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Your Goal for the Year
Originally Posted 01/19/11

It is a new year and it's time for you to get focused. We used to work on getting ready for the new year at the end of last year and then I realized over time that most every fitness business owner is so mentally deficient by the first of December that he or she just doesn't start thinking about a new year's business plan until after the 1st.


If it is December, then it is time to work less, drink more, plan little and hope I can survive until the first of the year without killing those stupid ass, worthless, degenerate, nasty, smelly, cheap, whinny shallow end of the gene pool members. In December, we hate them all and the in January we will love them all after we have been drunk for three solid weeks and go to the club as little as possible.

Now that you're back to work, let's go to work. Here is your big goal for 2011 if you are a mainstream fitness center: By the end of the year your training generated receivable base will be larger than your membership receivable base. This is assuming you have switched away from stupid ideas, such as sessions and packages, and have converted your system to long-term EFT based training.

If you own a training club, or something in between, your minimum goal for 2011 is to develop a training EFT receivable base of at least $40,000. Again, you are moving away from sessions and packages and moving toward getting all of you clients on long-term agreements based upon monthly usage and the number of people that train together at one time (sharing the cost of the trainer).

Trainers, you have to get a dedicated new client acquisition person in place now, before you miss the January-May rush. Get one person in your system that does nothing but get new members each month. Trainers avoid this person but the successful, big number training clubs have already gone there.

Creating dual income streams is perhaps one of the biggest ideas in fitness. Why haven't we taken what should be the biggest revenue generator in our businesses and developed it to the same level as memberships? You can do this, but you need to give up the concept that all we do is sell memberships. You also have to stop judging your day by memberships sold and cash in the drawer and start evaluating the total new training paper you created that day in comparison to your membership totals.

Why do we find this hard? Look who sells training in the typical club? We hire the best people we can find and let them sell memberships. We then take the least likely person to sell anybody anything, the trainer himself, and expect him to sell directly to the clients. Trainers have a hard time dressing themselves each day and we expect them to generate revenue from a sophisticated clientele? The trainers canít even get dates if it wasnít for the clients asking them out.

Look at the product sell? Training should be something everyone in the club needs, and it is, but we have made the product so elite that only 5% of a typical club's memberships will buy; yet we are in the fitness business and shouldn't we be designing a membership where the largest number of members get the best results so they will stay longer and pay longer? Why do we restrict the one product everyone in the damn gym needs to such a limited number of people by following such a weak business model?

Look how we sell training in the club? We let a trainer give some person a workout and then the trainer sits on a bench and asks for money. No tools, no visuals, no plan, just sweat. What the hell are you thinking out there? We give the sales people tools and we give trainers a sweat-stained clipboard.

Look again at who sells and when? We know trainers suck at sales, so we let a salesperson try and sell at point of sale. The salesperson probably has no training background, is not certified, probably doesn't use a trainer himself and yet this is the guy we want to pitch our biggest product. Here again, we have a sales person selling a product he doesnít understand to a person looking for personal information and guidance.

The big question is where have we been and why canít we understand this? It is so logical if you think of training as the core product in our business. Training is to fitness businesses as coffee is to Starbucks. One should not exist without the other, but we have managed to build fitness businesses that provide no help at all.

What if we created a completely different sales team centered on a closer (thank you Jeremy Klugerman) whose only job is to generate fresh training revenue every day. Two teams designed to generate big numbers. Say you canít afford it? The training/sales team can do better numbers than your membership team if you just get it into your head that you are loaded on the wrong side of the business.

There is no reason that you can't develop a dual income stream that surpasses your membership monthly draft in less than a year. Create the same importance in training/sales as you do in memberships. Get the best person you can hire whose only job everyday is to convert at least a third of your memberships into a layered pricing model where there is a price and a level for almost every member. Track your training sales numbers every day. Look at the gross contracts being generated everyday in training. Add layers to your pricing model that doesn't drop the price but instead just adds more people to share the trainers.

Dual income steams will also allow you to get into the price wars without becoming dependent on volume alone. This system gives you the best of both worlds. You can show a low entry price to get people into the club, and you can also get a much higher average EFT compared to your competitors because we are chasing a higher number through the layered pricing; something your price fixated, volume driven competitors can't match.

We are teaching all of this in this year's workshops starting in Atlanta. If you haven't attended in awhile, come see us and get working on this model. Come on, you can't imagine a training income stream that is bigger than your membership revenue? Dream bigger and learn how to do this.

Original Comments:

Bwiningar-

I do see the point in doing the layerd membership pricing is there anything you have seen people do that we should stay away from when doing this?

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Thomas Plummer-

The most likely thing to get screwed up in a mainstream club is that they donít understand the need to get two sales teams nor do they believe that your training revenue can be bigger than membership.

On the training side, they are poor at the induction process, meaning they have terrible systems to effectively get a client into the system. Most do much assessment at the point of sale. Dude, I already know I am fat and out of shape, you donít need to prove it with a full FMS and body composition. They could benefit from an hour structured induction that builds confidence and highlights expertise not humbles someone trying to do business with you.

Thanks Ben,

Thom

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Bwiningar-

Thanks for the feedback

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Brian K. OíRourke-

Great content Thom. Thanks for sharing and I hope to see you at your DFW workshop.

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Info-

Hi Thom, I am a student of your books and signed up for the Orlando clinic. I was wondering if you recommend the layered pricing for women only clubs? I am surrounded by low price competitors between $10-$10 mo. My model which includes exercise & nutrition programming at $59 per month is my standard membership (it is essential for women who donít like to exercise) and we sell PT on top of that. We are always over $5 in our usage rate but I am finding it more difficult lately to get members in the door. I am not sure if all the low price TV ads are affecting the perception of what fitness is worth to our potential customers. Do you recommend $10-19 base membership and then ala carte the ancillary services on top of that?? Remember we are women only and am not sure if that makes any difference. Iíll see you in Orlando to ask more, thanks.

Rocco

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Thomas Plummer-

I think this would work very well for any type of womenís club. You donít say how big the club is but we are developing womenís clubs as big as 15,000 square as training clubs. You can show the low price but you will need to add 3-5 layers on top to make it work since you do not want to compete as just a volume club, especially in Florida. Depending on space, you might go $19 entry level and then $49 for group personal training and then go up from there. The goal in your club is to get your monthly training revenue larger than your monthly dues, which can be done in about a year. Hope to see you in Florida.

Thom

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Info-

Thanks Thom. I appreciate your expertise and look forward to meeting you.

Rocco

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OJ Flander-

Thom,

We will be launching 1 out of 5 clubs starting on Monday Ė every two weeks another Club fill follow. Thanks for all the help and insite. It has been an unbelievable amount of work to get to t his point. We have a few loose ends we are working out but one quick question Ė how to differiantate group experience with semi-private. We have a few ideas i.e. different tools but as we sell this we want to have something solid.

OJ

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John2011-

I dunno how many clubs/companies I have now taken away from packages, yet owners still donít get it.

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Thomas Plummer-

Mainstream fitness owners are in the membership business, not the training/results business. You canít manage something if you donít understand it.

Thanks John

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Roy-

Perfect example of why I still follow TPlogic after all these yearsÖ I will be using a model such as this within my new facility..

Thanks for the years of "makes senseĒ

Roy McIntyre

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Thomas Plummer-

We are doing the 3-day advanced school on how to implement our system in Atlanta at the end of March for anyone who wants to get a higher level of understanding of our training business model.

Roy, thanks for writing and always good to know you are still alive out there.

Thom

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Wade-

What are the dates youíll be in Atlanta?

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Jillian Taylor-

My name is Jillian and I am with the NFBA Ė we are going to be in ATL March 31, April 1 and April 2 for our Personal Training Workshop Ė Let me know if I can get more details!

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Thomas Plummer-

January 27-28 will be the launch for this yearís tour.

We will be there again at the end of March for an advanced school for three days of implementing our training business model.

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Fitness4lifemark-

Absolutely love this Tom. Tried to get our club to do this a few years ago, but they never got around to it. We made some positive changes, but itís still me sitting on the bench after showing a few exercises, "wanna sign up for training?Ē Going to print this out and show to the big wigs at the gym.

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Thomas Plummer-

Drag the players to a workshop. We are pounding this theme this year and teaching several different price strategies as well. Let me hammer on them for two days and see what happens.



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