Simplify your life and save yourself time by creating a system or Membership FAQ, for how you handle member cancellations and membership holds.  Be sure to answer all pertinent questions regarding how your memberships work, including questions about putting a membership on hold, cancelling a membership and the process to do so.

Things to include:

1. A list of each of the different membership options
2. Your membership cancellation/hold  policy details. Do you require advance notice for cancelling a membership or putting a membership on hold? For example 30 days notice is fairly standard, you could also do 60 days or something else, your call.
3. Any associated fees with cancelling or holding? Do you have a cancellation fee and a hold fee?  Be sure to list these. (Again these are fairly standard if they aren’t in a month-to-month agreement. Something nominal to hold, like $25 and something a little more steep to cancel, at least $100-$200)
4. How to go about cancelling or holding? Do you require this notification in writing?  If so be sure to state that.  Something to the effect of “please send all cancellation or membership modification requests to info@yourgym.com.” I highly recommend requiring these in writing.  Verbal mentions of a membership hold are likely to get forgotten resulting in stress on your part when you finally remember or even more stress on your part when you don’t remember and the person gets charged. Also, frequently a person will say “I need to hold my membership until Sept 1”.  So Sept 1 comes around and they get billed.  Then if they call/email to complain you just have to produce the email they wrote saying they’d be back on Sept 1 and you have an easy way to show them that this is what they communicated to you.

Aslo include any and all “what ifs” that you get asked, such as:

1. What if I’m going on vacation and will miss 3 weeks of class?
2. What if I want to increase my membership from 2x per week to 3x per week?

And so forth…

Appointments need cancellation policies too!

If you do any amount of Private training you will also want to have a cancellation policy in place for appointments.  A 24 hour cancellation policy is fairly standard.  State something to the effect that cancellations need to be received 24 hours prior to your appt or you will be charged for the appt.  Have a signature line for the client to sign at the time of purchase of a PT package.

Now, you as the owner or trainer can decide on a case-by-case basis if you want to flex on it.  For example there’s a death in the family and the person doesn’t give adequate notice…I personally wouldn’t charge the person for the appt.  But having a policy in place helps protect you from the 10% of folks who are flakey and will abuse you if you don’t have one.

Having some simple policies in place can save you time and energy.

Hope you’re all off to a great start in 2012!

When you sign up for this app, clients that have been in your facility in the past two weeks will be sent an email invitation to connect with your business on Facebook.

If they accept (it’s opt-in) each time they are checked into a class in MBO we will automatically check them in to your business’ Facebook page.

The number of check-ins on Facebook is a form of social validation letting people know that there is a lot of activity at your facility.  A business that has had thousands of check-ins appears more popular, established and viable than a business with only a few check-ins.

Second, each of these check-ins shows up in your clients’ activity feed on Facebook and can be seen by their friends – kind of like an ad impression but even better because they are in your client’s feed.

Since our clients (like most people on Facebook) have about 100 friends each these were potentially seen over 43,000 times on Facebook.

Over 15% of our clients at NorCal have opted to use the app on FB, and each month we get hundreds Facebook check-ins.  Our clients who have signed up like that they have an easy way to let their friends know they are going to work out, and we are happy because it is driving traffic to our Facebook page, increasing the social exposure of our brand to our clients’ friends, many of whom are our best prospects.

A friend of mine looked into running an advertisement for his gym and Facebook would have charged him a $2 CPM (cost per thousand impressions) to target the same set of people.  To get these same 43,000 impressions via a Facebook add would have cost us $86…instead we got those same impressions free with this app!

To top it all off it’s EASY!  You sign up once and Skilled Athlete will automatically invite all clients who have been in your facility in the last 2 weeks.  Anyone who comes in after that initial invite (old clients or new) will also be automatically sent an invite.  There is no further action required on your part.  Also, if they so desire, your clients can opt out at any time by simply uninstalling the app from their personal FB profile.

A couple of things:

Just like the FB schedule app, your business needs to have a FB page (not a personal profile) to utilize this.  You can read more about the importance of having a page for your business here.

If you already have the Skilled Athlete Facebook Schedule app installed just send an email to support@skilledathlete.com , and we can turn on the FB check-in feature for you.  If you don’t yet have the FB schedule app installed you can do that here.

And stay tuned…in late January Skilled Athlete will be releasing an iPhone app that will allow you and your trainers to check clients into classes directly from your phone.

Tracking attendance is important and this app is going to be a super helpful if your gym or studio doesn’t utilize key tags or self-sign in.  But, if like NorCal Strength & Conditioning, you DO use key tags the app is still going to be helpful since your trainers can check to make sure their roster is accurate at the start of each class and don’t have to double check that all clients signed in at the end of class or the end of the day.

The app will also allow you to take client photos with your iPhone and push to their MBO profile (read this article if you aren’t yet in the habit of storing client photos in their profiles), email and phone clients directly from the app and much more!

Again, wishing you all a very happy and safe holiday!

Here is the 5th interview in my series of interviews with CrossFit Affiliate owners.  If you missed the first four you can find them here:  Interview 1, Interview 2, Interview3, Interview 4.  I have also been contacted privately by some additional affiliates wanting to share their experiences as well.  I will by synthesizing those together for a future post.

Enjoy Interview 5!

How long have you been “open for business?”

Just shy of 3 years now.

How many hours do you typically work per week in/on your business?

Define “work.”  This is a really tough question to answer because I am not sure where I would draw the lines between “work” and “play.”  I have nothing that would resemble a “balanced” life.  I would say that I am probably tinkering with something related to the gym, training (myself), coaching, communicating with employees, designing programs, etc…between 12 and 14 hours a day.  Even an ideal Sunday (when the gym is closed) typically starts with a workout with my girlfriend and several of my close friends – who also happen to coach at the gym. Then it’s off to a coffee shop where we’re kicking around ideas or playing with new programming concepts.  But this is fun for me.  I kind of discarded the theory of balance when I decided to open a gym.  I am a typical Type-A personality, so balance was never my style.  This allows me to be “unbalanced” and still doing what I love.

Did you leave another job to open your gym?  Are you making more or less money now?

I did.  I now make a fraction (well below 50%) of my previous income.

Is owning and running a gym different than you imagined? How so?

Yes.  When I conceptualized owning a gym, and even when I was just getting started, I emphasized and put my time into all of the amazing reasons I started a gym – interacting with members, developing a culture, coaching folks to become the best versions of themselves, etc….  As time has gone on, I have also had to realize that in addition to owning an AMAZING place for folks to become happier and healthier, I also have to run a business.  When I set out on this journey, I cannot say I dreamed about submitting payroll, how I was going to figure out how to pay health benefits for employees, tax liabilities, etc….  The actual running of the business was lost in the dreamy ether of the fun of working with individuals that I genuinely enjoy being around.

Knowing what you know now, would you choose to do it again? Why or why not?

Absolutely!  This is my calling.  The trials that come from learning in any career or endeavor worth doing are just part of the territory.  I love what I do and the coaches, staff and members that have made this dream a reality.  I walk into my little slice of the happiest place on earth every day.

What about your business frustrates you the most?

My lack of preparation in creating business systems to make life easier on my coaches and staff.  I am not a systems-driven personality.  I operate from principles and intuition.  Unfortunately, as you expand a business you have to have ways to effectively communicate and empower others to exercise the decisions that you would want made.  That means codifying these ideas and creating consistent systems and protocols.  This is really hard for me.  Luckily I have a couple of amazing friends/family/coaches that help to compensate for this weakness.

What about your business brings you the most joy?

The people.  Easiest question on here by far.  The coaches, staff and members that I get to interact with on a daily basis are inspiring.  Their improvements and happiness drive me to become even better. That feeds into the second best thing about the business, which is the constant opportunity to learn and grow.  The fitness industry is an amazing, constantly changing organism.  There are so many phenomenally smart coaches and ideas out there as to how to best help athletes and individuals that want to improve their health and fitness.  I can easily get lost in books and seminars discussing ideas, commonalities and differences in training approaches.  This intellectual stimulus keeps me from stagnating and getting bored.

Reflecting back to when you opened would you consider yourself well-prepared for owning a business? What were your strengths and weaknesses?

No.  I knew enough about coaching, and I knew a lot about hard work, but I didn’t have a clue as to how to run a business.  My willingness to work hard, to develop relationships with great people (members and coaches) and to help people achieve results were the strengths that pulled us through, but my weaknesses were myriad and extreme.  I had really never delegated anything in my life, I avoided financial analysis like the plague, and I was (and still am not) not tech savvy at all when it came to maintaining an online presence.

Did you have experience coaching prior to opening?

Yes.  I had two years of CrossFit-specific coaching, and a lot of years coaching other sports and martial arts.  I have always enjoyed teaching others and sharing knowledge, and martial arts gave me an opportunity to start doing so at a young age.

Do you feel you are sufficiently financially rewarded for the amount of time you’ve invested in your business?

Yes.  If you look at it from a dollars per hour perspective, I am probably violating even third-world country standards of labor laws.  But I didn’t make this career change with an eye toward maximizing my monetary health.  The intangible rewards far outweigh the financial rewards.  And luckily, the business is now at a place where I can be a bit more generous to myself financially.

Do you see yourself doing this (owning/operating a microgym) 10 years from now?

Yes.

As a current CrossFit affiliate, what are the benefits of affiliation as you see them? In your estimation and in your particular circumstance are they worth the price?

The primary benefit of affiliation is the community of individuals and their shared enthusiasm for fitness.  It’s rare to have so many folks rally around good nutrition and pushing themselves to their physical limits.  It means that folks from across the country or overseas can come to my town and know they have a place that will understand and accept their passion for fitness.  Affiliation creates a common word and concept that indicates we understand that passion and pursuit of an individual’s own personal fitness excellence.  The methods we use to get there may differ from other gyms around the world, but we still “get it” and stand prepared to help folks achieve their best results.

It’s too soon to know the exact impact yet, but the airing of the CrossFit Games on ESPN2 and some great commercials by Reebok and CrossFit encouraging folks to find their local affiliate – coupled with a map tool that now shows how far each affiliate is from your location – could be a huge benefit.  This could provide not only exposure for the sport and CrossFit.com, but also a push to link prospective members with qualified coaches in their area.  I am excited about the prospects of what this could do for affiliate gyms.

How close is the nearest affiliate to your place of business.  How has this affected your business?  

There are three within 2 miles of us.  I don’t believe it has impacted our business greatly.  We all have slightly different cultures and methodologies.  I think our clients select the gym that works best for their needs and personality, and I think that translates into a happy community here and at the other gyms.  That said, I would be remiss if I did not say that it disappoints me when other gyms/coaches undervalue their services.  I think this is a real problem.  Nobody wins when the costs of membership drop, it just means you have to work so much harder servicing more clients in order to be profitable.  If you look around at what personal trainers and boot camps charge, it is often much more than CrossFit affiliates and they provide a fraction of the coaching.  So, my two-part plea to all affiliate owners is: (1) raise your rates to properly value your services; and (2) commit yourself to becoming the best coach you can be (seminars, certifications, reading, etc…) and be the best deal in town even with the most expensive membership dues.

What if any trends do you see among new affiliates?

Two things come to mind.  First, it seems like folks are coming in with a lot more money to invest in their gym at the outset.  In general, this means they are able to provide a much more professional-looking environment.  That is a great thing . . . as long as it is also backed up with professional coaching and business management.  If not, it just tends to result in a larger loss of personally invested capital.  Second, I see way too many people opening gyms without adequate coaching experience.  I would strongly encourage any prospective gym owner to spend at least a year (and preferably more) coaching and learning from others.  You should never take on the risks associated with owning a business if you haven’t put in the time to know exactly what coaching 6-8 hours per day is like.  In my mind, this is the most common mistake I see affiliate owners make – learning on the fly.  There are good coaches and gyms out there.  Reach out to them, be clear about your intentions (to open your own space), and see if you can reach an agreement to work for and learn from them for a period of time before exploring the option of opening your own.  Oh yeah, and you might also be prepared to do that for free . . . because that’s probably what you will be doing in the initial stages of owning your own gym anyway.

Would you consider yourself an introvert (you gain energy from having time alone) or extrovert (you gain energy from being around others)?

Ok, maybe this is the easiest question on here.  I am an extrovert.

What advice or words of wisdom would you give to someone considering opening a microgym or similar fitness studio?

We all have passions and dreams.  You should chase yours . . . BUT ONLY (1) after you have put in the time to hone your skills and gain and intimate understanding of the profession; (2) if you are willing to sacrifice your time and financial security; and (3) if you are committed to moving heaven and earth to succeed.  If you get squeamish about the thought of losing it all, don’t do it.  I made the jump from making a lot of money to owning a gym only after two years of dedicating myself to learning how to coach and manage other coaches; I was fully prepared to lose everything I had in pursuit of my dream, and equally committed to ensuring my success.  I can only hope that others will go in with a similar approach.  It’s not a decision that should be taken lightly.

What is the hardest lesson you’ve had to learn?

That I cannot do everything.  Learning to delegate and clearly and effectively communicate projects and tasks to others has been tough.  We grew faster than we expected, and I am definitely behind the curve on learning some lessons that will be essential to ensuring continued smooth growth.  My focus is on learning to better leverage the amazing talent I have around me, and I have been blessed that these are good friends who have been more patient than I might have deserved at times.

If you answered yes to all three questions you are in for a special treat!  (If you answered yes to the first two, but not the third then read this post I wrote last week and get your gym’s FB profile converted to a Page and you’ll be good to go).

I am a founding team member in a company called Skilled Athlete, which includes several former Expedia developers.  Over the past few months we have been working on a suite of social media and CRM (customer relationship management) tools for gyms, most of which can plug right into your existing MindBody account.  We have several very cool tools in the works and we will be releasing them as they get developed.  Some of them will be free, like this one, and some won’t.  (Skilled Athlete will only be charging for tools that will have a direct positive influence on your bottom line!).

This first one is a Class Schedule App for your Facebook page.  Now your clients can find your class schedule simply by navigating to your Facebook page and clicking the “class schedule” link below your business’ page photo.

Then voila! Your class schedule appears!

Clients can click on the class times to show the instructor for the class as well as “reserve” a spot in that class if your gym has that feature enabled in MBO.

If you’d like to check out the Schedule App in action you can see it live on our NorCal Facebook page here.

When you’re ready to deploy your own Mindbody schedule on your FB page just head over to Skilled Athlete.  The set up process is pretty simple and again it’s free!

Oh, and one more thing.  If you aren’t yet using a business management solution like Mindbody Online, then you might want to head there first!

You may or may not know this, but FB profile pages where you collect “friends” are strictly for individuals to use.  In fact entities and organizations, like businesses, caught using individual profiles can have their profiles deleted per Facebook Terms of Use.

From Facebook:

Since profiles are for meant individual people, they aren’t suited to meet your business needs. Pages offer more robust features for organizations, businesses, brands, and public figures, which you can learn more abouthere.

Further, maintaining a profile for anything other than an individual person is a violation of Facebook’s Statement of Rights and Responsibilities. If you don’t convert your profile to a Page, you risk permanently losing access to the profile and all of your content.

Aside from FB rules there are several advantages for a business to have a PAGE and not a profile.  I’ll touch on some of the main points here:

• First and foremost a profile page is limited to a maximum of 5000 friends. Why would you want your businesses exposure to be limited to the first 5000 people you come across? If you’re in business you want unlimited exposure. Period.
• Only friends of the profile can view the profile.  Whereas even folks who aren’t yet Fans can view your Page. Again, you have more reach here.
• FB pages are indexed by search engines.  Fb profiles are not.
• With a page you can put Like buttons on your business web site and direct site visitors to your FB page and get more Likes.
• A page can have multiple Admins.  You can have your trainers or managers be Admins and all of you can be posting content (photos, videos, wall posts) to your page, keeping it fresh and dynamic.
• Your Fans that are actually customers can “check in” to your location page when they visit your business.  If you notice on the left hand side of a Fan page there is listed the number of Likes as well as the number of folks who were “here”.  The more people who “check in” to your business the more socially visible and credible your business becomes.  Also, when a person checks in to your business it posts that they are at your place of business on their wall.  Their friends can now see they are your customer, can click the link and go to your page, and are more likely to be interested in your services themselves.  Word of mouth marketing, Facebook style.
• Metrics.  You get a weekly summary email from Facebook showing the weekly activity of your page.
• More metrics.  There’s a nifty Insights button on your page that will show you all sorts of great information about the people frequenting your page, from user demographics to which wall posts had the most interactions.  Lot’s of fun stuff to geek out on here.

Uploading your client’s photo or headshot into their profile might seem superfluous if you’re just getting going with your studio or microgym.  If you have fewer than 50 clients you obviously know everyone’s name and can easily locate them in MBO when you need to.

However, there will come a day when you aren’t the only one selling memberships in the retail screen and signing folks into class who forgot their keytags.  You will at some point have a few or several trainers.  And you will at some point have 30 people with the first name “John” or “Katie” in your system.  This is when it becomes important to have the profile pic stored.

We were lazy with this when we first started using MBO in 2007…but have since become quite fastidious about it.  With several trainers and several folks with duplicate names it’s important to make sure we’re signing the right “Katie” into a class and selling the right “Katie” a private training package.  Sell it to the “wrong” Katie and Katie1 essentially buys Katie2 a $600 PT package.  It can be messy to clean up after these types of mistakes. Not to mention it looks quite unprofessional.

So this is just my friendly reminder to start taking client photos and uploading them to their profiles if you aren’t already doing so!  Cheers!

Without giving too many details that might reveal your identity, let’s just say you are somewhat of a CF affiliate connoisseur.  When did you start traveling and visiting affiliates?  Approximately how many affiliates have you stepped foot in to date? Anything else about yourself that you can share?

I have been in the fitness industry as a trainer and coach in some capacity since 2005. I began to focus primarily on CrossFit as an athlete in 2007.  In 2010, I began traveling and have visited a little over 30 affiliates. Through attending seminars, the CrossFit Games, and other community events, I have had the opportunity to talk “shop” with another 20-30 affiliate owners.  So in total, it is somewhere in the range of 50 to 70.

You don’t own a microgym or an affiliate.  Do you have experience running or owning any other business?

I have been my “own” business as a sole proprietor since early 2009 and also own a performance-based LLC that you could say is a “micro” microgym primarily focused on one-on-one training. Prior to becoming involved in CrossFit, I worked as a trainer in big box commercial health and fitness centers, which included some business development and planning as well.

When I began to seriously travel, I was surprised to learn that affiliate owners and coaches were just as interested in discussing business development as they were in improving their skills as trainers. So in some capacity I’ve been providing business consulting for microgyms and affiliates since I first started traveling.

Based on the broad cross-section of boxes you’ve seen, where do you see folks collectively succeeding?  And alternatively where do you see them failing?

With the explosive growth of CrossFit in just the past two years alone, many markets have become flooded with affiliates, particularly in metropolitan areas. In my experience, the most successful affiliates are creating their own “brand” of CrossFit. In addition to CrossFit classes, many offer sport-specific training for weightlifters (sport), endurance athletes, and high school athletes. They are offering more in general to attract a broader mainstream client base that may not necessarily be drinking the CrossFit “kool aid.” Many are still using CrossFit-based training as the foundation for these programs, but have found more success in marketing to a specific clientele than using a one-size-fits-all-approach.

Now don’t get me wrong; many affiliates are very successful and offer only CrossFit classes or group training. However, as many markets become more saturated I think the need for owners to distinguish themselves and create separation from other affiliates will become more important (especially if two affiliates are located across the street from one another). I also think with the growth of the CrossFit Games and CrossFit as a sport, appealing to the mainstream will also become increasingly important.

Joe the Banker or Jane the Soccer Mom want to be able to join a microgym that offers CrossFit without necessarily being competitive CrossFit athletes. There will be a market for firebreathers and Games competitors, but in my experience these athletes are a very small percentage of a microgym’s clientele. As a business, keep your primary clientele in mind, which ties back in to the importance of knowing your niche and developing your own brand. I have seen several affiliates struggle with this exact issue, and their clients have suffered as a result – due to programming that was suited for competitors but not for the mainstream client.

Most successful affiliates I have visited also have thoughtful and organized class structures. They rely heavily on the point of entry model by utilizing introductory sessions, an elements curriculum, a foundations curriculum, or an On Ramp, etc. In doing so, they are not only providing a less intense or intimidating barrier to entry, but are also distinguishing themselves from other nearby microgyms or affiliates. Interestingly, these gyms tend to also have the strongest communities. I would argue their reliance on open points of entry creates more inclusive microgym communities. New clients are not as intimidated and are welcomed into the fold by their microgym peers. These microgyms are also not plagued by the “ego” or “elitism” I have seen at some affiliates. In addition, organized class structures allow you to maximize your time, which is an invaluable commodity when you are being pulled in a million directions as a microgym owner.

And strong microgyms usually have a model for improving the quality of their training staff, which I argue is a huge opportunity to create brand distinction and separation. Regardless of whether they treat coaches and trainers as independent contractors or employees, the most successful boxes are providing continuing education opportunities and business opportunities that benefit the individual coach/trainer, enhance trainer-owner relationships, and generate more revenue for the box.

What advice would you give to the boxes you’ve seen who in your estimation need the most help?

If you are an affiliate owner or microgym owner, you need to ensure you have a complete business plan. We love training clients and helping people reach their goals and reach their athletic potential. But, we cannot focus on that if we do not have the business backend in order.

Here are some questions that come to mind based on what I have seen at struggling affiliates: What is your plan for improving client retention? Do you have any metric for client attendance and class size? How are you controlling the quality of your coaching staff? Are you creating your own niche or subject matter expertise that sets you apart from your competitors? Did you require your trainers/coaches to sign Independent Contractor agreements? What are you going to do if your trainers leave and open up a competing affiliate down the street from you and take many of your clients with them?*

*I have seen this happen several times. This is one reason (out of many) why enlisting the services of attorney for all business matters is so important.

Another question I like to ask affiliate owners just to assist in creating a business plan is: What are you going to do if CrossFit no longer existed tomorrow? How would you market your business and your services in that situation? I have seen a lot of affiliate owners fail to consider how they may operate if they were not a part of the CrossFit community or wanted to separate and be a non-affiliated microgym. This usually helps get the wheels turning and allows the owner to better conceptualize his or her ultimate vision for the gym (which can be a daunting task when first starting or when struggling).

If you are currently struggling, evaluate why you are struggling. Ask yourself difficult questions. Talk to other affiliate owners and microgym owners and ask for advice.  If possible, have someone neutral take a look at your business model or your books. Study the business models of successful microgyms and businesses. I think improving a struggling affiliate can be similar to the progression one follows in improving their abilities and skills as a coach/trainer. It starts small and continues to develop overtime as the coach/trainer improves through continuing education, seminars, experience, etc. Start by looking at the basics – your class schedule, your clientele, your rates, etc. – and then expand from there.

What can affiliate owners do to continually elevate the quality of service they are offering their clients?

Improving quality of service starts with continuing education. However, do not simply “chase paper.” Attending seminars to simply say you “attended” is not an effective use of your time or your microgym’s resources. Look at continuing education as an investment; you want to get the highest return on investment for the microgym’s long-term success and growth. For example, do you have a strong endurance community in your area? Then spend time investing in endurance education that will make you more marketable to that particular niche.

If you have a basic foundation upon which all of your training/programming is built, then you can more easily market to sport-specific groups with a little tweaking/focus. World-class coaches like Louie Simmons are subject matter experts, but are able to leverage their expertise to serve a wide variety of clients. Microgym owners can do the same thing.

From a staff standpoint, implement or develop a strong metric for evaluating your training staff and for training and recruiting new coaches. For example, some of the successful affiliates that are continuously improving have very methodical, progressive internship programs that allow interns and coaches-in-training to grow from the day they start to the day they actually become full-fledged members of the gym’s staff (as contractors or as employees). This does three things: (1) it ensures you are actively involved in the coach’s improvement/development, (2) you are developing a strong, competent and professional staff from the ground up, and (3) you are creating loyalty and setting up your staff for success. Regardless of your approach, have an approach! I have seen numerous trainers leave affiliates due to the owner’s lack of concern for instructor quality.

Emphasize overall quality, always. Successful microgyms, in my experience, are built on being more intimate with an emphasis on quality of instruction and service (even if they have hundreds of members or only a few dozen). Other affiliates can undercut you, offer bells and whistles – and yes, you may lose some clients – but ultimately, I have seen those affiliates falter due to a lack of overall quality, service and a plan.

As CrossFit continues to grow, I think this emphasis on quality is what will continue to separate successful microgyms from “big box” commercial gyms that may elect to capitalize on the growth through their large amounts of capital and resources. And quality need not be focused only on quality of instruction. The points of entry, the community, your microgym’s attitude/atmosphere, and the inclusiveness, in addition to great instruction, all paint a positive picture for new clients.

Finally, document everything. E-v-e-r-y-t-h-i-n-g. Hire an attorney. This is especially important when dealing with friends and family that may be your clients and/or trainers/coaches. I have seen relationships and businesses damaged due to disagreements that could have been solved by being proactive with legal protection and paperwork. And even in a community that is as open and welcoming as CrossFit, there are unfortunately situations where you will wish you had developed some strong CYA.

And although we are discussing ways to improve the quality of service for microgym owners and affiliate owners, I should mention that many of these principles and ideas apply to trainers as well. As a trainer working as an independent contractor, you may have a great deal of flexibility, but you also may not have a great deal of protection, especially if your affiliate owner elects to not have you sign any sort of contractual agreement that spells out pay, duties, etc. For your own protection as a fitness professional, always make sure you are covering yourself.

Any thoughts on the relationship between CrossFit and Reebok?  What does the future hold for the affiliate owner?

To be perfectly honest, I was skeptical when the relationship between CrossFit and Reebok was first announced. After attending the 2011 Reebok CrossFit Games, I am more optimistic. While I know there are numerous people out there that may argue CrossFit HQ is “selling out” or is “in it for the money,” I think the community, microgym owners and affiliate owners can benefit. It is simply a matter of channeling the exposure and growth that the relationship provides to benefit your microgym or affiliate. The exposure and subsequent growth gives microgym owners more marketability. More people are going to be interested in CrossFit, which is good for business.

However, all relationships have potential drawbacks. I am interested to see how CrossFit HQ manages to balance growth and quality. Exponential growth is going to be a strain on CrossFit, but all business relationships have growing pains. My concern is the amount of effort and time that will go into preparing for each year’s Games may detract from an emphasis on the community – on the individual box owners.

Will there be higher barriers to entry to become affiliate owners as more individuals (and possibly more big box commercial entities) try to capitalize on the CrossFit success bandwagon? Given the number of boxes in some markets already, it is not an outrageous question. And while it is true successful affiliates may continue to be successful, the volatility and rapid growth could lead to a big drop in brand quality and/or reputation. This is why I think building your own brand or own microgym niche is so important.

Ultimately, I see the relationship between CrossFit and Reebok as a good business opportunity. Just think of the relationship, for now, as opportunistic marketing that complements a sound microgym business plan.

Welcome back! In the first piece I  took you down memory lane and described how some training related inputs from our friends Mike Rutherford and Dave Werner dramatically improved our training and business. The training piece might be obvious, especially in the case of the Max Effort Black Box template Rut offered to the world. With this technology our clients made much better progress and could finally reach the strength levels necessary to do well at CrossFit diagnostic WOD’s. The athletic skill standards however inspired a change not only in our class structure, but it gave us the opportunity to really think about our business from a systems based perspective, starting right at the front door.

First Contact

How do folks make first contact with a business like NorCal Strength & Conditioning? Initially our contacts could be broken down into the following categories: Phone, Email, Walk-in. Today I’d add blog, FaceBook and Twitter in that mix as potential first contact options for prospective clients. This may all seem obvious, but without some kind of system these contacts get lost (hampering the acquisition of new clients) and you are left with no idea about conversions from contact to sign-up, retention or a host of other really important concepts. Well, important if you want to keep the doors open.

When Nicki is tinkering with an idea she will “act her way through the idea…It’s part thespian warm-up, part dementia ward ramblings (love you babe!) but let’s use this wacky little technique to look at how folks flow into your business:

So, someone phones, emails or walks-into your business (or perhaps they asked a question about your facility on Facebook) this new person comes through the door…what do you have to offer this would-be customer? Any type of a screening process? A one size fits all program, or something that can meet the needs of 95% of the population? Do you have a way of documenting how said person found you or relative % conversion to a real client? Do you know the likelihood this person will still be with you in 6 months or a year?

Until we brought in Dave Werner’s skill standards we tried to shoe-horn everyone coming through the door into the one size fits all program (based largely around the sexy MetCon) and we had a ton of problems with this (mentioned in part 1). It was not safe, it was not a good experience for the clients…it was not a system. It was neither physics class nor birthday party, it was a joke. As I mentioned in the Performance, Health & Longevity piece that I did for my wife, we enacted several different programs which addressed these initial shortcomings and are now critical to our success.

Personal training-Where our orthopedically or medically challenged folks go. Also a great place for local celebrities/business people who may not want to be in a group class format.

On-Ramp-A beginner class with set structure which introduces the movements, intensity and nutritional components of the program in a small group format. We have excellent retention from this format as compared to dumping everyone into a large group. I’ve received some push back about this from folks who are concerned about “diluting the community” of their gym. Get four classes running simultaneously with upwards of 60-80 people being coached at a time…you not only have community you now also have quality coaching.

Elements, Level 1, Level 2-I talked about these previously. Tough, mixed modal group classes with specific skill/fitness standards to participate.

Strength Class. Periodized strength class where folks get seriously strong.

LIFT-“Low intensity functional training.” Mixed modal training, but no names go on the board, no specific time is given for the training. Some men will die for points, other folks simply quit the gym when they get tired of getting the dog-piss beat out of them.

So, this whole scene is an integrated system. It allows us to “sell” a program that reaches damn near anyone (personal training, or the group class options), it provides years of progression to keep folks interested and engaged, it offers alternate tracks with more or less intensity to meet folks where they are. We are able to offer better programming & safety while keeping things really fun.  If you have solid business management software the whole thing runs pretty well and with a minimum of onerous, repetitious activity.

I know first hand how hard it can be to run a small business like a microgym or martial arts studio. I’ve done both. It can be as fun as it is exhausting and taxing. Folks frequently go into  business because of a love for the subject matter and (hopefully) also love working with people. Often times I see folks who love the subject matter and discover how draining coaching can be…tough gig. If you consistently focus on quality of coaching and business systems it is better and “funner” for you and your clients. Systems, first and foremost, allow you to “stay in business.” That seems like a bonus! In the hierarchy of needs this success allows us to move beyond survival and start flexing our creative muscles…this is the stuff that keeps one engaged across a lifetime.

Occasionally I hear excuses about enacting better systems like I’ve described here. In one case it was a mom & pop gym with a good number of clients but the owners felt systems (business management software, scanner type check-in, structured trainer development program) would “make things lose that family feel.” Well, 4 years into this frackas these folks realized they might want to quit their day jobs and really make a go of things with the gym as the primary income source. They had 4 years of no infrastructure development and were (economically) getting their asses kicked by folks who were in business a fraction the time, but who tackled the gym as a business, not a hobby. Interestingly, the folks who were in business for 4 years were also STILL operating in a very unsophisticated level with regards to programming and trainer development. Said in a more direct way: their programming sucked, was dangerous and their trainers could not make a living.

Please, please…tell me what is good about this situation, whether we are talking about the owners, trainers or clients?

If you have chosen to be in this service arena you do not have the luxury of selling cheap plastic widgets. That means you need to prioratize the quality of your offerings. This often mean recognizing the gaps in your knowledge, how effe’d up your operation is and then getting “Zen” about it all and just moving forward. Time is a ticking. Do you want to start building a better program now or wait 4 years? What type of towel rack do YOU want to be?

How long have you been “open for business?”

2003 unofficial garage gym, 2006 official CF affiliate. What a glorious Mesozoic-like time it was in CF History.

How many hours do you typically work per week in/on your business?

Physical hours? 50-60 easy, but we have put in a few 24+ days for certain things. I always work or am present at the gym seven days a week. This is mainly because we are continually growing and pushing limits. Mental hours? I am constantly thinking about making improvements and tinkering with things. It’s really an issue sometimes.

I do have a wonderful team and flexibility in my schedule if I need it. If I wanted to go on a vision quest for like a month I have complete confidence everything would run 90% perfect.  It wasn’t always like this, but something that I have worked to achieve.

Did you leave another job to open your gym?  Are you making more or less money now?

I was in the military and got out because I wanted to, but not for CF.  While in the military I was “coaching” if we can call it that, but I didn’t really have a master plan when I got out.

I make less, but I have waaaay more flexibility, and the ability to proactively shape my life with my skills, which is something I value over stability.  I am optimistic that in a year or two I will make way more than I could have ever made in the military, but that really isn’t my #1 goal in life.

Is owning and running a gym different than you imagined? How so?

Honestly, and this may sound dumb considering how big we have grown,  but I really didn’t think about what running a gym would be like. I just kinda jumped into it.  That being said, owning a gym is very agreeable to most of my natural tendencies, but each new level of growth requires new skills and knowledge.

If I had thought about it perhaps I wouldn’t have guessed at:

• The sacrifice of your fitness, heath, and training that generally happens because you are worrying about dumb stuff.
• How a job is different then a hobby
• How MBO slowly works to make me insane

Knowing what you know now, would you choose to do it again? Why or why not?

I would do it again. For sure. I have learned a ton about Coaching and due to the challenges that we have faced I have had to learn a ton about business. Compared to most CFs I am told that we are killing it. Additionally I have met and helped some of the coolest people I could have ever hoped to meet, and I have a couch to crash on probably on any continent in the world.

Why?

When you step back and think about it, helping people improve their lives is a pretty awesome job. If I am feeling like crap and then have to teach a class, all of that stress (bills, emails, etc) goes away because nobody wants a crabby coach! This is a huge perk.

Why Not perhaps?

It’s probably no different than most small businesses, but everything about running a great facility takes 2x more effort and 2x longer then you think.

If so what would you do differently?

I would have read this page as the partner thing didn’t quite work out for me.

I would get every last thing in writing if you have a partner, set and explain expectations, and don’t wait to have difficult talks.

I wouldn’t get loans (at least not way more then you need)!! Somebody is going to have to pay this back, even if you buy dumb stuff.

Don’t feel like you have to grow to larger and larger spots.

I would have moved to Columbus and started an equipment company in 2003.

What about your business frustrates you the most?

Many things have frustrated me, but currently it is my quest to pay down debt. This results in my taking a really low “salary,” especially when compared with other owners whose facilities are as large and profitable as we are.

By most measures of success that are evaluated: top coaches with excellent coaching skills, fun vibe, number and size of facilities, membership, etc etc we are way up there. But due to some dodgy business decisions a few years back and me deciding to work it out and not quit, we have had to work to become great just to barely get by.  We probably have a year or two to go at this then things will be golden.

I never got into this to make a ton of money, but financial stability is really the next thing for us, and it will take a lot off my plate.

What about your business brings you the most joy?

We have created an environment and culture that people will remember for the rest of their lives. Something that stands out and is memorable and legit. Most stuff in life is blah.

Reflecting back to when you opened would you consider yourself well-prepared for owning a business? What were your strengths and weaknesses?

Well prepared for business? No. Wired for business? Perhaps. I am a glutton for punishment and will spend all my time/energy/resources if need be to make something happen.  This trait is a double-edged sword for sure.

I doubt most people would take the risks, and put themselves in the positions of stress that I have. We have made some big moves that could have failed miserably. I also think I have a great attention to detail and am reasonably creative.

I am great at doing work and I would rather do something myself then watch it be done like shit by someone else. This leads to overload. Now that we have grown so big my boss skills have been put to the test and this is hard because I don’t really view myself as the “Boss.” But sometimes that is needed.

Did you have experience coaching prior to opening?

Not really, but I did grow up playing/completing in the sports that would make up most CF exercises.  Kind of weird really.

Aside from that I love the internet and books almost to a fault. Before this was my job I read Coaching articles on the internet everyday and read gems like this.

Do you feel you are sufficiently financially rewarded for the amount of time you’ve invested in your business?

No, but honestly the amount of money isn’t the problem for me.  I guess recently I have thought about getting a house or whatever and you need money for that.  My main problem is that I have well-surpassed every metric I can think of (size, membership, community awesomeness, monthly revenue) except my personal pay.  It is kinda like being really fast at every WOD, but when double unders come up you suck ass.

Do you see yourself doing this (owning/operating a microgym) 10 years from now?

Yes. Not knowing when enough is a enough we have opened up several more facilities. I really think that if I have the business skills down why should a coach have to take time away from learning about the Olympic lifts to learn about local tax laws? I would have loved to have had that.

As a current CrossFit affiliate, what are the benefits of affiliation as you see them?

The name. Which I feel some ownership of as we built the “CF” brand in our area big time, but I know I am not really an owner of the CF Brand.

In your estimation and in your particular circumstance are they worth the price?

Like the other interviews I pay $500 so that really isn’t that much. For our other place it is more, but even that really isn’t a lot.

How close is the nearest affiliate to your place of business.  How has this affected your business? 

2 blocks. Hasn’t affected us at all. If you can’t get enough members to pay the bills you should take a good hard look in the mirror instead of blaming someone else. I do know other places have price wars/member theft/general dumbassness, but I don’t have experience with that here.

What if any trends do you see among new affiliates?

It seems that it is way more stream lined now and people are opening that have less passion. Back in the day it seems you really had to look to find CF and that brought out some really bright and intelligent people. Those people still show up, but you just have to meet a lot more people looking at the business side now too. Sadly the people that know the least think they know the most.

And they are in no way stopped from starting a facility. I understand that I was given a big chance by getting a facility with little experience, but I think times have changed and a mentorship with more experienced owners would lead to better quality across the board and open peoples eyes to real word.

Would you consider yourself an introvert (you gain energy from having time alone) or extrovert (you gain energy from being around others)?

Introvert in my free time, but I have no problem public speaking, running 100 person classes/events, lecturing at a cert or chatting all day with members.  I gain energy at work, but love to have my own time. So maybe I have multiple personalities?

What advice or words of wisdom would you give to someone considering opening a microgym or similar fitness studio?

Coaching has to be the key. The better coach you are (Knowledge, communication skills, truly wanting people to get better) the longer runway you will have to figure out all the other stuff.  You probably don’t know how to teach something right now. Research it tonight and teach that this week for the warm up. Do that again and again.

Anything you do to get good at coaching needs to be applied also to business skills and research.  You don’t let people change out overhead squat because they don’t like them, so why don’t you just sack up and learn about taxes.

What is the hardest lesson you’ve had to learn?

Job =/= hobby. It’s slow, but at some point when you aren’t looking something changes. Its not necessarily less fun or enjoyable, but something changes.

First, the concept for the On Ramp came about after a rocky initial start with our business.  In 2004 when we opened, the group training model was held up in CF land as THE way to run a business and we adopted it without hesitation.

The challenge in 2004 was that no one had ever heard the word CrossFit.  In fact the brand equity that CrossFit now has is due in large part to the growth of the affiliates.  Small affiliate gyms with passionate owners, opening up all over the country and ultimately the world, spreading the brand.

However, in rural Chico circa 2004 there was no brand.  And there certainly was no box in people’s heads for the type of training we were providing.  Folks were comparing our rates with globo gym rates despite the fact that we clearly were not a globo gym, we were providing quality coaching and instruction.  But still the distinction was not obvious and we were too new in town and didn’t have a network to pull from yet.  And when folks heard our prices and learned we did not have a swimming pool or showers…well, needless to say it was challenging.

First you stumble, then you find your way

We stumbled quite a bit early on.  We undervalued our services, we didn’t provide entry points or a client path, we lacked of a solid pricing structure and we lacked a way to run our back end (like MBO). By the end of 2005 we had grown our client base to around 70 clients but had only an average client billing of $65 per person.  We were easily covering overhead, but as coaches weren’t paying ourselves anything. And it wasn’t obvious how we were going to make this model work and pay our three owners anything that resembled a fair wage based on the number of hours that were being put in (Greg Everett of Catalyst Athletics was an early partner).

With some quick math it became obvious that by moving to a private training only model we could quickly be grossing what we were then grossing, and there was an easy path to actually paying ourselves! So beginning in January 2006 we moved to a private training only model. Quickly we were making more money than we had in the previous two years!

I am a big advocate for microgyms with group class based models to also offer private training.  I’ve talked about this before.  It can make a huge difference in a new gym’s profitability and it is a great way to develop trainers (you’ve got to be able to successfully coach 1 person at a time before you can coach 15 people at a time). That said a PT only model has its drawbacks, namely huge fluctuation and variability in revenue.  During the summer of 2007 we had several of our PT clients go on vacation, and one injured himself when he crashed his golf cart.  When your PT clients don’t show, you don’t get paid.  This is where the stability of the group class revenue is such a beautiful compliment in a microgym setting.

We decided to bring back group classes in October of 2007, but we did it very differently this time.  The first thing we did was sign up with MindBodyOnline.  I wanted an easy way to track member payments as well as track frequency of training/client visits. I think we were one of the first CF style gyms to use MBO.  I contacted them in September 2007 and we were up and running by the time we re-opened group classes in October.

Instead of opening up 5 classes per day I converted a group of 3 guys that I was training 1-on-3 into our first “class”.  It ran MWF at 6am.    These guys were stoked to be paying a group rate of $150 instead of their 1-on-3 rate of $360/each.  We slowly grew small groups like this and only added classes as made sense.

We also created an entry point to help ensure a base level of movement proficiency.  At that point our singular entry point was a requirement of 12 sessions of PT prior to entering a group.  This worked quite well, but with a requirement of 12 pt sessions we had a very slow entry into our groups and because of the higher pricing for 12 sessions of PT we had a high barrier to entry.  It was a consultation with Beverly Murphy at MBU in March of 2008 that made all the difference.  She said our PT requirement posed too high a barrier to entry…and had we thought about a beginner class as an alternate option? Can you say light bulb moment!

We took that feedback to heart and went back to NorCal and created the On Ramp program!  We now have 2 entry points: On Ramp or Private training.  Both are critical to our client path.  Many clients are seeking PT, and many are not appropriate for On Ramp without some PT first…both are revenue streams and both ensure our clients are well prepared prior to entering the group class environment.

Ok.  Enough of the history.  As many of you have asked “how do you set it up?”

Determine the days and times you will be holding the workshop (I like 3 days per week for 4 weeks) and start spreading the word in your gym.  Tell your existing members that you are starting a beginner workshop that will help prepare new members and encourage them to tell any friends, coworkers, family, etc who are interested in training.  You may even get some inexpensive postcards printed and hand those out to clients and ask them to pass out as well.

Decide on the max number of new clients you feel comfortable with, as well as the number of coaches that will be coaching.  At NorCal we cap our On Ramp classes at 10 clients and have 2 trainers coaching.  If your typical client is relatively young and healthy you might get a way with a single coach on 10 clients.  We tend to get a wide mix of both ages and aptitudes (mobility issues, etc) and find having two coaches makes for a more seamless running of the class.

Also, the On Ramp is a new client’s first exposure to our gym.  We look at the 12 sessions of the On Ramp as “our time to shine”. Whether or not a client chooses to sign up for ongoing classes beyond this first month rests largely on their experience in the On Ramp.  We feel that having two trainers coaching allows us to really put our best foot forward.  Here are a few key points:

1)   One coach can describe and explain what we are looking for with the movement while the other demos the movement.

2)   Getting equipment setup is easier with 2 coaches.  For example, one coach can be warming people up while the other is setting up racks and bars for the press or other skill introduction/review.

3)   2 coaches mean clients get more attention.  This is especially important when you have a few folks in the class with movement limitations.

4)   At the end of the workout one coach can run stopwatch and call out times while the other records times on the board

5)   Great dynamicism between coaches.  New clients get exposed to more than one of your coaches and are then more comfortable trying different class times.

6)   A second coach helps streamline the closing process at the end of the 12 sessions helping to get these 10 new folks signed up for ongoing classes.

4 sessions, 8 sessions or 12 sessions?

Many folks have modified the On Ramp and have either a 4 or 8 session intro class.  If you feel folks are adequately prepared to join your regular classes after 4 sessions then by all means.  For us 12 sessions allows us to accomplish several things:

1)   Introductory exposure to movements with multiple opportunities to review, especially the three key lifts: deadlift, press, and squat.  In my opinion one exposure to each of these lifts is not enough to have a new individual safely migrate into a larger group class.

2)   12 sessions spans a full month and with nutrition compliance folks will see body composition changes in addition to improving their baseline workout times.  These results are what sells your program and increases your conversion rate.

3)   12 sessions in a beginners group allows folks to bond with one another.  By the end they are asking each other what times they are planning on training in the Elements classes…they want to continue the relationship.

Success rate

Success rate is measured two ways.

First: How prepared are individuals exiting the On Ramp upon entering ongoing classes?  Do they feel well prepared and confident?

We constantly get feedback from new clients about how professional our coaches are and how pleased they were to not be thrown in the deep end.   Clients feel well taken care of and well prepared.  Their initial feelings of intimidation about starting a strength and conditioning program completely dissipate when they are in a safe environment of beginners with quality coaches.  If you can make a great impression and demonstrate the success of your program in 1 month you are far more likely to have folks who want to sign up for more!

Second: conversion rate.  How many folks sign up for ongoing classes at the conclusion of the On Ramp?

Occasionally you will get a 100% conversion rate, but if you average across 12 months of On Ramps most folks end up with somewhere around a 75% average conversion rate.  You should be tracking this.  After every On Ramp you run you should calculate your conversion rate.  Track this over time and always work to improve it.  This conversion rate, along with your attrition rate are the two largest factors (mathematically speaking) that control the growth of your gym and ultimately your profitability.

I know many of you are using the initial version of the NorCal On Ramp as a template in your business.  Please feel free to share your experiences and findings!