Your business has two parts: operations and audience.
The operations side is how you actually deliver your service. Great operations mean excellent coaching and care for your clients, consistency in your pricing, and clarity in your processes. A great measure of your operational excellence is how long people stay with your gym—we call that length of engagement or LEG.
Here are the steps to making your operations excellent:
1. Get Them out of Your Head
Write down every process and procedure in your business. Make the explanation as simple as possible—bring it down to checklist level whenever you can. No one can guess how you want things done. You have to tell them in advance or you’ll be correcting them later.
2. Collect Them
Put all your processes and procedures into one place. We call this a “playbook,” and we provide a sample in RampUp (honestly, that resource alone is worth over $2,000).
3. Deliver Them to Your Staff
You’ve achieved the first part of operational excellence: You’ve standardized your delivery. You’ve established the bare minimum.
4. Measure Them
Calculate your retention score (LEG).
Now, the next step: Optimize your operations.
You own a client-centric business. Everything you do revolves around solving the client’s problems, not forcing a model on them.
5. Map Them
Lay out your client’s journey in detail. What should happen with every client in a perfect relationship?
Here’s how to do it: “The New Client Journey: Design and Deliver.”
6. Evaluate Them
Measure your drop-off points.
Look at the last 20 clients who cancelled their memberships. Take those 20 clients and look at how long they remained a client in months. That’s their individual LEG score. (For you super nerds like me, we’re creating a sample “cohort” here.)
Where were the common drop-off points in those 20 cancellations? After on-ramp? After four months?
You don’t want a mean average this time—you want a modal average (the drop-off point that occurs most often).
Then set a Goal Review Session to happen for all clients one to two weeks before that average drop-off point.
For example: I take my last 20 cancellations. I see that seven of the 20 cancelled around the four-month mark, three cancelled at the 11-month mark, and the rest were scattered all over the map.
Seven out of 20 is pretty significant. So I add a Goal Review Session to my client journey two weeks before the four-month mark for every new client.
7. Improve Them
Implement the Prescriptive Model. This is incredibly important, and you can find all the details here.
8. Measure Them Again
Evaluate your LEG once more.
What’s at Stake? Tens of Thousands of Dollars
As you can see, the path to excellence requires a lot of auditing and measuring. And I didn’t even include the pieces about evaluating your coaches, changing your software or altering your services! For now, focus on building your business around your clients, and use their retention score (LEG) as your North Star.
If your process keeps clients engaged longer, then it’s good. If your service isn’t good enough to keep people around long-term, then it’s not good enough.
What’s at stake? How about $40,000 in revenue that most gym owners are missing? If your gym has 150 members paying $150 per month (that’s too low—more tomorrow) and you can keep every member three months longer, that’s well over $65,000 in revenue. And you don’t have to do any additional marketing or sales to earn this money!
You can build an excellent service and still not get any clients. We’ll solve that problem in the next article in this series.
But here’s the catch-22: If you build a poor service, you might get clients—but you won’t keep them. Long term, that’s actually worse because people talk. Word of mouth can work for you and it can also work against you.
Be excellent and then learn to market and sell. I’ll tell you how in the next post.
Other Media in This Series
“The Two Sides to Your Business”
“6 Steps to Build an Audience and Sell More”