Mike Warkentin (00:02):
Meet Starla, the new business model. Does anyone remember that awkward scene from “Arrested Development”? It involved a swimsuit model, not a spreadsheet. The gym world is actually a lot like that at times. Our business models are often super weird or just completely absent. So, do you have a business model? I’ve got good news for you. Chris Cooper has five of them, and they’re all backed by data in our brand-new guide. Each of the models has a spreadsheet that shows you how you can make $100,000 as a gym owner. We’re going to dig into them today. I’m Mike Warkentin. This is “Run a Profitable Gym.” With me today is Chris Cooper, Two-Brain Founder. Good morning, Chris. How are you?
Chris Cooper (00:35):
I’m way better, man. That intro made my day.
Mike Warkentin (00:38):
Do you remember that scene?
Chris Cooper (00:40):
The “Arrested Development” joke. Oh yeah. I’m a huge “Arrested Development” fan. It so great.
Mike Warkentin (00:43):
It was so great. Gob is just in the boardroom, and he’s just, “I have a business model, Michael,” and you know, and she comes in on the rock, sitting on the rock, and it went from there, and the board didn’t appreciate it.
Chris Cooper (00:56):
My family has a joke. There’s always money in the banana stands.
Mike Warkentin (00:59):
There’s always money in the banana stand.
Chris Cooper (01:00):
That comes from “Arrested Development” too.
Mike Warkentin (01:02):
Yep. That’s a great show, and it’s a great setup for this one because back when you and I started gyms, there was no business model, and there was no money in the banana stand. We were just making it up as we went. We were making tons of mistakes, and it took us decades to get to profitability, and some of us didn’t make it there at all. So, I’m really pumped about this because I’ve gone through this new guide in detail, and there’s really cool stuff in there. I’m going to put you on the spot right off the beginning because I followed this path, and I want to know if it still works. Is the group model still viable at this point in time? What do you think?
Chris Cooper (01:32):
There are a few outliers who are doing really well with the group model. By and large, these people have “first-mover” advantage. So, they opened up CrossFit Toronto or whatever—you know, that’s a bad example because I think CrossFit Toronto is gone now—but maybe they open up the first CrossFit in Detroit, and they got to name it CrossFit Detroit. And they’ll always have that brand advantage. So, anybody that wants to try CrossFit or people who are looking for better CrossFit, they’re going to go to that brand. But by and large, these are the minority. Like less than 5% of gyms are doing really well with that group model unless they introduce like one-on-one or something else. We’ll talk about that later. And if you look broadly, if you look at—let’s look outside CrossFit. Let’s look at F45; let’s look at spin studios.
Chris Cooper (02:19):
Let’s look—out of Australia, there’s like 12 different brands every single month coming into the market there. What happens is that the um, group model is so commoditized you can’t even tell the difference between F45 and you know, now it’s like the “green theory,” and the only differentiator is price. And so that drives down the pricing model. People can’t make a living there, the owners aren’t making any money, and it’s just kind of this downward spiral. And so if all you’re doing is selling group classes, you’re really going to struggle to compete against a growing market.
Mike Warkentin (02:54):
Well, because you’re still, at that point, you almost get pushed into the micro or the corporate gym model where you need more and more people at these really low rates. But you’ve still got these little labor costs, and you are “coaching” people, but really what you’re doing is hurting people, and screaming at them in a giant pile, and you’re not charging enough to cover any of it. And I’ve seen a lot of those studios start to go under around me. I don’t know what it’s like where you’re at.
Chris Cooper (03:15):
Yeah, they’re gone. I mean, so where that came from in CrossFit—this almost industrial model of like, “let’s pack 30 people in, and we’re all going to do everything in sync,” and it’s almost choreography in some of these gyms—that actually came from martial arts. Like that wasn’t Greg’s original model. We’ll talk more about that later. But CrossFit invited a speaker to the affiliate summit in 2006, and this guy came from karate, and he talked about the model they have in karate, which is 30 kids wearing the exact same uniform, occupying a two-foot-by-two-foot square space doing everything in complete sync. Everybody kicks at the same time, throws punches at the same time. There’s no equipment; there’s no sparring going on, but that’s how you make a living in that model. The problem is that when you add complicated movements, and you add 10 people who are all at different levels, and you add equipment like barbells and boxes that change every single day, it is very, very hard to compete. And now a lot of gyms are seeing that profit margin just shrink and shrink and shrink because they’re trying to compete with the bootcamp next door, the HIIT gym next door, the F45. Clients are moving faster and faster between coaches, and unfortunately, if you don’t do something to differentiate yourself and really focus on building a coaching business, that’s who you’re competing with now.
Mike Warkentin (04:31):
OK, so in our new guide, we actually have a group model that’s just group-only with a little bit of extra stuff in there. We’ll tell you about that in just a sec. But Chris, give me the short version for people who are listening, and they don’t think it’s a swimsuit model. What is a business model? Why should a gym owner care? What are we going at?
Chris Cooper (04:46):
A business model is just your actual plan to succeed. So, it doesn’t have to be fancy. It’s some numbers on a page where you’re basically tracking: Here’s how many clients I have, here’s what each client pays me, here’s how long they stay, and then here’s what I spend on expenses, and here’s what I spend on staff, and here’s what’s left over at the end. And we all came into this as first-time entrepreneurs. I know I was terrified to learn this stuff because I didn’t want to be the witness to my own failure. But the reality is like in the three years that I avoided learning this stuff, my business didn’t improve. And so, you don’t need to become an accountant to run your gym, but you have to have a very basic understanding of what metrics you need to track, and you need to track them.
Chris Cooper (05:29):
And then what that does is it helps you make decisions. So, if you’re looking at your P&L, your profit and loss, like the most basic accounting document there is, you can say, “What if I added five more clients? How would that affect my bottom line? What if I added more space? How would that affect me? What if I increased what I was charging by $5? What if I added on-ramp? What if I did more personal training? What if I did whatever? And so, what we’ve done in this guide is we’ve actually broken down five models that work, including the group-only model because I don’t want to say it never works—sometimes it does—but I want you to see the actual math of how this stuff breaks down so that you can decide for yourself.
Mike Warkentin (06:08):
So let’s talk a little bit about those group models and specifically the group-only one because a key feature of that in the book is that regardless of whether you’re focusing on 150 group clients, we still want to bring them in with one-on-one on-ramps, personal training by another word. Why is that, and why is that such an essential feature of that group model?
Chris Cooper (06:27):
Well, you got two options to make a group model go, right? Number one—well, there’s really three. So, one is you have a ton of clients, and that model is the one that’s most talked about in like CrossFit gyms for example. The next model is that you have 150 to 200 clients, but you charge a high price point. So, that’s really common in Orange Theory, which is a growing brand; they’re probably the fastest growing of all the ones that I’m talking about. And then the third model is that you have mostly group training, but you introduce some one-on-one at some point. We call this the prescriptive model. And basically, what you’re doing is you’re saying, like, “Go to the group classes for exercise, but you are going to be working one-on-one with somebody who oversees your journey.”
Chris Cooper (07:13):
“So you’re going to be checking in with them; they’re going to be measuring your progress, and if your progress isn’t as fast as you would like it, they’re going to change your prescription a little bit. They’re going to tell you to come more often. They might recommend some personal training or whatever. Sometimes they’ll tell you to come left less often, but like there’s somebody overseeing your particular case.” And this is the big differentiator that a lot of brands can’t compete with. So, if you’re a CrossFit gym, and you don’t have to follow the F45 franchise playbook, this is your big opportunity to be different, have a more valuable gym, keep people longer, and really actually change their lives instead of just keeping them for six months and then they’re churning out to Fit Body Boot Camp.
Mike Warkentin (07:52):
I’ll ask you this, and I’ll play devil’s advocate. What if I told you that I think on-ramp is a barrier to entry to group classes? What would you say?
Chris Cooper (07:58):
Well, I mean, the data says that’s just not true. Like, my opinion doesn’t matter. What matters is data from 15,000 gyms that we’ve collected, is the experience of a mentor team of 70 successful gym owners, and you know, we’ve had the experience now of working with well over 2,000 gyms. And on-ramp, like a one-on-one introduction to your course or your group program or whatever is not a barrier to entry, it’s actually a barrier to exit, so what happens is people pay a little bit more; they learn the fundamentals, but more than anything else, they get comfortable. And so, after five or six sessions or whatever you pick, you say, “Do you feel comfortable joining the group class now?” And eight out of 10 will say, “Yep, ready to go.” And then you put a great client into that class who knows all the movements.
Chris Cooper (08:44):
They’re not like, “What’s a power clean again?” But more than anything else, they don’t feel stupid in that class because you know what happens, right? Like they get in that class, and some people will say, “What’s a power clean again?” But most people will just be like, “What am I doing here? I forget.” And then they quickly feel like, “I don’t belong here.” And so, they bail. So, you know, the whole free trials thing that went through CrossFit gyms, like the reason that it doesn’t work isn’t because you’re not going to sign people up. You will, especially if you’re brand new, but you’re not going to keep those people. And so that’s the real key to on-ramp. The other, the other like argument for on-ramp, especially when people say, “It’s a barrier to entry”: If you don’t offer a one-on-one introduction to your program, 20% of the people coming in your door will just not want to do it.
Chris Cooper (09:33):
And it’s because they’re already feeling awkward; they’re already feeling insecure. Like, “I don’t know if I can do this. Man, these workouts look hard.” Now they have got to do that in front of a group of strangers. Like, think about that, OK? Not only have you never played the piano before, but your first lesson is going to be on stage in front of 15 other people who are just going to stand there and watch you. That’s how they feel. So, offering that one-on-one option, most of the time, it invites people who would not normally join a group class. In our gym, there are also people who prioritize their schedule over their budget. For example, like, “I need to come at 10 a.m.” “We don’t have a class at 10 a.m.” “OK, I’ll do personal training.” Or you know, maybe they’ve got a unique characteristic: one leg shorter than the other, they got this old shoulder injury. They should not be in a group class self-moderating or scaling. They should be working one-on-one with a trainer, getting them ready, so they can be successful maybe in your group program later. So having that one-on-one option, it’s great for the business. We didn’t even talk about that. But the most important thing is it’s better for the client, and it’s not a barrier to entry at all. It’s an appropriate entry that also serves as a barrier to exit.
Mike Warkentin (10:42):
Yeah, I’ll give you the feedback from ground level: I was terrified to put an on-ramp in place because I’m like, “OK, I’m going to charge $400 in advance of $150 unlimited group membership.” That seemed horrifying to me because I’m just going to screen out all these people. But what actually happened is when I sold on-ramps, I realized every month that I sold a bunch of on-ramps was a profitable month, and the months that I didn’t were not profitable. And because I had these on-ramps, people stayed longer. And then again, Two-Brain retention data says, I think, 14 months—it takes average retention from eight months with a free trial if they join to 14 months with an on-ramp. That was floating my business because people were staying around longer. So, as I started to look at that, I realized this is actually a huge financial boom, and it’s better for the client.
Mike Warkentin (11:25):
Talk to me now about, so I mean that model—the group model—works, but it’s going to work way, way, way better if you have that introductory one-on-one thing where you build these relationships and move people through. And so, when we have this model in book, 150 people, you can make a hundred grand, but that intake of five people a month with an on-ramp of—I think it’s five sessions or six sessions at $300, something like that—adds in a chunk of revenue and supports the gym and increases retention. So that’s why, listeners, you’ll see that one in there. Chris, talk to me about the group model, but with a lot more PT and a lot more even like high value services, like that’s another evolution of things where we still have group classes, but now we’re adding in other revenue streams. What’s going on in those two models?
Chris Cooper (12:07):
Yeah, I think the next model, which some would call like high-ticket for example, is taking a step up and saying like, “OK, what does the client actually need?” It’s a more holistic view of their fitness. So, they need to exercise? Absolutely. Do they need the support of a community? Maybe. Yeah, probably. Do they need a coach? For sure. They have not succeeded before. They need a coach; they need your guidance. OK, so one element of what we need to change their lives is fitness that’s fun, that keeps them coming around with good retention and coaching. Another element might be nutrition; another element might be sleep. Who’s looking over that whole thing? Or are we just servicing like the one hour of their day and maybe it’s the best hour of their day, but it’s only one hour of their day and maybe three or four hours of their week: Is that enough to change their lives?
Chris Cooper (12:55):
And so if we take the perspective of, like, “What does the client actually need to change their lives?” that becomes a much more valuable service. And I said it’s a more holistic service because usually when people buy a high-ticket item in gyms, what they’re actually doing is buying the whole package, right? The holistic view of fitness, including exercise and nutrition. So, a lot of gyms will have a high-ticket offer. This could be anywhere between 1,000 and 3,000 bucks. I would say that an on-ramp that costs $300 is like a higher-ticket offer than what most gyms sell. So, you know, consider that whole spectrum. But in many cases what these gyms find is that when a client comes in and they’re paying $2,000 for the first two months, month even, they are getting so much attention from the coach that they can’t fail.
Chris Cooper (13:45):
And what’s interesting is that it forces the gym to be just on top of that client because they’re basically saying, “We’re going to guarantee your success here.” After that initial two months, the conversion into group classes is pretty high. Like a lot of people will take that, the first two months, they change their whole life; they get some good habits established, and many will continue with that. But let me go again. Another 90 days at your top tier offer: Some will convert into group, but the best gyms after doing this for a few years have found that they need to build the two things together. So, I’ll give you a great example from a gym that’s really crushing it in Two-Brain. And these guys are in San Francisco, so their high-ticket offer is $2,700, and that gets them through their first three months.
Chris Cooper (14:29):
OK? So, 900 bucks a month. You’ve got a dedicated coach who’s overseeing your journey, and that coach is going to tell you, “OK, you need personal training twice a week, but you need five workouts a week, so your other three are going to be group. Here are our group classes; which ones can you make? Then I need you to talk to our nutritionist. And then I’ve got a sleep expert that you’re going to talk to,” or “I’ve got a habits person,” like they can prescribe anything. They’ve got a bigger toolkit, and three months in the client has established amazing habits and patterns. And so now the client has a different perspective on things, and they say, like, “OK, well, what parts of this do I need to keep going?” “Well, you need to keep exercising four times a week. Do you want to keep going one-on-one, or do you want to do group, or what is it?” And basically, this health coach—or this expert or whatever you want to call them—is telling the client: Go to two classes. Go to two personal training sessions. Like they can draw from all the different offerings that the business has. And that is dramatically different than saying, “You pay this, and you’re allowed to come to this many classes per …”
Mike Warkentin (15:33):
And that kind of leads into the other model that’s in there: group plus personal training, where you’re just selling a number. It’s not like 1,000 personal training sessions a month, but it’s like a smaller number where you have this second revenue stream. We don’t have to beat that one to death, but the idea is just you’ve got a bunch of group clients; you’re also selling personal training—those two revenue streams combined to produce $100,000 a year in net owner benefit in our spreadsheets. Chris, what are the key aspects of that model that you want to point out?
Chris Cooper (16:00):
Yeah, so I mean the person who’s using this uber successfully is Per Mattsson over in Sweden. And this model is working so well for him that he’s actually buying up other CrossFit gyms and partnering with them. And you know, it’s really awesome to see how fast he’s growing. But what happens is somebody signs up for a membership at his gym; that membership includes both group classes and one-on-one training. Now of course the price reflects that the price is quite a bit higher than if he was just selling group classes. But what he’s doing is basically taking the prescriptive model and saying, “Here’s exactly what you need, except here’s our base; our minimum is going to be group plus one personal training session a month so that we can work on your weaknesses, address your program and maybe change course if we need to.”
Chris Cooper (16:45):
The thing is, if people can’t change course—if their option in your gym is just do these group classes, eventually they’re going to change their mind about what they’re doing. But as a real coach who has a higher-level perspective on things, if you can say, “OK, this isn’t working; we need to change and do more personal training or more nutrition,” like that’s how you keep the client because they can shift direction without shifting gyms. And so, adding like that base personal training to the group model does a few things: It increases client value, it serves as a bit of a filter because not everybody’s going to want that—here are other CrossFit gyms close to all of Per’s gyms—but it also creates a more standardized income stream for his trainers, the people who work for him. It creates better long-term client results; it increases retention. So, it’s good for the business and good for the client. And that’s what’s beautiful about some of these models is it’s not just what’s best for the business or what’s best for CrossFit HQ: It’s what’s best for the actual client and the business owner and the staff, and that’s what we want to show in these spreadsheets too.
Mike Warkentin (17:51):
Yeah, and it’s really neat because if you take the industry average for a group training—it’s about $160, something like that—and add in the industry average for a PT session, which is about $75, all of a sudden, your average revenue per member if you sell that hybrid program is about 235, which as opposed to 160 is a huge, huge difference. If my ARM was 235 back when I was running a gym 10 years ago, I’d probably have a different car in the driveway. But the idea is, it makes a huge difference, and it’s just one extra session. The cool part about this though is that people say, “Oh, I can’t find people who are going to pay $235 a month.” We only need 150 in these models. We break down the exact number of clients that you need, and it’s not 500 people.
Mike Warkentin (18:30):
Maybe you can’t find 500 people who want to pay this, but could you find 150? And the spreadsheets will show you exactly what these numbers are. And like Chris said, you can take these things and start playing with them and saying, “If I reduced this to 70 clients, and I charge this, then OK,” and now you’ve all got—this is the beauty of the model. I want to get into this one because it’s a really interesting one. It’s a newer model that we’ve come up with: semi-private training. What is this, and how does it work?
Chris Cooper (18:56):
Yeah, man, so semi-private has been around for a while, and it’s slowly cropping off more and more. And the trend, we spotted it on our leaderboard. Who are these people who are doing $400 or $500 per month in ARM. One of these guys, honestly, Mike, last night texted me, he’s like, “My net owner benefit, so my take-home this month—one month take-home—from two semi-private gyms is $35,000. What do I do with it?” And I just went like, “That’s insane.” So, he’s got two gyms that are about 2,000 square feet each. He provides an income for his trainers that’s like double the industry average. His retention is incredible. What’s he doing? It’s semi-private. So, the way that semi-private works is this: There are 3, 4, 5 of us training together in the gym at the same time.
Chris Cooper (19:47):
You and I have different programs, but we’re sharing the same coach. And so, at 11 o’clock today, literally an hour and a half from now, I’ll go into my gym, there will be three people warming up and each one of us has our clipboard with our program on it. The coach has looked at each of our clipboards in the past, like she knows exactly what we’re doing today, and “Chris, you’re warming up on the rower. Lauren is warming up on the assault bike.” Who else is in there? “Kelsey is like 36-weeks pregnant, so you know, she’s doing like some air squats to warm up and stuff, and Bev is brand new, so she’s going to be doing a lot more one-on-one with me.” So, during the course of the next hour, I know what I have to do.
Chris Cooper (20:27):
I have some press today, and I have some front squats today. So, my coach, Jessica, is going to come around and be like, “Coop, you know, why is your right elbow sagging on your front squats? Like, let’s really focus on that.” Whatever. She goes to Kelsey: “Kelsey, slow it down. We don’t want you to give birth on the floor.” She goes to Lauren: “Lauren, hold that. Get your bum down on the plank.” You know, and that’s semi-private training, and for most of us, that ticks all the boxes. Like I’ve got a fun little group that I work out with. I’ve got a personalized program for my goals, so I know what I’m doing today, but it’s not what they’re doing today. I’ve got a coach overseeing me. 25 years into coaching fitness, I still want a fitness coach. And what’s really amazing about this model is not just that it’s great for the client, but it’s amazing for the gym.
Chris Cooper (21:11):
I mean that that coach will be making $80 an hour to coach four of us. Each person in our little semi-private is paying slightly less than they pay for personal training, but way more than they would pay for like CrossFit group classes at my gym. It’s just such a win for everybody that my coaches really just want to do semi-private all the time now. And this is the biggest challenge in semi-private. It’s a really growing model. It’s very effective. And to be honest with you, Mike, and absolutely frank, if I’d known about this in 2008, I would not have opened up my second location. I would not have tried to jump to group classes. I would not have starved myself for three years and almost gone bankrupt trying to figure this out.
Mike Warkentin (21:48):
It makes sense. Listeners, this is the basic summary. This is like PT light. So, if you think about a PT session and you’re talking to your clients in between sets, and you’re just like shooting stuff about the weekend and so forth, basically think about if you didn’t do that part; you just moved on to another client, coach them on something, watch their thing, go to the next person, next person. You’re just administering, say, four individual programs at once. Takes a lot of skill, but you can do it if you’re a good coach, and you’re just cutting out some of the other stuff that you maybe don’t need.
Chris Cooper (22:14):
Yeah, I mean the hardest part about personal training honestly is boredom for the trainer. Like once the program is written, the exciting part’s kind of done, and what we would find when we were just doing one-on-one training is you would have 10, 11 clients in a day, and you’d have the exact same conversation every hour on the hour, and at the end of the day you’d be like mentally exhausted from making small talk. That doesn’t happen. I mean, yeah, there’s beauty in the group, right? Like, but you can get that beauty from four people instead of from 12. There’s cheerleading that goes on; like, when Linda in our group was coming back from an injury, and she was able to squat to a 13-inch box, like the other four of us just went bananas, and it’s awesome. Semi-private is different from small group though, and maybe this is where we segue into what small group training is, Mike.
Mike Warkentin (23:04):
Yeah, and before you do that, I’m just going to say, listeners, I’m going to put a link in the show notes to—Brian Bott is our expert on semi-private training. He did a whole show on this. So, if you want to dig into this model, Brian lays it out in total detail. You can find out everything you want about this, so if you review our spreadsheets and the new guide and check out what Brian has to say, there’s some really cool stuff in there. Small group, Chris, a little bit different. I’m not doing my own program, but what am I doing?
Chris Cooper (23:27):
We’re all doing the same program. So now instead of you and I training with two other people, and everybody’s got their own program, we’re sharing a coach, we’re all doing the same thing, but we’re sharing a coach, and it’s really, really interesting this model. So usually, you charge quite a bit more for it because what you’re charging for is like—
Mike Warkentin (23:45):
I didn’t. I did this, but I did it with three-person group classes.
Chris Cooper (23:47):
Yeah, yeah, exactly, right? We were doing small group training at like big group rates, and that’s the mistake is—
Mike Warkentin (23:53):
You can charge more for this?
Chris Cooper (23:55):
Like twice as much, and you know, you’re attracting people who value privacy, having their own little tribe of five or six regular buddies, having their—they can determine kind of the schedule that they’re on. And what’s interesting is this was Glassman’s path. If you listen to my interview with him at his kitchen table, he describes exactly what he was doing, and he went from one-on-one personal training to: “I can’t fill any more sessions. Hey, I’ve got this other person training with me; I think you guys would be a great match. Let’s try it. Let’s do two-on-one to three-on-one to four-on-one.” And you know, he’s talked about this in a lot of the journal videos too. Eventually he got up to maybe five- or six-on-one, but he was still charging close to personal training rates, and that’s why he didn’t need bigger than like 1,500 square feet.
Chris Cooper (24:41):
I mean, I think you’ve been to the original gym, I’ve been there—like, yeah, tiny 800 square feet down below and a little tiny balcony thing up above, right? People can see pictures. That’s where the confusion is: What was small group training back then? And we never heard about that. And so, there are gyms like Daniel Purington who’s absolutely killing this right now. He is doing CrossFit with these people, and they’re getting amazing results. He’s got amazing retention, and he is charging like double what the other gyms are in town. It’s a really good model. And the only thing that stops gyms from doing this is mythology that comes from like other biz coaches telling you to have big groups and what’s in between their own ears.
Mike Warkentin (25:22):
So it’s just creating value instead of saying, you know, “Group classes are this price, and you come and whoever shows up gets the same treatment.” It’s saying, “These are capped small group training sessions where I’m giving you x amount of attention. It’s high value.” You promote it like that, and you can charge more than what essentially worked out to like 7.50 a class for me if I was charging 150 for unlimited, right? So that’s a really interesting way to charge more. And like I said, I literally did this, but I charged the wrong rates because I just charged $150 unlimited. And honestly, many of my classes had three or four people show up. Some had one. I was giving great coaching, but I wasn’t making any money. And then I had to come see you because I was going under.
Chris Cooper (25:59):
Well that’s the real irony, right? Small group coaching is the model, but most of us only have six or seven people in the average class anyway. The problem is not that we’re not doing a good job with this. The problem is just that we don’t understand what our actual service is, and we’re not charging for it. You know, it’s not like, “Oh, you should just double your prices, and that’ll fix everything.” It’s: You need to understand what value is; it’s not just like having a time for people to work out in a big group of 15 and like, I’m going to—if you’re doing something seriously wrong, I’m going to come and triage your knees or whatever. It’s like we’re going to coach you. I’m only going to split my attention five other ways. You’ve got just enough people to keep you moving forward, but not so many people that you’re lost in the big group and that’s—you’ve got some time flexibility there.
Chris Cooper (26:48):
A lot of my clients who do personal training, it’s not because they’re scared of the group, it’s because they’re scared of what happens at noon in their business or their life. Like they can’t come at—so they’re paying for convenience. Yeah. And I really think this is a really successful growing model. There are so many brand-new franchises like Alloy, where they do small group personal training. They will not allow their franchisees to say the word “class” because gyms have basically created such a low value proposition for the term “class” that they don’t even want to be associated with that. So, it really is like a growing market segment, and you’re going to hear a lot more from gyms doing semi-private and doing a small group in the future.
Mike Warkentin (27:30):
Gym owners, if you’re not making what you want to make, I would encourage you to dig into this part of our new guide. Look at that spreadsheet, look at the numbers and think about what you might be able to do with this. I want to go to the last one, model five, and this is one that I hadn’t heard of until earlier this year: guided access. What is that, and how does it work when you’ve got this large space, and you’re not running the corporate gym where you’re handing out towels at the front desk?
Chris Cooper (27:53):
Yeah. This is kind of a different value proposition of clients. And so, Joe and Alessandra from CrossFit Mass, they came out of COVID with no staff. Now they’re in Boston, right? CrossFit Mass is short from Massachusetts, and Boston was locked down longer than a lot of other places—you know, California and Canada, we were kind of the same, New York. But what they found is like, “OK, now we’ve got to reopen. It’s just the two of us. Do we really want to do this again?” They had a very successful gym, and they said, “There’s got to be another way.” And so, what they actually did was incorporate programming with coaching at certain specific times and access to the gym. So, there’s a fantastic podcast on this, but—
Mike Warkentin (28:34):
We’ll link to that.
Chris Cooper (28:35):
Yeah, OK. In a nutshell, you sign up at their gym, Joe, who is an expert at writing programming—or Alessandra, another expert at writing programming—they’re going to write your program for you. You’re going to do some one-on-one sessions until you know exactly what you’re doing. And then you can show up at the gym anytime between like 6 a.m. and 9 o’clock at night. You just boop in with your little key swipe thingy and, or your app, whatever system you’re using. And if you want to come while there’s a coach on the floor, there will be a coach on the floor from 9 until 12. You don’t have to start at 9 sharp, you can start at 9:15, you can start at 10:01, whatever. The coach will guide you, like semi-private. If you can’t make that window of time, no problem. Show up at 1 o’clock.
Chris Cooper (29:18):
There’ll be somebody in the building. And if we’re busy, like we won’t be coaching you, but we’ll be around if you don’t understand something. Do your own thing. You know, if you’ve been around for a while, you don’t really need the coach, but you want to show up when there’s other people here, come between 9 and 12. If you’ve been around for a while and you just need to get in and get it done, hey, come at 3 o’clock; get it done. Let us know it’s—we’ll see it in the app that you’ve completed it. And this model is brilliant because Joe and Alessandra—and I can testify to this; they’re in our Tinker program. They’re with me four times a year, like in Vegas, in Dallas, wherever—they can leave their gym. They have like one part-timer who fills in for them sometimes.
Chris Cooper (29:57):
Alessandra works from about 7 a.m. until about 11 in the morning at the gym. Joe goes in from 4 until 7, the rest of their work is completely remote. Very successful gym, very high ARM; they don’t need a massive space to do it. It’s amazing. So, I do love this. And you know, Mike, I just want to reiterate: Our goal with this guide and this podcast is not to say that one is better than the other. What we’re saying is that you need to have a model. You need to have a plan, and you need to select a plan based on the strengths and weaknesses and your personal preferences. You can make a great living with big group training. Sure, follow the plan. Like if you’re going to do that, you have to have a high ARM, that’s all. Because you’re going to have a higher churn rate.
Chris Cooper (30:39):
That’s just how it is. You’re going to need to recruit more clients; you’re going to need to do more marketing. That’s how it is. But if that’s what you want, you can do it, and we’ll show you how. If you want to do guided access, you need to have a bigger skill set and programming. You need to have a different clientele; you need to have a different space layout, right? Like you need to have the key card access thing. You can do it, and we’ll show you how. You just have to know the pros and cons of each one before you start. And we made semi-private and small group really sound rosy. But of course, there are challenges to that too. Like it’s very hard to introduce semi-private if you’ve just been doing group classes. If you’re a personal trainer, you’re crazy not to do this. But you know, there’s pros and cons to both. We can help you with any one of these models. Absolutely. The key is just to get gym owners picking a model, knowing what’s involved and making an informed decision. We’re not against group coaching; we’re not only telling people to do semi-private. We’re business mentors. We want you to understand your metrics so that you can make decisions that will benefit you for the rest of your life.
Mike Warkentin (31:40):
Yeah. And this guide has that laid out. There are five clearly defined models, but we’re not tied to those models. It’s not the only five that exist; it’s just five very common ones where you can—we’ve got executive summaries in there. So, if you don’t care for spreadsheets, you can look at the bullet points of “Here’s the pros. Here’s the cons. Here’s the essential details.” If you want to dig into the spreadsheets, you can go further, and then you can recreate this stuff and start fiddling around to see where the numbers work for you. But these aren’t the only five models. That’s the benefit of Two-Brain membership is they’re going to create the model and help you implement the model that works for your exact business. And it might be one of these five; it might be a combination. It might be something slightly different. And we’re always looking to figure out what’s working right now. That’s kind of where semi-private and guided access came from. That was something we weren’t talking about a year ago. And then Joe and Alessandra come up with this. Brian Bott starts telling us these amazing things that are working elsewhere, and we get these new things. So that’s the benefit of the data, hey, Coop?
Chris Cooper (32:30):
Yeah, and really this is the long-term benefit of tracking these metrics. Like you, the gym owner listening, watching this, you have to track these metrics so that you can make these decisions yourself. It’s not enough for me to be like, “Big group training is the way to go.” You know, ultimately, you’re going to be doing this for 30 years. I would love to be with you every day, but I won’t be. You need to know how to make these decisions. And so, the interesting thing though is that when you’re as big as Two Brain is, we see these decisions being made and the metrics being tracked across hundreds, thousands of gyms. And so, we start to see these trends. Like we weren’t talking about small group training in the last guide. We had never heard of guided access in the last guide, but as these things prove themselves to be better with actual numbers and owner lifestyle, we can start talking about them more. We’re not just guessing. We’re not hyping our favorite method or like whatever HQ or F45 is telling us to say. We can say, like, “Here’s what actually works because we’ve got the proof.”
Mike Warkentin (33:31):
Proof, and the data is available. Chris, how can people get this new guide?
Chris Cooper (33:35):
You just got to go to gymownersunited.com, and that’s a Facebook group, and you’ll see the guide stuck to the top, and all you do is just send me a quick DM on Facebook and say, “Can I have that guide?” In fact, if you’re just on Facebook, you can shoot me a DM there, and say, “Can I get that guide?” And we’ll give you this five-models guide. It doesn’t mean you have to change what you’re doing. It doesn’t mean that what you’re doing is wrong. It just means like this is—you’re going to pick one of these models, and that’s your goal, and you’re going to slowly work toward that model. If you want to work toward getting to that model faster, you use a mentor.
Mike Warkentin (34:06):
Go on Facebook, send Chris a DM; head to Gym Owners United. You can interact in there. Continue the discussion on this, and another thing, you could talk about models that you see working, ask some questions. Two-Brain mentors are in there all the time. And you can get the guide through that group as well. Thanks, Coop, for laying this out. This is really interesting. I’m really curious to see what happens when some people start working on these newer models and see what happens. Thanks for being here.
Chris Cooper (34:25):
Yeah man, thank you. Use these as a template. Everybody should have their own business model. Use a mentor to help you build one if you don’t know how.
Mike Warkentin (34:33):
This has been “Run a Profitable Gym.” Please hit subscribe on your way, and be sure to get that guy by DMing Coop.
