¶ Guided Access in Gym Operations Transition
Joe and Alessandra, welcome to run a profitable gym.
Hey , thank you for having us, Chris. Hello.
Yeah, it's so awesome to have you guys. I mean, I get to hang out with you guys in person at ticker meetups and summit and stuff, but , uh, you know, our, our audience doesn't know you yet. And you know , just as a , a funny story, the first time I ever met Joe, I was down at CrossFit mass and we were doing this f on bad workout. And part of the, the workout was you had like a C P R dummy.
Yep . Yeah. Rescue Randy. Yeah, rescue
Randy. That's it. And so one of the stations was like, you had to backward carry Ru rescue, Randy, I don't know, through this kind of shuttle run. And I have never wanted to throw up after a CrossFit workout more in my life than frigging rescue Randy.
Yeah, yeah. You did it right. If you , if you felt like that .
Alright , well guys, I'd love to get into, and thank you so much for generously offering to share this story is what brought you to the point of doing guided access in your gym? What were you doing right before and what kinda like triggered the transition? And then we'll get into the specifics of what it is later.
Yeah, so real quick, we, we were doing sort of the typical CrossFit thing, pre pandemic. You know, we had, we had group classes. That was our, that was our main offering. We did privates, we did specialty classes, you know, the two brain kind of model. But one of the specialty offerings we had was individual design.
So if someone didn't really fit into a group class model, they had a condition that didn't allow them to participate, or they had a goal that was really specialized, we'd spin them off into this individual design model.
Yep . Um,
When the pandemic hit, the government said, Hey, everybody, go home. Right? And that wasn't cool. So we took our entire client base, privates and group clients and we put them all into the piece of software called True Coach . And we started program programming for them remotely. Right. Based on what they had at home individually.
And then when we're allowed to reopen, we could, we continued that, we continued that and we , we never really let up on that.
That's really interesting. And we did the same, but when we came back, we tried to bring everybody back to the original kind of group class model. And there were a number of reasons why that just didn't happen. But for you guys, the problem actually got compounded a little bit more. So you brought people back.
Yep .
And then staffing.
Right. So it was just the two of us. Um , when we initially brought people back , uh, you can only have so many people in the building. Uh , so, you know, we divided the gym up into separate zones and they, everybody came in and would work out in their own zone and there'd be a coach on the floor. So she would take the mornings some days and I would take the evenings.
And so you'd still get coached even though you're all doing the individual programming. But there was more flexibility there , uh, in , in that. And yeah, so that's, that's how we managed that for a while . And then recently we came across the staffing issue again. Uh, 'cause we had built some staff back up and, and then things have changed.
And so we've introduced something called enhanced Access where the clients can come in on , in off hours, non coached hours and utilize the gym then.
That's awesome. And , uh, Aandra shared her schedule with me yesterday. We're actually gonna walk through it, but what I'd like you to do is just kind of describe this. So I'm a new client walking in, like, what is your program? What are you selling me?
Well, we do a formal consult , um, sit down with Chris and ask you your past experience , um, any goals that you have near or far. We also ask you if you have any previous injuries, right? So we get a full scope of who you are coming in. Um , we go over different types of programs that might fit your goals and your budget. So the predominant buckets are individual design or private training to some extent.
Then what happens is, if you choose the individual design route, we go through that whole process, right? We set up your three one-on-one sessions that we'll go through. Um, we'll also walk you around the gym and make sure you kind of get an idea of where you're going to be, where you're going to park, different things like that.
And then once you're ready to get going, we just, you know, set you up on the backend and give you some , uh, little trinkets, or not trinkets, but drips in your email of what to expect. And , uh, we , we each show for your first day and we, we have at it on those three, one-on-one sessions to see how you move and what areas we can improve first to help you towards your goals.
Okay. And then the next step is you write me a program and I come in and do the program. How's that done?
Yep . So that's delivered to you on your phone. We have software, you get video previews, you see your whole workup for the week on Sundays with video previews and instructions from your coach. You are able to talk to your coach through the software.
So if your schedule doesn't line up with your coaches, you're in there with another coach, you're in there during the extended access time, you can still communicate verbally and visually with that coach. Right. You record your data so they can track your progress through the software to make sure you're , you are making progress and they don't, we don't need to pivot.
So yeah, the , the software is , is really been great for us to act as a lever, right? It lets us be there more without actually being physically present. Right. We can, we can project our coaching across broader times.
Okay. So when I show up to do my program and I'm a client, is there any coaching going on while I'm there?
Uh , yeah. So , uh, what we did was we old , we used the old Chris Cooper model of, we've done it twice now since the pandemic. We opened for two weeks at a time, seven in seven 30 in the morning to about seven at night. And we just see when people come in and we heat map it.
And so we've determined when the times that are most popular for people to come in and we put coaches on the floor during those hours, they're coached floor hours. So, you know, we might have a half dozen people on the floor at a time doing each doing their own thing. And the coach is just working the floor like a party going around, making, making suggestions, tweaking things a little bit.
So there's probably about 20, 25 coached floor hours spread across the week. And then there's other times that the staff is in, but they're teaching privates and you're welcome to come in at those times. But the, but again, the latest addition to the program, I , was it March? End of March we added it?
Yes.
Um, is there's electronic access to the door , uh, to the gym. So you can use your phone, you can access the gym, and then you can come in and, and get your work done from six in the morning to about nine at night too . And those are not necessarily coached hours. Right. But there's the , the flexibility.
So you have kind of three phases of coming in, coached hours about 20, 25 of those study hall hours where there's a coach in the building, but they're not necessarily dedicated to being on the floor. Right. They can still help out a little bit, but they're not really dedicated to be on the floor. And then there's this enhanced access where it's kind of wide open for you to come in and get your work done.
Okay. Now when we were talking about this yesterday, we were talking about the mistakes that some gyms are making and just offering 24 7 access because, you know, it's, the tech makes it really, really easy. And the problem is that that kind of devalues your coaching product. You guys have a very interesting bridge here. So let's, let's talk about access and how that actually works.
Like you're not open 24 hours a day with my phone app, right? Correct. Yeah,
That's correct. Um, we decided on six to nine based around the fact that most people should be asleep from 10 10 at night till about six in the morning. Right. If you're getting up at five o'clock or you're getting into the gym at five o'clock, there's a good chance you're not getting a good night's sleep on the regular. Right .
And since the main thrust of our clients and our programming is health and longevity right now. Yeah. We want you to be asleep. We, we, when we switched to that model after the pandemic, we actually saw injury rates go down. We dropped the five 30 class 'cause we knew it wasn't sustainable and we forced rest days on people too.
We, we were running initially we were only ran three days a week for the first few weeks and yeah. Injury went down. Wow. Injury rates went down and PRS went up.
Wow.
Okay. That we're coming back to that. That's, that's news. Yeah . Uh , Alessandra, maybe you can walk me through like a daily schedule at the gym. So at 6:00 AM I'm a client, I can go in, but is there a coach in the building?
No. So from 6:00 AM to about seven 15, you're by yourself. And then I show up around like today's Wednesday, I showed up around seven 15 to do my opening tasks. You know, some might have waited to ask me questions, but I'm getting myself set up from more people to then come in. Um, so for example, this morning we had , uh, six or seven people already in there, which was great. Yeah . Being led through their app.
But this morning we were open seven 30 to one and again, people float in. There are coached hours, there's study hall hours, some questions, but people mostly know what to do.
So during the coached hours mm-hmm.
,
When are those and how many?
So today the coached hours were seven 30 to eight 30. I did a couple privates in between because we found that eight 30 to about 1130 sparse. Some people come in, people with different schedules. So I completed three privates during that time and then coached hours again from 1130 to one.
Really Cool. And then Joe, you go in in the afternoon?
Yep . Yeah, I'll open up around, well today's Wednesday I'll, I'll roll in there around 4, 4 30 for study hall and then I'll be on the floor about five 30 to seven coaching people actively.
So study hall, you are in the building but you're not on the floor coaching, right? Correct. So you , what are you doing during study hall time?
Uh, it could be anything. It could be privates like she did earlier today. Um, I could be taking consults either Zoom or , um, via the phone or just be on a Zoom meeting. Like there's a regular Tinker zoom meeting right from four to five. Yeah . There it is. So that's, that's what I'll be doing today if I, if I can manage it right. Or
Sales or
Yeah. Sales. Yeah. And basically anything but I'm in the building, so if there's an emergency or someone doesn't have access yet, 'cause we don't just give people access to the gym when they sign up. They have to, usually we have a , we have a 12 week , uh, initiation process, we call it the jumpstart.
And somewhere in there, usually by the end we're like, Hey Chris is, Chris is okay to work out by himself so he can, we can give him the electronic access, he can execute these workouts safely , uh, on his own. We still encourage you to come to the coached hours 'cause it is a coach facility, right. We want to have you in front of you, we want to help you.
But we understand that not everybody's schedule is perfectly regimented and, and you're gonna need more flexibility. And that's what the enhanced access really is. It's more flexibility. It means we don't have to worry about shutting down on a holiday because you can still come in if you need to get your workout done.
We can take a long weekend once in a while with just two of us running the gym and we can take vacations every now and again, maybe someday
. That's amazing. Yeah . Congrats
¶ Gym Model and Programming Analysis
guys. I mean, I I really think like you've, you've got a working model here. So in my mind the client passes through a few stages. First they're doing three privates with you minimum, right?
Correct. Then
It's kind of up till the three month mark. They're still in Jumpstart. So they can only come to coached hours in the gym.
Correct. Yep . And
Then after that, as long as they're moving well, they have, you know, access , uh, so they can start their work at any time between six and 9:00 PM and also some weekend times. Yep .
Correct.
Wonderful. Yeah.
Nailed it.
Okay, well, hey, yeah, that's all I've been thinking about since we talked about it 24 hours ago. So I'm, I'm glad that I've got a really good concept of it. So there's a couple of of things that I , I think gym owners would probably be asking about this model. Number one, like, it seems like you guys went to this model in phases.
You had regular group classes, then you were shut down, you pivoted to one-on-one or Id and when you came out, everybody was already on id so they knew what they were doing. Do you think it would be a lot harder to pivot from I'm just running a group class model with some personal training right now to this model enhanced access?
Yeah, a hundred percent. Because there's a mind shift when someone comes in and they're like, I'm working out in a group and I'm doing what everybody else is doing. So we got lucky is not a way I would ever describe the pandemic, but it um, it was, it was a good time to do it 'cause everyone understood that we were changing these things to benefit them and to , to keep their fitness uninterrupted.
And then once that was established and we saw the benefit to giving someone, instead of having someone come in five or six days a week, 'cause they have workouts on the schedule and they wanted to get the most out of their membership, they, they appreciated the fact that, hey, if I , I can work out hard on Monday, Wednesday, Friday, take the rest of the days off or be active outside the gym, walk, do a little yoga
or something like that. Get some sleeping , get some food prep in and actually get better results, right? I don't have to come to the 5:30 AM class five days a week to get the results I want and smash the heck outta myself.
Right? Yeah. That , that is a really common problem. And I think a lot of gym owners are actually at odds because they hear like, wow , the , the more times your clients show up, the longer they stick around. But deep down they know that high intensity, you know, five days a week is not gonna be a long time sustainable solution for the client.
I think you guys are maybe more attuned to that than, than any, than a lot of people. But you're also like better , uh, at analyzing human movement than most people and also better at programming than most people. Where's that background come from?
So I have done a lot of classes with Quin , which is actually a local Quin groups local, they're down in Rhode Island . And Oex had a lot of great classes on individual design and programming that I could take of , and, and they drew a lot from Quin as well. So a lot of that comes from there.
And we pair that up a lot with some of the, the CrossFit type , um, methodology as well, you know, the big compound lifts and that sort of thing. So it's, it is , it's really a, a big mishmash over the last 14 years or so of those techniques.
But it , but what we really do a lot of, and what Alessandra alluded to a little bit in the three privates is we test 35 points of performance when you first get on the floor and yeah, over those three privates, we pump it into a tool we've created. It's a spreadsheet, it color codes, everything. I was doing it in my head for years and I realized I needed to , to make it accessible to the staff.
But basically, you know, if, if you only can hold a hollow hold for 27 seconds, that's well under the threshold we want to see and that's gonna light up red and we gotta do more ab work for you. Right? Do your ankles flex enough? Do you know how to use your glutes shoulder health aerobic capacity, some VO two max stuff.
It all gets kind of , uh, put together and , and then the coach bases your workouts, you know , your programming around that, that data. And we retest that constantly because it's all, you're putting your workout data right into the software as you're going along during your workout. And we can look back at it and go, oh, Chris is making's a good progresser. Chris has stalled up for the last couple of weeks.
What's going on? Oh, he's, he's got all kinds of meetings with the accountants and acquiring businesses or something like that. His stress level's super high. We gotta take him off of his two high intensity workouts and give him extra recovery workouts. Right. So that's the, that's the game we've been playing for the last three years. It's three,
Three years
Now. It's crazy.
Wow. Last week the only weird H R V score that I had was mm-hmm . When a , uh, cube van backed into a liquor store in a building that I own.
Oh my God. That
Actually hurt my sleep. Yeah. Anyway, so you know, it's, it's amazing that you guys track this because I know even a lot of gyms are interested in this type of data and their clients will go out and they'll buy a whoop or they'll, you know , a Garmin Phoenix or whatever, right ?
And
Then the coach is like, how do I get that data from them and what do I even do with it? So it's amazing that you guys are doing it and I'm sure that's part of the reason this program works.
Yep , absolutely.
But I , you know, this is really a business podcast and so Alessandra, maybe you can just walk me through like when you are doing an hour on the floor and you've got a dozen people in there, like that picture you sent me of 9:30 AM yesterday, like what are you actually doing as the coach?
So one of the first things I do is I check who is actually R S V Ped and open up their true coach programming. Um, so I can just look it over real quick and an understanding of what they're
¶ Tech & Personal Coaching in Fitness
doing. And then also because I have relationships with these people, I know sort of where they're at and as they come in the door I greet them , ask 'em how things are going, right. If there's any weird things that have happened in the past 24 hours, they get moved ,
Man , hitting the
Liquor storm , right ? you man . Um , you know, so it's sort of, again, you're greeting everybody. You're making sure everybody's in good spirits or you know what , analyzing if maybe already I need to make some adjustments to their program. And Joe and I work closely enough that I can make adjustments based on maybe his thought process as well.
So after everybody's moving, you're moving around to each person making sure that whether they've been with us for 11 years or they're within their first 90 days with us, they're still getting the same amount of attention. There's always something to work on. So just making sure you don't spend too much time with maybe like somebody who has a million questions.
We always try to encourage them to look at their programming in advance, ask questions to their coach or if they don't understand something to clarify. But I'm there also to give a quick answer to that question as well. So making sure that everybody gets the time and attention that they need.
Yeah . Really cool. I mean, honestly that's what I just experienced in our noon group during the lifting portion only, you know, the coaches are told you go around and give everybody about 60 to 90 seconds of one-on-one attention, give them one cue to improve. We were doing Split Jerk today and that's what happened.
And it sounds like you're doing that, but you know, through the entire hour, it honestly sounds like a lot of fun.
It's fun , it is fun. 'cause you get to really connect with people. It's very , um, relaxed as opposed to, you know, the group that you used to run where it was like, okay, do this 'cause stuff is moving so fast, this is more like, go over how like, is this feeling funny because of that thing you told me about in the beginning Right. Of, of your sessions.
So we kind of get to open up a little bit more about their movement and what's going on.
It's more social too because way more's not , you're not, you're not herding 15 cats at once, right? Yeah.
You're ,
It's almost like you're working the room like a party, right? Where you're, you're just moving around to person to person and just checking in on 'em . It doesn't drain you like, like a group class does .
Yeah . And I , I imagine a lot of the distractions aren't there either. I mean, it used to drive me absolutely bananas when somebody walked in seven minutes late. I mean, it shouldn't throw me off, but it would, you know. Yeah . So , yeah . And , and I'm sure you've got people coming and going and starting and ending at all different times. Right .
Okay.
So next question. What do you guys charge? Like what is your kind of base membership for this guided access or enhanced access program?
Yeah, so we're starting right now people at 2 75 a month to come in six days a week, depending if they wanna work with a specific coach. We have tiered coaches prices out before, but right now it's just the two of us and so we're sticking with that for right now. Yeah.
And it wouldn't go lower than that, right? Like it would only go higher
If it was a brand, brand new coach and you were trying to build their base up. I might take 'em to 2 65 a month, but I wouldn't go any lower than that in the past . Right . Yeah.
How long do you think you can run this model? I mean, you know, years ago I was talking with uh, Greg Glassman and Dale Saron and we were talking about like why the affiliate model was set up the way it is and the affiliate fees are so low. And he said it's because it's an owner operator model and it was always supposed to be one passionate coach, a couple of part-timers and, and that's all they're doing.
And of course, you know, the realities of business dictate that usually we need more staff than that. But it , it actually seems like you guys are actually leveraging technology instead of leveraging human bodies.
Right? That's actually exactly what we're doing. It's , he
Hasn't , he hasn't written on his paper like
I wrote notes and we're tr we're using technology as a , as a, as a lever like, or a force multiplier, right? So media, so we , we shoot videos or we find videos to, to deliver like, hey, this is the movement pattern I want you to be familiar with for the day, right? And communicating with that, using the electronic access. How long can we do this is a really interesting question.
And, and that was one I asked myself when we were allowed to reopen from the pandemic and that's part of the reason we dialed the hours, hours back a little bit. 'cause it's not sustainable to ask somebody to open a gym up five 30 in the morning for three years in a row, five days.
There sure isn't
Right. It's not healthy for the coach, it's not really healthy for the clients either. You know, once in a while you gotta pop in there early. I get it. But you really should be sleeping until six 6:00 AM for, for health and longevity, right? We know that dementia , dementia numbers go way, way up when you're not getting seven hours of sleep a night or, or more.
So it's kind of built to be run for the long term , right? Wow .
That's the way Yeah, it hopefully we , you know, the hiring thing will change sometimes soon and we can get some help in, you know, but we could be, I think we could do it for a long time because we're able with , with the electronic access to the door, we can go away, like I said for a long weekend, the 4th of July, tanker trips, tanker meetups, and we can let the gym sort of run itself for a few days and and
still have a life. And we did a wedding too. Yeah .
And we shut
Down for an extra day and a half. So we've done it a few times since March and we've had zero problems, which is good. You
Know what's amazing is if anybody who's listening to this other than a gym owner, they'd be like, big deal. You can take a day off. Gym owners are like, this is revolutionary . Yeah . What a wedding. You guys went to a wedding, tell me more. Right ? And , and so that's, that's really remarkable.
Joe, yesterday you , you were talking about like a , a quote from Naval and he was talking about like leveraging humans or leveraging, what was it?
So he has got four ways you can was it create wealth? It's it's in the , the almanac, right? You can either, you can either leverage people, which is, you know, have employees and lead them, right? Which is the most complicated. Um , you can leverage , uh, capital real estate or he says programming or media. And I just think of that as any technology that you can sort of set up and , and go on your own, right?
Not talking about ai, but AI probably works in there too. Yeah.
Because
You can , you can, you could say, hey, do these things, but you still have to coach behind it, right? Just 'cause there's a lever doesn't mean there , it's not somebody on the other end literally working the lever and directing, putting the direction in . So that's what I was looking at when things kinda weren't really working out for us, hiring people the last year or so.
And I said, let's, let's run in that direction.
So if you guys were pivoting to this today, four or five months after you did, you know, is there anything that you would do differently from the way that you started doing this in March?
Oh , what will
We do ? Marketing sooner?
Yeah, yeah, good point. We gotta , we gotta talk to more people about the fact that we have this enhanced access and everything's customized and 'cause we're still a CrossFit but we're doing more than that now. So that's, that's probably the toughest thing, right?
Because , because I can in individualize for you, you could be doing strong man , you could be doing just bodybuilding stuff depending on your goals, you know, 'cause we're, we're programming individually for everyone. So yeah, that would probably be the same marketing. Yeah,
I think there are a lot of CrossFit boxes jumping into the access game. The challenge though is that they're not making more money on it and in fact it's probably costing them money because as clients just get access, they come to get less coaching and then it's like, wow , I could get cheaper access somewhere else. Right? It's not actually their service.
What I like about this is it it compliments your coaching service. You know, it serves your, your coaching instead of just kind of selling access and competing with Gold's Jim.
A a hundred percent. 'cause if you just start selling access, you can, you can go find someone that's gonna push you a template for $20 for a program that's perfectly good. It's not built for Chris , it's not built for Alessandra. But you can get away with that for a while, right? But you're not getting feedback, you're not getting , uh, uh, you know, course corrections on the programming as you're going along, right?
To keep you progressing and install and keep , uh, plateaus from happening.
Yeah, high intensity training is really commoditized. You can buy it anywhere for like you said, 20 bucks a month. And some of it's really, really good for that price. Like, you're not gonna compete on programming anymore unless it's absolutely tailored and, and done this way. So guys, really love this model. Thanks a lot.
Um, I know that your a r m is actually much higher than that 2 75 because some people buy privates on top of ID or instead of Id congrats and I, I hope that you guys can find like one staff person so that you can take a month off , uh, . But I'm, I'm really happy to know that if you don't, you're okay. You're good. Thank
You. Thank you . Thank you very much Chris. Alright
Guys, thanks so much for, for generously sharing all these details with people. I think it's gonna open up a lot of eyes. So guys, Joe and Alessandra were very generous in sharing with you how their guided access model works.
Like a lot of us, they're struggling to get staff right now and when their last staff person took their full-time job and and left the gym, Joe and Alessandra said, how can we do this by ourselves? And so now I wanna actually show you with mostly, you know, hypothetical numbers, how this could actually work for you. I want to give you an actual p and l. I don't just want you to think, oh that's an interesting idea.
I want you to see the actual math behind how this model could work in your gym. So I'm gonna bring up our model p and l that we share with owners in two brain to walk them through tests and how like a model could work for them. Now this is not a lesson on how to read a p
¶ Profitability and Growth of Gym Business
and l, I just wanna highlight a couple of things here because I want you to see where I've used Joan Alessandra's numbers and where I've used data from industry-wide averages. So first off, you heard them say that their average price is 297 bucks per person per month.
And expenses, I took an industry average because I don't know their actual expenses retention rate, I took an industry average, but I'm betting their retention rate is actually higher. Uh , ramp up average price I took an industry average be , but I'm betting their ex , theirs is actually higher than this.
They have a three session on ramp that they spoke about in the interview and then I started them with a salary of $5,500 a month. It's probably higher, but what I want you to see here is how the profit line changes. So they're guaranteed the salary every month, but they also take home like the extra too. So this net income here that's profit and net owner benefit is this total of that salary plus profit. Okay?
So here we go. First of all, we wanna know how many clients does it take for them to break even? And so because we're not changing the salary, like I don't want them to work for nothing. So if they're not getting paid a salary from their gym, it's not a successful gym, they're not actually breaking even. So let's start with this.
I put in 59 clients here because I know that's pretty ballpark to what they would actually need to make this gym viable and pay themselves at least the salary of 5,500 a month even if there's no profit. So if I drop this down to 55 clients, okay, and I keep their average membership price the same, I don't sell any personal training and nothing else, what I'll find is that they're losing about 461 bucks a month.
So that tells me that to make this viable with no other personal training, it's just selling guided access for 2 97 a month. They need two more clients than that. So they need about 57. So in 57 clients paying 2 97 a month, they can pay themselves a salary of $5,500 and really have nothing left over . Okay? So this is a viable business. This is a business that is treading water.
Quick sidebar here, if your business is breaking even but not paying you anything, it is not a viable business because you're volunteering and you can't do that forever. You will personally run outta money. So 5,500 bucks is not enough for them to make a living here, but it's like the barely uh , acceptable minimum.
What happens though to our bottom line when new clients come in, this is what's interesting about the guided access model to me. So let's say they get three new clients, they just walk in off the street, they don't normally get new clients, but here they are and they all sign up, right? So now they've all gone through on-ramp or whatever, but that's not gonna be reflected in our bottom line for that month.
We just want recurring. So now I look at this and it's like, okay, not only are they making their 5,500 a month in salary, they're also making $987 a month in profit. Aha . So that actually boosts us up quite a bit to $77,000 take home , which is about double the industry average with 57 , uh, 60 clients, right? Pretty good because none of their, none of that money is going out to staff.
They're covering their expenses and once those expenses are covered, like they're good, right? So next what happens if we bring that number up to 75 clients, okay? Clients are the same. They're not selling any additional services, it's just the guided access membership.
We're not counting on new clients coming in and paying for on-ramp or selling personal training or anything like that, but our expenses also don't go up and our coaching needs don't go up because you know, we're still showing up the same number of times of the day. We don't need help right now. Suddenly our profitability goes through the roof.
Like just adding 15 clients takes our profitability from around 77,000 a year to 129,000 a year. Okay? So that's interesting just adding 15 clients. So hypothetically, and again, like the only numbers that actually came from Joe and Alessandra here are what they charge per month. And I know their a R M is 2 97 with 75 clients, retention rate of 95% and this should be higher.
These guys could make $129,962 take home per year, right? And again, there's two of them, but like their partners in life and in business, they live together. So they share some costs there and they're not paying any coaches, right? The other interesting thing too is that while they are working most days, they're not working weekends, they can take a long weekend if they want to, to come to our tinker meetups.
They can take a vacation if they want to, and you know, it's not costing them anything to do that. Let's, let's take this a different way. Okay? So now , um, let's say that we're, we're back to 60 clients, but we know they're gonna get maybe three new clients a month, okay? And I'm being super conservative here.
What that does is it means that's another $900 in on-ramp time because people are paying for those three sessions when they start. So that brings the average client revenue per month a r m up to three 12 now. Very interesting. And if our retention rate is still 95%, that means that our total client headcount is growing by at least two people per month. Well just doing that, okay ?
Bringing in three new people a month that brings their average income, their net owner benefit up to $83,000 per year. Okay ? That alone, just three clients a month on this model, alright ? So good. But what happens when they start selling personal training opportunities on top?
So, you know, you can come in at 9:00 AM your buddies are gonna be there, you've got your program, you're working out, it's kind of a group , group class feel, it's awesome. There's a coach circulating to correct your form, to tell you when to go up, when to go down, when to scale, when to change exercises, all of that is great. What happens if you want more one-on-one attention, then that program buys you.
What if you want to come in once a week and work one-on-one with Alessandra? Some people do that. So if what I'm doing is selling, you know , 10% of my clients want that, that's six people and they just wanna buy one more session per month at, I don't know , 70 bucks a session. Okay? Then that's , uh, 420 extra dollars right there. So that's secondary revenue. Six people, right?
Paying , buying one session for 70 bucks a month. Very conservative. What happens now? Well, you know, our income is up to 86,312, okay? So that's, that's super interesting. The other thing that happened here is that we put down a coach taking those, those one-on-one classes or those one-on-one sessions, but actually alessandra's doing that.
So all that money is now gonna go to them, and that's why we're now at $93,282 per year. Okay? So she's doing about, you know, seven PT sessions a month and it's bumping them up that much because again, like they don't have to pay another coach. What happens if they wanna take a two week vacation, they can't really take that much time off. They're gonna have to pay somebody to be there.
Well, we know that they're working about six hours a day and if they want to pay a coach even 25 bucks an hour times 30 hours a week, right? We can add that in here. So let's say that the average class rate is we're gonna pay 25 bucks an hour, okay ? And , uh, per week, we know that we just said we're gonna pay somebody 30 bucks a week. So what would happen if Joe and Alessandra said, you know what?
I'm tired of working six hours a day, five days a week, I wanna bring in a backup . Or, you know, we don't like feeling fragile . Like what if one of us gets sick or what if we wanna take a month off? What do we do? Well, they could bring in a part-time coach kind of a floater, right? So this is somebody who can spot movement flaws. They're not gonna write the programming for any clients.
They don't need advanced knowledge, but somebody who's like a CrossFit L one or, or even an L two is great. They don't have to do any class management. You're basically circling during study hall hours and saying, okay, let's correct your form a little bit. Let's add five pounds. Let's take five pounds off, you know, let's, let's switch that sandbag carry to a farmer's carry, you know, or whatever, right?
Let's scale you up, let's scale you down. That's basically what they're doing. They're, they're sharking. During those study hall hours, you could pay that person, you know, 30 hours a week times 30 bucks an hour, 900 bucks a week, right? That's a pretty good income for a coach. That does of course affect their bottom line.
However, you know, they can wait until they're at a comfortable income level and then add that expense in. So maybe it's like 3,600 bucks a month, okay ? And you say like, well, how many, how many clients do I need to actually get there? Well, if you wanted to keep this person full time , it would just be 3,600, you know, times 12 months, which is $43,200 per year.
And of course that would bring our net owner benefit down because now you've got staff expenses, but like, how many clients do I need to get to actually carry that person? Well, let's try it. Let's go to 75 clients with a 95% retention, three new clients coming in a month, doing a little bit of personal training. There we go, right? We're still at $102,206 per year.
Net owner benefit, we got one employee making about $43,000 per year. Maybe they're making more if they're also selling personal training too, but that's also driving revenue for the business. So, you know, I get to 75 clients, I can have a a staff person working 30 hours a week. What if I wanna make that person full-time? What if I want to pay them more than $50,000 per year?
Well, okay, let's do that math really quickly. So now still, you know, an average of like 30 bucks an hour, which by the way is way above the industry standard according to our data set . Also, according to hiring job sites like Glassdoor, 30 bucks an hour in the fitness industry, especially for 40 hours a week is really, really good. Okay, so
¶ Profitability and Business Model for Gym
now what are we actually paying here? Well, 40 hours a week, 30 bucks an hour, 1200 bucks a week, right? Times four, we make this 4,800 and we're gonna do that times 12 months, right? It's gonna be like a salary or whatever, $57,600 per year. Wonderful. Okay? But that cuts their Joe and Alessandra's net owner benefit back to 87. So how many clients do I actually have to get here?
Well, I'm just gonna go up another 15 and say 90 clients. Okay? So here we are at 90 clients. They've got a full-time staff person for $57,600. Their salary stays the same, but their profit is over 6,000 a month. So their net owner benefit is actually 139,929.
So, okay, big picture here using some of the metrics that we know from Joe and alessandra's, guided access program and metrics that we've drawn from the state of the industry for industry average to calculate our expenses and staff pay and stuff .
With 90 clients in a guided access program, gaining three new clients a month who pay 300 bucks for on-ramp before they get going, doing like two personal training sessions a week on top, having one full-time staff member making $57,600 per year, Joe and Alessandra could net owner benefit around $140,000. Now of course there are reason , there are pros and cons to this model, right?
90 clients means that every client who leaves is kind of a big deal. However, their retention is a little bit higher. Also, maybe you want to hire staff, maybe you wanna have a lot more coaches , or perhaps you wanna run semi-private or you don't want to do access to your gym or more than anything else, you're probably scared about charging that $297 per month for guided access, right?
These are things that you talk about with your mentor when you're making decisions, but these decisions should always come down to the math. What is gonna be most viable to you? And if you're an owner operator or you're struggling to get staff, and I get that, this might be a model that is worth considering.
Talk to your mentor, open up your own p and l, do the numbers for yourself before you make any decisions, but it's a viable model. I'm Chris Cooper, this is Run a Profitable gym . Thanks to Joe and Alessandra so much for walking us through this. And I hope that you can make your gym more profitable, help more people impact your community even more.