Mike (00:02):
What does your gym contribute to your life? We aren’t talking happiness and satisfaction today, we’re talking dollars and cents. In just a minute, I’ll tell you what, the top 10 Two-Brain gym owners are earning from their gym. And one of the leaders will share his secrets. Stay tuned to Two-Brain Radio.
Chris (00:17):
Back to Two-Brain Radio in just a minute. Your gym members will love O2’s hydrating, non-carbonated beverages after a tough workout. Even better, O2 is a community-based brand that wants to give back to gyms. If you sell O2 at your gym, you get a free sponsored event every year. Gym owners who wholesale O2 also get their first order for a dollar. Visit wholesale.drinko2.com to apply for an account today.
Mike (00:43):
This is Two-Brain Radio and I’m Mike Warkentin, your host. Net owner benefit. It’s the number that tells you exactly what your gym contributes to your life financially. It can include your salary or payments you get from your business, but it also includes any other benefits. Like if your gym covers your cell phone payment, provides a vehicle or even takes care of coffee with another entrepreneur. We track this number across all Two-Brain gyms and in July our top 10 owners had net owner benefits ranging from over $10,000 a month to over $20,000 a month. Matthew Becker was on that list and he had a net owner benefit over $12,000. He runs Industrial Athletics in Pittsburgh, Pennsylvania, and he’s here to explain how he did it. Matthew, welcome to the show. How are you today?
Matthew (01:27):
Hey, thanks Mike. I’m doing really well. Thanks for having me on the show today. I’m really excited to get a chance to talk with you and talk with the other peoplR listening to Two-Brain radio.
Mike (01:37):
It’s my pleasure. And I’m really excited because owner benefit is such an important metric. A lot of people don’t know too much about it. So I want to ask you, how has this number changed and improved over time for you? And what does it include besides just say salary or profit distributions”
Matthew (01:55):
Net owner benefit was really interesting number for me to track. And then in some sense, I’ve been tracking it even since I started my gym eight years ago, a little bit over eight years, and then before ever joining Two-Brain. Cause I think in some sense, I started my gym kind of like backwards from the Two-Brain message, the Two-Brain method is that founder, farmer, tinker, thief. And so as the founder, right, you’re the guy who’s there, 24/7, open to close. And then as it grows and you realize you can start to afford or you need somebody else, then you start to move into that like more farmer phase. Well I was a full-time attorney when I opened my gym, I needed somewhere to work out. As long as this thing remains in the black, then it’ll kind of be a hobby and I can still practice full-time. But because I had my full-time legal practice, that meant I had to hire people from the beginning.
Mike (02:59):
I did the same thing, Matthew, I did the same thing, but I did the exact same thing and I probably wasn’t as successful as you, but you tell the story.
Matthew (03:08):
So I originally hired somebody. So I kind of, I feel like I was almost in like that aspect of farmer phase from the beginning. But, whenever we first opened, I always tried to take, like, I remember it was $250 and I was like $250 is going to be the set aside every month. Like I will make that a priority. So kind of, I would almost say like profit first model, maybe even before, I don’t know, has profit first been around for like eight years, but maybe a little bit like before I even knew about profit first. So that was just, that was the original like net owner benefit. And 250 a month, I just put that, just left that in the bank account. Let the bank account grow, use that if we needed new equipment. You know, and as the gym grew, you know, that that 250 kind of grew a little bit, but then also wasn’t then earmarked for like new equipment. So I would start to take some of that. So maybe I’d take like $250 a month or I would take $500 a month and a year or two in, I used essentially what was that accrued net owner benefit to pay off my first car.
Mike (04:22):
Started as kind of beer money, right? Cause you had a full-time job. So it wasn’t like money that you were using to pay your mortgage, but then you found a benefit, to park it onto a car loan eventually.
Matthew (04:31):
Yeah, exactly, exactly. I think that was probably like the turning moment of like, oh wow, I can actually make enough at this, that it can in some way financially impact my regular life outside of like my legal practice.
Mike (04:49):
And you know, that’s an interesting observation that I got to jump in for because a lot of people who don’t pay themselves and I was guilty of this a hundred percent, you don’t pay yourself. And then eventually you’re like, what is the point of all this stress? Right? Cause there was a very long time that I never took a paycheck from my gym. And even if I had done it even $250, even $50, I would have seen more benefit and I would have been less cranky. I think. So that’s a really interesting thing that you did right off the bat was pay yourself right away. And that’s now in the Two-Brain philosophy, courtesy of profit first. So you hit upon it by accident and it was a good thing.
Matthew (05:22):
Then kind of another note on that, I think my mindset on this was different again, cause I had that fortunate aspect of already having a full-time income. But you know, I think for somebody who’s starting out or somebody who is young or somebody who is looking at like the leaderboard that’s going to come out with this month net and a benefit and be like, oh my God, I can never make that much money. Like I think you have to have a mindset going into it of any dollar I make is worth it and try not to put a dollar value on how much work you’re going to end up having to do. Because like you just said, like you do like a whole bunch of work and maybe you don’t make any money one month or maybe you make like pennies on the dollar and you’re like, why am I doing all of this?
Matthew (06:09):
I think you almost have to have another motivation than like I’m gonna make a million dollars in year one. Anyway, paying off that car was like the first time that I was like, oh sweet, like I can make money and I can use it too for my regular life. And it just kept growing. And eventually I would say 3, 4, 5 years. Yeah, probably about five years. Then it started to grow to the point that while it wasn’t making as much as the legal practice, I could be like, Hey, I don’t want to practice law anymore. I could do the gym full time off of what I’m currently making and I can survive.
Matthew (06:55):
Yeah. And you asked like, what does it pay for besides my just, you know, what else is it just profit or salary or anything and not a lot. I mean, yeah, it paid off my car, but it’s not like the gym pays for my car every month or anything. I mean I consider myself to be a pretty basic living kind of guy. So, you know, maybe if the gym orders clothes, it’ll pay for me to get a new, like a new shirt or whatever. I get new shirts. Which is really nice because once you work full time in a gym, all you need is the gym’s logo T-shirts anyway, it’s basically purchased my upper wardrobe for the last number of years.
Mike (07:37):
Yeah. The reason I ask, like, it’s cool because there’s so many people have creative ways of paying themselves and you know, we all figure out with our accountants and bookkeepers ways to do things that, you know, you can find ways to legally hide your, you know, not hide, but shield your income and things like that. And then there’s things like business expenses, like, you know, your cell phone or your different, you know, even office supplies and so forth. So I was always curious if there’s something in there I got to ask you this though. What kind of law did you specialize in?
Matthew (08:04):
Criminal defense and consumer protection. Criminal defense is obvious. Consumer protection is like any kind of contract stuff. So defending people who can’t pay their credit card bills, defending people with mortgage foreclosures, suing car dealerships for either bad car, like used car deals or suing manufacturers for lemon law kinds of stuff, contractors who messed up your house.
Mike (08:31):
I got questions for you on a different podcast, I think there’s probably some interesting stuff in your history. I’m going to hold myself back from asking him about that, but I always am amazed to find out some of the other skills and careers that gym owners have had. And, we’ll probably dig into your story a little more later on,I gotta ask you this, you said that, you know, your July score, you went from lake starting at $250 a month. Now over 12,000. You know, I understand that your score is partially a result of doing the things that your mentor advised. So I need to know what is the, what are the big things that your mentor advised, the ones that really drove that number up?
Matthew (09:14):
I can tell you first and foremost is stop giving away your fundamentals program for free and charge a private training fee, foundations, fundamentals, on-ramp, whatever you call it. And I think in large part, I joined Two-Brain and they were not my first business, Two-Brain’s, not my first business consulting company. It’s actually my second and my mentor, Greg is my fourth coach or mentor. And so I think he was not the first one to say, raise rates. You’re not the first one to say, you know, charge 50, 60, 70, $80 an hour for private training. He was not the first to say, stop giving your fundamentals away for free. But whether I was in the right mindset at the time or whether it was just, you know, Two-Brain comes with a reputation. And so when you have, I’ll say to this, let me use this analogy, because I use this with like my private training clients all the time, your spouse can tell you to do something fitness or diet related and you just look at them and be like, yeah, OK, whatever. Your trainer can tell you the exact same thing and it’s the gospel.
Mike (10:35):
Proximity bias, I think is the term for that one.
Matthew (10:40):
I need to remember that because that sounds like really impressive. It was that same aspect. So, you know, before joining Two-Brain, I had a coach that said like, you got to charge like four or 500, $600. No, like nobody’s ever going to pay that. And I wouldn’t pay that. So they’re not going to pay, you know, I was that stereotypical person who tried to project my spending habits on somebody else. And I think Greg was very patient with me and he took time to explain things in a way that would make sense. And he had the backing of Two-Brain and I’ve been a reader of Chris Cooper’s for a number of years. So, you know, eventually when Chris Cooper says you should be charging for this, no discounts, no freebies, charge for this, no discounts, no freebies. Eventually it sinks in. So I was like, all right, Greg, nobody’s going to pay me 700 bucks for a 12 session fundamentals, but I’ll try. And then literally the first person I did it bought it. And I was like, why didn’t I do this before? So that if I had to point to like one thing, like that was the one thing that really shot up my net owner benefit.
Mike (11:57):
So I can tell you this, if Chris Cooper’s listening to this, you’re going to bring a smile to his face. And the reason is that, you know, the stuff that Two-Brain teaches, Chris gives it away for free. So you could literally do the program without really, you know, paying for it. You certainly could. However, the thing that Chris prides himself on is having mentors who get you to take action. So if Greg got you to take action on stuff that you’d maybe heard before, maybe knew, that’s a huge win, and this is Greg Straus, we’re talking about, correct?
Mike (12:23):
Yes, yes, yes.
Mike (12:24):
So that, I mean, that’s the thing, Chris is big on action. And that’s the whole point of the program is that if you don’t take action, the information is worthless. Getting someone to act is the most important part.
Mike (12:35):
So, you know, hats off to you for doing it, hats off to Greg for getting you to do it. And I’m going to correct myself. Proximity bias is actually, I’ve checked it out here. That’s the tendency to favor people closest to us. So I’m going to say that it’s reverse proximity bias, where you tend to ignore the people that are closest to you because you don’t quite, you know, you’re like, ah, it’s not as important and I’ve done the exact same thing. And again, you can get into spousal discussions here all the time about this stuff, but that’s exactly the principle. So Greg got you to do some stuff that had a huge effect. And how long I’m going to ask you, how long did you give away fundamentals for free or on ramp?
Matthew (13:12):
Do I really have to say it? We’ve been open for eight years, eight and a half years. I’ve been a member of Two-Brain for a year. So you do the math. Seven and a half. We gave away fundamentals for free, $720 for 12 private fundamental sessions. One-on-one with a coach.
Mike (13:42):
- So that’s a high ticket item. So when you make a sale, you’re guaranteeing yourself 720 or whatever, plus most likely the membership that comes with that, cause I’m sure most people who do that join. So you look at it. I’m not, and the reason I can say this easily is I’ve made similar, costly mistakes. You definitely look at seven years of missing out on a huge chunk of revenue. So I can see as soon as you put that in. Wow. You’re you’re I mean, when you made that change, it probably took a little bit of time just to get some people into that program, but did you see a huge revenue boost when you made that change?
Matthew (14:15):
Yes, I mean, post COVID, we were maybe 16,000, 17,000 in gross month revenue. And then it’s just been steadily climbing since then.
Mike (14:30):
So here’s a question for you. You went from free on-ramp to an on-ramp of about $720. That’s a huge jump. Did you freak out at all about that? Were you nervous to do it, like to pull the trigger on it?
Matthew (14:44):
Yeah. I never thought anybody would buy it, you know, but again, like Greg’s not the first person to say that, to do it. Other people, other coaches have told me to do it or at least one other has told me to do. And we’re just like, no nobody’s ever going to buy it. I’m not that good of a salesman. There’s no way I can convince somebody or trick somebody. Right. Or like, I don’t, I feel sleazy if I put enough fear, which I know how to do, because I’m an attorney I can throw fear into a conversation. I know how to do that, but I don’t, I feel sleazy on that aspect of things to do that. And Greg just kept saying, and Coop says, you know, it’s about help first.
Matthew (15:24):
And you don’t have to like trick somebody into buying this and yes, you’re a good enough salesman. So yeah, there was, I think even to this day, you know, not that I’ve been doing this forever, I’ve been on it for a year. But to this day I get nervous when it comes time for the end of the conversation, doesn’t matter how good the no sweat intro goes. I’ve had people like, I’m ready to go. How do I sign up? I’m like, it’s going to be $720. You’re like, I’m still nervous about putting that dollar value in front of them. Yeah. I don’t think it ever it’ll ever get any easier.
Mike (16:05):
What happened the first time someone you sold one though, the first time you had you closed on the 720 on ramp, what was going through your head?
Matthew (16:16):
I was shocked. Like, I was like, it’s going to be $720. And she was like, oh, OK, cool. When can I get started? And I was like, wait, oh, like next week. Like, and then I think I immediately like texted Greg. Like she walked out of the gym, everything’s set up and I just like immediately texted Greg. And I was like, holy expletive, I just sold, like you were right. Like I just sold it. I can’t believe it actually worked. And I actually just saw her this morning. She’s still a member.
Mike (16:49):
Oh, that’s awesome. Do you remember what Greg said? Do you remember his reply to that text was?
Matthew (16:53):
I don’t, it was not I told you so, but it was probably in the back of his mind I told you so, but it was very supportive of great job. I knew you could do it, you know? Cause that’s typically just his attitude. Anytime I send him like, Hey, you know, bright spot, Tuesday at 2:50 in the afternoon. Here’s what just happened. And he was like, fantastic, good job. Keep going.
Mike (17:21):
So I’m going to ask you this, like, that’s obviously a huge, I mean, you created a whole entire revenue stream that has a high price attached to it that obviously reflects the value. I mean, it’s 12 sessions of personalized instruction for 720, that’s not a stretch by any means. Did you make any adjustments to membership prices at all?
Matthew (17:39):
Not on current members. On new members we did.
Mike (17:44):
How much of an increase did you make based, over what you were charging originally?
Matthew (17:49):
So 12 times a month, which is basically like your three days a week kind of thing. We did a $10 increase from 145 to 155 and unlimited went from 165 to 185.
Mike (18:04):
- OK. So that’s interesting. So that’s your standard, we’ll call them your standard rates, I suppose. And you do that on incoming clients, like, were there other programs that you added that contributed to this? Like after you created your whole on-ramp thing, what else have you got going on? That’s contributing to this number?
Matthew (18:19):
Just a lot more personal training and then we added hybrid. Yeah, we added hybrids and then I joined Two-Brain postcode. So a lot of my history is like the pre-COVID post COVID type stuff. Right. So pre COVID, everybody walked in the door, let me put you through a movement intro and then sit down and then we’re going to go through this sales portion of it. And then I’m going to erase the fee for fundamentals if you sign up today, you know, it was all this sort of, now it looks like trickery kind of stuff. And everybody was instantly moved into group. Post-COVID it’s come in, sit down. Motivational interviewing. No sweat intro. Yes. It’s probably going to be somewhere around 12 sessions.
Matthew (19:18):
If the conversation starts to lead somewhere else, we may not even do, I may not even put the 12 sessions out there. It might just be, let’s go into private training, but you know, even if they go into 12 session fundamentals, post that, unless they ask, I don’t even put their other options up on the board. We do everything on a whiteboard. I know you’ve just started iPad stuff and I might convert over to that, but you know, I just put everything on a whiteboard behind me in my office and you know, I just put up those initial 12 and if they agree and we start scheduling stuff, the conversation just stops, you know, like we just move on and then post their initial 12, then we sit back down again and talk. Do you want to continue into privates? Do you want to move into a hybrid or do you want to move into group?
Mike (20:09):
Yeah. That’s money-making right there, obviously. It’s so interesting because, you know, I ran a gym. I don’t have a physical space anymore. We started in 2011 I believe. But we did similar stuff where we’d run group on-ramps for very, very low rates. Eventually we got an individual on ramps, but we never, as soon as the idea was always when you’re done your individual on ramp, you go to group and I never ever saw the idea of personal training from that process. I certainly never saw hybrid training. And only toward the end of when we got rid of our physical space, where we getting into that, and we were seeing, you know, obviously the results that you have. So what you’re doing there is you’re selling this high ticket item on the way in, and then you’re giving them other options.
Mike (20:53):
And the interesting part is that the group of options you’re giving them is your discount. It’s your lowest rate, which for me was my highest sale. You know, that’s incredible. Right? So you guys you’re out there listening, just know that if all your revenue is coming from group classes, there are some very clear ways to serve your clients better by offering different memberships. And a lot of the stuff that Matthew’s talking about, like motivational interviewing, you know, the iPad sales, all this stuff is taught to you in Two-Brain and is available for you guys to figure out and we have the resources available. So if you don’t understand any of that stuff, we have free articles from Chris Cooper and in the program, it’s all laid out, plug and play by the numbers. And Matthew, I want to ask you about this. You talked a little bit about earlier, before the show, not just generating more revenue, but minimizing expenses, because that’s a part of profitability that a lot of people don’t recognize. What kind of stuff did you chop to improve your profitability?
Matthew (21:47):
Our conversation beforehand of like what sage advice can I give everybody? It’s not necessarily that we ever chopped anything so much as we just never incurred it to begin with.
Mike (22:02):
Well, that’s good. So I like that. That’s good too. Tell me some of the stuff that maybe you didn’t do it. I’ll give you an example. I interviewed a gym owner who does not use gym management software. He uses acuity, right? It’s expensive. He uses acuity and he, you know, he says, it’s fine. So like what kind of stuff didn’t you incur?
Chris (22:19):
Chris Cooper here to talk about Beyond the Whiteboard, the world’s premier workout tracking platform. Beyond the Whiteboard empowers gym owners with tools designed to retain and motivate members. We all know clients need to accomplish their goals if they’re going to stick around long term, and Beyond the Whiteboard will help your members chart their progress. They can earn badges view, leaderboards, track their macros, assess their fitness levels, and a lot more. Your job is to get great results for your members. Beyond the Whiteboard’s job is to make sure your members see those results and celebrate them. For a free 30-day trial, visit BTwb.com today.
Matthew (22:56):
Yeah, by the way, I read that. I don’t know if you put it on the Facebook or he put it on a Facebook group or something like that. And I was like, holy crap. Not using like Wodify. Anyway, we’ve always run a very tight ship. So like starting out, we moved into spaces, we’re currently in our second space, but we’re in the third iteration of our second space. So meaning like when we originally moved in there, we only took up a portion of our current space in order to keep that cost low. And then as the membership grew and as we needed to increase, then we took a next step incremental. And then we took the next step through there. So we probably maximize our space now. But in that sense, we’re not running a 10,000 foot facility. Like we have 3,400 square feet.
Matthew (23:52):
We used to run 14 people per class, 16 people per class, and it was tight. Now we run eight and everybody has their own space. Everybody has their own piece of equipment and we have two available spots. We do squares and that’s a whole different conversation, pre COVID post COVID. But anyway, we’ve kept the squares. We have two squares available for private training and that’s all. And so we I’ve kept rent and everything else, very low reasonably speaking. Because we, you don’t need more space. We’ve always bargain shopped in some sense for our equipment, especially nowadays when we opened eight years ago, like you don’t really have a whole lot of options. You bought Rogue, you bought Again Faster, or you bought crap.
Matthew (24:52):
You would pay the higher price. And you’re just like, ah, is Rogue cheaper, is Again Faster cheaper nowadays. Like you can get a quality barbell for 50 or $75 cheaper than Rogue. It doesn’t say Rogue on it, but it’s not crap. They hold up just fine. You can get a pull-up rig and that’s not Rogue. And I don’t have anything against RoGue. We have a lot of Rogue equipment, but we also, we bargain hunt a little bit, depending on it. Like Rogue sells a really nice wooden box. So does some other company, and it’s a wooden box. Like I don’t need Rogue’s stamp. Nobody coming into the gym knows what Rogue is. They don’t know what anybody else’s equipment is like, you’re not impressing anybody. Keep costs down that way. You don’t need a dual TV. I have enough trouble getting my members to log their scores in Wodify as it is, and you think they’re gonna log their scores better because I have two TVs up in front of them that look impressive?
Matthew (25:56):
No, you don’t need two TVs. So a lot of it was just, we didn’t incur those expenses to begin with. But then from there, you know, it’s my impression that people perhaps, and I know Coop doesn’t teach this, Two-Brain doesn’t teach this. I think it gets misinterpreted this way of you have the money to spend. So go spend the money. Like I can afford to hire a cleaner. So I need to go pay for somebody to clean. And that’s not, I don’t think that’s Coop’s message. Coop’s message for the way that I interpret it is you have the money to hire a cleaner. You also have something else that you need to do that’s more lucrative than you cleaning. So hire a cleaner. So I’ve always had the, when it comes to incurring additional expenses is I’m not going to incur the additional expense just because I can afford it. I’m going to create the need for that additional expense first. Then I’m going to go incur that additional expense.
Mike (27:02):
Yeah. That’s a huge step that so many people miss, because when you, the system that Chris is talking about always is called climbing the value ladder. While you’re replacing yourself in quote unquote, lower value roles so that you can move up the ladder. The thing that people forget about that is that when you do that, you have to put yourself in a role and then generate more income in that role that more than pays for the thing you offloaded. So like you said, if you just say, OK, I’m going to hire a cleaner, and then you decide to use those three hours a week to play Xbox, you’re not going to get that money back. And that’s fine if that’s your plan. Like if you just want to like offload some jobs and sit there and take the profit, and you’ve got the gym running according to all your systems, you can absolutely do that. But if you want to use that time to generate more, you’ve got to go and do like something like sales or retention or any of those other things that will help you make more money per hour than the cleaner costs you. So that’s a huge step and you’re interpreting what Chris is saying exactly. So you’ve been very clear about when you’ve incurred expenses, like obviously you’re not just blowing money cause you have it, you’re spending it because you want to buy more time. Is that right?
Matthew (28:11):
Well, I spent it because I needed the additional time. A perfect example with cleaning. I cleaned my gym with my head coach for seven years, every Friday morning. We would do it at different times when I was practicing. But especially when I started to transition more from over the law and to the gym, every week, I’ll say every week I cleaned the gym with my head coach until I joined Two-Brain. And they helped me acquire additional private training clients because now I have a private training client every Friday morning. So I can’t help clean anymore because it was either charge $60 an hour for this private training client and go train with the client or continue to clean my gym.
Mike (28:59):
And the cleaning rate is like, you know, 15 bucks an hour or whatever,
Matthew (29:05):
Right? It wasn’t a matter of I’m going to incur this expense so I can go out and do something else. It was, I have something else to do. So I’m going to incur this expense.
Mike (29:16):
Ah, you know, the thing I got to point out too is you mentioned leases and spaces and so forth. I bet it was just, you know, your landlord must just hate seeing you coming back with the, you know, proposed lease with a bunch of red lines. He’s expecting to serve this to like some ignorant gym owner and you’re going to lawyer up on it.
Matthew (29:36):
It took a few months to get a good lease with no personal guarantee in there.
Mike (29:45):
Yeah. Well, you know, I love it because we definitely used a lawyer for our lease just to make sure, cause I didn’t know what I was doing. And a lot of gym owners, you know, don’t do that and can run into some problems. So I just thought I’d point that out to a few people that if you don’t have your own legal skills, it’s probably worth checking over your lease to get the best deal, because that is a huge, huge expense. If you sign a bad one, you can be in a really tough spot, especially if there’s stuff that you didn’t plan for. We might have you back on the show to talk a little more about rent negotiations at some point, if you don’t mind, that’s a huge one for people. So we’ve got a lot of interesting stuff that you’ve talked about here.
Mike (30:19):
I’m really, you know, I think the thing that I love that you just said about expenses is not putting them in place in the first place. Because a lot of times we have gym owners, we have to audit their systems, right? Our mentors go through and look at all their stuff and say, OK, you haven’t used this subscription for X in four months. Why are you paying $80 a month for it? Right. It’s peeling back all these things from a different approach. You right from the start, were very hesitant to put things in place unless you absolutely needed them or could show a return on them. And that saves you a ton of expenses and that compounds over time because you weren’t paying for those crappy subscriptions for, you know, 17 months before you realized you didn’t need them. I’m looking literally right now at my appliable boxes that I made in a garage with a buddy of mine, no one ever noticed a difference to those things.
Mike (31:03):
And again, that’s no slight any to any equipment manufacturer. But we traded a guy a membership to make some boxes and that saved us a ton of money at a time when we needed it. You could certainly do the math on that and say, OK, I don’t want to make plyo boxes. I will buy them. And it saves me time. You could make that decision too, but at least make the decision one way or the other by calculating. That’s a great one. Let’s go back in time. So you’ve been a longterm gym owner. You’ve made some dramatic changes in the last month or not last month, last year, pardon me. Let’s say, you’re starting a new gym tomorrow. You were starting or even like your second gym or something. And you wanted to get net owner benefit as high as possible, as fast as possible. What are like the two main things you would do when you set up that gym? Like the first steps that you would take to ensure that you are making money yourself.
Matthew (31:49):
You’re limiting me to two, I literally wrote like five.
Mike (31:51):
Give me five then.
Matthew (31:51):
No, I got notes on all these. So I’ll come back to that one last. So the start, the first thing I would do is pretty much what we’ve already talked about doing, starting on like absolute bare bones. What is the absolute minimum you can get away with to get people in the door and get them training.
Mike (32:17):
Less than you think. I don’t want to interrupt, but there’s a YouTube video of Chris Cooper showing exactly how he started his business. And it’s like this, you know, old plyo box that he made as well. It’s like a skipping rope and a dumbbell or kettlebell or something like that. And some rubber tubing, I think so like guys, if you’re listening and you’re thinking of starting a gym, do not make the giant $80,000 Rogue laundry list, you can start your gym with smaller stuff. So I just want to emphasize that and say we have a video resource for you on YouTube on our channel. Sorry.
Matthew (32:46):
Oh, it’s all good. Sell your services, not your facility. But then in the same breath like you have, I would put a whole bunch more time and effort into distinguishing myself and the business from every other business to begin with. Now I know majority of people who listen to the show are probably CrossFit owners or ex CrossFit.
Mike (33:14):
Probably 65% or CrossFit or were. That’s probably about the number. Yeah.
Matthew (33:18):
But even if you’re looking at like a dojo, even if you’re looking at like an MMA gym or a yoga facility, you know, any of those or weightlifting facility, there’s likely another one, at least already in your town, don’t come out as the new CrossFit gym, because everybody who signs up is going to know, have some experience with what a CrossFit gym should look like, what a CrossFit gym should offer, what equipment they use on the games. But so you have to come out of the gate, distinguishing yourself in a way that’s different so that people know what to expect when they walk in the door. And so I would put a lot more time and effort in that. And now I’m fighting that, right? I fight this constantly with my coach because, but my mentor and I work on this constantly because for seven years, my website has been built on CrossFit.
Matthew (34:15):
It shows up really well on Google for CrossFit. So everybody who comes to my gym, once group CrossFit classes, I’m already at a disadvantage when I sit down for a no sweat intro, because for me to then turn around and be like, Hey, we’re going to do one-on-one training. And they’re like, wait a second. My buddy who goes to CrossFit does group classes for a fraction of what you’re telling me this is going to cost. I’m going to go to the other CrossFit gym down the street. Well, I’m now fighting to distinguish myself. I wish I wouldn’t have done it from the beginning.
Mike (34:48):
That is fascinating because there’s long been a debate about the value of CrossFit affiliation. And nobody’s totally sure. Chris is looking into this in our state of the industry survey and so forth. We’re always asking because as again, it’s an expense, right? So we’re always looking to justify that expense. And it’s interesting that you’re saying that the name CrossFit in this case can sometimes give people the impression that they’re coming for group classes, which are actually your discount option. That’s fascinating.
Matthew (35:15):
Now flip side of that, and that would be, I would love that. Let me plug a potential topic for you in the future to talk to one of the gyms who has dropped their CrossFit affiliation last year, and then either to understand how that has impacted their membership or how they have continued to grow, not having it, because I can say our monthly inquiries, our intros would drastically drop if I dropped the name CrossFit.
Mike (35:49):
- So there is value there and outside. That’s good to know as well.
Matthew (35:53):
I wouldn’t, I was freaked out at the potential of having to give up the name CrossFit, because it is such a good marketing tool. So there is some give and take there. I just, I think I need to do a better job in my marketing of distinguishing myself. Yes. I think I can still use the CrossFit name, but I’ve got to make it very clear to people that, you know, this is not your, and it sounds cliche. We’re not the average CrossFit gym.
Mike (36:23):
Yeah. But that’s, I mean, I literally wrote down that topic and that’s an excellent one I want to look into. But so what you’re saying is that CrossFit has, the name has huge SEO and Google value, and it has huge value in getting people in the door. But you also, if you want to sell more than just group training, we’ll call the classic CrossFit training program. You need to find some ways to differentiate yourself either by organic media, by marketing, by your website, by paid marketing, whatever you need to find ways to let people know that your gym isn’t just group classes. You can actually do CrossFit one-on-one or you can do other kinds of training one-on-one or you could do, you know, two one-on-one or online coaching, nutrition, coaching, or anything like that. So this, again, that is a huge point of differentiating yourself from other things in the marketplace. Good one, what else you got?
Matthew (37:08):
So next one is spend money on your website, SEO and social media, especially SEO, right? Social, especially SEO and the website. One of the ways that we didn’t cover as far as, as cutting expenses, that in my opinion need to do is the owner needs to be prepared to be the Jack of all trades for as long as humanly possible. And then handing over that task to somebody else. So case in point, I designed our first website, I built it. I taught myself how to do it. I taught myself how to do basic SEO when we opened eight years ago, that got me to about 75 members at that point, because we went two or three months and it was no growth at all. I was zero sum. I was like, actually, it’s probably more than two or three months, but I was like, gotta do something about this only then did I incur the expense of having somebody else do my website nowadays? I think you have to have somebody do your website to look professional. It is like, great, take a crack at it yourself. But as soon as you got enough money and you can get them done for about a thousand, $2,000, and it looks like a really nice website, get somebody to do your website.
Mike (38:28):
I made the mistake of using a website that was designed to be, you know, quote unquote, cool. Or it was supposed to look a certain way. What I didn’t do with my early websites was design a website that was designed to convert. Pardon me, convert clients. It wasn’t gonna make any money. It was just going to show off my cool picture with my workout of the day, which was maybe good for retention, but didn’t do anything for someone that came to the website, looking to get it getting into the program. So now, and there are lots of options out there. You would really want to get a website that clearly is designed to get people, to sign up for your program, or at least tell them what the next step in your process is. As in get on my newsletter, book a no sweat intro. So I love that.
Matthew (39:12):
Yeah. And get somebody to do SEO. It’s easy to start. And so you can save a lot in costs upfront just by using your own time to blog, use your own time to draft the website and use keywords and backlinks and everything else. But eventually, yes, you’re going to run out of the time. So once you’ve saved that cost even upfront, very quickly, figure out how to spend, you know, a hundred, 200, $250 a month paying somebody to optimize that website.
Mike (39:48):
I like it. Search organic reach is becoming tougher and tougher to get so the more work you can do with your media and with your website to get people there, the more you’re going to sell, especially if your website’s optimized for that. What’s next on the list. These are good things.
Matthew (40:03):
Standardize and systemize, everything ASAP. I feel like I’m just like plugging inTwo-Brain.
Mike (40:12):
So is Kaleda Connell, our SOP expert. She’s having the greatest day just cheers with a glass of wine. You know.
Matthew (40:19):
You have got to get consistent in what you’re doing. And it blows me away today. When I hear a gym, like I know I don’t do a lot of travel. I don’t unfortunately get to visit a lot of other gyms, but I have members that do I have a strong enough relationship with my members that I go to certain ones. I’m like, Hey, give me the good and bad of when you went into the other gyms. And one of the constant feedbacks that I get is like, there was no system whatsoever. lLike the coach just sat there. It didn’t seem like we had any plan going from point a to point B. I had no idea what was coming up next. Didn’t know when workout was going to start like, so it it’s clear that like, there’s still gyms,
Matthew (41:02):
I don’t know how they survive, but there’s still gyms that don’t have systems. And those systems like you don’t understand how much the membership appreciates things like, Hey guys, you got five minutes, let’s go do this. And we’re going to come back. You’ve got 10 minutes to work up to a five rep, max back squat or whatever, you know, you know, have these plans set in place. Everything needs to be laid out. Point by point by point. We have membership contracts. This is how somebody gets onboarded. This is how you clean bathroom. Yeah. Systemize.
Mike (41:36):
I mean, it sounds funny, right. But you actually need to tell people exactly how to do every aspect of your business. And guys, if you’re listening out there and that sounds confusing or intimidating, we teach you step by step, how to do that in our ramp up program. So check that out because at the end of that, you’re going to have a staff playbook that tells people how to do exactly everything. And it could be as simple as park here, open the door at this time, turn on the music to this station. And then everything else comes after that, get your systems in place. It will literally change your life and the lives of your members guaranteed. What else are you going to do? Yeah.
Matthew (42:11):
One more that I think is more of an advice thing than, cause I think I was prepared for this one I opened, but I’m spinning off to another business, which another conversation and I’m being reminded of this point. So you’ve got to get ready to work 24 7. And I just, I need to remind myself of that. That whenever you open up a business, whenever you open up a gym, you’re it, it doesn’t matter. Even if you’ve hired somebody like the buck stops with you. And if you’re not prepared to answer an email at nine o’clock at night, call a potential member on your dog walk, get up at four o’clock in the morning because you have to go coach the 5:15 AM class and from the beginning, you’re not prepared to do this stuff. You’re either going to sacrifice your net owner benefit, or you’re just not in the right industry.
Matthew (43:06):
Like maybe it’s me coming from the legal field where it was like work, work, work, work, work all the time. And so I just brought that over into the gym, but you know, I’ve had people I know that have opened gyms in the past and I’ve said to them before they’ve opened, like be ready because you’re walking out your nine to five job and you’re opening a gym. It’s not nine to five and they’ve come back years later months later and said, wow, I work like so much. And like, we started this conversation. I worked so much, I made a thousand dollars last night.
Mike (43:40):
I’m going to connect your fourth point to your fifth point and say that you know, you’re exactly right. Like you are the person when you open a business and you’re going to have to do everything. That’s farmer phase that Chris has spoken about the goal in farmer phase is to get to break even right away. And then in that, or pardon me, I’m sorry. I’ve got the order wrong, founder phase ,and your goal and founder faces to do everything, get to break even. And then in farmer phase, which is the second phase, that’s when you start relying on your systems, rely on your operations, hiring people, delegating, and that’s where you can really start to expand. And you don’t have to work 60 hours a week unless you want to, because you can start to hire and do those things.
Mike (44:17):
And then we talk about tinker stage that’s stage three. And that’s kind of where you’re sounds like you’re getting to where you’re thinking about other business opportunities. And at that point you literally can’t clean your bathrooms. You can’t afford to clean your bathrooms because you could do so much stuff elsewhere. And we teach you how to do that too, because instead of working on your business in your business, pardon me, you’re working on your business. And instead of coaching the class, you are delegating and teaching and mentoring and generating revenue by developing your staff. So like, I think you’re exactly right when you start, you’re going to be prepared to do everything. And then unless you want to do everything, there are literal steps that you can do to offload all this stuff, create exactly the life that you want. And maybe it is working 40 hours or 60 hours a week. Maybe it’s not, but the steps are there. Have I got that more or less, correct?
Matthew (45:01):
Great job.
Mike (45:07):
Do you want to say what your other businesses that you’re working on right now?
Matthew (45:12):
Running a virtual flower market. I’ll through that out really generally.
Mike (45:18):
- Well, we’ll heck back in with you later on. When you get back, I want to hear more about that, but, we won’t, we won’t let you give away all your secrets right off the bat here, before you get fully going, Matthew, this was great. This is super helpful because what you’ve done here is you’ve given some clear steps to people that they can, that they can take. And so really good advice from a long-term gym owner, who’s made some serious changes in the last year .And dramatic ones. So I really want to thank you for being on the show and being so concise about this as a lawyer, I wouldn’t have expected anything less from you, but thank you for doing it.
Matthew (45:52):
Thanks for having me on, and in any way I can help Two-Brain and anybody else, any other gym owner I’m always willing and open to help.
Mike (45:58):
All right. Thank you, Matthew. That was net owner benefit leader, Matthew Becker. I’m your host, Mike Warkentin, be sure to subscribe for more episodes of Two-Brain Radio. Now here’s a final word from Two-Brain founder, Chris Cooper.
Chris (46:10):
Thanks for listening to Two-Brain Radio. If you aren’t in the Gym Owners United group on Facebook, this is my personal invitation to join. It’s the only public Facebook group that I participate in and I’m in there all the time with tips, tactics, and free resources. I’d love to network with you and help you grow your business. Join Gym Owners United on Facebook.
