Simple Income-Boosting Tactics From a Top-Earning Gym Owner

We give away gold from the best gym owners in the world every single week, and you can literally improve your business if you listen and take one action after the show. So dig in, please subscribe. Now, net owner benefit, its salary, dividends, and anything extra that your gym pays you. It's a key metric.

We track it over a three month period and we present one month so that we show sustainable numbers, not flash in the pan , one hit wonder, massive dividend payments. These are sustainable regular numbers. And a March leaderboard went from 16,000 to 38,000 us . Darren Thornton is the owner of Defy Functional Fitness in Toronto. He's been on the show before. He's back because he made our leaderboard for March.

And we're gonna dig into his numbers so he can tell you exactly how he did it. Darren , welcome from Toronto. How are you today?

So very, very quickly and early on I realized that I needed to get off the coaching floor. Obviously we were also cleaning, as you mentioned, scrubbing toilets. We were doing all of these jobs and I , I just realized that, you know, I actually quickly started to detest coaching purely because it took me away from doing the things that I knew my business needed to grow. Right?

So the goal really was can I make myself not needed in this business and how do I go about that? And I don't think it's totally doable from a hundred percent you, you still have to perform these high value roles that we're talking about, you know, and that's really, you know, being a CEO of a business.

And if I introduce myself as Oh, I'm a CEO of Defy Wellness, I think that would, people would have a , a different perspective than, oh, I'm a gym owner. Mm-Hmm.

So it was really just starting the process of how can we keep hiring good people, which is so key to this, but I've also done it earlier than I probably, my metrics look like I could have done, right? So I would sacrifice some growth to make sure we get the right person.

Then when we find the right person or if the right person comes along at different points, I would try to get them in the business as quick as possible and then really build, build things for them , um, because it's kind of hard to do the other way around. Right.

Um, but if you have six people doing those things at the same time, then that limit becomes a lot bigger and it allows, you know, everybody to get, you know what Chris Cooper talks about a lot, let's build that pie nice and big so everyone can have a nice big slice of it. Right?

Um , but in terms of some of the skills, you know, understanding how to hire people, you know, getting caught up in I don't know how to do this. So, you know, paralysis by analysis kind of thing. And you know, that's where, you know, two brainin comes in where you have a mentor and you can kind of just bounce those ideas off, speak to people who've done things in the past.

There's a ton of data within two brain that we can always look at and see, which is really good ways to go. Uh , so I think utilizing, you know, a little bit what I think is a bit of an entrepreneurial spirit that I think you can definitely kindle it, but it helps if you've got it inside you.

And then also just looking at what other people have done , uh, bouncing ideas off people and taking some of the industry best practices to get the best result.

So if I can pay a cleaner, 20, 30 bucks an hour, whatever that that number is in your particular area, then how can I make, you know, two or three times that in the next hour is that cold calling people, calling hot leads, getting no sweat intros in at , at some points that was delivered a personal training session because that was a better use of my time than cleaning the gym.

And then as you just keep ascending up the ladder and you can keep finding, as we always go back to getting good people, then you can look at what are the next things.

So I might spend an hour writing a blog post, which, you know, doesn't necessarily give a , a direct ROI in that moment, but doing that for the last five years, every single week or two times a week or whatever, now we can start to see that trickling down. So kind of thinking about these further down the line, what's gonna build the brand?

What's gonna get our name out there and trying to do those roles as opposed to the ones that I can, you know, hire people for.

Log, how many hours that you, you spend in each role . Then from there, you're just gonna sign a dollar dollar value, a fair market replacement cost for those, for those hours. So like cleaner, I spend five hours a week as a cleaner, I'm gonna pay a cleaner $20 an hour, and my replacement cost then is going to be 200 bucks or whatever it was. Now you freed up 20 hours or whatever the number is in those 20 hours.

Can you find the way to invest your time and make more than you're paying the cleaner so that you have some profit? Yes, you can. And the Darren just said it, if I clean and I take an hour and I pay someone $20 to clean for me, I sell that hour at $75 for personal training, I now have a profit of $55, right? I'm ahead. That's the principle. And you can apply this all throughout your business.

It goes from coaching, programming, general managing, all of a sudden you're a CEO where you might work four hours a month overseeing your business and making about 30 grand from that business. That's what our top gym owners are doing. So if you take action on this right now, I won't be mad if you click outta the shelf because that's exactly what Darren did and it does work. Darren , I'm gonna ask you this.

So now that we've talked about how you found the time to work on average revenue per member know , what did you do to increase it? Because it's great to say, oh , I'd like to drive up my average revenue per member. What are the exact tactics you used to get your number way up high?

So that's one-on-one personal training I

Now when it comes to fitness, there might be a point where they get to, you know, a certain expertise, certain level, if you will, and the group program then makes more sense, right? And they can do that from a comradery standpoint , have people to work out with that kind of stuff. So primarily we work on the personal training, which is obviously a , you know, a higher cost service than group training.

We have nutrition coaching , uh, which is, you know, we also do that very high level , very one-to-one very specific. We're fortunate, my wife is a family physician who's also our nutrition coach. So in terms of expertise in that realm, you know, there's not very much that you can get better. So we can charge a premium on that because we're giving premium service. We also deliver specialty courses.

So, you know, I think in the early days of CrossFit gyms, you have mobility weightlifting, group classes, gymnastics classes, and everything's included in this umbrella membership of unlimited CrossFit, right? The problem is, is not everybody wants mobility. Not everybody wants weightlifting. Not everybody wants this.

So what we quickly did is realize that like let's give everybody what they want, which is group training predominantly for us. We're not a CrossFit gym, but we do strength and addition training. And then if you want to do weightlifting or you want to do gymnastics, then we can do specialty coach courses there, which we can then obviously charge for because the people who want it need it and they value it.

Could that client move faster towards the goal if that person worked one-on-one with you, of course. Is that one-on-one service worth more ? Yes. So your first step might be to just say to a group class member, dude, I know you're struggling with muscle ups . If you book a one-on-one session with me, I think we can make some huge progress.

Cool. He says, yes, you tack on $75, you now have created a group class membership plus an additional one-on-one session that's called a hybrid membership in many circles. You can now market this thing and say, I'm selling one extra session personal training per month with your group membership. Your a RM goes up. I've seen it in gyms . The A RM usually boosts from like say 160 to like 240, which is a huge, huge deal.

And then the other thing that you might start looking at is your entire model for your business, just like Darren has and says, you know what, I'm gonna focus on personal training, nutrition. Those are both super, super valuable services and some group and group is the discount offering in that there's nothing wrong with it, but it's not as fast, it's not gonna get results as fast as the other other two combined.

So look at how you can solve problems for clients, put together packages in place so that they do it very quickly and you're gonna make more money on that. That's your second exercise. Darren , I got this one for you. Tell us a little bit about your business. You've given us some, a few things about what you're focused on. You obviously know exactly who , what you're selling to, who, what else, what have you got?

How much space, how many staff members? Give us the 4 1 1 on your business in Toronto.

And something that I've done to be able to offer that professional service long term is we only hire full-time coaches. Okay ? So we don't have , we've never had part-time on staff. Um, and I kind of mentioned that earlier .

We've kind of slowed growth down a little bit till we find that next full-time person because , um, just from a consistency point of view, from a continuity point of view, making sure everyone understands our SOPs, everything like that, the full-timer, in my opinion, he helps to deliver that higher level of service. Right.

Um, I also have a CSM client success manager who works remotely and she really probably one of the biggest things when we brought her on was one of the biggest sort of boosts in the business because she deals with every email of mine prior to me logging onto my emails.

'cause you know, the, the, the brain sometimes going ahead of me, but if I can, she can put out all of those things that I don't need to touch before I get there, which just means that my brain's not full with all the different fires and whatever. And then if there's anything that's out of the ordinary, maybe we don't have an SOP for it or whatever it is, that can then get pushed up to me.

Um, and this is something that was like a dam Martel principle that I adopted pretty early when he spoke to us, I think on one of the summits , uh, potentially mm-Hmm . . So, and obviously from his book and everything, but that one has , has been really key. And then , um, yeah, so that's the business five full-time coaches. One is our general manager. We have a CA client success manager as well who is remote.

And then , um, our main sort of avatar is, you know, the , we have , we're , we're in a really good family neighborhood, so we, our avatar is really the family, right? Mm-Hmm . , it's not a particular one person. Uh , it tends to work that we, we, we initially get the, the , the wife, the husband then joins and then the kids in the kids program, right?

So we end up with pretty good 360 coverage of the local families, which was one of the reasons we actually put ourselves here.

CSM, this is another huge point. Client success manager takes care of retention and does all sorts of stuff to run the business better and keep clients longer. If you keep clients longer, your revenue goes up and you make more as a gym owner. Client success managers are important roles, but they don't need to be paid a hundred dollars an hour.

You can find them for very reasonable prices and you can give them a list of tasks to do. Dan Martell at the summit said something like this, I believe it was 80% done by someone else is a hundred percent effing awesome. Of course he used the actual f word there, but I'll leave it out here for the podcast. Delegate some stuff. Create an SOP , give it away. You don't have to answer every email.

Some of 'em are just lame. And if it's just like getting back to me and saying, yes, I can be on your podcast. Your CSM can do that by looking at your calendar. Darren doesn't even have to check his email to get on the show. He just has to let his CSM do it, and then he has to show up on time. It works just like that. These are incredible principles. So you've got a bunch to work on already.

Uh, I wanna ask you this one, Darren , I think I know the answer, but I'm gonna ask anyway. How has your net owner benefit changed over time? Are we talking like steady growth? Are we talking like huge gains? How did it work?

And then, you know, we've had a really big boost in business, whether we've hired a couple of coaches who've, you know, managed to take the business to the next level. And then that allowed me to go up to, you know, quite a significant salary jump.

He wanted that time more than he needed the money. And so he did that and it worked out just fine for him. He still on the leaderboard making a really, really great wage, but he made that call. And that's the freedom that you have when your business is paying you a lot. You could choose, maybe I work four hours a month and I hire someone to do everything else. Maybe, you know, you have all this freedom.

So tell us, if you don't mind, share anything you're comfortable with. How do you pay yourself? Is it salary, dividends? What do you do? How does your structure work?

Um , definitely not , uh, qualified in that area, but if you can, you know, live through your business a little bit, you know, things that you are doing for the business that will benefit you and costs that you may have. If you were just a , an employee of a company, then obviously use that and that can help sort of boost your net on benefit as well.

But yeah, a little bit of all three is mm-hmm , kind of what we do , uh, have standard salaries and then , um, from there we can , uh, you know, take dividend injections and use it to, you know, invest or improve lifestyle.

Stuff like this, you know, you buy a package of pens, you're using 'em for the business, the business should pay for that, not you personally find out what the tax code allows. Stick to it of course, and then do it because you deserve the benefit of owning a business and you put in the hard work, you should get the reward for that.

So do check with an accountant if you have any questions, because mistakes can be made here. Now you talked about, you said something interesting where you said you had goal numbers and you tried to hit them. I wanna know how a mentor helps you do that. So we've all , Chris has said many times, Chris Cooper, our founder, you need a goal, you need a plan, and you need someone to hold you to the plan.

How did a mentor help you hit numbers that you wanted to hit?

You have more time to research these, you have more, you maybe have more capital to, you know, invest in these kind of things. But at the end of the day, what, what is gonna provide the next sort of best return as opposed to just following all these different directions? So somebody who keeps you accountable to that plan, right?

So having, you know, having an annual plan and working back from that, what you need to do each month, what you need to do each week, and really sticking on target and you know, looking at what does the long term look like?

What's, you know, so the , the idea of a vivid vision sort of three years down the line, once you've got those things on paper, unless there's some dramatic change in circumstances, like how can we stick to that as much as possible?

So like, what you need to learn and what you need to, the questions that you're asking are changing. So it's been a steady period.

I think, you know, for me the, the biggest, like, I wouldn't say light bulb moment for me personally, but the biggest thing to our business was figuring out how to market , which, you know, going through the two brain marketing course very early on in, in , uh, the program was like, you know, we, two and a half times our revenue in one month. Right? Did you really?

Because yeah, we did, because, you know, even though we're in a great location, and these weren't massive numbers back then, don't get me wrong , um, still, but like we two and a half times our revenue just from understanding how to put a Facebook ad out there, right? So, you know, that was one of the things where if we'd have not done that, then maybe we wouldn't have been here anymore, right?

'cause we didn't , I did not have a marketing plan. I did not understand what to do back then. Uh, uh . So yeah, that's probably one of the biggest, like, okay, this is where we need to go. We need to have these plans in place to bring in members, right?

We had a very rudimentary business plan, which was like, what's the minimum amount of members we can gain each month and show the bank that we can make money so that we can get a loan, right? But in reality, like there was a lot more hidden costs than I understood. Um , so, you know, we needed to grow a lot quicker than that. And yeah, so that was one.

But you know, in terms of having a mentor, the relationship with a mentor is just, it's evolving constantly. There's always new questions that are asking. There's always different roles that, you know, my role evolves into. Um , so there's always different answers that are needed.

And like, I would rather as a business owner, see incremental, steady gains all the way up the chain than have one big jump and then be like, I don't, I don't know what to do now because I just gutted my business with paid in full discounts or, or something like that. So I love the idea of steady incremental gains and the idea of this is next, this is next, this is next.

And it's a constant , constant building of momentum to the point even where, you know, Darren , you're at what we call our tinker level for listeners, that's our upper level gym owners. They now have freedom of time and money. They can figure out what else they wanna do. It might be open another business, it might be start something completely different or a second gym. They could do whatever they want.

So what do they do? And we have mentors that help them get at that level too, because the mistakes are als are more costly at this level. The rewards are greater, but the mistakes are also very costly. So we have mentorship all the way through from the beginning start of gym all the way through to elite level gym ownership. So, Darren , we're gonna shut this guy down.

I wanna ask you for advice for someone who's out there. So there's a gym owner out there listening right now who isn't earning as much as they want from a gym. What is it? Step one, to increasing their net owner benefit. When they hit stop on this podcast,

Because if you don't know the numbers, then you're, you're going in blindly, right ? You're not, you're not aiming for anything. So if you figure out, okay, I , I can only get a hundred members 'cause I'm in a small town, or whatever that is, how much do you need to charge for that to, to enable you? And then what value can you provide for that amount of money that you need to charge?

So if it comes out, you need to charge $400 a month. Okay , that seems quite an quite a large number for, you know, standard CrossFit gym. But how can you provide maximum value to enable you to charge that and then work backwards from there. That comes from an annual plan, which you know, is a really good resource in the, in the two brain toolkit , which allows you to plug in those numbers.

How much do you wanna earn, what do you wanna spend on education? All those kind of things. And then it gives you your monthly sort of revenue targets. And then you can work backwards and plug in , are you gonna do retail order? Are you gonna do everything? But for me, step one is just figure out what do you need to earn,

So you're going to need to work on some numbers, an invitation for you. If you wanna start looking at these numbers and figuring out how you might improve them, book a call. Just link in the show notes. You can talk to someone who's going to talk to you about your business and explain how a mentor can help you to get from where you are, what your goal is.

And you might not even know what your goal is, but you can talk about it on that call. Darren , I wanna thank you so much for being here today. This is, you know, I hope I get to talk to you in a year , uh, because every time I talk to you, I learn something new. So thank you so much for your time.

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