Thomas Plummer

The business of fitness


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Sometimes the only way to save a business is to destroy it…. one thread at a time

The threads of our past may be killing our future

(Four minute read)

Sometimes the only way to save a business is to destroy it.

A single, flimsy thread can’t do much harm to you. Threads are usually just little cotton strands that a child can snap with her little fingers. Thousands of threads, especially those that keep us tied to a failed past can, however, combine into a force that chokes the life out of any business trying to stay alive or evolve.

Every business with any age to it has threads that bind that business to its history. Threads are the history of that business, but seldom its future. Employees from the old days, aged physical plants, old procedure manuals, a glorified past where the business was known and successful, and an ownership trapped trying to restore a fading concept rather than letting the business evolve to its current potential, are all threads binding you to something that may no longer exist and may no longer be viable into today’s business environment.

Businesses fail because they don’t evolve, forcing it to lose the ability to react to a changing market. Keep doing what you are doing and the world offers up someone doing it faster, better, cheaper, nicer or just different. Doing what you have always done, especially when it is proven not to work, guarantees failure, since you have already validated there simply isn’t enough clients out there who want to buy your old method of business. Sure, there are fans of desktop computers, K-Mart, film cameras, CD music, circuit training and old school aerobic classes; but not enough of those fans to keep any of these concepts viable going forward in time.

Sometimes, the only way to save or grow a stagnant business is to destroy it. Sometimes the only way to save a business is to cut all those threads that bind you to your history and let the business evolve. Sometimes you have to sit down and reinvent the concept for the market that exists today, not try to maintain it for the ever fading pack of fans that still believe in what you are selling, but isn’t big enough as group to support your efforts any longer.

The problem of course is that we never recognize the threads that bind us to the past. These threads are insidious in nature, much like the proverbial frog sitting in slowly heating water that gets boiled rather than leaps. In our case, the very things we are so proud of in our businesses are often the very things that are causing the most damage.

For example, the employee left over from the old days who fights to restore the way it was when everything was perfect and only he knew how to get it done: “It is our employees that are killing us today,” he says, “If we just go back and train them as we did when were making money we can fix it all.” Usually this is the old sales guy who believes we just need more closers, rather than questioning if what we are selling is what people want to buy today. This isn’t a sales problem, it is a concept problem.

When the business environment all around you changes, using techniques that made you successful 20 years ago will have little bearing on fixing a struggling business today. For example, you might have been the world’s greatest pager salesman, ran the greatest team, and were the company star, but no matter how good you were then has no value on competing in a world of smart phone fanatics. The market changed, the business changed, the needed techniques have changed; everything has changed except for this employee who can’t let go of the company’s past, or his own. The solution? Cut his thread.

Forgetting that what made you famous will not keep your famous is the real problem here. Businesses will plateau at some point, meaning that if we keep using the techniques and people we currently have, we cannot grow the revenue of this company any higher. We peaked with what we had, but what we have is usually not enough to drive through to the next level.

The thread here is that we refuse to change because we are so afraid of pissing off current clients. “If we change, we will lose all (your employees always go for worst case to validate their points) of our clients that love the way we do things.” The big question, especially if the business is stalled or in decline is, “If we don’t change, we might lose the whole business instead of a few old customers.” Old customers, who fight change to their service, product or even something as simple as a change in their gym equipment who then threaten us with their willingness to go elsewhere, hold us hostage to doing what is the best for the business, which is cutting that thread to the past.

Our staffs tell us that if we get rid of that old equipment, we will lose too many members and hurt the business, but the reality is that the current equipment array isn’t attracting enough new members to sustain the business. If you are held hostage by the old staff, yet again, and some of the old members threaten to quit if anything changes, then you won’t even paint the walls in fear of making some old client mad enough to go somewhere else. Put more simply, the very equipment or dated programming that is keeping that old guy from leaving you is what may be keeping a lot of new clients from joining you.

The answer here is to do what is necessary to give the business a chance to attract a new generation of clients, in big enough numbers, to replace the old client who might leave, but are preventing the business from growing.

There is no way you could ever survey this in a business. Ask any old client what happens if you change anything they know, replacing the known with an unknown, and no one will ever let go of what they have, but remember, for every client who clings to the past there is another old client who hates the fact that you haven’t reinvested in that business in 20 years. Having equipment, or programming, or a service that hasn’t changed in a decade is not a badge of honor to many clients; it simply means you are cheap and won’t reinvest in your business.

As a side note here, are we sure it is the old clients who refuse to change? Many times it is the employee who fights so hard to keep the same old, same old. Employees demand leadership and if you want change you have to replace the vision of, “We have always done it this way and this is all I know” with a tighter vision of what can happen if we let go of the past and embrace your clearly described vision of the future.

Your history is just that, something that happened in the past, and has no bearing whatsoever on what you can be tomorrow. A big question to ask here that frames this issue more clearly for most employees is, “If we just started the business today, would we be doing the same things we are doing now?”

The answer to this is seldom yes. If we started the business today, you wouldn’t have the old physical plants; the old, already ruined employees, and you would be able to start today fresh correcting all of your past mistakes by focusing on a vision of what the business has to be today to compete.

And this is how you should learn to run your business. If you want to go forward, you often need to cut the threads to the past. What are we going to do today to compete is for more sustainable over time than clinging to a past identity that is not sustainable going forward.

If your business is flat, getting surrounded by competition and you are fading, or it is simply not performing, ask yourself these questions:

  • Are the employees that have been with me so long part of the solution, or are they really part of the problem that keeps this business from growing? Long-term employees seldom change when times get tough. Yes, there are a few who have been around for a long time and who can change, but not many. Often the very people you are counting on for help to evolve are the same ones who secretly fight every new idea by hanging on to the way you have always done it. Long term employees often nest and build empires and even the ones who have been with you just a few years will often cling to what they know, not embrace what you want them to do. Big change requires big change; often the only way to do that is to start fresh with people not afraid of your new vision.
  • Is this concept even competitive today? What made you successful will not keep you that way. Markets evolve; competitors steal best practices and the expectations of the consumer changes too. Sometimes you have to admit you were brilliant in 1995, but not even in the game today. Change is often harder than death, as almost any smoker will tell you. Sometimes letting go of a concept and replacing it with, “What is next” is enough to save a flat lined business that is fading year after year.
  • If I look back the last 18 months, can I predict success or failure during the next 18 months? If what you are doing, such as a string of negative numbers, has lasted more than three quarters, you don’t have a trend, you have a new reality, and that reality is that you are denying the inevitable. The numbers will not change if you do not change them, but if what you are doing isn’t working, defined by shrinking numbers, failing physical plants, dated processes and a staff that won’t let go of who you used to be, then you have to break it if you want to save it.
  • Do I know the difference between a patch and a fresh concept? Putting little turf areas into the back room of a mainstream gym doesn’t make it a training gym. Signing up for a new group exercise license won’t save a business from three decades ago. Adding a few pieces of the newest, latest and greatest equipment doesn’t change the situation enough to attract a huge number of new clients. Patching means you are using programming and other gimmicks to prop up your failing concept. Most of you do not have a programming problem; you have a concept problem. Old, tired streetwalkers with fresh makeup and new clothes are still old, tired streetwalkers. Old, tired gyms with a little paint, 200 feet of turf and a few treads are still old tired gyms three decades past their prime.

Sometimes the only way to save a business is to destroy it. Sometimes the only way to go forward is to cut all the threads from the past. Sometimes the right thing to do to save a business is just to start over.


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What if your pricing system is as old as this picture?

(10 minute read and study)

The technique was right in 1999, but that doesn’t mean it is right in 2016.

Solving problems is situational and in the late 90s the problem that needed to be solved in the fitness world was what to do with the collapse of the mainstream fitness market? The chains were strong in the late 90s, the independent owner was small and not changing much of the world yet and the “real” gyms, such as Gold’s, World’s and Powerhouse, were at their prime. But there was a niche in the market that no one noticed, which is why the modern training gym is here today.

The 90s was the decade where the new generation training guru emerged. Sports performance had been out there for years, of course, but no one had taken the team dynamic and the already functional approach to training and applied it to the mainstream consumer and that was where the hole was in the market: small training gyms, or maybe mainstream guys who were willing to adapt, focused on a client that was tired of six-day a week bodybuilding dogma and wanted to be better at sports and life rather than just entering a show and standing as a pile of muscle on stage.

But there was no map, no model and no plan to build one of these. So we adapted. Bill Parisi in New Jersey would have been the first gym in the country to mix sports performance with the mainstream Average Joe client. In 1996 he did $950,000 in 3900 square feet, something that even today would be impressive in any market. Following right behind this breakthrough in the late 90s were Alwyn and Rachel Cosgrove in California, who were the first owners in the country to switch completely to small group coaching only doing away completely with the one-on-one concept in their first gym.

We also didn’t have the strategy to make this small group idea work so again, we adapted. Everyone prior to this time period who received any type of training in any gym in the country did it one-on-one. There was no small group training. There was no team concept. CrossFit was still 10 years away from being a team factor in the world at this time.

The first price strategy for small group training was based upon simply modifying the one-on-one idea:

  • Instead of one-on-one, we train the clients in groups
  • Everyone bought sessions in the past, so we break away and just charge the clients for coming either 1/2/3 times per week
  • All the one-on-one guys had their own workouts, so just put together a small group and each guy still does his own thing increasing our profit, although we stupidly started paying the trainer for more people in his group. In those days he did sell, but we gave away a lot to the coaches that later proved not to be necessary.
  • In essence, the client just bought an extended version of sessions. Instead of sessions based upon a package, he just bought them by the week over time. Sessions were still sessions and the client still wanted to make the individual missed sessions up next month
  • About three guys were all a coach could handle since everyone was doing their own workout at their own speed (except Parisi, who was already coaching mainstream clients as if they were on a sports team).

There was no kind of group dynamic at all. Everyone did his own thing, at his own speed, and the coach just runs around trying to keep everyone safe and moving. This type of workout was nothing more than three guys doing one-on-one workouts together, which made sense then but is fairly funny now.

The price strategy looked like this:

  • One time per week you paid $189 per month
  • Two times per week you paid $289 per week
  • Three times per week you paid $389 per week

All the memberships were on a 12-month basis, or at least the early gyms were heading in that direction and the first adapters were already doing away with sessions and packages or even doing away with one-on-one coaching altogether.

This price strategy was brilliant in the late 90s and early 2000s, but while I was right then, I would be horribly wrong now using this system. The weakness is that we created a training methodology based upon just modifying a one-on-one concept and basing it on a newer price model.

Nowhere in here did we look at the scalability of the system (could we use this with bigger groups and a lot more members?) or the time and effectiveness it takes to design three workouts for three guys and then keeping them all moving at the same time with one coach. In other words, this was a prefect system to solve a problem of transition from the mainstream gym to the first training gyms, but it is not an effective way to make money or train clients today.

How the training business model has evolved

Small group coaching has evolved into the primary category for a financially successful training gym. This is where the best results occur and this is where the highest consistent revenue per client is generated, with the biggest profit margin. Team training is still important, but the real profit comes from small groups paying a higher-return-per-client-served.

Here is what has to happen for you to be able to train a large number of clients successfully over time at the highest revenue possible:

#1…. You have to shift the responsibility of showing up to the client: In the old system, the client believed he bought sessions, such as the ability to come twice per week. The problem was that if he missed a session he wanted to make it up next month. We sold times per week instead of access to the training, which is what has to happen. Access means you can come up to so many times per month, but you do not have to use all of those times if your schedule doesn’t permit that week.

#2…. By selling access you kill the failure mode that was written into the old system. In the old days, trainers sold their own books and every trainer of course wanted to fill his time so he told the client that he or she has to be there at least three times per week or you are a failure. If the soccer mom got busy and couldn’t show up for a perfect week of working out, she felt she failed simply because her coach planted that seed in her head by telling her if you don’t get here three times per week you will never reach your goals. She failed, and then often quit, because why keep going in a system where failure was going to happen almost every week?

Here is what a modern pricing strategy would look like along with the strategy behind it, but first we have to start with the terms needed to set up the concept:

  • Unlimited means you can come up to 12 times a month with a coach. This is not a contradiction since unlimited means you always have something to do on your off day designed by the coaching team. You don’t have unlimited coaching, you have unlimited access to coaching guidance at this gym.
  • Limited means you can come up to five times per month
  • You get everything below the level you sign up for at this gym, although few people ever take advantage of this benefit
  • The average person who takes unlimited will train somewhere between 9.2-10 times per month depending on the region of this country or where you live internationally. If you live in London or New York, the average client will train more than someone who lives in a more rural part of the country. If you look at just one client, you would think the client is killing the gym, but if you average 20 clients using a number in this range, the gym will usually net about 40% on coaching.
  • The average person who takes limited will only train about 4.5 times per month. Even this group does not show up for all five workouts every month.
  • The key is that we are selling access. This means you can come up to 12 times if your schedule permits, but if you only make it in nine times this month you didn’t fail. You have to build success into every system by eliminating a false sense of how many times equates to success. If you haven’t been working out for years, but get into a gym once per week for a year, is that a success for the client or a failure?
  • The annual coaching program means the person has complete support for the year including all supplements, nutritional support, and even medical referrals if that is relevant for your business.
  • Four people in a small group is perfect. This allows you to have two sets of equipment and then train your clients as a group rather than as individuals. Most experienced coaches modify the client using progressions and regressions rather than modifying or creating separate workouts for each client. If the client has severe pain or dysfunction, he should be in 1/1 anyway and not part of this type of group until he can function. All prehab work should be done on their own prior to the workout, such as foam rolling or specific stretching needs.

Four people is where the intensive coaching lives in your gym compared to team training, which might have up to 20 people in it. In small group you can go after the complex movement patterns safely as opposed as trying to coach 20 people when they are tired doing something that no coach can truly supervise. IN team we use simple movement patterns and use the same workout for the week so the clients can chase progressions.

In small group, you could have two people doing low box jumps and two people doing heavy carries at the same time. The box jumps are where you coach and the carries are where the clients just take off since there is little coaching required at this level. By having two sets of all needed equipment, and by using the mix of a skilled movement with kettle head movements (movements that require steel, but not much brain power) you can keep four people together as a team and still get great results.

The technical movements, such as a power clean, can be done with two doing and two watching form and then alternating. This system allows you to move four, the optimal number of clients, around in a smaller space with less equipment needs.

And obviously, training four at a time is so much more cost effective than training just three or two.

The price structure:

$1499 a month for 12 months annual coaching program

$899 a month for 12 months unlimited 1/1                                                                                        $499 a month for 12 months limited 1/1                                                                                              (This 1/1 training is based upon a $100 per workout)

$289 a month for 12 months unlimited small group coaching                                                    $189 a month for 12 months limited small group training

$129 a month for 12 months unlimited team training

$89 per month for 12 months access with a template workout provided monthly

Special: $249 a month for 12 months individualized workout including full screening (FMS) and full body comp and a workout designed based upon the results of this testing and your goals. Not all gyms will offer this or have open access space. If you are 4,000 square feet or bigger (400 meters), you should have a dedicated open access space so clients can come into your gym on their off days and do their own thing, meaning doing something relevant for them individually designed by your coaches but not needing the cost of direct supervision.

This system solves all the problems of the old 1/2/3 times per week and creates a more stable business platform that is sustainable over time. This is also scalable for even the biggest training gyms, some of which are now over 16,000 square feet.

Everything evolves and this old system is no exception. People using versions of this basic structure, such as Rick Mayo, Justin Grinnell, Colin McGarty and Frank Nash, are doing numbers never before possible in a training gym business. If you aren’t making the money you want from your gym, take a look at your pricing structure. How you charge and collect from the clients may be the reason you are forever locked at a lower revenue.

 


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Good systems make average people great

(Three minute read)

Good systems make average people great.

Define systems as set ways of doing things, designed to make the business great and that can be carried out daily, easily learned and easily repeated by an average employee.

Without systems, you get trapped by what is called situational management. Situational management means that without consistent structure and procedures, every issue or problem in the business is handled differently as it comes up each time.

Today, you are in a bad mood and handle a membership problem in a way that reflects that member, your mood, time of day and maybe because of the money that problem will cost you. Tomorrow, you have a different member in front of you, and maybe one that you like differently than the member yesterday, so you handle the same situation differently.

The problem in front of you might be the same, but you handle this issue differently depending on the situation at the time. Situational management simply means only you can make decisions in the business, because each issue, even if this issue is often another version of the same problem you faced yesterday, is handled differently depending on your whim, mood and who the client is.

The problem with this method of madness is how do you teach anyone else to do this and to manage your business this way? If every situation depends on the client, the mood you are in, the time of day and the money in the bank, there is no way in the world you can ever teach anyone else to think exactly like you do.

This is, by the way, why so many young owners get frustrated with their staff people. “Why can’t he just do it the way I want him to handle it?” you scream, yet since you handle every major, and minor, decision off the top of your head, there is no way anyone can figure out how to manage your business. You don’t have procedures or a system, you have only you deciding to make some crap up as needed to get this current issue done and out of your face.

Developing systems allows the staff to have a set direction, in writing and in a manual that allows them to handle the major recurring issues in the gym. Systems mean that if a cancellation issue arises, for example, and it is a common one, a staff person can look up how to handle it in their procedures manual. It doesn’t matter who the client is. It doesn’t matter what day it is. It doesn’t matter what mood you are in as an owner. It only matters that the staff can handle the issue professionally each and every time even though you are not there to take care of it personally.

Here are a few examples of issues that should be covered in a procedures manual. Keep in mind that a procedures manual is also a tool you use to train new staff. The manual over time will grow to cover all the major issues you have in your gym and this tool can, therefore, be used to train new staff more quickly as to how to handle a routine day at work:

  • How to handle any complaints
  • Follow up procedures on all sales leads
  • How to answer the phone (common courtesy and message taking)
  • How to start a new client
  • Scheduling appointments, including how the scheduler works and how to fix it if is doesn’t
  • Asking for past due money
  • Proper dress for the job
  • Procedures on closing the gym each night. What lights stay on? What lights stay off? Where is the emergency key? What temperature is set at night? What do I do with the paperwork? Where does the money go?
  • How to open the gym in the morning
  • Handling inquiry calls on the phone
  • How the different trial memberships work. You would need a separate section for each trial

This list could go on and on. The real issue is that most owners like to be the one that makes all the decisions and handle all the problems, but in the harsh world of small business you ruin your staff by doing this, because they can never be able to handle anything unless they are standing there next to you for years trying to learn how one situation is different from another.

Yes, you can always override your own system. If there is someone who is a favorite client, who has major personal issues, or is politically important in the gym, yes, you can make that decision as an owner to do it your way. But if you want a staff that can rise to the occasion and take control of the gym when you aren’t there, then building systems that are scalable is the only way to stay in business over time.

The secret to a small business is how can you get an average staff person to deliver a super experience every single day? The answer is consistent systems developed to handle every issue professionally, ethically and quickly each and every time. Your gym will only be as good as the staff’s own ability to help you make money and you can’t make money if you have to stand and stare at the owner waiting for him or her to make a decision on every single issue in the gym every single day.

 

The old adage is that staff is only as good as you make them. In a training gym, our staff is often only as good as we allow them to be and many of them could be so much better if the damn owner would only get out of his own way. Maybe it really isn’t the staff that is the problem in your business; maybe it is you?


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Finding the humanistic side of coaching

(Three minute read)

It is easy as a coach to hurt people. Young coaches do it every single day by over training the client or by using the old, “I only know one way to train people and if it doesn’t work for you tough, you are going to train this way no matter what.”

It is much harder in this business to get maximum results, from the largest number of clients over time; a skill that takes years of patience, education and finally the ability to see the client as a truly unique experience.

Most coaches seems to pass through three stages as they progress through their careers: you become completely enamored with a methodology, you move to becoming a technical nightmare and then you finally, if you survive and if you haven’t killed any clients, arrive at the humanistic stage of training where you can truly individualize the vast tools you have accumulated in your arsenal to help a client succeed with the most simplistic approach necessary.

It should also be pointed out that a training business only makes money when the majority of its coaches, or at least the owner who spends his time coaching coaches, arrives at the last humanistic stage. Overly technical, over initialed behind the name and overly zealous to prove you know it all absolutely kills client retention. It is not how much you know that impresses clients; it is how much you can help me get what I want or need using the least stressful process.

Clients seek results, but the majority that stay longer and pay longer in your business want it as simple as possible, entertaining, and well coached, meaning is it safe and can you keep me from hurting myself? Nothing like coming from a hard day at work and having your coach take you through nine different exercises that have to be repeated for three full rounds.

Then add that there are five in your group that day and we are all doing the exercises at a different rate so our coach is now all over the gym trying to keep a herd of people who are now doing nothing but free styling doing their own workout on track and in good form.

In this example, we lost the power of the group dynamic, we lost the ability to coach because we lost control of the group and most importantly, we have annoyed a paying client who feels he or she is paying for coaching, but finds himself standing in a corner doing an exercise on his own with his coach on the other side of the damn gym. Let’s look at the three stages and what they do to your coaching business:

The methodology stage

This is the easiest trap to fall into in coaching. You are new to the industry, know nothing, spend a day or two at a certification, and now you have a fully developed system that apparently provides all the answers to any training issue. This is sort of like a teenage boy who falls madly in love with his first girlfriend. She is the one, and always will be, because she was the first and only one this guy has ever known.

Methodology madness eliminates the ability to solve problems you encounter with individual clients. You own a hammer and now everything you see is a nail. One size does not fit all in the business of fitness. If you want to build a house that stands over time, you have to acquire a variety of tools.

The technical stage

Our intrepid coach now realizes there is more to life than a single methodology. He or she now starts the endless process of acquiring initials behind the name. Add a certification here, one over here, and yet another this weekend and a few years later you are a technical master of too much information to breathe.

You have learned it all, know it all, and have the collection of diplomas to prove it, but you haven’t trained enough clients, and never will, to use it all. But the mistake here is that the coach at this level has that innate need to over complicate everything by trying to use too much of a good thing. I know it all and this week my clients are going to see yet another seismic shift in my coaching as I incorporate everything new into this week’s workouts.

This is the coach that has to write a workout that the average human being can’t do, or on his best day, has doubts about doing. Too much, too complicated, unnecessary and boring. Yes, boring. Too much in a workout just leaves a client numb mentally and didn’t she come to you suffering from too much stress in her life, with the need to get into better shape? Let’s make the workout so complicated that one round feels like a week of mental stress.

The humanistic stage

You have arrived. You now have done enough sessions, touched enough souls and aged enough mentally that you realize maybe simplifying a workout keeps the client happy, showing up more because he is happy and getting in better shape because he is showing up to the gym more often.

We forget that sometimes just showing up to the gym is a major mental victory for the client and that has to be celebrated. Sometimes we have to realize that his standards for fitness at 50 have nothing to do with your personal standards at 26. Maybe four people working as a group, building friendships and keeping the workout effective but simple is the best gift we can offer a paying client.

Humanistic means you understand that the coach and the environment he creates is more important than overloading anyone with too much technical crap. Humanistic also means you are now a master of progressions and regressions that allows you to keep a group moving as a group and celebrating the power of the group dynamic.

And maybe humanistic means you have finally learned enough to realize you don’t know it all, never will and now at this stage of your coaching life just the learning process itself is magical. Congratulations, you are now a fully functioning master trainer and industry is better off because you are in it.