Mike Warkentin: (00:00)
Chad, I was thinking. There’s gotta be more to my life than just being ridiculously, ridiculously really, really good looking. Is there?
Chad Pinther: (00:09)
Well, you could run a profitable gym as well.
Mike Warkentin: (00:12)
Ooh. Well, I guess I could try that. How would you know that’s an option?
Chad Pinther: (00:18)
Well, I have been a successful model and I run a profitable gym. So I should know.
Mike Warkentin: (00:24)
Yeah. Prove it. Give me your signature. Look, if you’re a model, you have a signature look. Prove it. It’s like looking into the sun. Okay. I’m gonna have to ask, are you up for talking about the gym too?
Chad Pinther: (00:37)
Absolutely. I would love to.
Mike Warkentin: (00:39)
All right. We’re on it. This is Run A Profitable Gym. I’m your host, Mike Warkentin. Every week I talk to the world’s best gym owners. I find out what they’re doing in their businesses. You wanna subscribe so that you can hear all the tips and tricks. Now, today, my guest, the good-natured Chad Pinther is here. He runs Colfax Strong in Denver with his wife Esther. She was an accomplished swimmer and gymnast. Chad, you might have seen him on a billboard or even in a magazine. He’s worked as a model for 20 years. We’re not gonna make Zoolander jokes anymore. We’re gonna actually get into the business. Even though Chad humored me on the way in, he’s here to talk about earning a spot on Two-Brain’s leaderboard for net owner benefit in January. Now, net owner benefit, NOB, is the sum total of what an owner gets from their gym. It could be wages, could be dividends, could be other benefits. Our leaderboard in January ran from 16,000 to over $21,000. These are huge numbers. Now this is a rolling three month average, not a flash in the pan, or one good month. These owners are earning 48,000, $62,000 per quarter. And that’s not revenue or profit. That’s what they’re taking home to their families. So this is a big deal. You’re gonna wanna hear what Chad has to say. So let’s get to it. Chad, welcome to the show. Thanks for humoring me in the intro.
Chad Pinther: (01:51)
You got it. Thanks so much, big honor to be on here. I appreciate it.
Mike Warkentin: (01:55)
I can’t wait to talk to you about this because when I started a gym, I paid myself. My owner benefit was zero. It was nothing. I didn’t pay myself. I slaved away as a labor of love. It was a side project. It wasn’t until I started getting into the Two-Brain thing that I started paying myself and actually earning stuff from it. So, gym owners who have had this success is mind blowing to me. So let’s get right into it. Talk to me a little bit, how this number has changed over time. What have you done? Where did you start? Where’d you go?
Chad Pinther: (02:20)
Sure. Yeah, Mike, I completely understand that. So my wife and I did the same thing. We didn’t really make anything. And even when we were making some money, initially, we weren’t paying ourselves anything. But once we got onto Two-Brain and really started to work, predominantly the Profit First sort of framework, then we’ve gone basically three times since we opened in 2019. And not only increased our gross revenue three times during that time period, but we were also able to increase our net owner benefit three times.
Mike Warkentin: (03:04)
So you said originally when you started doing this, you got some increases, but you didn’t pay yourself anymore. Where was that money going? Because for me, every time I made something, I put it into some more kettle bells or I expanded it or did something and I never thought to pay myself. So what were you doing originally?
Chad Pinther: (03:18)
Yeah, so it was a combination of paying off any debt. I’m really big on being debt free. Worked really hard in my life to remain completely debt free other than a mortgage. And so we paid off a lot of the debt that we had to purchase the business. Little backstory, we actually bought the gym from the original owners that had opened in 2013, and we grabbed it in February 2019. Ok. So we paid off the debt, but also we were living in that fear mentality, kind of a scarcity ideology of, oh man, we gotta save this. So we would just leave it in the business account. Right. And it did accumulate, but weren’t really giving ourselves anything out of that.
Mike Warkentin: (04:06)
And that works for a while. ‘Cause I did the same thing. We’re very similar. It sounds like, well, I don’t like debt and I like to have a security blanket and so forth. But after a while you kind of start thinking, man, I’d like to see some benefit from owning this business. Right. Like, we need to make my life a little better. And I wasn’t doing that. So before we get into the exact details here, just tell me a little bit about Colfax. What do you guys do there? What’s your structure like? What are you selling? How does it work?
Chad Pinther: (04:28)
Great. Yes. So we are near downtown Denver, our name is CrossFit Colfax, I’m sorry, Colfax Strength and Conditioning. But we are still affiliated with CrossFit. So we are a CrossFit gym. And our affiliate name is CrossFit Colfax. Okay. So we provide predominantly group, but over the last year we really ramped up doing personal training. So that’s been a huge part of our increase as well. We also provide nutrition services as well. So that’s the work that we do in the gym.
Mike Warkentin: (05:12)
Okay. So that’s similar to what a lot of gyms do. The interesting part is that as a CrossFit affiliate, group classes are obviously the main thing. Adding personal training in his revenue stream and a nutrition revenue stream, all that stuff goes together like cookies and cream. Obviously, if you run a fitness business, a nutrition add-on is a huge deal. We’ll get into that a little bit more. But I wanna ask you before you get into that, what’s your net owner benefit strategy? Because there’s tons of ways that people do this. Like, some people will just take a salary from the gym, other people have corporate structures with wages and dividends and things like that. Right. Chris Cooper billed his truck and his cell phone through his companies and so forth. So how do you look at this with you and your wife? What’s your plan?
Chad Pinther: (05:51)
Sure. So I mentioned it before, the “Profit First” sort of framework. I think a lot of times, the idea is in most businesses is that you pay yourself after all your expenses, et cetera. And of course the great book “Profit First” was super helpful, recommended by our mentor Lisa. We originally started with Tammy and then Tammy retired and we jumped on with Lisa. She’s been fantastic. She’s in the UK. And so where we start with is, what it is that we would like to make, right? As far as our expenses, et cetera. Our savings goals. And then we build things from there. And then paying ourselves first out of that with what’s coming in the business. And then that helps us structure how we do our expenses, et cetera. Ok. So we have a definitive salary for my wife Esther and I, and that’s automatically taken out. So it’s not a situation where we’re looking at each month. Oh, I think we’ve got enough to pay ourselves. It’s definitively given to us as well as automatically setting aside everything for retirement in our savings goals. And then we do some, oh, sorry,
Mike Warkentin: (07:15)
You go ahead. Finish off that.
Chad Pinther: (07:16)
Yeah, and then we do some distributions once we know that we’ve paid taxes and things like that, paid obviously all of our coaches and everything and got that. Then we’re able to pull some additional distributions out, that we can utilize for other things that we’re doing within additional investments and things like that. And we’re also building some liquid capital ’cause we wanna move into doing some real estate investment as well in the next year here. We’ve got plans for that.
Mike Warkentin: (07:52)
Oh, I’m excited to have you back and hear about that stuff, ’cause that would be very cool. Yeah. So when you say profit first, are you referring to the John Briggs “Profit First for Microgyms”, that specific variation or the larger “Profit First”? Yes. Yeah. Okay. So if you haven’t seen this, we’ll put a link to the book. John Briggs wrote a “Profit First” variation. It’s specifically for microgyms. Right. And he’ll tell you how this whole situation works. John has been on the show as well many times, and he can help people out with tax and accounting. So that’s a big plug for him. The concept though is that rather than pay yourself last, and this is exactly what I did, I ran a gym and I thought if there’s money left over, I’ll pay myself something. And then of course, there was never money left over because I always allocated it to other stuff, or I sat on it because I was scared that I wanted to build up a savings or anything like that.
Mike Warkentin: (08:38)
And eventually I got angry that I wasn’t making any money. Right. So the “Profit First” concept tells you, you pay this to yourself, you take the profit out. If you take that money out for yourself first, and then you allocate things. There’s a whole system of accounts that you can actually set up and they’re streamlined or very specific variations of this where you have your tax account, your operations account, all these different things, and you start to put that money aside so that it’s always there. Now did you follow that exact plan, the regimen, all these different bank accounts kinda thing?
Chad Pinther: (09:06)
Full disclosure? No, I did not. I personally thought that was, in concept, fantastic. I thought it was quite a bit, complex. More than I wanted to kind of have a lot of those moving parts. But of course, we obviously have a definitive business account, right. We keep everything separate from personal. As well as, I’ve got a CPA that we work with, and they’ve got access to all of our QuickBooks so that they know exactly, okay Chad, here’s what’s coming in, here’s what we know you need to take out. And so towards the end of the year, she can kind of see projections and she’d say, okay, we might be a little bit short here, so we’re gonna do an extra draw out for your taxes. So I’ve got somebody on that that’s managing that. So it’s not a big surprise at the end of the year. Like, uh oh, we owe this much more money. And so we had some record year this year. We’ll probably have one this coming year for sure. But having somebody on that, I think, is just as effective for us as having all these separate accounts, so that I don’t have to think about moving and shifting things around.
Mike Warkentin: (10:28)
Yeah. It depends on the person. I’m like you, I don’t wanna have seven different bank accounts, but if you’re someone else who really doesn’t have a good handle on things, what can happen with one account is you drain it and then you don’t have money for tax at the end of the year. So a simple principle of setting aside an account where the tax goes in so that you’re not short at the end of the year, you can do either system, whatever works for you. But the point here, gym owners if you’re listening, is that you need to look at your books or have someone that is looking at your books and helping you through that. So I wanna ask you about the Profit First system. When you sat down and said, okay, we’re gonna pay ourselves. Did you set an aspirational number where you were gonna have to backfill some revenue? Or was this something that was based on current revenue and then you wanted to build that up in tandem? How did that work?
Chad Pinther: (11:11)
Yeah. Honestly, it wasn’t initially as thoughtful as it probably should have been. I was really looking at things not from that mentality, at first. I was literally looking at, okay, what do we have? Okay, this account’s building up. Now we can start paying some to ourselves. So because I’m very conservative with finances, I had to kind of get some confidence built that, oh, okay, this is actually continuously happening. Right? I had to build confidence in the system that we were creating in the gym, confidence in my team, confidence in what we were providing. And then that started to be reflected in what we were seeing income-wise, and there was more money in there. So then I started to, okay, we need to start drawing. That was initially a reactionary sort of model, but now we look at more things about, okay, here’s what we would like to have and here’s the goals we need to hit for sales with the team in general gross revenue with the gym. And then actually being able to try to hit those goals.
Mike Warkentin: (12:27)
Okay. So what was the feeling the first month when you actually paid yourself? Was it scary? Did it feel great? How did it feel? ‘Cause for everyone it’s a little bit different.
Chad Pinther: (12:37)
Yeah, yeah, yeah. It was definitely a feeling of accomplishment to actually have something coming into the account. But still, again, I’m always a little tentative. I kind of operate a little bit off of like, ah, I dunno if this is gonna work out. Right. But the real feeling was, you know what? We can actually support ourselves with this business. I know a lot of people who run these gyms, kind of as a second side hustle. And I totally respect that. But I had always funneled in from my modeling business. It supported the business to start. When we bought the business, it was truly not making any money, and was on a projection downward. And so I took a big risk getting involved in it in the first place.
Chad Pinther: (13:33)
But the real turning point for us was when I realized, oh, we can actually take what we need to pay our bills to meet our savings goals, et cetera. And I was able to step away from the modeling thing because I was really pretty exhausted from traveling for up to six months out of the year I wanted to be home. We have a 14 year old daughter. I wanted to be home more with my wife and run the business together. So to be able to step away from that and know, alright, we can do this a hundred percent was a real sense of accomplishment.
Mike Warkentin: (14:08)
Well, that’s amazing too. So you start this thing and essentially you’re funneling money into it to prop it up, and then because you’ve built it up properly, it now allows you to make a lifestyle change that works for you and your family and your current situation. So that’s a really cool story. And listeners, the “Profit First” idea of paying yourself what you want can be scary. And the money doesn’t come from nowhere. It doesn’t magically appear because you decide, oh, I’m gonna pay myself $50,000. It doesn’t just appear. The principle is this, though. As a gym owner, you are a type-A person probably, right? You want to improve your life, right? You wanna improve your fitness, you want it, you are going to drive and accomplish goals. So if you decide I’m gonna pay myself this. The principle then is you’re going to figure out how to make the revenue to pay for that and to make sure that’s there. Okay? So it’s not just to snap your fingers, money appears in the account. There actually is a plan for this. And we’re gonna get into that a little bit now, because you obviously took over a business that was trending downward, not looking good, and you’re propping it up. Then you decide, okay, we’re gonna pay ourselves. How do you build up the revenue now to make that happen? What did you do? What were the exact tactics you used to start making this thing profitable?
Chad Pinther: (15:18)
Yeah, Mike, thank you. This is something I thought a lot about before we were gonna meet here today. And I thought, okay, essentially we have to understand. You can’t just say, all right, I just want to take more money. Right? The money has to be there. That was the theme that kept coming into my mind. The money’s gotta be there and you’ve gotta generate that money from someplace. Right? And this is where, without question, the number one thing that effectively changed all of this and has allowed us to make progress was we got a Two-Brain mentor, right. To start that process. When we first bought this business, I didn’t know what I was doing, right? I loved CrossFit. We had started a little small little community gym in our garage because I had interviewed a bunch of owners of successful long-term CrossFit gyms and affiliates.
Chad Pinther: (16:24)
And I asked them, how do I get started? And many of them said, you know what? Get your feet wet and just do it in your garage. Many of it started that way. ‘Cause there’s a difference between doing CrossFit and then running the business, obviously. So we started our garage and set it up like a little mini box. We even had, at the time, CrossFit had a little gym affiliate thing you could do, right? We checked in athletes, but when we got to about 20 people, we can only train so many people. We heard about CrossFit Colfax selling, and I went down there with my wife and we met the owners and we kind of took a look at it. But I realized right away, not sure if I know what I’m doing here.
Chad Pinther: (17:16)
And I’m a person who’s always like, okay, I need to go find the people who know what they’re doing, the experts, and then ask them what they’re doing and then execute that. Right? Right. So I literally searched “how to run a gym” and first thing that pops up: Two-Brain. And I thought, ah, I don’t know, ’cause there was quite a significant buy-in upfront. And I did some research on a lot of testimonials and they’re like, Hey, it’s a lot of front load work, building your processes out, et cetera. And I thought, I don’t know if we can pull this off. We’re already pretty buried with what we’re doing to get this going, but everybody said it’s worth. And I saw how many people were making more exponentially and setting things up.
Chad Pinther: (18:05)
And I thought, you know what? This has been around this long. I don’t wanna make all the same mistakes. So we signed on with Two-Brain. Got started, like I said, initially with Tammy. And it is the thing that has helped us get where we are today. I’m really good at, if you tell me what to do, I can execute it, right? So do this, do that. And they’ve never steered us wrong. Going through the modules, watching all of that to start, and then just those monthly calls, getting that support saying, Hey, I don’t know how to fix this problem. Can you help me? And they’re like, absolutely. ‘Cause they already own gyms. And they’re like, absolutely, here’s what you do. And truly never at at any point have we ever been steered wrong, you know?
Chad Pinther: (18:56)
And everything has worked out. So that’s the first thing. Getting on board. And then out of that, the wellspring from that is all these pieces between hiring the right staff, right. Knowing what to look for, paying them. For us, we really pay our staff well. We take good care of them. They’re wonderful people. It’s a fantastic team, super grateful for them. And so that translates to members feeling well taken care of. Adopting the process of how we bring people into the gym, making sure that we understand that they’re the right fit, the right avatar, so to speak, for our gym. Both financially speaking and the community, so we can protect that community. Just a really robust lead management system, right? When we bought the gym, it didn’t even have a phone in there.
Chad Pinther: (19:55)
No one could even call. So we put a phone in there, obviously we started lead management. We got on with Gym Lead Machine, which has been fantastic. So people could get on our website, ’cause the whole thing is you gotta get them in the door, right? And then we can sit down. So then building out that system of bringing them in, making sure they’re prepared to get on the floor, paying attention to the details, taking care of the gym, making sure it’s really clean, right? Taking care of the equipment. We do the prescriptive model of how we know people’s goals and then all along, 90 day goal reviews. We actually build in InBody scans during every 90 day goal review ourself. So all those steps came out of the guidance from Two-Brain.
Chad Pinther: (20:49)
So that’s the main pieces that have ultimately increased the pot of which we’re bringing in that gross income because you can’t have a high net owner benefit unless you’ve got the actual money coming in. So you gotta create an excellent service, right, that has a ton of value. And then you have confidence, right? This is the really key piece that I lacked. When we first got started, we kind of went with the, oh, come try a class if you like it, get started. Right? And we were really kind of doing that for a little while, and really like, okay. Are you okay paying this? That was kind of the feeling. And as we grew with confidence, as we got that mentorship, as we built a gym and a service that was in high regard and that people really got results from, then we gained confidence in letting go of that fear of asking, and requiring payment for what the service is worth. Right? So believing in what you’re providing and then charging what that’s worth. So you first gotta create that service that people think this is worth every penny, or I would pay double for this, I don’t want to be without this. Right? So all those pieces came into creating that bigger pot for us that would allow us to thus increase our net owner benefit.
Mike Warkentin: (22:38)
So that’s an incredible story. But to boil it down simply is that you bought a gym that was trending downwards. You got a mentor, bolted in the Two-Brain plan step by step, and you tripled your take home as an owner.
Chad Pinther: (22:52)
Yep. Exactly.
Mike Warkentin: (22:54)
What was the year. How soon after buying the gym did you get a mentor? What was the year there?
Chad Pinther: (23:01)
February 2019 is when we were given the keys. And I believe we started later that year. I think we started late that year in 2019. Yep, that’s true because we started to really put in place the things that they were teaching us and then pandemic hits. In fact, we had a record. So Pandemic came, was it February or March of 2020, right? Yeah. And Denver was a very compliant state for what you had to do. We had to tape all these things out, but we had a record January, right? We got our membership up to about 110, which is amazing considering that we bought the gym and it had 70 and we had to change so many things because of how the gym was running, the culture in the gym.
Chad Pinther: (24:12)
Of those 70, we probably lost 60 of those people, right? But we started the lead management system, all this stuff, and we were backfilling the whole time. So we had a record January 2020 and then boom. Pandemic hits. And we were like, are you kidding me? Are we gonna survive this? What’s gonna happen? But again, we really leaned on our mentor and she was like, Chad, do this, do this, do this. Right? And so we had actions we were taking and we were closed for about two and a half months. Then once we got open, there was a whole plan. Here’s what you do when you open, here’s how you even set up your gym. Right? So I didn’t even have to think about that. So that was super helpful for us to go. So considering that we’re three times, even with the pandemic and even with some of the losses we had is pretty phenomenal. Yeah. Having to rebuild the gym that way.
Mike Warkentin: (25:15)
I love hearing when people implement the plan to a T. And this is not to say that you can’t freelance stuff, but the stuff that Two-Brain kicks out has been tested. Hundreds of gyms have done it and it works. And I just spoke to a gym owner about the exact same thing. Name was Jodi Butler, she’s in Pittsburgh, also on the leaderboard. And she said the same thing. She stuck to the plan, put the stuff in place, and it worked like a charm. She took a slightly different path with different things, but you guys ended up in the same spot at the end. So I wanna ask you specifically about this one because I think it’s probably a big one. I ran a CrossFit gym for a long time and we focused on group training and I imagine that Colfax did a lot of that too. Talk to me about adding PT and what that did for a CrossFit affiliate and a gym business.
Chad Pinther: (26:00)
Yeah. I have to credit one of our particular trainers, for the most part, who we hired and brought in from outside the gym. And he came from a personal training institute, right? It was his thing. So when he came in, he really kind of helped us build a lot of that, right? How to do that. And then how to actually deliver that service. So suddenly, now you’re not chasing down a bunch of people for group, right? Now you’ve got these people who by and large are coming in and they’re staying on for a longer period of time. So that was a huge benefit. And the original website that we inherited from the original owners didn’t even have any ability to click anywhere for, I want to do personal training. So Gym Lead Machine has dialed that stuff in. It’s literally one click boom, I’m in for a consultation. So that was present, finally. And that started to bring in those people. And then once they get in there, you’ve got a really good personal training program and coaches there, you start to really increase your revenue. Cause obviously what you’re pulling in for each person is so much more than a general group membership.
Mike Warkentin: (27:37)
Ok? So I’m gonna tie this back to the “Profit First” thing where you say, okay, I wanna pay myself this, I’m gonna do that. And then you gotta figure out where the money comes from. And gym owners, if you’re listening out there, one of the places the money often comes from is, I’m selling group classes, not selling personal training. I need to start selling personal training. Or maybe I can add on nutrition services. Or maybe it’s a kids program. We don’t recommend you do all the programs, but three or four really strong revenue streams are going to help you run a profitable business. Another thing that I thought was really interesting that you were talking about is, getting a real good handle on what the staff member has and then using that to grow the business.
Mike Warkentin: (28:18)
So you’re leaning on these really great staff members and doing a great job of upgrading your business. So if you start thinking about profit first, you are finding ways to get the revenue. Another spot, my gym doesn’t have a phone and my website doesn’t have a way to get in. That’s a pretty obvious place where you need to get the slippery slide going into your business, right? And so the idea is I wanna make this, here’s how we do it. And it’s analyzing, is my website any good? Do I have leads coming in? Are my rates okay? All these different things. And that’s where a mentor tells you tactically, do this, do this, do this, bolt this solution, fix this. And then all of a sudden you start getting the things that you need in place, the revenue goes up. So I wanna ask you about average revenue per member. Often when you see people who’ve bought CrossFit gyms, the revenue is low to start. And we always want gym owners to increase average revenue per member. And that doesn’t mean you’re gouging members. What it means is you’re providing huge amounts of value to help ’em accomplish their goals. And they’re willing to pay for that because goals are a big deal. Right? So did your average revenue per member go up a lot from the time you bought the gym to now?
Chad Pinther: (29:24)
Big time. Yeah, big time. We also, man. So many things here, Mike, you made me think a lot about all the things that go into how we generate more and provide better service. But when we started, the members that we inherited were, and this was part of the change that needed to happen. I feel like we could do a whole podcast on buying somebody else’s gym. So we should think about that. We had a lot of people in the gym that were in that mentality of a 24-hour fitness, global gym ish, right? Where, hey, if I sign on at this rate, then it stays like that forever, right? And we had some people that were paying just really low. And it wasn’t their fault, it was the previous owner’s fault.
Chad Pinther: (30:19)
So we had to both try to reeducate, here’s the service. We’re providing so much more. ‘Cause you can’t just go, all right, you’re gonna pay more money now. We’ve gotta say, we’re gonna give you more. It’s so much more value, but we are gonna have to charge more, right? Because we’ve gotta pay for ourselves, we’ve gotta pay our coaches. So we had to really change that and that unfortunately caused us to lose a good chunk of people as we started to do a rate increase, right? Maybe rate leveling, right? Two different things. And we did different steps and processes with that, whether it was a level or whether it was an increase. And again, Two-Brain provides the exact template for how to do that. We followed that, it worked great. Yes, we lost a few people, but in the end it always ends up in the positive, right? So yes, what we started out with was, we’re exponentially bigger now. Right? And then another big change that we did was when we started to change the process of how we brought people in and integrate personal training directly into that process. Yeah.
Mike Warkentin: (31:40)
So that’s tied to ARM, average revenue member, big time. It’s a better service. Yeah.
Chad Pinther: (31:44)
Plus, so for us at our gym, to even get on the floor, we wanna make sure that you’re ready and prepared to fully take on a lot of these movements that can often be technical and they can be intimidating for a lot of people. We wanna make sure that people have the confidence to actually get out there. And so we require minimum three one-on-one personal training sessions per person, regardless of your experience. We got people coming in, like I’ve been doing CrossFit 10, 15 years, but we all know we all have our movement faults, right? We all have things that we need to work on, but predominantly we have your average person coming in. A lot of people brand new. So the great thing about that is not only does it give them the confidence, but they start to establish that relationship early on.
Chad Pinther: (32:33)
And they see the value in personal training. When your model is just, Hey, come try a class. Join. Right? You don’t see any value in that. And you can be struggling through some of these movements for sometimes months or whatever. But you see one session, or a skill session. ‘Cause we provide those too, a 30 minute skill session. They can see, wow, I can really change in a positive direction and get a lot of this movement. So that was big for us because now that exponentially increases, right? What people are paying when they start, they’re more confident, they feel better, the service is better, but that allows us to have increased revenue.
Mike Warkentin: (33:20)
Yeah. And you mentioned a couple of things earlier. The prescriptive model and goal reviews and so forth. Listeners, the quick summary is exactly what Chad’s talking about here. Instead of just having people come in for a free trial and chucking them in the class or whatever, you actually have a client journey and you’ve laid out exactly how every person starts at your gym and the whole process. And that process starts with a free consultation. They come in, they tell you about their goals, then you prescribe the best solution to their problems and help them accomplish their goals. And that might be personal training and nutrition plus some group classes at a rate of $500 a month or something like that. All of a sudden this person says, I can accomplish all my goals if I follow your plan, take my credit card. And the gym wins, the person wins.
Mike Warkentin: (34:00)
There’s value in the transaction. It’s not a gouging situation. It’s about value. And that’s where you start getting very high average revenue per member rates. And that’s where you start getting very high gross revenue profit and net owner benefit rates. And it’s all tied to this prescriptive model of intake. And I’ll put a link in the show notes for you so you can take a close look at this. And then the thing that’s built into the prescriptive model in this client journey is exactly what Chad mentioned earlier. Goal reviews. You find out about the goals, then you meet with the clients. Are we accomplishing the goals? If so, you celebrate. If not, you adjust the plan and you keep going and some people will upgrade their plans. Talk to me a little bit about what goal reviews and check-ins with clients have done for retention. Because I don’t know a single gym owner who has a great income, who doesn’t have great retention.
Chad Pinther: (34:48)
Yep. So within that, we’ve worked with, again, I just wanna back up for one second. Yeah. ‘Cause this is related to the team that we’ve gotten and allowing us to have a team that can exercise their strengths, right? Two pieces to this. Providing the mentorship, getting the mentorship from Two-Brain, right? That instructs us how to get a great team in and then let them do what they’re really good at and allow Esther and I to do what we’re really good at. I’m really great at running the business, doing the finances. Esther runs the community, she builds that community, she runs the events. And now we can really help get these people in to do what they do best. And that’s working for us.
Chad Pinther: (35:47)
We have a team that works really great with people, right? They coach better than I can ever coach. And then in conjunction with that, coming back to the prescriptive model, they’re great at sitting down with people. ‘Cause we build our three full-time coaches directly into the intake process, right? We want them to have that contact as soon as they walk in the door with who they’re gonna see out on that floor. So they sit down with people, bring them in, find out what they’re working on, et cetera. And then in subsequent 90 days, myself, my wife and all of our coaches, we take part in these meetings so these coaches can work with the people, can make these recommendations and specific action steps that get them to their goals, right? So that’s been helpful. And in part of that, I’ve had to work with them on getting confidence in saying, Hey, let’s book a PT session.
Chad Pinther: (36:50)
If you’ve been struggling to get handstands, if you’ve been struggling to really work on your Olympic lifts, hey, we’ve got the barbell club over here. Right. Which is a whole other side thing as well that we have that’s kind of entrepreneurialism, where we allow our coaches to build own their own businesses inside the business. So, let’s try a barbell club. We can really dial in just your lifts. So teaching them how to be confident in selling, right? But not for the purpose of just selling to make money. We’re doing it to provide what the client wants, giving them the service that they need, and literally changing their life for the better. But teaching our team how to do that in those 90-day goal reviews.
Mike Warkentin: (37:43)
So you integrated your staff completely into the prescriptive model. That’s the intake, all the way to retention. And the business is succeeding as a result. And you’re creating great careers for people who wanna work in the fitness industry, not just as an owner. Correct.
Chad Pinther: (37:57)
Correct. Yeah.
Mike Warkentin: (37:59)
So I mean, that’s such a great story. And that’s from a business that you said was trending downward. I know Denver’s not a cheap city. It wouldn’t take much to put a business under in Denver. So you took a business that was going downward and took it to a place where you’ve got great careers for coaches, you’ve got satisfied, happy long-term, high value clients, got a great income for you and your wife that allows you to live a life that you want with your daughter. Sounds like a fairytale story.
Chad Pinther: (38:21)
Yeah. Super lucky, super grateful. I’ve got a great partner. My wife’s just amazing. I don’t think a lot of people could both work and be together all the time. Fortunately, we really enjoy spending time together, thankfully. But yeah, we’re just really lucky to have a fantastic team of people. We’ve also got a CSM, a client success manager, who’s directly integrated into the intake process and manages people throughout that whole process of when they come in, it’s their point of contact. That position’s really grown as well. And then we really just knew this January again, we’re projecting record income as well because we completely overhauled our nutrition program. Before, we weren’t really totally bought in to how we were providing that. I was really frustrated with why it wasn’t working.
Chad Pinther: (39:18)
So I finally took advantage of some office hours that Cynthia Fati put on, sat in with that. And I was like, wow, okay, we’re doing everything wrong. That’s why it’s not working. So we have a separate Nutrition-certified coach. And I said, you know what? I’m gonna pay to do a separate mentorship with just Cynthia. You and I are gonna sit in with her. We’re gonna figure out this whole thing. So I got ahold of Cynthia Fati directly and said, Hey, what do you do? We want to do what you do. And so we sat down with her for an hour and we built out a whole 12 week program and I was again scared, fearful, I dunno if it’s gonna work because we literally went from a month or a four week or six week program to suddenly a 12 week and it was double the cost.
Chad Pinther: (40:15)
Right. And I thought, I don’t know if this is gonna work, man. And in the first two weeks we grabbed seven and we had zero. So we had seven and we’ve just been adding people. Because we changed how we actually present it and then the support we provide, I think people really thought, oh, I can actually make a change here. Instead of a throwaway amount that doesn’t have a lot of support that they can just let go of. So that’s gonna be a huge thing that we’re excited about. And again, Two-Brain has provided that support. I don’t know if a lot of people really look at these office hours, but they’re so valuable. There was one on sales last week and I didn’t catch it, but I ran down Coop and I was like, Hey, send me that link. And he sent me the link and I watched it and it was like, here we go. And I’m doing a whole training next week on the sales process using that specific information that I grabbed in that Zoom call.
Mike Warkentin: (41:27)
So listeners, Chad is talking about office hours. These are available for Two-Brain clients. Every week we have a specialist who will teach a concept and it could be nutrition, it could be making your sales funnel better, it could be better marketing assets. I teach media ones sometimes. There’s all sorts of different things that are available to Two-Brain clients. That’s in addition to your monthly work with a mentor and all the other stuff. So it’s a value add there. And there’s some really cool stuff. Chad, I wanna ask you about this. There are gym owners out there who are struggling and listening and saying, man, I wish I could earn more from my gym. I don’t know what to do. What’s your number one piece of advice? Send them out with something that they can do today to start with money. Sure.
Chad Pinther: (42:01)
Alright. Well, I can’t say it enough. You’ve got to get a mentor. It’s the single most effective and impactive thing that has changed our business. You gotta get somebody that knows what they’re doing. I would say stop trying to reinvent the wheel. All right? I think we all as entrepreneurs get started in this and think, all right, I know what I’m doing. I’ll figure this out, right? But most of this has already been done. The mistakes have been made. So don’t do that. Get a mentor. Get somebody in there, then listen to them, trust them, and then execute. Right? Because sometimes we get this information and then we think, oh, I’m gonna do it. And then we don’t execute it. You’ve gotta execute it and trust it. Then related to that, work on making the best possible experience and value for your members.
Chad Pinther: (43:05)
Dial that stuff in. And there’s a lot of support for that with your mentorship service. Make sure your members know that you care about their goals. Have a definitive thing that you write these down and a step by step process to getting them to achieve that. Then have ongoing support for that with your 90-day goal reviews and body scans, et cetera. That way they really see that you care about what’s happening. Build a great team, right? I know it’s hard when you’re doing all this stuff by yourself right at the start. But as soon as you can get to a place where you can get somebody to offload some of this stuff so that you can build the business better, get that on your team. Find somebody who does those things better than you do them, right? And then take care of them.
Chad Pinther: (43:58)
Right? Pay them well. I know we pay our coaches better than what I know of in anywhere in the city, right? So that they wanna stay with you. Constantly invest in them so that they get more education and they feel like you care about what they’re doing. Allow them opportunities to build business inside of your business, that entrepreneurialism. And then all of this will build your confidence to be able to charge what it’s worth, right? And then have that confidence in yourself to ask for that. And then these members are gonna stick around for longer, right? And then finally, as soon as possible, pay yourself. Right? Pay yourself and make it a regular thing. Make it a consistent thing. Automate it, right? And then work off that “Profit First” so that you’re giving yourself some money. You get some reward for the hard work that you’re doing. I mean, my wife and I put in 80, 90, 100-hour work weeks when we started. It was wild. But get that back. Give yourself more time to work-life balance, right? But pay yourself. And then you’re gonna start to see some fruits of your labor and feel better about this.
Mike Warkentin: (45:28)
I love it. Step one is get a mentor. I will put a link in the show notes, to book a call if you wanna talk about this. The mentor will tell you one thing to do at a time. It’ll be the thing you need to do right now and you’ll knock them off the list and it won’t be, I need to figure out all the stuff of a business. It’ll be one thing, and you’ll take action on that one thing. And it’s a sprint. Our ramp-up program is a 12 week sprint. The ROI on it is incredible. If you want to hear more about it and want to get to the level that Chad’s at, book a call today. Chad, thanks so much for sharing your story. I really appreciate it. I love hearing that a gym that was going in a nose dive is now heading into the sky. That is awesome. Congrats to you.
Chad Pinther: (46:03)
Thank you, Mike. Appreciate you having me on.
Mike Warkentin: (46:05)
I love it. We’ll get you back when you buy that real estate.
Chris Cooper: (46:09)
Hey, it’s Two-Brain founder Chris Cooper with a quick note. We created the Gym Owners United Facebook group to help you run a profitable gym. Thousands of gym owners just like you have already joined in the group. We share sound advice about the business of fitness every day. I answer questions, I run free webinars and I give away all kinds of great resources to help you grow your gym. I’d love to have you in that group. It’s Gym Owners United on Facebook, or go to GymOwnersUnited.com to join. Do it today.
Menu
