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Is Cash Flow the Most Important Thing?

(originally published on DontBuyAds.com, Oct. 28 2010.) Cash Flow Trumps Revenue The worst 30 minutes I’ve ever experienced in this industry wasn’t in a gym. It was on a comfortable couch in a shareholder’s office. I was there to ask for money. Three years in. Beyond the original investment – only $16,000 – I’d never asked for money from these guys.  My goal, only a few months before, had been to buy their shares back, and take 100% control of the company where I was spending 80 hours every week. And here I was, hat in hand, asking for a cash contribution to make payroll. Even worse, the share structure meant a leveraged short-term loan: for every $250 contributed by the shareholders, I’d have to come up with $750 myself.  All I could pry from my partners was $500, because I didn’t have the cash to match their piece of the pie. “How are sales?” they asked, sympathetic.  “Strong,” I said, “but we have huge accounts receivable.” To the tune of around $12,000, I didn’t add. In fact, if even one or two of the larger accounts paid their bill, I wouldn’t have had a problem at all. “Have you been paid this week?” one asked. “No.” I quickly replied. They knew they were unlikely to make their commission that month, too. An hour later, after discussing a few ideas that I didn’t want to pursue – calling clients to demand payment, offering a discount for immediate payment, adding an interest charge to accounts, selling the debt for 20% of its actual value – they gave me $500 between them, and I left, broke and doubting my future in business. A week later, I was sitting at a buddy’s kitchen table. Nick owns an auto body. He’s fifty-five, had two heart attacks, and put two daughters through school. I was bemoaning my credit problems. “Yeah, I know a guy who had ...
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Episode 71: Remote Control, with Brian Lelli

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Why Do You Own A Gym?

By Ken Andrukow, TwoBrain Mentor To make a quick buck? To be surrounded by beautiful, fit people? So your friends will pay to work out with you? There are probably thousands of fitness trends that, if you were to invest in them as a business owner, would provide you with a means to these goals. CrossFit is different. We build a community based on shared values: health, being physically prepared for the real world, and personal growth. As a CrossFit gym owner, you are in the enviable position of being able to make a career sharing your passion for these values with others. With this privilege comes great responsibility. On one level, you are responsible for the success or failure of your gym and with that accountability comes the need to be exceptionally productive—a concept your mentor will help you manifest in your earliest days with Two-Brain Business. However, authentic leadership goes deeper than that. You are leading a community based on shared values, so HOW you live needs to be a reflection of these values. Nobody wants to follow a leader who is struggling and suffering. People want you to lead and be an example for which they will pay the appropriate value. Living a pied piper’s life is not something that people aspire to or are inspired by. Leadership through pursuing your values requires you to continually ask yourself the question: why do I own a gym? I built a company so that I would be able to help others and then to be able to help others help others. I see exponential growth in everyone around me because it’s part of my core values and I make sure in my perfect day as a gym owner, I’m investing in others. For example, I could coach 10 classes a day of 20 athletes and positively impact their growth. That seems like a step in the right direction, but ...
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TwoBrain Radio Replay: Affinity Marketing

Online marketing sure is sexy. We teach Facebook marketing, Instagram, Twitter in our Incubator. We teach you how to build landing pages, email campaigns, and even run podcasts or webinars. But the BEST new clients will ALWAYS come from your current clients. The people most like your favorites are probably their families. Or their coworkers. Or their best friends. But most “marketing plans” in the fitness world  start with the people LEAST likely to want your service, and then try to filter out those who don’t fit. It’s like cutting down a whole tree to find the right twig. Instead, start from a seed. Build a tree on which EVERY branch bears fruit. That’s Affinity Marketing. We’ll teach Affinity Marketing at the 2017 Summit. And we’re really excited about our new Facebook Marketing Course, coming soon! Want real, one-on-one mentorship to take you from building a more solid foundation right through growth? You need RampUp. Affinity marketing starts with your SEED clients: those perfect members who are most tightly connected to your brand. Then we move outward from the center: helping those people who are most tightly connected to your perfect client. Then, ring by ring, we identify the spheres of influence owned by the client. I give a few examples in this podcast, and then diverge into psychological and behavioral retention strategies. Affinity marketing is one of 9 recurring marketing strategies I teach as part of a monthly marketing plan. Specific examples and strategies are outlined in my book, Help First: Sell Less. Profit More. Recorded on April 10, 2016 in front of a fire under my rig at home.Follow TwoBrainBusiness on Facebook and Twitter!
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Setting Expectations

I opened my own gym because, like you, I am passionate about helping people and I believe CrossFit is one of the best ways to accomplish that. I thought that, to be a success, I would need to make every athlete who walked through my doors happy. In going above and beyond, I’d earn their loyalty and, just as importantly, their business for the long term. I’m sure this sounds very familiar to you. Some time ago, I learned a valuable lesson about the cost of doing too much for individuals, and why as business owners our focus needs to be on providing scalable services to the whole membership: one for all, not all for one. In the early days, I enjoyed being within arm’s reach of each client; taking in their input and responding whenever I could. As you know, as coaches we’re often approached by clients with limitations caused by current or past injuries, and the standard scaling and progressions that our coaches provide in every class don’t work for them. Instead, they need outright substitutions. I had one client in particular who I had gotten to know well. She attended WODs consistently and worked hard; we even had a couple of coffee dates where we talked business, workouts, and kids. When an old injury flared up on her, she began asking me and the other coaches for typical scaling for stressor movements. Of course, this was the norm for all of our clients and something that we were proud to accommodate. Those worked for a while. Then, as even the scaled movements still aggravated the injury, she began asking for different exercises she could do during the WOD in their place. Then I realized that we were scaling entire workouts for her daily, and personally spending more than 10 minutes with her in any given class. My husband Jason decided to write up a scaling guide she could use for every WOD that ...
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Why Gym Owners Need Business Mentors

By Ken Andrukow, TwoBrain Mentor and owner of Reebok CrossFit Ramsay If you don’t have a mentor, it can be difficult to understand the value of hiring one. Luckily, the industry we’re in gives us the perfect analogy with which to work. Replace “mentor” with “CrossFit coach”, and “business owner” with “athlete”, and now things make sense. We’re in the business of coaching athletes in functional fitness. The tools we use―burpees and box jumps, snatches and squats―they’re not secrets. But athletes come into our gyms to get coached on how to get the most out of their time doing these exercises. In one hour, they get the most efficient combination of metabolic conditioning, strength work, mobility, mental skills, so on and so on―this the core value we provide to our clients. Moreover, a CrossFit coach explains how to perform an exercise safely, helping the athlete avoid mistakes which cause injuries or prevent performance gains due to poor form. Some athletes would be able to figure these things out for themselves over the course of several months, maybe years. However, they see the value in putting themselves in the hands of someone who already has made the mistakes and will put them straight on the path to success. In the same way, our Two-Brain Business approach is systematic, just like CrossFit programming, but is personalized to your business and your strengths and weakness. What do you need to scale (hire the right person who has this strength)? Where should you push harder (devote your creative energy)? Are you addressing all of the areas you need to promote revenue growth? Mentors will show you how to get the most out of your business in the least amount of time, how to effectively apply your skills, and get you doing the right work to see gains in your business. WHEN DO YOU NEED A MENTOR? Going back to the athlete analogy, clients come ...
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