me on the spot. And with that avatar in place, she was able to drive up her EHR by speaking, you know, I’m guessing in your marketing or in your organic posts, to a very specific segment of your audience that wanted exactly what you are selling and you’ve created programs for that person, is that how it went?

Joleen (20:20):

Yeah. That’s exactly how it goes. And I would hope people see it on our social media. I’ve been told that it has, if you look at it, you could probably look at it and say, oh, you’re speaking to, you know, a middle-aged woman or man who wants to lose weight, wants to be healthy. And doesn’t have very much time.

Mike (20:38):

So my question here on this is it seems so counterintuitive to narrow your market right, to say, oh, there’s a huge pool of fish out here, but I only want to catch bass. Like, it seems counterintuitive because as a newer gym owner, or as someone who’s struggling, you’re like, I want to take everyone. I need every single client. So you put out this broad net and then you don’t catch the things that you want. Was it scary for you to dial that thing in and start talking to a specific segment that was much smaller than the broad whole?

Joleen (21:06):

Yes. If I’m being totally honest, it was. But I also realized that our vision was to, when I kind of distilled it down, that was our vision and anything else was just noise. And that noise was what was causing all the stress and causing me to lose sleep and causing all the problems, and getting rid of some of that noise, it was almost like a breath of fresh air. Like we can finally help the people that we want to help.

Mike (21:31):

Wow. I mean, like, I don’t want to beat this to death with a hammer here, but a lot of people still haven’t made that transition. And when you did and narrowed your audience, you literally saw, you know, clear financial success. That must have been like such a relief for you, but also such a, you know, a reward for taking a scary step.

Joleen (21:51):

Right. And, I know a lot of people listening to this might be working with a partner and sometimes your vision clashes with your partner a little bit. So this was very much my vision and my husband was gracious enough to go along and say, all right, you know what? You’re leading the ship right now. This is your vision. And even he is, he from the beginning was a little hesitant, same reasons, but even he now sees like, look, this is the right step. So it can be scary, no matter if it’s your vision or if you’re the partner of the person. But once you truly realize what it is that helped people. And for some people, it might not be my avatar, maybe it’s athletes. And when they hone in on athletes, they can show the success. That becomes a marketing strategy, more people like them come because they see they’re being successful and they feel comfortable being around people like them.

Mike (22:42):

What a cool marital moment to have, you know, your partner maybe not agree with you, but say, you know what, let’s do this thing and support you. That must have been great.

Joleen (22:49):

It was. And, now we’re kind of circling it back and seeing the benefits of it.

Mike (22:55):

And with good reason, because you’ve done the work and that’s the cool part is that you’ve actually done the work. And I love what you said about reinvesting yourself into the business and finding the you know, the weak spots or the things that need upgraded doing the work, then not abdicating, but delegating it out and making it better. So these are really important steps for people. I’m going to ask you this one. So we’re gonna go in the time machine. So like you just opened your gym. Imagine, or you just opened a gym. Someone out there is in this stage who has just opened a gym or is even thinking about opening a gym. What are the three things, or two or three things that you would focus on right off the bat to reach $50 an hour first when your EHR might be like $1 an hour when you opened your gym?

Joleen (23:37):

So number one, hire a mentor and listen to them. It’s kind of a two-part answer, hire a mentor that resonates with you, but listen to what they tell you and don’t be stubborn. So I’ll kind of tell a quick story with that. Jeff Smith is my mentor and he’s my mentor in tinker. And, you know, I can be very stubborn and I can be very hard to like, believe things at first. And he gave me some tough love on the one call, which was much needed, very, very much needed. And I listened to him. And from that, my leadership has increased dramatically. And you’re seeing some of the results of this now, too, because I am much, much stronger as a leader, just even from one little tiny, you know, phone call where I got a little bit of tough love. So don’t be afraid to listen to what your mentor says.

Mike (24:26):

I’m just going to highlight what you said. Listen and act because there’s so many programs out there, knowledge and information, you know, Two-Brain doesn’t have a trademark on knowledge and information. What we specialize in is getting people to take action. That’s what our mentors are trained to do. Obviously we have knowledge, but we’re getting people to act. And it’s funny, you know, Jeff is an old retired soldier that, I’m sure he had no problem handing out a bit of tough love for you when you needed it.

Joleen (24:49):

None at all, and never does, which is exactly the type of mentor I need. And that’s one of the things I love about Two-Brain too, is the ability to match someone up with a mentor that very much works with them.

Mike (25:00):

Hit me with number two, that’s a great point for the first one.

Joleen (25:02):

Number two, don’t be afraid to step back in and fix things. Sometimes we get so caught up in moving up to higher levels or higher, that I can’t even think the word rungs on the value ladder, terminology is alluding me today. So don’t be afraid that sometimes you might have to step back into a role that you might not have done for a year or two. Maybe you need to step back in and coach that class because you had to fire a coach who wasn’t getting results, or wasn’t acting in a way that you felt your business needed to portray themselves as. I read a really good story about one time, it’s actually a book, “The Dichotomy of Leadership.” In it, there was a military training exercise, and this really stuck with me, which I think it will with some other gym owners, they’re in a military training exercise and they killed the leader of the team, to see what would happen.

Joleen (25:52):

And the team entirely fell apart. Like, didn’t know what to do, people weren’t in the right place. So what they did to show the team what needed to happen, they brought the leader back to life, basically to show the rest of the team how to function and how to do the tasks, and then they could remove the leader again, and the team the second time learned how to do it. So I think sometimes my number two point would be being a leader requires you to get in there and helping guide and train. And don’t be afraid to do the kind of the dirty work sometimes to make that happen.

Mike (26:22):

Yeah. And my addition to that excellent point is to fix it as best you can so you don’t have to go back because you only want to fix things once. So if you lay the groundwork, you might not have to go back to that role, but if you do a crummy job of fixing and just offload it and move on, you might find yourself right back in the role. And one of the things that Chris has talked about, he actually has a process for this, is setting up all your systems, delegating them and then stress testing them. So like leave your gym for three days and be out of contact, just like quote unquote, you know, killing the leader in the military exercise, see what happens and come back and see what problems are and what problems needed to be solved. What couldn’t be solved, then solve them, put that stuff in your SOPa and in your staff playbook. And hopefully you’ll never have to deal with them again. And then constantly do these stress tests at increasing times. So to the point where we have some gym owners that won’t even check in with their gyms for like 30 days or something like that. So follow the process that Chris has for you guys. Number three, what do you got?

Joleen (27:17):

Number three. I kind of debated back and forth, but I think the most important thing for a new gym owner is identify your vision early on, who you want to help, who you want to be as a gym owner and as a gym. And then don’t let other things distract you. Take action on only the things that fit in with your vision. There are so many things that we see on the internet and we’re like, I don’t know many other people are, but I’m like, oh, that’s great! Wait. Focus. And even now I still have to draw myself back to the vision, which is why I kind of repeated over and over to myself and our avatar clients so that I do stick to it.

Mike (27:55):

I love that. And I’ll give you a ridiculous example is like, if you have your avatar in mind and your vision in mind, you’re probably not going to buy, you know, the 80 foot monkey bars rig, right. You’re just like, unless you know, OCR training is your avatar, but that’s just a simple example of how vision and avatar will make decisions for you. And it will take a lot of stress away. OK. So that’s a great one. So we’ll take the time machine just a little bit further forward. You’ve just hit $50 EHR as a gym owner. What are the three things that you’re going to focus on to reach the hundred dollar mark after that?

Joleen (28:29):

One would be developing yourself as a leader, really spending time on that. And for me, that meant joining tinker. For other people that meant doing other leadership development roles. But that would be number one. For me.

Mike (28:43):

That’s such a weird one, right? Because normally you’re working on your business and systems and SOPs and coaching and teaching the squat and all this stuff. And then all of a sudden to reach this next stage, you suddenly have to not stop, but like delegate all that stuff. And then look at yourself and say, how can I lead people better? That’s a tough one.

Joleen (29:00):

Yup. Number two for me would be really make sure any person I hire is 100% bought into the vision of the gym.

Mike (29:09):

So that means you can’t just hire the person who happens to be most convenient. You’ve actually got to start working to find the right people.

Joleen (29:15):

Right. And sometimes that means you have to keep your roles a little bit longer than you want to, to find that person. But it definitely pays off in the long run.

Mike (29:23):

That is a good one, because if you delegate, even if you, you know, you don’t abdicate, but you delegate something to the wrong person, you’re still gonna have a problem.

Joleen (29:30):

Yes. And actually you probably will have more problems.

Mike (29:34):

I agree. All right. Number three.

Joleen (29:36):

Number three is delete everything that doesn’t make sense in your business. Right? So, and I’ll kind of explain that a little bit more. You’ve developed your vision to get yourself to $50 an hour, right. But to get yourself to that next level, we all have these little pieces of our business that we hang onto for whatever reason, sentimental, because it’s always been done like that, whatever it is, but it doesn’t make us that much money and it’s not profitable. It just causes drama usually. So deleting those things out, and those can be hard to let go of.

Mike (30:09):

I’ll call that addition by subtraction. And Chris has written about this so many times, getting to advanced stages of business requires more focus and more narrow focus rather than broader stuff, because it’s so easy to get distracted as you get higher up on the rungs of the ladder. There’s so many opportunities are so many things you can do. You need to do the most profitable thing or the best thing, not a combination of things that are mediocre, you know, and I’ll give you a role that I think is probably it might hit home for a lot of people. Here’s one that people, I think generally hang onto too long: social media. I think that was one where it’s like, it’s a personal thing. There’s also that like, you get that real kick in the ego when you put up a post and get a bunch of likes and stuff, but it’s, and, you need social media, but do you need to do social media? Probably not yourself, you know, would you read agree that might be a good one to offload?

Joleen (31:01):

I agree. And I’m guilty of that one. I do it because I love it. So for me, that’s one of my passion things, but could I get rid of that? Yes, but I could. So social media, I think coaching’s and other one for people. Programming is definitely one. And even like membership adjustments, sometimes I think we get so caught up in wanting to see what memberships are coming in and out of our business every day and not just getting a report at the end of the month. And that’s one I think that’s really hard to let go of for most people.

Mike (31:37):

And I think one of the keys to doing it is what you said earlier is hiring the right people and then training them. Because if you hire the wrong people and don’t train them, all your reports and everything, you’re going to get to the end of the month. And it’s just, you’re going to look into a disaster and then you’ve got to go fix it. Right. But if you get the right people and systems in place, you can be comfortable that that report comes in, you get the numbers you need, everything is going well. There’s no wrenches in the machine and life is beautiful, right?

Joleen (32:01):

Yes, exactly. And I think that’s probably one of the reasons I haven’t given up the few things that I do, first of all, I like to do them. But second of all, I haven’t found that person who will do them to my standard yet. Doesn’t mean I’m not looking. It just means I haven’t found them yet.

Mike (32:14):

Yeah. It’s all according, the thing that I’m getting from you here is it’s all according to a progression and a plan, and guys, if you’re out there and you’re thinking like, oh my goodness, this is overwhelming. Know that like the plans that Joleen is talking about are laid out for you in the Two-Brain program. We absolutely have the steps in there and your mentor’s job is going to be to find the exact step you need to take at this exact time and then make you do it. And I don’t mean force you to do it, but help you find a way to take action by knowing what is your why, why do you need to do this and then do it. And then you move on to the next step, the next step, the next step. And it’s always finding the thing that’s going to move your business forward. So it’s not a question of, I have to figure this stuff out. It’s actually all documented according to a roadmap and plan. Joleen, when you went through that plan and when you help people go through that plan, you know, how does it work for people? Like, do they understand that this progression, like, are they stubborn like you at the beginning or do they jump in right away and realize that this is like literally a slippery slope of easy buttons and shortcuts to gym ownership? Like, how does it go mostly?

Joleen (33:12):

Actually I think it’s kind of a mixed bag and I think that’s what’s great is that mentorship is about you and your business. Not what everybody else’s business looks like. So your action steps and what you’re taking action on might be different than what somebody else needs to take action on. Yes, we all go through, you know, our ramp up where we get certain things in line in our business so that we all have kind of a, I guess I I’m trying to think of the right word, but the same starting place. Right? So that we have a really good foundation. That’s probably the best way to say it so that we have a good foundation to build on. But then the way I might take action is different than the way somebody else does it. But that doesn’t mean it’s wrong. It just means that my mentor sees this as the way for me to get there. Whereas somebody else might have a different path or thing that they should be focusing on.

Mike (34:00):

Listeners. If you’re out there and you want to hear more about this exact process, book a free call at twobrainbusiness.com. You’ll get 60 minutes on our dime to talk about exactly how this process would work for you and your unique business. And you might be lucky enough down the line to work with Joleen. Joleen. Thanks so much for being here and sharing your plan essentially for how you got to be on our leaderboard for EHR. Congratulations on that. And thank you so much.

Joleen (34:23):

Thanks for having me.

Mike (34:24):

That was Joleen Bingham, Two-Brain EHR leader for July. I’m your host Mike Warkentin. And I’d like to invite you to subscribe for more episodes. Now here’s Two-Brain founder, Chris Cooper, with a final word.

Chris (34:35):

Thanks for listening to Two-Brain Radio. If you aren’t in the Gym Owners United group on Facebook, this is my personal invitation to join. It’s the only public Facebook group that I participate in. And I’m in there all the time with tips, tactics, and free resources. I’d love to network with you and help you grow your business. Join Gym Owners United on Facebook.

 

The post Gym Owner Makes $290 an Hour (and Tells You How to Do It, Too) appeared first on Two-Brain Business.

How to Get More From Your Facebook Ads, Part 1

By Travis Mattern from Fitness Education Online

Facebook ads are too expensive, they don’t work, and they’re too complicated—right?

Well, that’s what a lot of people will say. And then you have the “digital marketing experts” who tell you “you need to know your audience.” They’ll tell you to consider all sorts of variables, run a video ad, retarget to anyone who watched three seconds or more, etc.

Well, I’m here to tell you it doesn’t need to be that complicated for most fitness professionals.

Don’t Make These Mistakes!

Here’s the biggest mistake trainers make when running Facebook ads: We run an ad we think will work instead of an ad that does work.

We produce copy that appeals to us and write things we would want to read. We use a photo that resonates with us. We provide a ton of information to justify price and show how much value we’re giving.

You’ll notice I said “we” above. That’s a problem: Trainers often aren’t focused on clients and what would resonate with them.

The prospective clients who see the ads might not yet have a love of fitness, or maybe they’re intimidated by the fit people in the photo. Or maybe they’re turned off by the fact that you’re offering 20 sessions a week and they can’t find the motivation to get off the couch at all.

To solve this problem, we must focus on running ads that appeal to our potential clients, not ourselves.

The next mistake: confusing boosting a post with running an ad on Facebook. There’s a difference. Boosted posts mean more people see specific content, which is cool. But does that content actually generate leads and grow your business? In our experience with 100s of trainers, it doesn’t. You’re simply lining Mark Zuckerberg’s pockets. 

So what should you do instead of boosting? There are heaps of options, which is why most people boost a post. It’s the easiest option. In our experience you should run a “lead ad” instead.

With a lead ad, viewers have to click “learn more,” and they will be directed to a form where they must enter their names and contact information to get more details. Once people have done this, they can receive an automated email response from you via a customer relationship manager (CRM). Then you should get on the phone with the lead and have a chat.

Making the perfect sales call is an art form, so if you haven’t perfected it, I recommend reaching out to a solid sales coach and reading plenty of books.

Subscribe to Two-Brain’s YouTube channel for sales content for gym owners.

So how much money are you willing to spend on an ad? And how much money is a new client worth to your business? The second question is the most important. In our experience, you want to sell a product that is at least $300. This means you’ll recoup a $300 ad spend with a very small number of sales depending on the costs associated with delivering your product.

Before you even look at running an ad, you need to know your numbers!

In the next post in this series, Travis will tell us how to set up Facebook ads for success!

The post How to Get More From Your Facebook Ads, Part 1 appeared first on Two-Brain Business.

The No. 1 Secret of 100 Top Gym Owners

I’ve interviewed many of the best gym owners in the world and found a common trait among them. Here it is:

They take clear action to improve their businesses.

At first glance, that might not seem earth shattering.

But it is.

A lot of us think we take action.

We rush around all day “doing stuff,” and when quitting time finally rolls around, we’re exhausted. We’ve clearly done something. Maybe even a lot of something.

But did we take clear action to improve a business or did we just run that business?

In many cases, we just ran the business. And there’s no shame in that. Gym owners have a ton of tasks. The list is endless: programming, running payroll, scheduling, ordering supplies, coaching, cleaning and so on.

This stuff is really the equivalent of spinning plates. Yes, you must keep all the important plates spinning. But that’s just “maintenance.” Your business isn’t really changing.

And that means things are probably getting worse, not better.

Mental Games for Self-Improvement

Here’s an exercise:

What’s the difference between maintaining your house and home improvement?

If you maintain something, you’re attempting to keep it as it is. If you improve something, you’re making it better than it was.

Now let’s go a step further:

Imagine the edge of a razor. On one side you have “getting worse” and on the other side you have “getting better.” You can’t exist on the edge of the razor—”maintenance” is not an option because times are changing even if you aren’t. You can’t stand still or you’ll be left behind. This is an either-or proposition.

So is your business getting better right now or getting worse?

Be honest with yourself. And if you can’t name a clear action you’re taking to improve it right now, you’re on the “worse” side of the razor.

That’s OK. It doesn’t take much to get to the other side.

Action Above All

Back to the world’s best gym owners.

Two-Brain collects huge amounts of data all the time, and every month, we create leaderboards for key metrics. Then I interview the leaders on Two-Brain Radio (subscribe!).

Without fail, the gym owners I interview have all taken clear action to improve their businesses. No one says, “I just do what I’ve always done.”

Sure, a few of our humble leaders don’t always know exactly what they did to land on the leaderboard.

Here are a few common answers owners provide as they shrug off praise:

“I just did what my mentor told me to.”“I just followed the plan.”“All I did was try to make my clients happy.”“I only tried to create careers for staff members.”

But I dig deeper, and every time I find the reason the gym owner made the Top 10.

The owner changed something. Or added something. Or did something faster and better.

It always comes back to taking action to improve.

A Challenge

So here’s my challenge to you today:

Take a clear action to improve your business.

It doesn’t have to be a great leap forward. Just a step. It could be as simple as delegating the ordering of toilet paper and then adding that standard operating procedure to your staff playbook. Or maybe you finally reorganize your consultation room so a desk no longer separates you from the potential client. Maybe you walk to the business next door with a tray of coffee and figure out how you can help each other.

I bet you know what you need to do. It’s probably something you’ve been putting off. If you’re stuck, text your mentor and ask for one simple task to improve your business today. You’ll get an answer.

Whatever you do, do something. And then do something else tomorrow.

Remember, you can’t stand on the edge of a razor. You’re either getting worse or getting better.

So which side of the razor are you on today?

The post The No. 1 Secret of 100 Top Gym Owners appeared first on Two-Brain Business.

Chris Cooper: Your Route Through the Entrepreneur’s Valley of Death

Andrew (00:02):

Chris Cooper is on Two-Brain Radio to talk about the dreaded valley of death in business. Coop will tell you what it is and how to ensure your business makes it through to the other side. Here’s how right after this.

Chris (00:13):

We know that getting clients results isn’t enough to make a great business or a great career, but it is the foundation. If you’re not getting your clients results, none of the other stuff matters. Your marketing plan, your operations plan, your retention plan, your systems, how much you care about the clients. You need to get them results. What does it take to get a client results? Long-term behavior change, short-term habit change. It means learning skills like motivational interviewing, peer-to-peer programming. It means focusing on things like adherence and retention instead of novelty. And I built twobraincoaching.com with my partner, Josh Martin, to teach coaches how to do this. More than ever before it is critical to get results for your clients. You need to charge a premium fee. You need to provide high value to warrant that fee. And what is most valuable to the client? What do they care about the most? The results on the goal that they choose. Twobraincoaching.com has programs set up to help your clients achieve those goals. We will train you and your coaches to deliver personal training, group training, online training, nutrition coaching, and coming soon, mindset coaching, in a way that’s simple for you to adopt, it’s legal everywhere. And it’s super effective. These courses were built by experts with years of experience getting clients results. Twobraincoaching.com is a labor of love for me, and I know you’re going to love it too.

Chris (01:30):

Hey everybody, Chris Cooper here, and today, we’re going to be talking about the valley of death. And this is a concept that I learned when my business was trying to scale from 250 to a million. And then I kind of had to learn it all over again as the business went from one to 5 million, and now that I’m emerging on the other side, I’ve got a ton of things to share about the valley of death. First off, this name valley of death came from, I think Greg Crabtree in his book, “Simple Numbers.” And what he’s talking about in most businesses is going from one location that’s operating well and running at about a 30 to 33% profit margin to multiple locations, or going from one location, one owner/operator-style business to one giant business within the same location.

Chris (02:30):

So either going from like one location to multiple locations, or from around 350K gross to around a million in gross. If that’s you, you’re about to go through the valley of death. And the only thing that we can do, we can’t avoid it, but we can get you through it faster. And so that’s my goal today. Going from a stable business to a broader platform requires risk. And even if you know the terrain, like you’re copying one working model, this gym is going well and you’re copying it over and over and over again, you still have to take a leap. You have to make bigger bets and you have to spend money before you start making it again. You have to invest time and money and tools into bridging this gap between your first business or the business as it is today and the other blocks in your platform.

Chris (03:19):

But for many gym owners, this gap can become the valley of death. It can actually kill them. And instead of going from this, you know, the golden goose, they wind up homeless and with nothing, they risk it all and they lose it all. So if you’re trying to start something new, the leap that you have to take is threefold. First, you’ve got a knowledge leap, right? You’ve got a knowledge gap that you have to leap over. Second is you’ve got a money gap. This is the biggest one. And the most obvious one for most people. Third is you’ve got a tools gap. You don’t have all the tools that you need to scale yet. So for example, knowledge gap, you own a gym and you want to start a bar or some completely different business, but you have no idea how to open one.

Chris (04:03):

You just think it might be cool. The money gap. You want to start a second location for your gym, but you don’t have an investment cushion. So how are you going to bridge that money gap? And tools? You know, that you need higher level staff than the ones that you’ve got right now, you cannot scale to a million dollar business letting the coach that you know, runs your Saturday morning group, also manage your books. OK? You have to have experienced, skilled staff who are highly educated and more qualified than you are. So here’s what typically happens. A gym owner tries to go from one thing to the next thing or the next level. And they spend so much time trying to build that next level that the first thing suffers, this is super, super common. So let’s say, like, for example, you’ve got a gym and you’re doing 250,000 a year and you see, or you hear a podcast from us or somebody else.

Chris (04:54):

And it’s like how to add a high-ticket coaching offer. And so you add this high-ticket coaching offer, but to do that, you’ve got to change your entire delivery. So you rip apart your playbook, you change all of your operations, you change your pricing, you change your sales process. Some of your original clients don’t really fit the model anymore. So they leave and you just kind of gut your original business to build the next business. And so what happens is your first idea suffers and maybe it survives, but maybe it doesn’t. The second thing that typically happens is you move your best staff away from your working business to build this new idea. So you’ve got an amazing coach at your first gym. You’re going to open up another gym at the next town over. Let’s take that amazing coach and move them great, except that you’re undermining your original business, this amazing coach that was such an integral part of your success in the first place is now gone.

Chris (05:50):

You know, it’s the exact same thing as if you would fire that coach, or if they had left to go do something somewhere else, like they’re just not in that gym anymore. And so your original members are suffering. And the third thing that typically happens is that they invest all their free capital into the new idea and their first business suffers from malnourishment. And this was totally me. In fact, I think I’m guilty in all three. So I’ll give you examples here. They spend so much time trying to build the next thing that their first thing suffers. For me, if I’m not entirely focused on making gym owners more money, if I’m focused on writing another unrelated book or starting an unrelated project or whatever, then I’m not helping gym owners make money faster. And so my first business suffers. Here’s an example of moving my best staff away.

Chris (06:40):

So at Catalyst, I had this amazing coach named Tyler and we had an opportunity to open up a second location inside a private school. And we would train the competitive basketball players from the private school. And we’d really focus on athletic training if we opened the second location. And the second location started off pretty well. I won’t get into that whole story, but it collapsed. Meanwhile, my best coach was no longer at my primary gym. And so his fans were like, where’s Tyler, you know? And I was gone too. So where’s Chris. And so now, you know, they’re dealing with coaches who have different personalities who appeal to different clients and they’re going like, where are these two best coaches? My experience is suffering. And third, they invest all their capital into the new idea and the first business suffers. I mean, when I opened up my first CrossFit gym, I had a personal training studio.

Chris (07:32):

The personal training studio was keeping me afloat. It was paying me, but I took all of the money from that business and just kept pumping it into my CrossFit box to keep it on life support. When really I could have upgraded a lot at my personal training facility,if I understood a different model. So I’ve done all these before. Don’t worry if you’re guilty too. If you’re trying to duplicate your gym and open more locations, or even to scale your gym from 350,000 a year to a million, here’s what typically happens. Like here are the most common problems. First off, your customer base is growing, but your team is struggling to keep up. So do you hire coaches in advance of the demand? Probably not. Right? Like, cause how are you going to pay them? The next problem is that the systems that you built for 150 clients, they don’t scale to a thousand clients.

Chris (08:23):

And I’d say that the same is true for a brand. Second or third. The owner has operational skills, not management skills. I think I’ve said, this is probably my thousandth time saying being a coach and being a gym owner are completely different jobs requiring different skill sets. But when you are the owner of one microgym and you’ve got 150 clients, you’re still involved in the coaching, or at least you’re like the mayor of the box, right? You’re engaged. You see people regularly enough, you maintain a personal relationship. When you go to a 1000 clients or even 500, your personal relationships are with your staff. And then they have relationships with your clients. And this is what’s called management, but most box owners don’t have management skills or management training. They could acquire them, but you know, who wants to? So they don’t. The fourth problem is that these higher value roles are expensive.

Chris (09:18):

So for example, let’s say that, you know, you’re going to go to a million, you’re going to have to hire somebody else to handle the marketing for you. Not because you can’t figure it out, but because you don’t have time to do all the things that you want to do. So you hire somebody to do your marketing. Well, that person is going to be very expensive because if they’re successful either they’re just going to market for themselves or, you know, maybe they’re making the lifestyle choice to work for you and get paid the sure thing. So let’s say that you have to hire like a chief marketing officer or a really qualified salesperson. And that person is going to cost you a hundred thousand dollars per year. Well, you have to make that commitment to hire them before the revenue is coming back, before you’re getting a return on that investment, right?

Chris (10:04):

And making like a high ticket salary offer to a coach, it won’t return that investment. So you have to really be careful. Higher value roles are really expensive. And at this stage you should only be investing in the ones that will show you a direct return. The next problem is that you can’t predict future growth. I mean, I talked to so many gym owners who had plans to open their second location, even their first location. And then COVID shut them down. What happens then? Can you keep paying the rent with zero revenue coming in? The next problem is that the staff that got you here might not be good enough to get you there. So, you know, most of the skills in a micro gym, you can train to your friends. You can take a coach who’s caring and empathetic and you can make them your client success manager.

Chris (10:53):

You can take a 16-year-old kid who helps out in your kids program and you can train them to do your social media for you. Absolutely. In an owner-operator model, this is just amazing. But to get to the next level, you’re probably going to need to make some people full time. You’re probably going to have to have a general manager who’s like qualified in running operations and just promoting the people that got you here into these higher paying jobs might feel great to you at first because you’re giving them a raise and you’re giving them more responsibility. And we’re doing this together as a team. But the reality is they’re not qualified to run things at a higher level and they might not want to either. Next, the company that you are right now might not be the same company that you are when you get to 500 clients or a million dollars, your services will probably change.

Chris (11:47):

Your customers will almost definitely change. And even your values might change. Not like suddenly you become dishonest. But what I’m saying is you might have different priorities. So for example, if my values are take 150 people at a time so that we can provide one-on-one touch points every single day, if you want to get to a million dollars in revenue, you probably can’t do that same thing. So you have to ask yourself, is the trade off of the impact that I’m going to have in my community worth less one-on-one time with my clients? And maybe it is, maybe you find a way to do that. All I’m saying is that a shift in values isn’t necessarily a bad thing. It’s just a shift in the current value set that you have, but not be the same value set that you have later and values evolve.

Chris (12:36):

It’s natural. Another problem when people are trying to scale is that, you know, as the gym owner, you are able to teach coaching skills to your friends, but you can’t teach tax planning strategies to your friends, right? Higher level knowledge has to be purchased from an expert. And this is not a cost thing because I already spoke about that. This is a trust and a fear thing. You are going to be hiring people who know more about their specialization than you do, and that’s why you’re hiring them. But also it’s tough to check their work, right? Like, OK, I’m going to hire this accountant. They’ve got this tax strategy. I’ve never heard of it before. I’ve really got to trust them because I won’t know if they’re making a mistake. All right. So scaling from a hundred thousand dollars in net owner benefit, what you take from the business, to 350K, you know, in revenue is simple, right?

Chris (13:32):

We go through this in ramp up. We go through this in growth. Scaling to a million in revenue requires a different infrastructure because you don’t just want to scale your revenue up. You want to make more money for doing that. It doesn’t do anybody any good to have a bigger business that makes you the same amount of money. So to do that, you need a few things. First, you need a clear guiding vision that inspires your team. We call this a vivid vision and we teach this in our tinker program. It’s more of a teaching. It’s a whole process that you have to go through. Second, instead of one generalist, that’s you, at the helm, you need like a team of specialists. Gino Wickman writes a lot about this in “Traction” and “Get a Grip.” And so we talk about it a lot in our tinker program too, but you know, you are pretty good, right?

Chris (14:17):

At a lot of different things. You can look at a P and L and you can spot glaring problems, but you can’t make a tax strategy. You can look at your website and say like, OK, yeah, we need to move this around. Or we need less text-based or get rid of those sliders. But you can’t optimize for conversions. You can look at a Facebook campaign and say, OK, this picture is working well. But what you can’t do is like optimize your retargeting. You’re going to have to hire some specialists. And that means you have to make investments in staff, but also in space and equipment ahead of revenue. And you have to make those just in the hope that it’s going to pay off. When you launched your business, you leaped out into space. That was scary. And it held unforeseen pain that you really

Chris (15:01):

don’t want to go through again, right? If I asked you five years ago, if you had known that you’d be at this point, having gone through this much pain today, would you still have opened a gym? A lot of people would say no. And so you don’t want to face that again, and I get it, but to make it to the next level, you have to make another leap. Only this time it’s across the valley of death. There’s more at stake, right? It’s easy to take risks when you’re at the plate. It’s really hard to take risks when you’re already on first base, because you’ve already got something. You have something to lose now. But you can’t avoid it. And you have to make it across this valley of death as quickly as possible. So here’s how to do it. First off, start with a buffer.

Chris (15:39):

I don’t mean start with $5,000 in your bank account. I mean, start with enough money that your second location can go three months without a drop of revenue. Now I know that sounds like a lot, but hear me out. If you have to save up $30,000 in cash before you open your second location, you’re going to look very, very hard at your current model and say, how can I generate cash? If I’m only profiting by a thousand dollars a month, and I don’t want to wait 30 months to have 30 in cash waiting and ready, then I need to change my current model. And now is the time to do that. Optimize your current model before you try to duplicate it, right? So we teach systemize optimize automate. But if we were looking at opening a second location, we’d add a fourth step to that.

Chris (16:25):

Systemize optimize, automate, duplicate would come after that. So start with a buffer. Second, don’t sacrifice your golden goose. If you are the primary coach at your first gym, do not buy a second gym because you will have to be there all the time. And your first business will suffer. And it’s the same with the primary coach. Third, get access to credit. A lot of us started our gyms with this notion that we had to like bootstrap everything that we should never go into debt, but credit is your parachute. You don’t have to use it, but I promise you, it will cost you more than you think to open up a second location or to expand. And while you’re waiting for that new revenue to be generated so that you can level up, you got to bridge that gap. You got to, if you’re going to leap off the cliff and over the valley of death, like having a parachute is a smart idea.

Chris (17:15):

You don’t want to run out of money before you run out of steam. Next, you can also have people pay in advance. So people in our tinker program who opened up a second location, they do something that’s called a founder’s club. And basically what you’re doing is you’re getting a commitment in advance from people that they’re going to be joining your gym. Now this isn’t so far in advance that it eliminates the risk. You still have to sign a lease, and I’m going to talk about that in a moment, but having this kind of security in advance, it buys you some time.

Chris (17:46):

Cooper here to talk about Incite Tax. The people at Incite Tax know you’re working long hours to improve health for the world, but it can still be hard to turn a profit. You just can’t focus on your mission without money in your account. So Incite founder John Briggs wrote “Profit First for Microgyms” and created a system that increases your cashflow so you can be home for dinner with a thriving fitness business. Bookkeeping, profit first, cash flow consulting, taxes, whatever your financial needs, Incite can help. Join their free five-day challenge at profitfirstformicrogyms/five days to get a snapshot of the financial health of your gym. That’s profitfirstformicrogyms/five days.

Chris (18:26):

So let’s say that you commit to a lease and you start paying on the lease September the first and you have to build out. So you’ve got a month’s worth of rental expenses set aside because you know, like no money is coming in while that build-out is happening, but then the build-out takes another month. Well, now things are running really short and you’re starting to panic. And then the builder says, actually, I can’t get you open until December 15th. And now you’re really worried because you’re entering the Christmas season when people stop buying gym memberships. So now you’re going to be three months without revenue, but what can help with that is a founder’s club where people are signed up in advance and they’ve reserved their spot so that you know there’s money coming. And you can even have them pay in advance if you want to.

Chris (19:10):

I really don’t recommend this, especially do not discount. You need cash at startup. You don’t want to give out discounts and like slit your own throat, um, grants. There are a number of grants post COVID to help people buy other businesses, expand their current businesses and just do whatever they can to keep people employed. So definitely check that out. Like, there are some great grants that I’ve heard about recently, especially for women who are expanding their business and other grants that I’ve heard about recently, for people who are buying existing businesses that are closing. I mean, the government, this is a good play for the US state that’s doing this. If a business is closing, they want to make sure that that business stays open if they can, so they want to encourage somebody else to come in, buy it up, keep people working, keep clients, paying, keep collecting taxes.

Chris (20:01):

Next is to trade where you can. So, I mean, when you’re trying to open up a second location or scale or whatever, don’t negate the value of sweat equity, OK? Now I’m in a stage where drywalling something is not worth my time because I can pay a drywaller 30 or $35 an hour. And plus I hate dry walling and I’m going to do a really crappy job. However, if you’re trying to make it across and preserve cashflow, do not be scared to trade in kind services, just put it in writing. OK? Like you don’t want to trade the sign guy a brand new sign for your location against membership without a firm end date. What you need to do is write a contract saying, OK, the sign is worth $2,500. Our membership is 250 a month. I will trade you 10 months of membership.

Chris (20:47):

It will commence on the day that the sign goes up. There are no transfers, no holds, it’s up in 10 months. OK. The next is getting a mastermind. I mean, every dollar that you can save every minute of time, potentially wasted that you can save has a resounding effect because instead of doing something that isn’t going to work or that wastes your time, you’re going to spend your time doing stuff that does work. You’re going to learn this from other people, but you’re really going to have support from them. I mean, I’ll tell you one of my favorite entrepreneurs in our tinker program, he owns a franchise in Texas and it’s not a gym franchise. It’s a tire franchise. And when all of his buddies who also own franchises in nearby towns open a new location, Nick flies out to offer to help.

Chris (21:36):

So he’ll show up and for four days he’ll work the sales floor for them. Like he’ll just volunteer. And then when it’s time for him to open up his own location, they all show up and they change tires, or they volunteer on the sales floor and it’s kind of fun for them, but it also helps them bridge that gap of like revenue to cash expenditure shortfall. So, you know, getting in a mastermind, it pays off and the dividends are sometimes obvious, like, oh, you’re opening up and you’re short a coach? I can send my coach down for the weekend. And sometimes it’s less obvious, but just as potent, Hey, here’s a mistake that I made. Don’t make that same mistake. I mean, I’ve heard just in the last week in our tinker group, oh my God, dude, you just saved me $30,000 for something that I would have done wrong, or, oh man, I took your advice on that

Chris (22:23):

lease negotiation. I saved $8,000 over the next two years. Like that is the value of being in a mastermind. Next, the next tip is to partner. I mean, you can defray some of the potential costs if you partner in the next location, you just have to be careful. A lot of us are tempted to give like one of our employees equity in the second location. And you know, the reason that we do it is we want to reward them. We want to motivate them. The problem is that everybody thinks they want to be an entrepreneur until it’s time to do what entrepreneurs do. And then they realize, oh my goodness, I would rather be an employee. This is not for me. A lot of them also think that you’re like handing them the golden ticket. So, wow. Chris has given me a share.

Chris (23:10):

He must make millions of dollars off this gym. I’m going to also make millions of dollars. I’m going to do the same amount of work, right? They don’t understand that their responsibility, their skillset, all of that has to upgrade just like yours did because they didn’t see you go through that process. And the last thing is equity. So if you’re giving up equity in your company, the partner has to bring equity into the company. So let’s say that I’m going to open up my second location. And I’m going to put $50,000 into this location and I’m going to give a coach 20%. Well that coach had better be bringing $10,000 in cash into the equation to get that 20% or else. What I’m actually doing is hiding the risk from them by paying all of that money upfront. You owe it to them to ask them to invest if they want to own a share.

Chris (24:03):

Because if not, they’re going to have a false sense of what’s actually required here. What’s actually at risk. OK. Let me give you a great example. About two years ago, I was talking to the GM of my gym about what would motivate him. And so we were actually talking about selling a share of Catalyst, you know, 20%. And then I explained what would happen in the case of a cash call. So let’s say that Catalyst lost money for a month. Now, Catalyst had not lost money in well over a decade. It was profitable month over month for over 10 years, but we couldn’t have foreseen COVID coming. And what would have happened is let’s say that for some reason, we couldn’t make payroll and we had to make payroll of $5,000. Well, if Catalyst didn’t have the money, I would have had to put in 4,000 and the other shareholder would have had to put in a thousand, right, along shareholder lines, to make up the shortfall. Like you share profit, but you also share costs if the business is ever losing money.

Chris (25:03):

And so when I explained that the GM said, whoa, whoa, where would I get the thousand dollars? Like I couldn’t afford to do that. And I said, well, you know, that’s part of the risk of being a shareholder. And he said, forget it. I don’t want to take that risk. And so if you’re not telling your staff this upfront, and you’re just giving them a share of equity, you’re not actually giving them a share of equity. Right. And you’re disguising the truth from them. When I opened up my second location, I gave a share to my best coach at the time. But I didn’t say upfront, like, look, you are the owner operator of this location. You will be delivering the service while I work on these other things. I have other businesses, you know, I will not be here daily coaching classes for you.

Chris (25:44):

I thought that went without saying. It didn’t. And he assumed that I would be there in the trenches with him every day coaching classes, doing personal training clients. And so when it went south, it was over a big misunderstanding that I should have cleared up in the beginning. It was over a lack of understanding of finance. You know, I made a personal loan to the company. And so when we decided to close that location, the company owed me $20,000 personally. And so I just basically waived it, took all the shares back and said, OK, now I own this, but because he didn’t have a financial education, it looked like, you know, the money wins again. You know, like I got screwed out of something here. So you have to really be careful because, and of course that ended the friendship too, which was a real shame.

Chris (26:29):

So be very careful. The next tip that you can use to scale through the valley of death faster is set up commercial agreements before you get there. Now I said like, you can pre-sell your memberships, don’t take people’s money until you’re open and don’t discount. But what you can do is talk to local businesses near your second location and set up training contracts in advance, and you can actually ask them for a deposit too, and you can do that with teams. You can do that with groups, but you don’t want to do that with individuals because in a lot of states and in Canada, you’re going to be bonded, to do that, right? Like you have to be insured that if you take somebody’s money, you’ll be able to give it back. And a lot of owner operators in all industries run into this trap where it’s like, OK, I’ve pre-sold these memberships, oh, there’s a delay.

Chris (27:18):

And I’m paying my bills out of this cash that I have. And now the cash is gone. And now I have to deliver my service for free for a month or two, or I have to like close up shop in the dead of night and escape town. That actually happened to a personal trainer in Sault Ste. Marie, I think back in 2006, he pre-sold memberships at this big discount. He got open, suddenly realized he didn’t have the cash to pay his bills anymore. And he skipped out, ran away with people’s money. Founders’ club, I mentioned, and then finally get commitments before you make commitments. So before you sign a lease, you want to be talking to the neighbors in this location. You want to be talking to local corporations. You want to be talking to schools and getting a sense of like, who will commit to something.

Chris (28:00):

And you want to get as close to like a written commitment as you possibly can. So, you know, if you’re talking to a school and they’re like, yeah, I would bring a gym class in to do some training at your gym. You want to get specific, like, what’s your budget for this? How many times a year do you think this would be possible? You know, how will you pay for it? That kind of thing. Instead of just kind of like a promise between buddies that never really pays out. All right, now, I’ve got a few kind of bigger gross rules too, if you’re trying to jump over the valley of death. This for most people will be a long process. I really recommend you get into a high level mastermind group, like our tinker program, but here’s some other best practices. First, simplicity scales faster. The simpler your brand and your method is to understand, the faster word will spread.

Chris (28:50):

Because if I understand it, I can talk about it more simply. If I don’t really understand it, I won’t talk about it because I never want to look dumb. And the same is true for your opps for your rules. OK? If you have 50 different pricing packages, that’s going to be really hard to scale. If you have, you know, 30 different programs, that’s going to be really hard to duplicate over and over. OK? So, another one adding a management layer, you still need to maintain your guidelines for where your money goes, your expenses, right? So in the founder phase and the farmer phase, we say your total salary, your total staff pay should be 44% or less. We used to call it the 4/9ths model. That’s like your salary cap. When you get into second location and stuff, that rule still applies, right?

Chris (29:39):

It should still be 44% or less of your gross, but now you have to track it differently. You have to look at contribution margin because when you’re adding a management layer, you need to know that everybody that’s in that business is contributing somehow, either they’re generating revenue or they’re creating time for you to go out and generate revenue. OK? Then you want to look at your team. You want to like, take a look at your org structure. You want to say, how much of a management layer do I need? Where can I duplicate services across gyms, you know, for a tiny little bit more. So, for example, maybe you pay your bookkeeper 150 bucks a month, but to do the books for two gyms at the same time, it’s 250. So you can scale without scaling costs proportionally. OK. You can share services across both businesses.

Chris (30:27):

The next thing is you have to mentor your team. Your team does not see how you know you got here. They haven’t gone through the stress. They don’t know the backstory. They don’t know what’s going on behind the curtain. It’s not just that you have to teach them that stuff or show them behind the curtain, but you have to mentor them. The way that your pie will grow is not on your personal brand. Not when you’ve got two locations. You have to grow the business. And that means growing your staff, as people, as leaders, and as practitioners. Next, you have to add different layers of marketing. So from $0 up to $350,000 a year, like one marketing pipeline is enough. You just run Facebook ads, or you just do Instagram, or you just do affinity marketing like I do. OK. One is enough.

Chris (31:15):

But to get to 1 million, you have to eliminate single points of failure so that your business can’t fail fast while it’s trying to grow. So how do you choose? You measure and you optimize one pathway knowing that each marketing strategy lasts between one and three years, then you add a second pathway that you can sustain, right? And they should leapfrog one another. So for example, if a year ago you added Facebook advertising. You know how to do that? Now you’re good at it. It’s getting you some results. So now you’re going to go to something else, right? Email marketing or referrals. And you’re going to focus on that for two to three years. Meanwhile, a year from now, referral marketing is really kind of catching on. You’ve got some good momentum, but Facebook ads stop working. OK, well now you can find the second one again.

Chris (32:03):

What you don’t want to do is like start from zero on marketing because marketing takes a little bit time to ramp up, gain momentum and snowball. So you always have to have at least one marketing system that’s working really well to scale. And you have to always be looking for a second one and building that second one. Now notice I only said two. I didn’t say five. If you’re trying to figure out Instagram, Facebook referrals, corporate, Tik Tok, LinkedIn, Clubhouse. If you try to do all these at once, you’re not doing any of them very well. I promise you. You know, Google Adwords, just the more you add the less well you’ll do at each one, you’re better to stick with two, but it has to be more than one. And the next, this is the biggest one. Think about your impact, right? Chasing money is not enough.

Chris (32:51):

It’s not enough of a reason to go to a bigger gym. You can make more than enough money with 150 people in one location. But none of us got into this to make money or get rich. So while the metrics and the money are exciting early on, cause you can see your success. It’s really impact that will pull you forward. And so before you make this scaling move, you want to think about what kind of impact am I trying to have. And finally, I need you to know that this will take years. Going from a startup to a multi-generational legacy is going to take 10 years, best case. So if like me, your first five years were really spent trying to figure it out, you know, you didn’t really spend five years figuring it out. You did like one year of work duplicated over and over and over again, and didn’t really get anywhere for five years.

Chris (33:40):

Then it’s going to take you 15 to get to that legacy stage, right? The first phase of entrepreneurship, which we call the founder phase, should take you about 18 months. The second phase, which is to get to a hundred thousand dollars net owner benefit, should take you around three years. And then you start building that wealth platform and we call that the tinker phase. So, and that should take you another three, four years probably. But for me it took a lot longer. And for a lot of people listening to that, they’re still in founder phase. Maybe, you know, they’re still trying to get their first dollar out of their business, or they’ve been in farmer phase for a decade. For me, I took seven years in founder phase. We can get people through that in about 18 months now at Two-Brain. I spent, four years in farmer phase, you know, and I had a mentor that whole time.

Chris (34:25):

And it still took me four years. We can get people through that now. I mean, we’re doing it in less than a year in some cases, it’s amazing. And then I’ve been five years in tinker phase going from 250,000 a year to a $5 million business. Right. But I’m slow. I try everything. I have a lot of ideas. I try them all and I screw it up instead of saying focused. So this is going to take you years, but even if it takes 10 years, even if it takes 20 years to go from a startup business to a multi-generational impact, you’re still creating a multi-generational impact. You’re still getting there twice as fast as your parents did. You know, your parents probably never had the opportunity to create a wealth platform that they can hand on to their kids and create recurring cashflow and have a lifestyle business. They never had that chance. Instead, they got a job. They worked for 40 years and they had just enough money to eke out a living until they died. You can finish when you want. You can get there faster. If you can do that in 10 years and get further than they got in 40, that’s incredible. And that is a gift that is saved just for entrepreneurs, the risk takers, who will make the leap. Thank you for taking the leap. And thank you for listening to this.

Chris (35:44):

Thanks for listening to Two-Brain Radio. If you aren’t in the Gym Owners, United group on Facebook, this is my personal invitation to join. It’s the only public Facebook group that I participate in, and I’m in there all the time with tips, tactics, and free resources. I’d love to network with you and help you grow your business. Join Gym Owners United on Facebook.

 

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War and Peace: How to Shift Your Focus to Match the Market

Gym owner Mike Collette led a great seminar in our Tinker group last month. He called it “Mentoring Your Team,” and he shared a fantastic tool for leading others to grow their businesses.

Here’s one of the comments he made: “This is a peacetime strategy. In wartime, things change.”

After the call, I asked him to explain further.

He told me that when your business is under stress—like a COVID lockdown, a location change or a period of key staff turnover—you take a “war stance.” But when times are normal to good, you shift to a “peacetime” strategy.

In WartimeAudit your expenses for ROI, and keep only the things that provide a clear return. Preserve cash flow. Don’t start anything new.Trim staff to the essentials. What roles do you absolutely need right now?Seek funding support (maybe grants but maybe just a cash buffer from the bank). Put everything into retention. Focus on keeping the clients you have instead of trying to replace the ones you’re losing with new clients.Shift delivery of your model but don’t change your model. Protect what you have instead of taking risks.In PeacetimeAudit your model. Raise your rates. Try adding new services. Mentor your team to grow their intrapreneurial ideas. Hire. Plan for expansion. Write your Vivid Vision. Build your reserves (two months’ expenses is more than enough). Look for opportunities to absorb competitors. Pull profit from the business and invest it elsewhere.What Time Is It?

The key is knowing the difference between wartime and peacetime.

Entrepreneurs are usually stressed. It can feel as if they’re always at war. But you have to ask yourself, “Is the pressure right now coming from something I can control or something that’s beyond my control?” That’s the difference between wartime and peacetime.

COVID lockdowns were the perfect example of wartime. Austerity measures were smart. Focusing on retention meant over-delivering to your clients, spending more time talking to them and investing more effort than usual in delivering your service.

But most gyms worldwide are at peace right now: They’re seeing a surge of hope from the market, they’re seeing opportunities to absorb competitors, and their staff members have a renewed sense of purpose. Times are easier right now, so it’s time to expand.

When your business is under stress that you can’t control, adopt a wartime mindset. Play defense. But when normalcy returns, it’s time to grow.

One final key: For many years, I thought I was living in wartime. I thought that my business was under constant attack from competitors and landlords and lack of cash.

But it was all in my head. A mentor showed me that the greatest enemy to my business was me: I was acting like a despot instead of the leader of the free world. That shift led to a more abundant mindset—and eventually wealth.

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High-Ticket Coaching: Our In-Depth Testing for Gym Owners

Some gym owners and trainers are selling their services for $3,000 and more per month—more than ten times the average—through a strategy called “high-ticket coaching.”

Can it work for you? Maybe.

Read on!

What’s High-Ticket Coaching?

High-ticket coaching focuses on selling an outcome rather than a service. Many trainers selling a high-ticket option refer to their process as a “transformation.” Many charge between $2,500 and $3,000 for the first purchase, and the service can last from one to three months.

Because the process is focused on the outcome, delivery will vary. Some gyms deliver their high-ticket offer as personal training; others deliver it in a group. Most use habit formation (or “life coaching”) as the core of their service, and they prescribe the client different diets, workouts or other strategies based on needs. Anything to get clients to their goals!

How We Test

Warren Buffett said, “There is always somewhere else I can put my money.”

The most important asset a gym owner or trainer has is time. And time is a finite resource. So when we test an idea for gym owners at Two-Brain, we don’t limit ourselves to the question “Does it work?” Instead, we ask the more important question: “Does this work better than the alternatives?”

In other words, “If I had only one hour to build my business today, should I spend it on developing a high-ticket coaching program?”

Our Comparison

We define a “high-ticket coaching program” as a specific program priced at either five times the gym’s average rates or requiring a minimum $1,500 up-front investment.

Two-Brain tested two high-ticket coaching companies in two different gyms. We also spoke with 10 gym owners who had implemented their own high-ticket programs. We measured their total revenue, close rates, client successes and retention. I was most concerned about long-term retention because who wants to make $3,000 per client and then lose them after a month?

How Did We Test High-Ticket Coaching?

Beginning in April, we registered a Two-Brain gym for a $5,000 high-ticket coaching mastermind program. We also tracked the results from another gym whose owner had signed up for a different mastermind on their own.

Our goal: test close rates and conversion rates with high-ticket coaching clients. We wanted to know:

Does the program help clients? Are they likely to stay in the gym long enough to change their lives? Does this service create more value for the clients, coaches and owner? Or is it just a slick sales technique that will soon be another embarrassment to the fitness industry?

Our strategy: We tracked signup and conversion rates in both gyms against their previous numbers.

The result: Each gym managed to sign up several high-ticket clients, and the clients converted to long-term memberships in the gym most of the time.

One gym converted clients to another transformation after the first trial period. The other gave clients an option: continue with the next transformation stage or sign up for regular group coaching.

The second gym retained more clients after the initial transformation but had a lower close rate with new clients. I’ll share why in the next section.

What does this mean for you? It depends on the stage of business you’re in.

When to Use High-Ticket Coaching

Founder Phase (you’re making $18,000 per year or less and coaching most of your clients yourself): Red—We do not recommend this strategy. You could invest your time in other projects that would have a greater return.

Farmer Phase (you’re making $100,000 per year or less and managing your gym full time): Red—We do not recommend this strategy. You could invest your time in other projects that would have a greater return.

Tinker Phase (you’re making over $100,000 per year and your gym runs itself): Yellow—This might be a viable strategy depending on your next business plan.

High-Ticket Coaching: Challenges

The challenge with high-ticket coaching is really “anchors.”

If you already own a gym, your rates are anchors. It’s very, very hard to sell a $3,000 transformation if your “regular” rates are $150 per month—not only because the clients will definitely find out but also because you will know that you’re charging more for some people than others. You’ll feel like you’re tricking them—and maybe you are.

If you’re selling a high-ticket option and a “regular” option, you must be able to answer the question, “Why is this worth 20 times the usual rate?” before a client asks that question.

Sometimes, a gym owner actually opens a completely separate location to sell a high-ticket offer. This helps avoid the “anchors problem” unless they’re selling the same service at the gym for a fraction of the price. They feel facetious and the clients feel as if they’ve been tricked when they find out.

Another anchor problem: your own budget. Many gym owners struggle to sell $150 memberships because they can’t afford $150 per month themselves. Imagine trying to sell a $3,000 transformation on a $30 budget—not only would you fail to close the sale, but you’ll also probably miss out on a great client who would have signed up for your $150 offering.

Read our review: “Sell by Chat for Gyms”

High-Ticket Coaching: Pros and Cons
Pros

You might make more money. While no one has been doing this long enough to provide meaningful retention data, both gyms in our test added to their gross revenue for the months of testing.

Coaches might make more money, too. Following the 4/9ths Model for staff pay, coaches can make more money in less time if the gym charges more money.

Cons

You might create a churn problem. While $3,000 sales do happen, we can’t say for sure how long a client will continue with your gym after making this purchase. Retention has been the problem with “challenges” in the past: The gym owner runs through a list of leads and signs up a few. Then they’re gone and the owner goes through a prolonged drought with no new clients.

Moving to a high-ticket-coaching offer means you’ll have to change a lot in your gym. You’ll need a new mindset, a new sales process, sales reps and regular training, confidence to keep going when you hear “no” more often than “yes,” a new compensation structure, a new gym schedule, and maybe even a different space. This is why we don’t recommend high-ticket coaching in Farmer Phase: You’ll be throwing a wrench into your machine. It will affect your current systems, schedule, rates, clientele and staff.

Unfortunately, it’s very hard to just bolt a high-ticket offer onto your existing service.

Side Benefits

You’ll see what your service is really worth to people.

Let’s face it: $150 per month is way too low for the service you’re providing. Not only are you giving people fitness and health, but you’re also doing it at a higher level than anyone else. People pay $700 per month for diet shakes; caring coaches should be making a lot more than they are.

Running a high-ticket coaching program might just prove your own value to yourself.

High-Ticket Coaching: Overall

We recommend high-ticket coaching only for gym owners in Tinker Phase or for gyms that generate a very high percentage of their revenue (more than 50 precent) from personal training.

Three of the Two-Brain mentors testing high-ticket transformations actually opened separate locations with different names and branding to offer their high-ticket options. As one said, “I’d never be able to sell this in a CrossFit gym.”

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You’re Invited to Two-Brain Regionals!

I want you to spend more time with gym owners.

You need new ideas. You need support. You need to surround yourself with people who will say, “You’re on the right track!”

We created Regionals to bring gym owners together around the world.

At a Two-Brain Regional Event, you’ll work through two video seminars led by Two-Brain mentors. Your host will then guide you through specific exercises to grow your gym. From there, you’ll participate in more open discussion with other local gym owners. You’ll also eat, work out and grow through community support.

Regional events are free for Two-Brain Business Growth and Tinker clients, and they are open to other gym owners for $99 per ticket.

Our next Regional event is Sept. 18! Click here for more info.

Here are the locations:

And here are the two seminars that will help you grow your business:

The Secret to Happy Customers, Confident Employees and a Company That Is Actually Worth Something

 
In this seminar, Kaleda Connell will help participants identify the weak links in their gym systems, understand why they should have SOPs in place, and identify where they should start building structure to increase accountability and efficiency in their businesses.

No Such Thing as an Unqualified Lead

In this seminar, Jeff Burlingame will help participants understand that all leads are qualified, and he’ll explain exactly how pursue them more effectively. He’ll also help attendees create a better prospect experience prior to the point of sale.

Network and Grow!

The biggest win? Being around successful gym owners (even if you’re not super successful yet).

You’re the average of the five people you hang around most. What if those people pulled you up?

Click here to join us on Sept. 18.

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How Matthew Becker Went From $250 to $12,000 in Monthly Net Owner Benefit

Mike (00:02):

What does your gym contribute to your life? We aren’t talking happiness and satisfaction today, we’re talking dollars and cents. In just a minute, I’ll tell you what, the top 10 Two-Brain gym owners are earning from their gym. And one of the leaders will share his secrets. Stay tuned to Two-Brain Radio.

Chris (00:17):

Back to Two-Brain Radio in just a minute. Your gym members will love O2’s hydrating, non-carbonated beverages after a tough workout. Even better, O2 is a community-based brand that wants to give back to gyms. If you sell O2 at your gym, you get a free sponsored event every year. Gym owners who wholesale O2 also get their first order for a dollar. Visit wholesale.drinko2.com to apply for an account today.

Mike (00:43):

This is Two-Brain Radio and I’m Mike Warkentin, your host. Net owner benefit. It’s the number that tells you exactly what your gym contributes to your life financially. It can include your salary or payments you get from your business, but it also includes any other benefits. Like if your gym covers your cell phone payment, provides a vehicle or even takes care of coffee with another entrepreneur. We track this number across all Two-Brain gyms and in July our top 10 owners had net owner benefits ranging from over $10,000 a month to over $20,000 a month. Matthew Becker was on that list and he had a net owner benefit over $12,000. He runs Industrial Athletics in Pittsburgh, Pennsylvania, and he’s here to explain how he did it. Matthew, welcome to the show. How are you today?

Matthew (01:27):

Hey, thanks Mike. I’m doing really well. Thanks for having me on the show today. I’m really excited to get a chance to talk with you and talk with the other peoplR listening to Two-Brain radio.

Mike (01:37):

It’s my pleasure. And I’m really excited because owner benefit is such an important metric. A lot of people don’t know too much about it. So I want to ask you, how has this number changed and improved over time for you? And what does it include besides just say salary or profit distributions”

Matthew (01:55):

Net owner benefit was really interesting number for me to track. And then in some sense, I’ve been tracking it even since I started my gym eight years ago, a little bit over eight years, and then before ever joining Two-Brain. Cause I think in some sense, I started my gym kind of like backwards from the Two-Brain message, the Two-Brain method is that founder, farmer, tinker, thief. And so as the founder, right, you’re the guy who’s there, 24/7, open to close. And then as it grows and you realize you can start to afford or you need somebody else, then you start to move into that like more farmer phase. Well I was a full-time attorney when I opened my gym, I needed somewhere to work out. As long as this thing remains in the black, then it’ll kind of be a hobby and I can still practice full-time. But because I had my full-time legal practice, that meant I had to hire people from the beginning.

Mike (02:59):

I did the same thing, Matthew, I did the same thing, but I did the exact same thing and I probably wasn’t as successful as you, but you tell the story.

Matthew (03:08):

So I originally hired somebody. So I kind of, I feel like I was almost in like that aspect of farmer phase from the beginning. But, whenever we first opened, I always tried to take, like, I remember it was $250 and I was like $250 is going to be the set aside every month. Like I will make that a priority. So kind of, I would almost say like profit first model, maybe even before, I don’t know, has profit first been around for like eight years, but maybe a little bit like before I even knew about profit first. So that was just, that was the original like net owner benefit. And 250 a month, I just put that, just left that in the bank account. Let the bank account grow, use that if we needed new equipment. You know, and as the gym grew, you know, that that 250 kind of grew a little bit, but then also wasn’t then earmarked for like new equipment. So I would start to take some of that. So maybe I’d take like $250 a month or I would take $500 a month and a year or two in, I used essentially what was that accrued net owner benefit to pay off my first car.

Mike (04:22):

Started as kind of beer money, right? Cause you had a full-time job. So it wasn’t like money that you were using to pay your mortgage, but then you found a benefit, to park it onto a car loan eventually.

Matthew (04:31):

Yeah, exactly, exactly. I think that was probably like the turning moment of like, oh wow, I can actually make enough at this, that it can in some way financially impact my regular life outside of like my legal practice.

Mike (04:49):

And you know, that’s an interesting observation that I got to jump in for because a lot of people who don’t pay themselves and I was guilty of this a hundred percent, you don’t pay yourself. And then eventually you’re like, what is the point of all this stress? Right? Cause there was a very long time that I never took a paycheck from my gym. And even if I had done it even $250, even $50, I would have seen more benefit and I would have been less cranky. I think. So that’s a really interesting thing that you did right off the bat was pay yourself right away. And that’s now in the Two-Brain philosophy, courtesy of profit first. So you hit upon it by accident and it was a good thing.

Matthew (05:22):

Then kind of another note on that, I think my mindset on this was different again, cause I had that fortunate aspect of already having a full-time income. But you know, I think for somebody who’s starting out or somebody who is young or somebody who is looking at like the leaderboard that’s going to come out with this month net and a benefit and be like, oh my God, I can never make that much money. Like I think you have to have a mindset going into it of any dollar I make is worth it and try not to put a dollar value on how much work you’re going to end up having to do. Because like you just said, like you do like a whole bunch of work and maybe you don’t make any money one month or maybe you make like pennies on the dollar and you’re like, why am I doing all of this?

Matthew (06:09):

I think you almost have to have another motivation than like I’m gonna make a million dollars in year one. Anyway, paying off that car was like the first time that I was like, oh sweet, like I can make money and I can use it too for my regular life. And it just kept growing. And eventually I would say 3, 4, 5 years. Yeah, probably about five years. Then it started to grow to the point that while it wasn’t making as much as the legal practice, I could be like, Hey, I don’t want to practice law anymore. I could do the gym full time off of what I’m currently making and I can survive.

Matthew (06:55):

Yeah. And you asked like, what does it pay for besides my just, you know, what else is it just profit or salary or anything and not a lot. I mean, yeah, it paid off my car, but it’s not like the gym pays for my car every month or anything. I mean I consider myself to be a pretty basic living kind of guy. So, you know, maybe if the gym orders clothes, it’ll pay for me to get a new, like a new shirt or whatever. I get new shirts. Which is really nice because once you work full time in a gym, all you need is the gym’s logo T-shirts anyway, it’s basically purchased my upper wardrobe for the last number of years.

Mike (07:37):

Yeah. The reason I ask, like, it’s cool because there’s so many people have creative ways of paying themselves and you know, we all figure out with our accountants and bookkeepers ways to do things that, you know, you can find ways to legally hide your, you know, not hide, but shield your income and things like that. And then there’s things like business expenses, like, you know, your cell phone or your different, you know, even office supplies and so forth. So I was always curious if there’s something in there I got to ask you this though. What kind of law did you specialize in?

Matthew (08:04):

Criminal defense and consumer protection. Criminal defense is obvious. Consumer protection is like any kind of contract stuff. So defending people who can’t pay their credit card bills, defending people with mortgage foreclosures, suing car dealerships for either bad car, like used car deals or suing manufacturers for lemon law kinds of stuff, contractors who messed up your house.

Mike (08:31):

I got questions for you on a different podcast, I think there’s probably some interesting stuff in your history. I’m going to hold myself back from asking him about that, but I always am amazed to find out some of the other skills and careers that gym owners have had. And, we’ll probably dig into your story a little more later on,I gotta ask you this, you said that, you know, your July score, you went from lake starting at $250 a month. Now over 12,000. You know, I understand that your score is partially a result of doing the things that your mentor advised. So I need to know what is the, what are the big things that your mentor advised, the ones that really drove that number up?

Matthew (09:14):

I can tell you first and foremost is stop giving away your fundamentals program for free and charge a private training fee, foundations, fundamentals, on-ramp, whatever you call it. And I think in large part, I joined Two-Brain and they were not my first business, Two-Brain’s, not my first business consulting company. It’s actually my second and my mentor, Greg is my fourth coach or mentor. And so I think he was not the first one to say, raise rates. You’re not the first one to say, you know, charge 50, 60, 70, $80 an hour for private training. He was not the first to say, stop giving your fundamentals away for free. But whether I was in the right mindset at the time or whether it was just, you know, Two-Brain comes with a reputation. And so when you have, I’ll say to this, let me use this analogy, because I use this with like my private training clients all the time, your spouse can tell you to do something fitness or diet related and you just look at them and be like, yeah, OK, whatever. Your trainer can tell you the exact same thing and it’s the gospel.

Mike (10:35):

Proximity bias, I think is the term for that one.

Matthew (10:40):

I need to remember that because that sounds like really impressive. It was that same aspect. So, you know, before joining Two-Brain, I had a coach that said like, you got to charge like four or 500, $600. No, like nobody’s ever going to pay that. And I wouldn’t pay that. So they’re not going to pay, you know, I was that stereotypical person who tried to project my spending habits on somebody else. And I think Greg was very patient with me and he took time to explain things in a way that would make sense. And he had the backing of Two-Brain and I’ve been a reader of Chris Cooper’s for a number of years. So, you know, eventually when Chris Cooper says you should be charging for this, no discounts, no freebies, charge for this, no discounts, no freebies. Eventually it sinks in. So I was like, all right, Greg, nobody’s going to pay me 700 bucks for a 12 session fundamentals, but I’ll try. And then literally the first person I did it bought it. And I was like, why didn’t I do this before? So that if I had to point to like one thing, like that was the one thing that really shot up my net owner benefit.

Mike (11:57):

So I can tell you this, if Chris Cooper’s listening to this, you’re going to bring a smile to his face. And the reason is that, you know, the stuff that Two-Brain teaches, Chris gives it away for free. So you could literally do the program without really, you know, paying for it. You certainly could. However, the thing that Chris prides himself on is having mentors who get you to take action. So if Greg got you to take action on stuff that you’d maybe heard before, maybe knew, that’s a huge win, and this is Greg Straus, we’re talking about, correct?

Mike (12:23):

Yes, yes, yes.

Mike (12:24):

So that, I mean, that’s the thing, Chris is big on action. And that’s the whole point of the program is that if you don’t take action, the information is worthless. Getting someone to act is the most important part.

Mike (12:35):

So, you know, hats off to you for doing it, hats off to Greg for getting you to do it. And I’m going to correct myself. Proximity bias is actually, I’ve checked it out here. That’s the tendency to favor people closest to us. So I’m going to say that it’s reverse proximity bias, where you tend to ignore the people that are closest to you because you don’t quite, you know, you’re like, ah, it’s not as important and I’ve done the exact same thing. And again, you can get into spousal discussions here all the time about this stuff, but that’s exactly the principle. So Greg got you to do some stuff that had a huge effect. And how long I’m going to ask you, how long did you give away fundamentals for free or on ramp?

Matthew (13:12):

Do I really have to say it? We’ve been open for eight years, eight and a half years. I’ve been a member of Two-Brain for a year. So you do the math. Seven and a half. We gave away fundamentals for free, $720 for 12 private fundamental sessions. One-on-one with a coach.

Mike (13:42):

So that’s a high ticket item. So when you make a sale, you’re guaranteeing yourself 720 or whatever, plus most likely the membership that comes with that, cause I’m sure most people who do that join. So you look at it. I’m not, and the reason I can say this easily is I’ve made similar, costly mistakes. You definitely look at seven years of missing out on a huge chunk of revenue. So I can see as soon as you put that in. Wow. You’re you’re I mean, when you made that change, it probably took a little bit of time just to get some people into that program, but did you see a huge revenue boost when you made that change?

Matthew (14:15):

Yes, I mean, post COVID, we were maybe 16,000, 17,000 in gross month revenue. And then it’s just been steadily climbing since then.

Mike (14:30):

So here’s a question for you. You went from free on-ramp to an on-ramp of about $720. That’s a huge jump. Did you freak out at all about that? Were you nervous to do it, like to pull the trigger on it?

Matthew (14:44):

Yeah. I never thought anybody would buy it, you know, but again, like Greg’s not the first person to say that, to do it. Other people, other coaches have told me to do it or at least one other has told me to do. And we’re just like, no nobody’s ever going to buy it. I’m not that good of a salesman. There’s no way I can convince somebody or trick somebody. Right. Or like, I don’t, I feel sleazy if I put enough fear, which I know how to do, because I’m an attorney I can throw fear into a conversation. I know how to do that, but I don’t, I feel sleazy on that aspect of things to do that. And Greg just kept saying, and Coop says, you know, it’s about help first.

Matthew (15:24):

And you don’t have to like trick somebody into buying this and yes, you’re a good enough salesman. So yeah, there was, I think even to this day, you know, not that I’ve been doing this forever, I’ve been on it for a year. But to this day I get nervous when it comes time for the end of the conversation, doesn’t matter how good the no sweat intro goes. I’ve had people like, I’m ready to go. How do I sign up? I’m like, it’s going to be $720. You’re like, I’m still nervous about putting that dollar value in front of them. Yeah. I don’t think it ever it’ll ever get any easier.

Mike (16:05):

What happened the first time someone you sold one though, the first time you had you closed on the 720 on ramp, what was going through your head?

Matthew (16:16):

I was shocked. Like, I was like, it’s going to be $720. And she was like, oh, OK, cool. When can I get started? And I was like, wait, oh, like next week. Like, and then I think I immediately like texted Greg. Like she walked out of the gym, everything’s set up and I just like immediately texted Greg. And I was like, holy expletive, I just sold, like you were right. Like I just sold it. I can’t believe it actually worked. And I actually just saw her this morning. She’s still a member.

Mike (16:49):

Oh, that’s awesome. Do you remember what Greg said? Do you remember his reply to that text was?

Matthew (16:53):

I don’t, it was not I told you so, but it was probably in the back of his mind I told you so, but it was very supportive of great job. I knew you could do it, you know? Cause that’s typically just his attitude. Anytime I send him like, Hey, you know, bright spot, Tuesday at 2:50 in the afternoon. Here’s what just happened. And he was like, fantastic, good job. Keep going.

Mike (17:21):

So I’m going to ask you this, like, that’s obviously a huge, I mean, you created a whole entire revenue stream that has a high price attached to it that obviously reflects the value. I mean, it’s 12 sessions of personalized instruction for 720, that’s not a stretch by any means. Did you make any adjustments to membership prices at all?

Matthew (17:39):

Not on current members. On new members we did.

Mike (17:44):

How much of an increase did you make based, over what you were charging originally?

Matthew (17:49):

So 12 times a month, which is basically like your three days a week kind of thing. We did a $10 increase from 145 to 155 and unlimited went from 165 to 185.

Mike (18:04):

OK. So that’s interesting. So that’s your standard, we’ll call them your standard rates, I suppose. And you do that on incoming clients, like, were there other programs that you added that contributed to this? Like after you created your whole on-ramp thing, what else have you got going on? That’s contributing to this number?

Matthew (18:19):

Just a lot more personal training and then we added hybrid. Yeah, we added hybrids and then I joined Two-Brain postcode. So a lot of my history is like the pre-COVID post COVID type stuff. Right. So pre COVID, everybody walked in the door, let me put you through a movement intro and then sit down and then we’re going to go through this sales portion of it. And then I’m going to erase the fee for fundamentals if you sign up today, you know, it was all this sort of, now it looks like trickery kind of stuff. And everybody was instantly moved into group. Post-COVID it’s come in, sit down. Motivational interviewing. No sweat intro. Yes. It’s probably going to be somewhere around 12 sessions.

Matthew (19:18):

If the conversation starts to lead somewhere else, we may not even do, I may not even put the 12 sessions out there. It might just be, let’s go into private training, but you know, even if they go into 12 session fundamentals, post that, unless they ask, I don’t even put their other options up on the board. We do everything on a whiteboard. I know you’ve just started iPad stuff and I might convert over to that, but you know, I just put everything on a whiteboard behind me in my office and you know, I just put up those initial 12 and if they agree and we start scheduling stuff, the conversation just stops, you know, like we just move on and then post their initial 12, then we sit back down again and talk. Do you want to continue into privates? Do you want to move into a hybrid or do you want to move into group?

Mike (20:09):

Yeah. That’s money-making right there, obviously. It’s so interesting because, you know, I ran a gym. I don’t have a physical space anymore. We started in 2011 I believe. But we did similar stuff where we’d run group on-ramps for very, very low rates. Eventually we got an individual on ramps, but we never, as soon as the idea was always when you’re done your individual on ramp, you go to group and I never ever saw the idea of personal training from that process. I certainly never saw hybrid training. And only toward the end of when we got rid of our physical space, where we getting into that, and we were seeing, you know, obviously the results that you have. So what you’re doing there is you’re selling this high ticket item on the way in, and then you’re giving them other options.

Mike (20:53):

And the interesting part is that the group of options you’re giving them is your discount. It’s your lowest rate, which for me was my highest sale. You know, that’s incredible. Right? So you guys you’re out there listening, just know that if all your revenue is coming from group classes, there are some very clear ways to serve your clients better by offering different memberships. And a lot of the stuff that Matthew’s talking about, like motivational interviewing, you know, the iPad sales, all this stuff is taught to you in Two-Brain and is available for you guys to figure out and we have the resources available. So if you don’t understand any of that stuff, we have free articles from Chris Cooper and in the program, it’s all laid out, plug and play by the numbers. And Matthew, I want to ask you about this. You talked a little bit about earlier, before the show, not just generating more revenue, but minimizing expenses, because that’s a part of profitability that a lot of people don’t recognize. What kind of stuff did you chop to improve your profitability?

Matthew (21:47):

Our conversation beforehand of like what sage advice can I give everybody? It’s not necessarily that we ever chopped anything so much as we just never incurred it to begin with.

Mike (22:02):

Well, that’s good. So I like that. That’s good too. Tell me some of the stuff that maybe you didn’t do it. I’ll give you an example. I interviewed a gym owner who does not use gym management software. He uses acuity, right? It’s expensive. He uses acuity and he, you know, he says, it’s fine. So like what kind of stuff didn’t you incur?

Chris (22:19):

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Matthew (22:56):

Yeah, by the way, I read that. I don’t know if you put it on the Facebook or he put it on a Facebook group or something like that. And I was like, holy crap. Not using like Wodify. Anyway, we’ve always run a very tight ship. So like starting out, we moved into spaces, we’re currently in our second space, but we’re in the third iteration of our second space. So meaning like when we originally moved in there, we only took up a portion of our current space in order to keep that cost low. And then as the membership grew and as we needed to increase, then we took a next step incremental. And then we took the next step through there. So we probably maximize our space now. But in that sense, we’re not running a 10,000 foot facility. Like we have 3,400 square feet.

Matthew (23:52):

We used to run 14 people per class, 16 people per class, and it was tight. Now we run eight and everybody has their own space. Everybody has their own piece of equipment and we have two available spots. We do squares and that’s a whole different conversation, pre COVID post COVID. But anyway, we’ve kept the squares. We have two squares available for private training and that’s all. And so we I’ve kept rent and everything else, very low reasonably speaking. Because we, you don’t need more space. We’ve always bargain shopped in some sense for our equipment, especially nowadays when we opened eight years ago, like you don’t really have a whole lot of options. You bought Rogue, you bought Again Faster, or you bought crap.

Matthew (24:52):

You would pay the higher price. And you’re just like, ah, is Rogue cheaper, is Again Faster cheaper nowadays. Like you can get a quality barbell for 50 or $75 cheaper than Rogue. It doesn’t say Rogue on it, but it’s not crap. They hold up just fine. You can get a pull-up rig and that’s not Rogue. And I don’t have anything against RoGue. We have a lot of Rogue equipment, but we also, we bargain hunt a little bit, depending on it. Like Rogue sells a really nice wooden box. So does some other company, and it’s a wooden box. Like I don’t need Rogue’s stamp. Nobody coming into the gym knows what Rogue is. They don’t know what anybody else’s equipment is like, you’re not impressing anybody. Keep costs down that way. You don’t need a dual TV. I have enough trouble getting my members to log their scores in Wodify as it is, and you think they’re gonna log their scores better because I have two TVs up in front of them that look impressive?

Matthew (25:56):

No, you don’t need two TVs. So a lot of it was just, we didn’t incur those expenses to begin with. But then from there, you know, it’s my impression that people perhaps, and I know Coop doesn’t teach this, Two-Brain doesn’t teach this. I think it gets misinterpreted this way of you have the money to spend. So go spend the money. Like I can afford to hire a cleaner. So I need to go pay for somebody to clean. And that’s not, I don’t think that’s Coop’s message. Coop’s message for the way that I interpret it is you have the money to hire a cleaner. You also have something else that you need to do that’s more lucrative than you cleaning. So hire a cleaner. So I’ve always had the, when it comes to incurring additional expenses is I’m not going to incur the additional expense just because I can afford it. I’m going to create the need for that additional expense first. Then I’m going to go incur that additional expense.

Mike (27:02):

Yeah. That’s a huge step that so many people miss, because when you, the system that Chris is talking about always is called climbing the value ladder. While you’re replacing yourself in quote unquote, lower value roles so that you can move up the ladder. The thing that people forget about that is that when you do that, you have to put yourself in a role and then generate more income in that role that more than pays for the thing you offloaded. So like you said, if you just say, OK, I’m going to hire a cleaner, and then you decide to use those three hours a week to play Xbox, you’re not going to get that money back. And that’s fine if that’s your plan. Like if you just want to like offload some jobs and sit there and take the profit, and you’ve got the gym running according to all your systems, you can absolutely do that. But if you want to use that time to generate more, you’ve got to go and do like something like sales or retention or any of those other things that will help you make more money per hour than the cleaner costs you. So that’s a huge step and you’re interpreting what Chris is saying exactly. So you’ve been very clear about when you’ve incurred expenses, like obviously you’re not just blowing money cause you have it, you’re spending it because you want to buy more time. Is that right?

Matthew (28:11):

Well, I spent it because I needed the additional time. A perfect example with cleaning. I cleaned my gym with my head coach for seven years, every Friday morning. We would do it at different times when I was practicing. But especially when I started to transition more from over the law and to the gym, every week, I’ll say every week I cleaned the gym with my head coach until I joined Two-Brain. And they helped me acquire additional private training clients because now I have a private training client every Friday morning. So I can’t help clean anymore because it was either charge $60 an hour for this private training client and go train with the client or continue to clean my gym.

Mike (28:59):

And the cleaning rate is like, you know, 15 bucks an hour or whatever,

Matthew (29:05):

Right? It wasn’t a matter of I’m going to incur this expense so I can go out and do something else. It was, I have something else to do. So I’m going to incur this expense.

Mike (29:16):

Ah, you know, the thing I got to point out too is you mentioned leases and spaces and so forth. I bet it was just, you know, your landlord must just hate seeing you coming back with the, you know, proposed lease with a bunch of red lines. He’s expecting to serve this to like some ignorant gym owner and you’re going to lawyer up on it.

Matthew (29:36):

It took a few months to get a good lease with no personal guarantee in there.

Mike (29:45):

Yeah. Well, you know, I love it because we definitely used a lawyer for our lease just to make sure, cause I didn’t know what I was doing. And a lot of gym owners, you know, don’t do that and can run into some problems. So I just thought I’d point that out to a few people that if you don’t have your own legal skills, it’s probably worth checking over your lease to get the best deal, because that is a huge, huge expense. If you sign a bad one, you can be in a really tough spot, especially if there’s stuff that you didn’t plan for. We might have you back on the show to talk a little more about rent negotiations at some point, if you don’t mind, that’s a huge one for people. So we’ve got a lot of interesting stuff that you’ve talked about here.

Mike (30:19):

I’m really, you know, I think the thing that I love that you just said about expenses is not putting them in place in the first place. Because a lot of times we have gym owners, we have to audit their systems, right? Our mentors go through and look at all their stuff and say, OK, you haven’t used this subscription for X in four months. Why are you paying $80 a month for it? Right. It’s peeling back all these things from a different approach. You right from the start, were very hesitant to put things in place unless you absolutely needed them or could show a return on them. And that saves you a ton of expenses and that compounds over time because you weren’t paying for those crappy subscriptions for, you know, 17 months before you realized you didn’t need them. I’m looking literally right now at my appliable boxes that I made in a garage with a buddy of mine, no one ever noticed a difference to those things.

Mike (31:03):

And again, that’s no slight any to any equipment manufacturer. But we traded a guy a membership to make some boxes and that saved us a ton of money at a time when we needed it. You could certainly do the math on that and say, OK, I don’t want to make plyo boxes. I will buy them. And it saves me time. You could make that decision too, but at least make the decision one way or the other by calculating. That’s a great one. Let’s go back in time. So you’ve been a longterm gym owner. You’ve made some dramatic changes in the last month or not last month, last year, pardon me. Let’s say, you’re starting a new gym tomorrow. You were starting or even like your second gym or something. And you wanted to get net owner benefit as high as possible, as fast as possible. What are like the two main things you would do when you set up that gym? Like the first steps that you would take to ensure that you are making money yourself.

Matthew (31:49):

You’re limiting me to two, I literally wrote like five.

Mike (31:51):

Give me five then.

Matthew (31:51):

No, I got notes on all these. So I’ll come back to that one last. So the start, the first thing I would do is pretty much what we’ve already talked about doing, starting on like absolute bare bones. What is the absolute minimum you can get away with to get people in the door and get them training.

Mike (32:17):

Less than you think. I don’t want to interrupt, but there’s a YouTube video of Chris Cooper showing exactly how he started his business. And it’s like this, you know, old plyo box that he made as well. It’s like a skipping rope and a dumbbell or kettlebell or something like that. And some rubber tubing, I think so like guys, if you’re listening and you’re thinking of starting a gym, do not make the giant $80,000 Rogue laundry list, you can start your gym with smaller stuff. So I just want to emphasize that and say we have a video resource for you on YouTube on our channel. Sorry.

Matthew (32:46):

Oh, it’s all good. Sell your services, not your facility. But then in the same breath like you have, I would put a whole bunch more time and effort into distinguishing myself and the business from every other business to begin with. Now I know majority of people who listen to the show are probably CrossFit owners or ex CrossFit.

Mike (33:14):

Probably 65% or CrossFit or were. That’s probably about the number. Yeah.

Matthew (33:18):

But even if you’re looking at like a dojo, even if you’re looking at like an MMA gym or a yoga facility, you know, any of those or weightlifting facility, there’s likely another one, at least already in your town, don’t come out as the new CrossFit gym, because everybody who signs up is going to know, have some experience with what a CrossFit gym should look like, what a CrossFit gym should offer, what equipment they use on the games. But so you have to come out of the gate, distinguishing yourself in a way that’s different so that people know what to expect when they walk in the door. And so I would put a lot more time and effort in that. And now I’m fighting that, right? I fight this constantly with my coach because, but my mentor and I work on this constantly because for seven years, my website has been built on CrossFit.

Matthew (34:15):

It shows up really well on Google for CrossFit. So everybody who comes to my gym, once group CrossFit classes, I’m already at a disadvantage when I sit down for a no sweat intro, because for me to then turn around and be like, Hey, we’re going to do one-on-one training. And they’re like, wait a second. My buddy who goes to CrossFit does group classes for a fraction of what you’re telling me this is going to cost. I’m going to go to the other CrossFit gym down the street. Well, I’m now fighting to distinguish myself. I wish I wouldn’t have done it from the beginning.

Mike (34:48):

That is fascinating because there’s long been a debate about the value of CrossFit affiliation. And nobody’s totally sure. Chris is looking into this in our state of the industry survey and so forth. We’re always asking because as again, it’s an expense, right? So we’re always looking to justify that expense. And it’s interesting that you’re saying that the name CrossFit in this case can sometimes give people the impression that they’re coming for group classes, which are actually your discount option. That’s fascinating.

Matthew (35:15):

Now flip side of that, and that would be, I would love that. Let me plug a potential topic for you in the future to talk to one of the gyms who has dropped their CrossFit affiliation last year, and then either to understand how that has impacted their membership or how they have continued to grow, not having it, because I can say our monthly inquiries, our intros would drastically drop if I dropped the name CrossFit.

Mike (35:49):

So there is value there and outside. That’s good to know as well.

Matthew (35:53):

I wouldn’t, I was freaked out at the potential of having to give up the name CrossFit, because it is such a good marketing tool. So there is some give and take there. I just, I think I need to do a better job in my marketing of distinguishing myself. Yes. I think I can still use the CrossFit name, but I’ve got to make it very clear to people that, you know, this is not your, and it sounds cliche. We’re not the average CrossFit gym.

Mike (36:23):

Yeah. But that’s, I mean, I literally wrote down that topic and that’s an excellent one I want to look into. But so what you’re saying is that CrossFit has, the name has huge SEO and Google value, and it has huge value in getting people in the door. But you also, if you want to sell more than just group training, we’ll call the classic CrossFit training program. You need to find some ways to differentiate yourself either by organic media, by marketing, by your website, by paid marketing, whatever you need to find ways to let people know that your gym isn’t just group classes. You can actually do CrossFit one-on-one or you can do other kinds of training one-on-one or you could do, you know, two one-on-one or online coaching, nutrition, coaching, or anything like that. So this, again, that is a huge point of differentiating yourself from other things in the marketplace. Good one, what else you got?

Matthew (37:08):

So next one is spend money on your website, SEO and social media, especially SEO, right? Social, especially SEO and the website. One of the ways that we didn’t cover as far as, as cutting expenses, that in my opinion need to do is the owner needs to be prepared to be the Jack of all trades for as long as humanly possible. And then handing over that task to somebody else. So case in point, I designed our first website, I built it. I taught myself how to do it. I taught myself how to do basic SEO when we opened eight years ago, that got me to about 75 members at that point, because we went two or three months and it was no growth at all. I was zero sum. I was like, actually, it’s probably more than two or three months, but I was like, gotta do something about this only then did I incur the expense of having somebody else do my website nowadays? I think you have to have somebody do your website to look professional. It is like, great, take a crack at it yourself. But as soon as you got enough money and you can get them done for about a thousand, $2,000, and it looks like a really nice website, get somebody to do your website.

Mike (38:28):

I made the mistake of using a website that was designed to be, you know, quote unquote, cool. Or it was supposed to look a certain way. What I didn’t do with my early websites was design a website that was designed to convert. Pardon me, convert clients. It wasn’t gonna make any money. It was just going to show off my cool picture with my workout of the day, which was maybe good for retention, but didn’t do anything for someone that came to the website, looking to get it getting into the program. So now, and there are lots of options out there. You would really want to get a website that clearly is designed to get people, to sign up for your program, or at least tell them what the next step in your process is. As in get on my newsletter, book a no sweat intro. So I love that.

Matthew (39:12):

Yeah. And get somebody to do SEO. It’s easy to start. And so you can save a lot in costs upfront just by using your own time to blog, use your own time to draft the website and use keywords and backlinks and everything else. But eventually, yes, you’re going to run out of the time. So once you’ve saved that cost even upfront, very quickly, figure out how to spend, you know, a hundred, 200, $250 a month paying somebody to optimize that website.

Mike (39:48):

I like it. Search organic reach is becoming tougher and tougher to get so the more work you can do with your media and with your website to get people there, the more you’re going to sell, especially if your website’s optimized for that. What’s next on the list. These are good things.

Matthew (40:03):

Standardize and systemize, everything ASAP. I feel like I’m just like plugging inTwo-Brain.

Mike (40:12):

So is Kaleda Connell, our SOP expert. She’s having the greatest day just cheers with a glass of wine. You know.

Matthew (40:19):

You have got to get consistent in what you’re doing. And it blows me away today. When I hear a gym, like I know I don’t do a lot of travel. I don’t unfortunately get to visit a lot of other gyms, but I have members that do I have a strong enough relationship with my members that I go to certain ones. I’m like, Hey, give me the good and bad of when you went into the other gyms. And one of the constant feedbacks that I get is like, there was no system whatsoever. lLike the coach just sat there. It didn’t seem like we had any plan going from point a to point B. I had no idea what was coming up next. Didn’t know when workout was going to start like, so it it’s clear that like, there’s still gyms,

Matthew (41:02):

I don’t know how they survive, but there’s still gyms that don’t have systems. And those systems like you don’t understand how much the membership appreciates things like, Hey guys, you got five minutes, let’s go do this. And we’re going to come back. You’ve got 10 minutes to work up to a five rep, max back squat or whatever, you know, you know, have these plans set in place. Everything needs to be laid out. Point by point by point. We have membership contracts. This is how somebody gets onboarded. This is how you clean bathroom. Yeah. Systemize.

Mike (41:36):

I mean, it sounds funny, right. But you actually need to tell people exactly how to do every aspect of your business. And guys, if you’re listening out there and that sounds confusing or intimidating, we teach you step by step, how to do that in our ramp up program. So check that out because at the end of that, you’re going to have a staff playbook that tells people how to do exactly everything. And it could be as simple as park here, open the door at this time, turn on the music to this station. And then everything else comes after that, get your systems in place. It will literally change your life and the lives of your members guaranteed. What else are you going to do? Yeah.

Matthew (42:11):

One more that I think is more of an advice thing than, cause I think I was prepared for this one I opened, but I’m spinning off to another business, which another conversation and I’m being reminded of this point. So you’ve got to get ready to work 24 7. And I just, I need to remind myself of that. That whenever you open up a business, whenever you open up a gym, you’re it, it doesn’t matter. Even if you’ve hired somebody like the buck stops with you. And if you’re not prepared to answer an email at nine o’clock at night, call a potential member on your dog walk, get up at four o’clock in the morning because you have to go coach the 5:15 AM class and from the beginning, you’re not prepared to do this stuff. You’re either going to sacrifice your net owner benefit, or you’re just not in the right industry.

Matthew (43:06):

Like maybe it’s me coming from the legal field where it was like work, work, work, work, work all the time. And so I just brought that over into the gym, but you know, I’ve had people I know that have opened gyms in the past and I’ve said to them before they’ve opened, like be ready because you’re walking out your nine to five job and you’re opening a gym. It’s not nine to five and they’ve come back years later months later and said, wow, I work like so much. And like, we started this conversation. I worked so much, I made a thousand dollars last night.

Mike (43:40):

I’m going to connect your fourth point to your fifth point and say that you know, you’re exactly right. Like you are the person when you open a business and you’re going to have to do everything. That’s farmer phase that Chris has spoken about the goal in farmer phase is to get to break even right away. And then in that, or pardon me, I’m sorry. I’ve got the order wrong, founder phase ,and your goal and founder faces to do everything, get to break even. And then in farmer phase, which is the second phase, that’s when you start relying on your systems, rely on your operations, hiring people, delegating, and that’s where you can really start to expand. And you don’t have to work 60 hours a week unless you want to, because you can start to hire and do those things.

Mike (44:17):

And then we talk about tinker stage that’s stage three. And that’s kind of where you’re sounds like you’re getting to where you’re thinking about other business opportunities. And at that point you literally can’t clean your bathrooms. You can’t afford to clean your bathrooms because you could do so much stuff elsewhere. And we teach you how to do that too, because instead of working on your business in your business, pardon me, you’re working on your business. And instead of coaching the class, you are delegating and teaching and mentoring and generating revenue by developing your staff. So like, I think you’re exactly right when you start, you’re going to be prepared to do everything. And then unless you want to do everything, there are literal steps that you can do to offload all this stuff, create exactly the life that you want. And maybe it is working 40 hours or 60 hours a week. Maybe it’s not, but the steps are there. Have I got that more or less, correct?

Matthew (45:01):

Great job.

Mike (45:07):

Do you want to say what your other businesses that you’re working on right now?

Matthew (45:12):

Running a virtual flower market. I’ll through that out really generally.

Mike (45:18):

Well, we’ll heck back in with you later on. When you get back, I want to hear more about that, but, we won’t, we won’t let you give away all your secrets right off the bat here, before you get fully going, Matthew, this was great. This is super helpful because what you’ve done here is you’ve given some clear steps to people that they can, that they can take. And so really good advice from a long-term gym owner, who’s made some serious changes in the last year .And dramatic ones. So I really want to thank you for being on the show and being so concise about this as a lawyer, I wouldn’t have expected anything less from you, but thank you for doing it.

Matthew (45:52):

Thanks for having me on, and in any way I can help Two-Brain and anybody else, any other gym owner I’m always willing and open to help.

Mike (45:58):

All right. Thank you, Matthew. That was net owner benefit leader, Matthew Becker. I’m your host, Mike Warkentin, be sure to subscribe for more episodes of Two-Brain Radio. Now here’s a final word from Two-Brain founder, Chris Cooper.

Chris (46:10):

Thanks for listening to Two-Brain Radio. If you aren’t in the Gym Owners United group on Facebook, this is my personal invitation to join. It’s the only public Facebook group that I participate in and I’m in there all the time with tips, tactics, and free resources. I’d love to network with you and help you grow your business. Join Gym Owners United on Facebook.

 

The post How Matthew Becker Went From $250 to $12,000 in Monthly Net Owner Benefit appeared first on Two-Brain Business.

5 Key People in Your Life: Your Personal Board of Directors

“We are the average of the five people we spend the most time with.” —Jim Rohn

At Two-Brain Business, we teach entrepreneurs to evolve in the “Six Fs”: in their fitness, their finances, their future, their faith, their family and their freedom.

The people closest to you should support you—but they should also challenge you.

They should illuminate the path to greatness. They should push you and pull you to get there faster.

If you want to improve your life as quickly as possible, you need people who will sometimes be your challengers, often be your partners and always have your back.

Maybe you already have these people and just need to focus on them more. So consider them your personal board of directors. They are:

Your life partner—your spouse or significant other, who represents your family.

Your fitness coach, who represents your health.

Your business mentor, who represents your finances, freedom and future.

Your spiritual guide—your pastor, priest or meditation guide, who represents your faith.

Your best friend, who represents your conscience. This person knows your whole story and will help you balance the rest. That’s important. As much as we value the pursuit of excellence in each of the Six F’s individually, there will never be perfect harmony between all six. Your best friend will give you the caring but objective perspective you need.

It’s easy to identify exactly who these people are. If you have gaps on your personal board of directors, fill those gaps first.

How to Use the Board

As soon as you have your board together, here are the next steps:

Prioritize them.

Listen to board members before everyone else. The board’s power comes from its ability to filter: to lift up the most important things in your life and hold back the noise.

For example, when I get a nasty email response, I read it out loud to my wife. Her skin is thicker than mine, and she helps me get my perspective back. Then I’m not distracted while I’m trying to spend time with my kids.

When I’m not certain which step to take in my business, I call my mentor and present my options. His objectivity helps me choose the path and stay on it until the end.

Maintain contact.

Make appointments with board members. Work them into your daily, weekly or monthly schedule. Don’t try to “fit them in” like everyone else—your schedule and head will fill with noise, and you’ll lose focus in the overwhelm. Chart your course instead of looking for a lighthouse when you’re approaching the rocks.

Ask them how you’re doing.

Be ready to hear the truth.

Ask them how you can improve.

“How can I be a better husband?” is a scary question. Be sure you’re ready to hear the response and act on it.

“How can I own a better business?” is another scary one (it took me three years to ask it of my first business mentor).

“How can I lose the weight that makes me feel unhappy?” is really tough for most people.

“How can I serve more?” “How can I be happier?” and “How can I find peace?” are possibly the hardest of all.

But here’s the thing: board members already know the answers. You don’t have to guess. You don’t have to make mistakes. You don’t have to try stuff, fail and then attempt to repair the damage. You have the most qualified people in the world sitting at your table. All you have to do is ask.

When I’m faced with a problem in my business, my first question is this: “Who has already solved this problem?” If there are several people, I ask, “Who has solved this problem better than anyone else in the world?”

When I realized I could take the same approach in the other areas of my life—my Six F’s—I started asking for help. I put my ego aside and achieved massive growth.

The Board: Your Bedrock

You can maintain around 150 personal relationships. I suggest that these five—life partner, fitness coach, business mentor, spiritual guide, best friend—matter more than almost all of the rest put together.

Identify these people, focus on them and grow with them.

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Vaccine Passports and Gym Owners: An All-Time Catch-22

I hate seeing business owners forced into no-win situations.

But after a very tough 18 months of the COVID pandemic, governments are once again making it harder for business owners to succeed.

Case in point: Proof-of-vaccination requirements for access to fitness facilities, as well as other “non-essential” establishments such as restaurants and theaters.

In Canada, governments in Manitoba, Ontario, Quebec and British Columbia are rolling out vaccine passports—or have done so already. Around the world, vaccine passports are also becoming common: BBC.com.

I’ll stay well clear of the debate about vaccination and vaccine passports. I’ll just say that the current policies put many business owners in an impossible position.

Think about it: No matter what a gym owner does, people will be upset.

Adhere to regulations and an owner risks the wrath of people who are not vaccinated and can no longer access a service or facility. The owner might also disappoint vaccinated people who think the new requirements go too far.

Disobey regulations and an owner risks the wrath of both the government and people who are vaccinated.

Reminder: Please reserve your criticism of unvaccinated or vaccinated people. And leave the individual choices of business owners out of it as well. We aren’t here to argue about any of that.

The point is that businesses might suffer no matter how they respond.

Anti-Vaxxers, the Vaccinated and Vitriol

Check out this article from Global News: “Quebec Gym Owner Facing Threats Over Policy to Require Clients to Show Proof of Vaccination.”

Short summary: A long-term gym owner got aggressively trolled for his decision. He was getting threats and one-star reviews from people who had never been to the gym. Granted, he put his policy in place before the government mandate, but that’s just a matter of timing. And threats are threats.

Across the country, a restaurateur is being attacked for following government policies: “B.C. Restaurant Owner Suffers Online Threats and Abuse for Stance on Vaccine Passports.”

Over in Massachusetts, another restaurant owner is getting threats. In Portland, a bakery now keeps bear mace handy after an angry customer threatened to rape an employee. Ontario entrepreneurs have already been subject to protests and are likely to see more as the government rolls out its passport system.

The anger flows both ways. Some B.C. businesses are openly stating they won’t follow the orders: Global B.C. One commenter on that video stated her business will not ask customers for private info.

A responder: “Please post the name of your establishment so we can avoid it.”

Another responder: “I will not support your business.”

One more: “Then shut down, please.”

All this is added to the strain most businesses are already feeling. They’ve had to spend more on cleaning supplies and personal protective equipment, they’ve been forced to close, they’ve had to limit capacity, they’ve had to alter procedures on the fly, they’ve had to develop new services, they’ve lost clients who are scared to go out in public, they can’t get stock or supplies, they can’t find staff—the list goes on.

Where I live, one struggling local restaurant literally closed its dine-in service before vaccine passports arrived simply because it was short staffed and couldn’t deal with angry customers screaming about slow service on a weekend evening.

Whatever your politics, we can all agree that this situation is unfair. One side or the other will be angry no matter what, and gym owners are forced to risk alienating or offending a significant percentage of their patrons with any action.

So what do gym owners do?

Communicate!

Chris Cooper and the Two-Brain team already whipped up a document that helps our clients navigate the situation. It’s got the options laid out, and it includes an email that can be adjusted and sent to clients to get out front of any issues. If you’re in Two-Brain and haven’t seen it, contact your mentor ASAP. Then take action.

Our clients are also sharing strategies in our private Facebook group: One helped another review local government requirements to find a way to serve all clients in an outdoor setting that’s onside of regulations.

For those on the outside, I’ll offer this advice from a PR standpoint: Over-communicate with your clients, explain your position and remind them that you care about all of them regardless of their individual politics or choices. Most will understand you’re in an impossible position. One option: Be prepared to offer alternative services for the segment of your membership that can’t or won’t access your gym. And be prepared to brush off a few angry people—chalk their reactions up to extreme stress and move on.

That plan, of course, doesn’t do much to mitigate the rage of the mobs on either side of the debate.

My best advice for dealing with the public: Keep your head down and avoid online arguments. You can’t win them and will only alienate one group to a greater degree. Online debates are not for the faint of heart these days.

If you must engage, I’d simply be calm and explain that you’re in a no-win situation. Your goal is to look reasonable rather than rabid to anyone who sees the engagement. Then get back to serving your existing clients to the best of your ability.

I’d also contact local elected representatives to voice your concerns. It might not do much, but maybe it will help. If we’ve learned one thing about pandemics, politicians and mobs, it’s that squeaky wheels tend to get grease.

How You Can Help

If you’re reading this and don’t run a business, or if you’re an entrepreneur who’s frustrated with another business, here’s my request:

Be kind to all entrepreneurs and their staffs regardless of their politics—or yours.

Business owners signed up for a tough job but not an all-timer of a Catch-22. It’s going to be hard for a while. But they’ll find a way through this eventually, and your kindness and understanding will help them do so.

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