Net owner benefit: It’s everything you get from your business.
Think of it as your total reward for taking risk as an entrepreneur.
Our mentorship program is designed to get gym owners to $100,000 net owner benefit (NOB) fast—and then we’ll go further.
But six figures is a great start, and you can reach that NOB number faster than you think.
Here’s data: The average time it takes a gym owner to get to $100,000 NOB with Two-Brain mentorship is two years, one month and nine days.
That’s just over 25 months. When our clients hit this number for the first time, we throw confetti and ring the PR bell—it happens a lot.
Two important qualifiers:
1. This stat remains the same regardless of starting point. If a gym owner is earning $15,000 or $50,000 when they start working with us, the average is still 25 months. So if your income is low now, take heart.
2. Some gym owners have hit $100,000 much faster. I’ve given you the average. Entrepreneurs who can focus and stick to the plan can reach six figures very quickly. So if 25 months seems like a long time to you, know that you can shave many months if you focus and do the work your mentor prescribes.
The Finer Points
Employees of companies get wages, and their pay is generally very straightforward. Entrepreneurs have more options—think of them as small rewards for creating jobs, supporting communities, growing the economy and taking risk.
Some of us take salaries from gyms. Some take profit distributions. Some charge the gym rent as a landlord. To avoid overtaxation, some have businesses pay their bills (cell phone, car loan, etc.). Some do all of the above.
NOB is the total of salary, profit and the “extras” your gym provides for you.
For example, a gym owner might make $100,000 in NOB this way:
- $66,000 salary ($5,500 per month)
- $20,000 profit ($5,000 quarterly distributions)
- $6,000 health insurance
- $6,000 vehicle
- $2,000 cell phone/extras
Total: $100,000 NOB (or $8,333 per month)
I’ll give you extra insight into that list.
Salary—You need to pay yourself for work that you do. This “seems obvious,” but it’s not. It’s very common for gym owners to “just do everything” without paying themselves for the work. That obscures the real cost of running the gym and ensures the owner can never offload unpaid tasks. No one else will work for free, right?
Profit—To pay yourself profit, you must generate profit. That means you must price your services correctly. And you must commit to paying yourself this money. You need a small buffer in your business, but leaving money inside the corporation is like putting it on a platter and serving it up to the government, the bank and your own temptation. I’m disciplined when it comes to finances, but if there’s an extra thousand bucks in my account, I start browsing the Rogue website. And if profit is just sitting there and you’re ever sued, that money is at risk.
Health insurance, vehicles, extras—Make a list of all your expenses, then ask your accountant to review it. You might preserve a lot of personal cash by shifting expenses to the business. Many gym owners don’t realize this is possible. They’ll absorb small costs such as printer toner and pens, and they’ll eat larger expenses such as cameras, phones and vehicles/transportation, too. Your tax pro can point out all the legal ways to shift expenses to the business and increase your NOB.
NOB Boost: Step 1
When talking about NOB, I always like to remind gym owners of the best step they can take immediately:
Give yourself a small raise today.
If you’re nervous, start with $50 a pay period. That’s only about a hundred bucks a month, or $1,200 a year.
I’m not suggesting this money will magically appear, but I am suggesting a raise can be a “forcing function.” Could you sell 16 $75 PT sessions in the next year to cover the $1,200? Yes, you could. Or do you really need to spend that surplus $1,200 on more sandbags? No, I’m sure you have lots of gear.
So give yourself the raise. It will feel good—like you’re being rewarded for owning a business. That’s a great thing, because when you feel rewarded, you start building confidence and momentum as an entrepreneur.
Now think about what it might feel like to add $500 or even $5,000 to your monthly NOB. This is very possible.
Let me show you one more time what our top earners take home per month:
Let’s start with a $100-a-month increase.
Give yourself that raise today.
And when you’re ready to talk about improving your business so you can give yourself much larger raises, click here to book a call.
