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The NonCompete

May 2, 2016 Gym Operations
Originally posted on DontBuyAds.com on 8/9/11. Note: CrossFit affiliate agreements specifically prohibit using a noncompete clause. But you can still use a Non-Solicit agreement, and you should have a confidentiality agreement anyway. The NonCompete A topic that’s been getting a lot of attention on the Affiliate discussion boards lately is the NonCompete Contract. With some centers now supporting 6 or more CrossFit boxes, it’s no surprise that Affiliates are considering the possibility of Coaches moving around from Box to Box. A bit of diffusion with Coaches, just as with athletes, is to be expected: no one is a perfect match for everyone. The big fear, though, seems to be that the cost of developing a Coach – which takes years and a TON of money – can be tossed aside when the Coach leaves to start her OWN Affiliate, usually taking clients with her. How can we know the correct way to write a NonCompete contract, preventing a staff member from going out on their own and drawing staff members, without a lot of trial and error? We can put a contract on the firing line and try to defend it. In our case, we’re currently defending AGAINST a NonCompete contract from another business. We’re going to win. More importantly, we’re going to learn where the law works to uphold a NonCompete contract…and where it won’t. When a court is considering the validity of a NonCompete contract, it has to answer three questions: 1.  Does the company have a proprietary interest that’s entitled to protection? Have you developed specific knowledge that can’t be gained easily, or without much effort, by the common person? Are others doing similar things in your area already? 2. Are the temporal or spatial restrictions too broad? After all, while you have the right to protect your business, you can’t stop another person from making a living forever, or remove them from the industry…. 3. Is a ...
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Episode 27: Meet The Browns

May 2, 2016 Podcast Vision
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Pricing Specialty Groups

April 27, 2016 Selling Gym Memberships
No matter what stage of business you’re in, your goal is the same: More revenue, less time. In other words, increasing the value of your “working” time. Like you, my job doesn’t always feel like “work.” But if I can leverage my time better, I can spend more time playing with my kids, my barbells and my investments. And I can afford better coffee, shoes and coffee. (I know, I said “coffee” twice, but my coffee budget is easily twice my shoe budget.) Someone once texted me this: “Pretend you’re a lawyer, and you bill at $120 per hour. Now add up the time you spend on Facebook. What’s that time worth?” Ouch. YOUR time might not be worth $120 per hour yet. But our goal is to get it moving in the right direction now, and that means increasing the value for your time. Let’s start by calculating the value of your time spent coaching: 1. Take your gross membership revenue and divide by your total number of clients. This will tell you what the average client pays you each month. Gross / Total clients = average membership 2. Divide by average attendance. How many times does the average client attend each month? Average membership / average attendance = average revenue per visit. 3. Multiply average revenue per visit by your average class size. Average revenue per visit X average visits per class = value of your coaching time. For the sake of example, let’s assign an arbitrary value. 10 clients paying an average of $10 per visit = $100 value of each class coached. When you’re planning a specialty group, the value of your time should always be HIGHER than an average class, because: Novelty. Specialty knowledge required. Limited time. Limited space. The value of your time should always be moving up. It doesn’t make sense to do more work for less money. Let’s imagine we run an 8-week ...
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Adherence and Retention

Retention and Adherence

April 26, 2016 Member Retention
I hated client contracts before I sold the first one. Convinced I needed contracts to be a “legitimate gym business,” I copied something I found online and presented it to Client 001 and 002, a father and son. “What if we don’t like it?” the father asked. I probably gave him some backpedalling speech about commitment to his goals. “What if he gets hurt playing football?” he glanced at his son, a teenager.“There’s stuff we can do. I’ll give him some rehab work,” I said, already over-promising. Guess what happened? A year later, after enforcing the contract with some clients and not others; after losing sleep over every cancellation request; after turning away potential clients who loved the workouts but weren’t ready to make a commitment, contracts were my biggest source of stress. But I was also barely breaking even. I thought I just needed to “harden up” and enforce the contracts better. Or, as my mentor suggested, I could find another way to keep people around. First, I had to define what I was trying to improve. The science of keeping people around can really be measured two different ways: Retention – The span of time between a client’s first visit and their last; Adherence – the frequency of a client’s visits (usually per week or month.) While these numbers are loosely correlated, there’s no direct parallel (for example, a client who attends more times per week NOW isn’t more likely to stay longer, necessarily.) To me, the retention numbers that matter are year-over-year retention. Others measure retention as the likelihood of a second purchase: “We have 75% retention after OnRamp!” – that means 3/4 of the people who finish your on-ramp program sign up for at least one month of your service. What if they all quit after the first month? Year-over-year is what matters to me. When I started developing our retention system, I thought I could duplicate ...
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Episode 26: The Obstacle-Racing Overlap

April 25, 2016 Gym Operations Podcast
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First Principles of Fitness

April 22, 2016 Personal Development
Most of what we know is unproven. In fact, we THINK a lot, but we really don’t know much. Most of what we “know” is really just the opinion or thoughts of another person. We believe in certain ideas because they tell a compelling story, or support our worldview, or were said by a person we trust. What do we really KNOW to be true? What’s incontestable? These are the First Principles on which we can build. Here’s Elon Musk: I think generally people’s thinking process is too bound by convention or analogy to prior experiences. It’s rare that people try to think of something on a first principles basis. They’ll say, “We’ll do that because it’s always been done that way.” Or they’ll not do it because “Well, nobody’s ever done that, so it must not be good.” But that’s just a ridiculous way to think. You have to build up the reasoning from the ground up—“from the first principles” is the phrase that’s used in physics. You look at the fundamentals and construct your reasoning from that, and then you see if you have a conclusion that works or doesn’t work, and it may or may not be different from what people have done in the past. When our beliefs are challenged, that’s heresy (exhibit A: Greg Glassman vs “The Scientists,” circa 2002.) Schopenhauer: “All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.” Glassman challenged fitness dogma, and mostly won. But has “Fitness In 100 Words” replaced the OLD dogma? Are we simply singing from a new hymn book? What do we KNOW to be true? Post your responses in our private Facebook group (if you ask, we’ll let you in.) Other ways to think phrase the question: What IS fitness? What’s required for the development (if anything) of fitness? What tools are available to ...
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