Want to Make $100k? Here Are 3 Gym Business Models That Work

Now, there are really infinite business models that can work in a Two Brain . We're a mentorship practice. We don't exist to force one model on you. We want you to build a gym that you love to run. What a mentor is going to do is help you actually understand your metrics so you don't fall prey to the people out there telling you that if you just have 300 members you're good.

Or if you just do 50 members at Semi-private, you're good. The reality is that you need to know your own metrics and you need to build a plan based off those metrics to be successful. That's what a mentor does with you. And one of the tools we use to do that is a profit and loss statement. A p and l, I'm gonna show you one now, if you're not used to looking at financial documents, don't worry.

It's really quick to be able to understand how this works and I'll be talking you through it slowly. My goal is to show you that almost any model can work if you have the right number of members paying the right membership rate and you're keeping them long enough and keeping your expenses in control. I'm not here to tell you that the big group model is dead or the big group model is the winner.

I'm definitely not here to tell you that one-on-one training is the answer or that you need to go all in on something else. What I am here to tell you is that you need to understand your numbers if you want to have control of your business and not fall prey to the people out there that want to sell you their model.

This is a model profit and loss statement and we share this with everybody in Two Brain and Mentors work to help gym owners understand this so that they can control their business forever. It's a standard accounting document. Your bookkeeper prepares this for you. If you haven't seen it yourself, your accountant needs to look at this at the end of the year and it's a very important tool.

When gyms come into two brainin quite often. Here's what we find now, I'm gonna use some some basic averages that we've taken from our state of the industry dataset. Every year we collect data from thousands of gyms around the world. We compile that into a big report for you called the State of the Industry, and we just give it away for freight . But what you do with that data is what's most important.

And so what you do with it is you use that to build a more successful gym model for you. I'm gonna give you a few examples of these. I'm gonna show you what a few different clients that two may have done. I'm going to start with their goal. Each one. In each case, their goal is to make a hundred thousand dollars net owner benefit from their gym. That's what their gym pays them.

They might take that as a salary, they might take that as profit, whatever. That's how much their gym pays them every year. That is the sign of a sustainable gym. It's not how many members you have, it's not how many coaches you employ. It's not whether you've got a 30 year lease or not. Your gym is sustainable if it is profitable. If you have a tiny little bit of profit, that's not sustainable.

Break even is not sustainable. You need to be able to make a good living and have your gym be anti-fragile enough that if something happens, like the rent goes up, you know it always does or some unforeseen expense happens. You know, a client smashes your glass door by accident. That always happens. You are not gonna go outta business if a coach leaves to open up their own gym and takes 10 clients.

You're not gonna go outta business if you know some other unforeseen thing happens, you can survive it. That's what we're after here. I also want you as a gym owner to be rewarded for the risk that you've taken for the service that you've dedicated yourself to and the lives that you've changed. And that's why we start off by uh , giving you a goal of making a hundred thousand dollars a year from your gym.

You deserve it. Let's start with this. So this is your basic p and l first from the state of the industry data, we know the average micro gym has about 122 clients paying on average about $119 a month. That's their kind of average rate. We know that they run about 32 classes a month and they pay a coach about 22 bucks an hour to run a class.

Now you can download our free guide, five Ways to Earn a hundred thousand dollars from your Gym. And you can see these broken down for you. And if you have your own p and l, you can play around with these numbers to fill it in for yourself. What this leads to though, this model is about $14,000 in monthly revenue. Okay ? Then if we break down your expenses, you'll see here's what's going out the door.

Here's what the staff is earning, not very much. And at the bottom here is net owner benefit. What the owner is actually keeping from the gym every year. Coaching fitness, doing what you love, saving lives, and making $28,000 a year. Hey, when you're 22 years old, unmarried and willing to sleep on a couch at the gym, dream come true.

But eventually you are going to want to have a family and you're gonna want to build a gym that's resilient to all those problems that I mentioned earlier. You're gonna want to employ people, you're gonna wanna make sure that you stick around and that you can weather the storms. And so we actually want you making more than that.

So, you know, when the average gym comes into two brain , sometimes they're making $0, sometimes they're losing money even. Um , sometimes they're making a hundred thousand dollars already and they wanna think about how they can grow. So the leavers that I'm gonna show you can work for all of these gyms and we can build a model around what you wanna build.

The most common model that's out there right now is, you know, like we wanna run a big group model. So when we talk to CrossFit gyms, when we talk to hit gyms, when we talk to bootcamps, even some franchises, often they come into two brains saying we just need more clients or we just need more leads. Well , let's look at how that affects your model as you add more clients.

And let's say that you can bring this client headcount up to 200. That's amazing. Congrats. Like that's a massive leap in clients, especially with a retention rate of 95%. That means that you're gaining 10 new clients a month because you are still losing about five. It means that , um, you're gonna have to add some classes, so you're gonna have to add some more expenses if you double the number of clients you have.

Yes, you're gonna fill the classes that aren't full right now, but you're also gonna have to add more. So let's just bring this up by 50% even though we nearly doubled the amount of clients that we have. So that brings us to about 48 classes a week. And then what that's gonna do is just add some coaching expenses. Okay?

Now hopefully you can do that without expanding your location, but the reality is, going from 119 clients to 200 might mean that you take on extra expenses here too. But let's just say that your marketing costs stay the same. Your lease stays the same, your coaches are still getting paid 22 bucks a class. And we go to the bottom here and we say, look at that. You've got a net owner benefit of $113,746. Okay?

Can you do it with 200 members? Yeah, of course you can, right? The challenge there is that your payroll is gonna go up, probably your expenses are going to go up, right? You're gonna need more space, you're gonna need more equipment. So let's factor those things in. First of all , uh, if you're a CrossFit gym, this affiliation number has just gone up. So we need to add that.

Second, if you've got more clients, you're gonna need more cleaning that's gonna go up. Your insurance is probably going to be going up from this as you add clients , uh, to get those clients, you probably had to do some marketing. I'm gonna say that we'll just keep this constant for now.

But the reality is that if you're not getting new clients in now and you want to get more clients, you're going to have to spend more time attention to money on marketing these other things. You know, you can, you can change 'em as you want to, but let's say that you add more space to accommodate more clients, well suddenly this goes up .

Then you've probably got, you know, if you're training more coaches, your certification costs go up, you know, and you're probably going to have something like purchases like , uh, you know, maybe you are buying more equipment to accommodate these people, right? So like your loan payment's gonna go up.

And what happens here is that while this staff person or collection of staff, people are earning more, they're still only earning about the industry average 44,000 a year. And you as the owner, are only earning about 80,000 a year. So in this situation, you've almost doubled the number of clients that you have. You went from 1 22 to 200. So to stay there, you have to get about 10 new clients a month.

'cause you're losing about 10 clients a month due to churn. That's just to maintain. You have to have coaches who are willing to work for 22 bucks an hour. You're gonna have to have more space, you're gonna have to have more equipment, and you're gonna have to pay coaches to run more class times. Your total revenue's about 24,000 a month, and your total expenses are pretty close to that.

So you're actually taking home about 6,600 a month . Okay ? Now this sounds good on paper, but the reality is there are very few gyms out there who are actually successful at this model.

Uh, in the CrossFit example, for example , uh, you know, for instance, the gyms that were the first in a major metropolitan area, they were crushing it right off the bat because if you get to call your name, you know, CrossFit Miami, I'm just picking a random name or CrossFit Portland, you've got a huge first mover advantage.

You're gonna quickly attract like , um, the early adopters in your market and that's, that's gonna work for three to five years. But slowly there's gonna be more gyms open around you slowly, those early adopters are gonna move on to other things. It's gonna be harder to get clients, there's gonna be more competition for them, less, you know, just organic interest. You're gonna have to work harder and harder.

And so over time, what we find is that a lot of people who are the first in their cities, they use this model and it works three to five years later though it doesn't work anymore and they're kind of panicking. So another alternative to this, if I go back to 1 22 and I go back to about 32 classes a week, a great alternative to this is to add a secondary revenue stream.

And so for example, one of the first things that we teach people is just to add an on ramp . Some call it ramp up . I'm gonna call it on ramp for you though. That on ramp should be about 300 bucks. Okay? Now what you saw change , there was a couple of things. Number one, the revenue , uh, sorry, 300 not $30.

Number one, the revenue went up quite a bit because you've got five new people paying $300, that's $1,500. Great. Number two a RM went up. So we brought up the average that each client is paying, that's great. What's not in these numbers is that on-ramp is actually a barrier to exit. It doesn't stop people from joining. It stops people from quitting. And so you keep people around longer.

So in reality, I should be fixing this retention rate, but I'm just gonna keep things simple. The other cool thing that went up here is that now your coach is making a little bit more per month. They are making that 44% of the on-ramp price because they're doing the one-on-one on-ramping with clients. So they're making an extra $8,000 a year right there.

Suddenly you've gone from a coach who's making like 21 a year to 29 a year without getting a single new client. All you're doing is replacing the five clients a month that are leaving with higher value clients coming in. None of these other things have changed.

You're still paying your affiliation, you're still paying, you know, the same amount of marketing, you're still paying, like in fact, you can drop that rent price back down. And this model, you know, suddenly the owner has gone to like from really making nothing to making about $15,000 a year.

You know, still not amazing, but better than it was to really make more , um, there's a couple of levers that we can pull, right? But keep in mind, like all we've done here is add an on ramp and the owner is already making more money. The next thing and so are the coaches, the next thing we wanna do is say, well, you know, what if we increased your membership by 10%, right? So now we went from 1 22 to 1 34.

What happens now? Same low rates one 19 , uh, they're, they're doing on ramp . Okay, great, we're not adding all of these in a month, but your gross revenue has gone up pretty significantly. And if we scroll to the bottom now the owner's up to $30,000 a year, still not sustainable, but we're certainly on the right track. The next thing that we can do is add a secondary revenue stream.

So what typically happens is when somebody does on-ramp, that's done one-on-one, and it's an introduction to your method. Here's how you do it more than anything else though, you're secretly building the exercise and nutrition habits for them . That's the point of on-ramp. And once they've got that habit, they can go into classes or they can stay one-on-one, and they're gonna stick around longer because they have that habit.

Now you coach them through the heart . So what typically happens is that your secondary revenue personal training in this case becomes worth about 10 to 20% of your other revenue. You add on 10 to 20% of your gross revenue just by offering that to people. You're not pushing it on anybody, you're not forcing people.

What you're doing is you're saying if you wanna work out at my gym, but you don't wanna work out in a group, I can, I can do one-on-one with you. So in general, that adds about 20% of your gross revenue. Okay? So we can actually move that up to 20%. 18 is close enough. This is very common.

When gyms come into two Brain , they get a few clients right off the bat, they add a personal training stream, they don't even raise their rates really yet. And they've jumped up in revenue quite a bit. And what's really interesting here is that now you've got a coach or maybe even two coaches getting a total of 50,000 488, 1 of those, you know, could be the owner.

And now the owner is taking home like $57,000 a year. They haven't raised their member their prices yet. All they've done is gained like 10% more clients and added a personal training option. You're crazy not to do this. If there are people out there, and I know there are who are saying just do big group, you know, our model is no personal training.

You hear this from FitBody Bootcamp, you hear this from F 45, you hear it from CrossFit. That's not the model. The the model is what will get my clients the best results, and often that's what will my clients do. And so you build your coaching model around what your clients want instead of the traditions of the method or whatever. Okay? So that's one thing.

The next thing that a lot of people do is they might add a tertiary revenue model. So this would be like they're gonna add supplements or they're gonna add retail. And this isn't big. It's usually gonna be about a thousand bucks a month, you know, and so they've got this third model, actually, I guess it's gonna be 2000 in this case.

So what we wind up with is actually this model, which is very, very common in the most successful two brand gyms. 70% of their revenue comes from group training or whatever their primary stream is. 20% comes from personal training, maybe nutrition coaching one or the other. And 10% comes from, maybe that's nutrition coaching, maybe it's retail, whatever that is. They've got a good robust business.

Because what happens is, you know, if you've got personal training revenue of $4,000 a month, like those people don't take a break between Thanksgiving and New Year, right? So while membership might fluctuate, your personal training appointments generally don't. So what happens here is now we've got this person, okay , they're doing about 57,000 a year.

And then we say, okay, well let's actually look at like what your rates are. So in this first example, let's say that the rates just went up by 10%, you know, to like , uh, one 30 , you know. Now what happens is we've, we've jumped revenue up by $10,000 a month.

That's revenue by adding 12 clients and moving your membership price up by 10%, by adding an on-ramp, by offering personal training to the people who want personal training and don't wanna exercise in a group and potentially adding some retail and supplements so they don't have to walk down the road and buy it from the teenager behind the counter at G nnc Easy ads. Look what happens.

Now, our net owner benefit is at $74,000 a year. These are simple changes and we're not asking you to put aside your philosophy of big group classes to do these things, okay? So what I'd like to do is, is walk through a couple of business models that are working right now, and these are great starting points. Your mentor will customize the model to match you. Okay?

So let's start off with the big group model and let's see what has to happen for the owner to make money. First model. Just get more clients and you'll be fine. Well, I've taken the averages from state of the industry and the average membership price at a CrossFit gym for example, is 1 0 9. That means, and the average coach pay is 22 bucks. They're running an average of 32 classes a week.

What we have to keep in mind though is that as this number goes up, we're gonna have to add classes, okay? We're gonna have to certify more coaches, hopefully we don't have to add space, but we might have to. So let's take a look here. If I'm running with an average number of clients, 122, which is the, you know, coaching micro gym average, I can expect, oh , this coach is actually losing money, okay?

Their coaches are making a little bit here, right? Like $21,000 a year. If this is a true owner operator model and you're paying yourself as a coach, that's how you split break the difference. And you might even be profitable by $13,000. It's not enough, but you know, you can do it. Then let's say, okay, well all we're gonna do here is we're gonna add more clients.

Now keep in mind there's already 122 people following your advice, doing exactly what you say here, and you're still not making money. Let's say that we bring that up to one 50 and don't change anything else. We can cram those 150 into the 20 or 32 classes you're running a week. We don't need more coaches. We can pay the coaches 22 bucks an hour and everybody's good with that, right? How much more can we make?

Well now you're making 27 5, okay? You're at 150 classes, which is more than the average gym has. You're still making 27 5 a year and you're coaching almost every class yourself, okay? You are paying a coach 21,000 a year, which is almost exactly what you're making. So you're probably gonna have the temptation to just do everything yourself.

So now you've got a business with 150 members that you're running every class that's 32 classes a week and trying to grow your business, you're gonna burn out . Trust me, I've been there. Let's say that we add, you know, 30 more clients by some miracle or over six months, we just add five clients a month, and now we're at 180. What happens? Well, our total revenue's up to almost 20,000 bucks.

That seems like a big number. We're still, we're probably not gonna be able to cram that many people into that many classes per week, not if they're coming on a regular basis. So you're probably gonna have to increase the number of classes that you do. So expenses go up because now you've almost, you've added like 50% more members, you are going to need some more equipment. And so , you know, what do we do here?

Do we, here's the loan, we probably gonna take a loan. You're not gonna have cash on hand to just pay for more equipment. So that loan's gonna go up. And what we see is that you're paying 32,000 out in coaching costs because you've got so many classes, but you're taking 42,000 home. So now we have added 50% more members. We've gone from 1 22 to 180 and you're still making below the industry average, okay ?

The problem is that as you add coaches, you're adding expenses and you need to add coaches. Yes, but you also need to improve a RM . However, let's keep going. How many people did this, does this gym owner actually need? If they wanna make a hundred thousand dollars a year, okay, well let's go up, let's go to two 10, we'll add another 30. Okay ? Still paying my coaches the 22 bucks a class, by the way.

Um, I'm gonna have to add a few more classes again to get all these people in. I'm probably gonna have to buy a little bit more equipment. Here we go. So that brings that loan payment up. Again, I'm still not expanding my space, but I'm gonna have to soon. Things are getting pretty tight. Well now you've got a coach making $40,000 a year and you're making 61,000 a year. Okay?

That's 210 members and you're still only making $60,000 a year. And here's what's scary. If you look at your monthly revenue at 20 3001 40 and you look at your net owner benefit, what you're actually taking home, you're making about a 25% margin off 210 clients if anything happens there. Okay ? So let's say now that one of these coaches says, I'm done making 22 bucks an hour.

I'm done coaching so many classes a week, I'm leaving and 30 clients are going with me. Well, you've just invested in more equipment. Now you've got all these classes and they've got one or two people in 'em . So you can't cancel 'em , you're still paying per class. What happens now? Well, your net owner benefit is cut like by more than half because you committed to all these other expenses.

And this is what happens in that big group model a lot. You don't get to 300 and stay there, you get to two 10 and drop to 180, you know, or you get to 120 and you drop to a hundred. And this is the trap. So let's go back to the successful model. Let's say you've got 250 clients. Your average membership price is still only 1 0 9.

You're still somehow managing to pay 22 bucks a class and you're still doing this on maybe 48 classes a week. You are rammed, your lease hasn't gone up yet. You are gonna have to buy more equipment, I guarantee it. But we'll keep it minimum. You got people sharing stuff, you got people exercising on the sidewalk, you haven't expanded yet, you haven't expanded your lease. Okay, well, where are we at finally?

We're at 102. So the way that you make this work using average numbers from across the entire world across the entire industry is you get 250 members. You get at least 25 new members every month because at a 5% churn rate, you're losing 25 members every month. So you have to get 25 just to replace them . Nobody's doing an on-ramp. So your churn is high. You're asking coaches to work for 22 bucks a class.

You're not expanding. So everybody's cramped. And now yes, you are taking home 102,000 per year. Okay? So this model can work, you can do with 250 members and there are gyms out there who are doing it. If, for example, they wanted to pay their coaches a little bit more 'cause they've only got one coach who's barely full-time on this model, they have no general manager.

The owner is coaching a bunch of the classes themselves. If you want to do more, you gotta increase your rates. So the next model that I'm gonna talk about is where we increase race by a little bit, where we increase client head count up to one 50. We hire more staff and pay them better, but we don't increase our other expenses.

So here's a gym owner who came into two Brain about six months ago, and um, right off the bat they got some new members, which they were super stoked about. But before they even did that, they added an on-ramp program. So quickly when they added that on-ramp, their revenue shot up to about 27,000. So from basically breaking even, potentially losing a little bit of money, now they're taking some money home.

It's, it's not enough, but it's a great start. The next thing that they did was they started adding clients. And so, you know, we, we build and package an on-ramp to these clients, you know, and then we start adding more clients. And so they started to climb up and, you know, within two months they add 1 35.

Now a gain of 12 clients net doesn't seem like a lot, but when you can do that consistently month after month, and again, it's, it's net clients not like how many clients they gained it . This also accounts for how many they lose. As you do that month after month, your business starts to snowball up. So, you know, step one at a on-ramp , step two, they started getting more clients. Well, look what happened.

Suddenly they're making money. Now, this is a Jim Miller who had never made money before. They were, you know, mission-driven. They loved doing what they were doing, but you know, they were tired. He was tired of his wife having to do this other shift work job to support the family. He wasn't bringing anything home. He was getting exhausted and burnt out.

The next thing that he did was actually just increase his rates for new clients coming in. Now this 1 0 9 rate was way too low, but you know, when he raised it up, new clients coming in started paying what they were actually worth. The other thing that happened was we just added the personal training option at the end of on-ramp and we started selling some supplements in retail. That was literally it.

From there, his average membership price started to go up as more of these new people joined . So first it went to one 19 on average. Look what happens, 58,000 a decent income right above the industry average. Then at over time as people were leaving at the old rate and coming in at the new rate, this average went up to 1 29. Great , let's take a peak . 74,000 now. Okay?

Then , uh, at 1 35, he made it his goal to get to about 150. And this took about 13 months, got to 150 clients. At that point, his average membership rate had gone up a little bit more. So I'm gonna say it was like 1 35. He was ready to actually increase his rates on his previous members, but he was doing about 4,000 a month in personal training. He was doing about 2000 a month in like retail.

He started some nutrition coaching stuff too, okay? And he was ready to make over a hundred thousand dollars a year. Then he said, actually, I just wanna pay my coaches more. I'm gonna start there. Every gym owner I know is like, I wanna pay my coaches more. So he moved the class rate up to 30. They were already making money from doing the personal training.

So now you've got a coach person who's making about 59,000 a year. Then this owner said, I wanna do two things. I wanna raise the rates and get rid of the old discounts on the people who are underpaying and I wanna hire an admin . He did not like tracking his metrics. He was doing it, but he was not super thrilled about it. Okay? Notice that even through all of these changes, he did not have to increase his rent.

He did not have to buy more equipment because while he is adding people, he's not in increasing the number of classes that he's doing a week. In fact, he probably went down to about 28 classes a week, but I'm gonna leave that as is. So now we're at 150 clients. He gave all his coaches a raise up to 30 bucks, not amazing, but way better than 22 above the industry average. He's bringing in 26,000 a month.

Notice his a RM is way higher and his coach is making about 2,400 a month in classes, 2,400 a month in doing personal training and taking home about 60,000 a year. Way better than most owners are doing . And now this owner is right at a hundred KA year. Okay, well now what? Well, now the owner says I'm doing it, you know, I'm kind of living my perfect day here.

I wanna buy back some of my time, but I don't wanna stop coaching. I love coaching. So what I'm gonna do is I'm gonna hire like a CSM and somebody that's gonna do the billing, the stuff that I hate. I'm not ready to hire a general manager yet, but I can spend, I can pay somebody, you know, 20 bucks an hour for, you know, I don't know, 10 hours a week, let's say. Okay?

So $200 a week times four weeks is gonna be about 800 a month, okay? 9,600 a year. This is a part-time person that's a great job that brings his net owner benefit down to 89,000, still absolutely fantastic. Then he says, well, okay, I've got this admin to help me. The CSM is checking in on people more, but it's really time to raise my rates. So he raised his rates by 10%, okay?

Now even without gaining more clients, watch what happens. So now we're at 1 49, that's a 10% rate increase. The interesting thing about that rate increase is that there are no expenses attached to it. You don't have to buy more barbells to increase your rates . You don't need more space, you don't need more staff.

It all drops straight to the bottom line and boom, 1 13, 6 90, okay , you're a gym owner , I'm a gym owner . He's making more than he needs to make his, his wife is thrilled. She's like giving up her career. What do you think he's gonna do with that extra? He's gonna invest it in more equipment, a bigger space. Maybe he's gonna buy a building, he's gonna start investing it , right?

And that's what's really important here. So this second model was very simply get to 150 clients paying just 150 bucks a month, which is still low by the way. Maintain his current retention rate. He didn't even fix that. Add an on-ramp. Offer personal training to those who want it. Offer nutrition coaching or supplements or retail to those who want that pay his coaches even better. He gave them all a raise.

He hired a CSM and admin to do his like bookkeeping and client check-ins for him . And he is still making this much money. Most gym owners that I know would say, let's go, let's double down. Let's open another gym. Let's buy a competitor. Let's, you know, invest in buying the building. And that's, that's up to him.

The third case study I wanna share with you is a woman who was doing personal training in her own space. She was paying $3,000 a month for that. Uh , she was doing some pretty heavy marketing to get clients, but basically just like trusting an ad agency to do that for her because she didn't have time. And here's why you'll see it.

She's got 50 personal training clients and they were all doing one hour sessions with her. They were paying $70 a session and doing about one a week each. 'cause that's all she could fit them in for. She was not paying anybody to help her. You know, like she was doing all these herself and when she was coming in, she was only earning about 39,000 a year.

Now that's not bad, but the reality is like, that's a lot of work to earn that kind of money. And so her goals were twofold. Number one, she wanted to make more money to support her family, and number two, she wanted to work less. She thought she was working way too much. So the first thing that we did was we said, well let's, let's start by moving people into a semi-private or small group model.

And so the, the approach that she took with her clients was, do you wanna come twice as often for just a little bit more money? So instead of paying two 80 a month, and by the way, she was selling these in packages of like 10 or 20 sessions. So some of these people were paying discounts, some of them owed her money. Cashflow was a nightmare. So she wasn't actually even taking that much money out of her business.

She was trying to collect from people. Nobody wants to do that. So the first thing that we did was we moved to a semi-private model where people could come twice a week for 3 99. She gave everybody that option. And when people started to take it, she said, I'm not doing any more . One-on-one, she was done. So she lost a few clients and that's okay.

What you can see though is that her revenue per month , uh, went way up and her take home actually increased quite a bit. It almost doubled, right? So now she's at 70,000 a year, almost six grand a month. Well that's good, you know, 70,000 a year is certainly better than 35. 39, but she's still working quite a bit. And so she said, what ? Now what do I do?

Like I'm coaching a little bit less because even when people are coming twice a week, there's four of them . So you know, it's like half as much, but I still don't wanna coach all this amount. So what we said was, well, let's, let's pay somebody to take 20 of those clients.

And so , you know, or maybe they're just gonna do like 20 classes a week or whatever, you're gonna have to pay them 50 bucks for each one to do that. And so what that did was obviously it added, you know , uh, quite a bit of expenses to her about $800 per month and it brought her net owner benefit down to 60. But now what that did is it bought her four classes in one day.

Like, you know, it brought her back her Fridays. So now she could spend her Fridays working on growing the business with her mentor. So now she can go back and she could say, okay, well let's actually look at getting more clients. She started getting more clients, right? So she added 10. And let's take a look at what this does to her bottom line. Now she's at 1 0 7 again.

Okay, well let's buy myself back a little bit more time. Okay, let's pay a coach to take 10 more of these, okay, back down to 75. But this is how you ratchet things up. So first you improve your ar right, and you improve your value to the client so that you can charge more. You do that by adding an on-ramp. In this case she moved to semi-private. We've got different ways to do this.

Uh , you could do it by adding a secondary service or whatever. Then you look at, do I have the time to actually grow my business? If you do, great, start adding clients. If you don't, then you have to buy some help.

Another way that she could have gone here if she wasn't training so much is instead of hiring a part-time coach, she could have just hired, you know, for example, like a cleaner, a social media person, an admin. If she really wanted to coach 50 sessions a week, she could have hired somebody else to help her with these other things and, you know, still grown her business. Anyway, here's the key.

Look, there are a lot of ways to grow a business, but the way that you don't grow a business is by guessing, by just assuming that getting more members is gonna get you more money or by just saying, I don't care about the money, or by not paying attention to your metrics. Those are the things that shrink the business. Your number one priority as a CEO is to learn how to run a business.

Getting your fifth level degree or your master's or your PhD in fitness is not gonna help you run a better business. As soon as you open a business, you are the CEO and it's immediately your responsibility to grow that business. How do you measure growth by what you actually earn? That's the ultimate measuring stick. It's not how many members you have or even how much revenue you do.

As you saw in that last example, you don't need crazy revenue to take home really great profits. The key is knowing which levers to pull, how the math works, how an s and p operates. And so we're a mentorship practice because we don't wanna force one model on anybody. We never say the big group model won't work. We never say one-on-one personal training won't work. Instead we say, here's how that can work for you.

And we tell them the metrics that they have to have to make it work, and then we guide them to take the steps to change their metrics to the ones that work. That's what mentorship is. That's what running a profitable gym is. This is run a profitable gym. I'm Chris Cooper and hey, thanks for doing math with me.