It’s nice to see the world returning to normal in the wake of this bizarre pandemic! It’s only now in most parts of Canada all the Covid restrictions are falling away.
I finally see the trend developing that should see advanced recovery in a lot of industries in the coming months (namely the fitness industry)
So I just wanted to reach out today because well….it’s July.
July typically is the most poorly attended month of the year (followed by December) maybe it’s not that way everywhere but anywhere that has 4 seasons I’ve noticed this to be true.
It’s also a time of year that’s it’s more challenging typically to create a steady stream of new trials (not always but if you weren’t gearing up for this season that’s fairly typical.)
So what should you be doing in July?
1) Think ahead to September. We all know September post Labour Day is a key time for people to start thinking about their own routines. I’d argue it’s the true beginning to our 9 month peak season (not January.)
This is where the “Whole Summer Deal” came in.
We found there were still plenty of people throughout the summer that were looking to get started and take their health more seriously (in fact many of the “get in shape for summer” pundits still hope they can accomplish that even this late in the game.)
The commonality with these consumers is getting started needs to address one very specific fear, “I don’t want to waste money on time I am not going to use…maybe I should wait until September.”
We found most people typically holiday for about 2-3 weeks through the course of the summer, so on average we tried to offer up about 4 weeks of service free as part of the Whole Summer Deal. For most this made it attractive enough for them to commit now and get started because they really had nothing to lose. (This is for brand new clients only of course, and not applicable to exiting memberships.)
There’s a variety of ways you can package this, it can be the whole summer at a greatly reduced cost as your outward promotion.
Internally as time ticks away you may need to alter the deal to reflect. The goal was always to have an aggressive promotion to get people in our system now with the goal of having a renewal plan for just after Labour Day as this always fit people’s commitment cycle.
A pro-tip we often was to price the deal aggressively, but not as aggressive as we might have been willing, in addition to the price point as a selling feature to help close the deal when we met with prospects was to explain that we also offered them a reimbursement for any time missed on this particular program (which basically made it a no brainer) but the key is that reimbursement came by way of a renewal onto a long term program in the fall.
It’s never about the first sale, it’s always about the long-term value of the customer.
Here’s a copy & paste example of one of our old emails for this promotion:
Notes about promo:
- We always began offering this somewhere in mid June through to the middle of July, the price was typically about 1 month price X 1.3
- As a general rule the agreement stated this program would automatically renew in September at our ongoing month-to-month price (typically unlimited) and as a courtesy we would contact the customer right after Labour Day weekend prior to billing them (this is a key time for people to return to fitness, so often many would first hesitate then sometimes ask for the courtesy to delay the start one week until kids were firmly back to school, this always boded well for us to ensure they continued come September.)
Subject 1 – Summer Already?! Special offer inside 😉
SUB 2 – Whole summer one low price (For A Limited Time)
SUB 3 – In case you missed this…(Big savings for you.)
Send the same email 3 times with the above subject lines.
Can you believe it’s summer already!?
Doesn’t the first half of the year just seem to fly by?
The weather is finally getting nicer. People are walking, biking, swimming and playing outside.
Have you ever said “I don’t need my gym membership in the summer because I’m going to be more active outside?”
I hear this all the time, and while people generally have really good intentions about this, it doesn’t usually work the way we want it to.
It’s not even necessarily that people are less active, it’s just that we eat and drink a lot of extra empty calories in the summer.
Ice cream, drinks on the patio and lots of bbq. You can relate right?
With all these extra empty calories it doesn’t take long before we’re consuming more calories than we can burn by just being active outside in the summer months.
That’s why I went to the boss and told him we have to help! We have to help people stay accountable in the summer to their goals.
After some tough convincing, and a lot of back and forth emails, we came to an amazing agreement 🙂
I have a special offer for new clients to find a workout program that will work for the summer!
If you act fast I can offer you the whole summer, that’s from the day you sign up until August 31st for just a 1 time fee of $199(Your price). After the summer you’ll continue at our best unlimited VIP rate 🙂
The best part of this deal is everything we do is backed by an unconditional 30 day money back guarantee. If you don’t absolutely love boot camp in the first 30 days we will refund your money.
That’s unlimited boot camp sessions + accountability and nutrition support for 2 whole months for just $199(Your price)
Do you know what you can accomplish with this type of workout/support in 2 months? If you workout as often as you can and follow our nutrition guidance (while still indulging in a few summer treats) you are going to see some big changes. You’ll see changes in your energy levels, you’ll sleep better and you’re going to see some changes on the scale or in your clothing as well!
Who doesn’t want to buy a new fall outfit?!
Don’t miss out on this great opportunity, it’s only going to be around for a couple of days!
Reply to this email or text me today at (your phone) before time runs out!
The Fine Print – Only new clients and first time participants are eligible for this offer, no purchase is necessary and it may not be combined with any other offer unless otherwise stated. May not be applied to, combined with or replace current active trials or memberships of any kind.
2) Spend a little more on marketing in the summer. Look I know, Facebook etc, not like it used to be, but regardless in the summer months there’s more noise. People have many distractions, your message needs to be delivered more times to move them to action, this means your lead cost will be higher so to continue to acquire an adequate number of leads you are going to need to be advertising more not less. (This is why we use the Quarterly Business Review with my clients to track our average lead and customer costs so we can anticipate these costs quarter to quarter and budget accordingly.
3) This is a great time to review your operational policies. Every summer, but I’d say this summer more than ever, if you are not yet brimming with activity it’s a really good time to review your ops manuals. Fix any small problems that have developed, update and replace redundant policies because if you ever hope to step away from or create an exit in your business it’s this one document that will make or break that opportunity!
I’ve certainly seen a number of my clients are having an unusually busy summer as a result of the “pandemic” seemingly subsiding once and for all, it’s really great news to see consumer demand return in this fashion, and the best part, mark my words this will be magnified once we return to the normal seasonal trend cycle for our business.
Of course there will be new problems (like massive amounts of new competition coming) but more on that later!
Hope you are well, remember I am always here to help!
P.S. Now that I can see a trend developing I’m cautiously taking a few new coaching clients. Coaching with me is different, I work closely with each individual, I don’t force you to operate in the same box as everyone else, it’s inefficient so I only service a handful of dedicated individuals. Sound like you? Click if you’d like more details on a business coaching consultation: https://calendly.com/cabelmcelderry/freeconsult
I can’t tell you how many clients I’ve had that really struggled with how to present pricing when selling personal training or fitness service.
It seems like so often we’re apprehensive to ask for money, I know at one time this was a problem for me too.
I was so passionate about fitness and working out I just wanted everyone to know what I knew; and I felt bad asking them for their money.
That sounds so stupid, even as I typed it, but totally the truth; and I suspect you might feel some of this too.
This video explains the exact process I used for years and years, it’s worked well for teaching others, giving them a guideline and method to follow that makes the conversation natural and authentic when presenting pricing for personal training or any fitness service.
It also (as you’ll learn in the video) creates something that can be given to the client to take home, and helps guide the spouse conversation that’s usually the roadblock to a decision today.
Give it a try, see if this helps you.
Are you a personal trainer or a fitness professional with a dream of one day opening your own gym or studio?
Well I remember being there, but fast forward many years and I bought, built, and sold five studios of my own.
I’ve had partnerships, solo ventures, I’ve used financing, I’ve self financed.
And I have helped dozens of other trainers on four different continents open their first, next, 5th or 10th locations.
So I’ve been building this kind of A-Z series on the steps to take and how to layout your plan successfully, really helping people acknowledge some of the key areas that are generally skipped or misunderstood in this process.
Heck I remember when I first got this crazy notion.
I remember the look of the real estate agent showing me the 15,000 square foot building and he plans I had for the grand temple of iron!
Little did I know my savings of $27,000 was not going to finance the million dollar project!
I remember being deflated when next we looked at the beat up 2000 square foot dance studio, and because it was the only option we could afford felt we had to proceed.
Little did I know at the time the bullet I dodged.
We went on to build a business that would do more than $1,000,000 in personal training revenue in it’s first 18 months of operation (this from a trainer who previously struggled to generate $50-70k annually on my own.)
I sold that business three years ago, but it’s still operating today, nearly 14 years after it began with the humble beginnings of that beat up dance studio filled with hopes and dreams.
If that sounds at all like you, I hope these videos help you do it faster than I did, and skip so many mistakes that cost me tens of thousands of dollars!
Part 1: Visualizing Your Dream and Finding and Validating A Good Location
Part 2: Projecting Your Operating Costs, Setting Pricing, and How-to Plan to Be Profitable On Day 1
Part 3: Renovation Costs, Total Opening Costs, Financing, and Negotiating Your Lease
If you found any of this helpful I hope you’ll subscribe! (Just click here to subscribe www.youtube.com/mrfitnessmarketing)
Am I spending too much on Facebook? Should I be spending more on Facebook?
What else should I be spending marketing dollars on?
Is print/radio/flyers/direct mail/this, that or that other thing worth it?
How do I know if any of this is working?
I’m sure all of these and many more questions are going through your head all the time. (And if they’re not then clearly you’re in denial and just avoiding it altogether which means you need to understand this even more.)
You’re working hard to grow a personal training business that works, you can’t afford to keep throwing money away on things that don’t work.
Worse, it’s getting harder all the time with all the extra competition.
Things that worked last month are now twice as expensive and working half as well.
Ahhhhhh….what do I do?
Well as we all know by now, we need to make decisions objectively, this is certainly maybe even more true when it comes to business.
You need to be able to evaluate your fitness marketing objectively, be able to quantify the results.
And here’s the great news, not only will I teach you to do that, when you do the decisions become super easy and clear.
In fact you’ll stop looking at your fitness marketing efforts as a stressful expense and see them as a lucrative and scalable investment!
Check out this short video, it will teach you all you need to know about calculating your fitness marketing ROI (and likely give you a few new things to think about too!)
If you like it I hope you’ll subscribe! (Just click here to subscribe www.youtube.com/mrfitnessmarketing)
Lord of the Rings Fan? Ok I am, but it just so happens much like the 7 Rings of Power there are also 7 Fitness Studio KPIs that have proven to be very impactful in running and managing a fitness business.
Don’t know what a KPI is? Don’t worry you’re not alone, it’s weird that a group such as trainers who are all about progression and measurement have been shamefully kept in the dark about Key Performance Indicators (KPIs) when it comes to business.
Much like you know with your clients, measurement is key when it comes to your clients, measurement shows progress, but more importantly still it creates dialogue, trust and collaboration between you and your client.
The numbers form an objective point of measurement so you can work together to reaching the desired outcome.
The same is true for your team, your fitness studio KPIs in many respects will decide the outcome of your business.
But here’s the best part, all you need is a simple whiteboard, 5 minutes per week and the willingness to learn something new and this can begin having a positive impact on your business in as little as the next seven days.
That’s no exaggeration, this short video will lay out the whole process.
It will teach you the 7 numbers, the 7 fitness studio KPIs, why they are important, how to find them, what to do with them, and how to get your team involved with them.
This is one of those blog posts that I hope everyone will somehow find and absorb because I just know the impact it can have.
If you like it I hope you’ll subscribe! (Just click here to subscribe www.youtube.com/mrfitnessmarketing)
I’ve always preached that you need to be, “fishing in multiple ponds,” when it comes to generating enough leads to successfully grow your fitness business (or any business for that matter.)
So something I’ve always taught my clients is what I call the “5X25 Fitness Marketing Model.”
You see we live in a time where online is so easy and appealing, because it’s quick and easy.
And then days happen like recently where both Facebook and Instagram were down for a good part of the day.
Not to mention that both of these platforms are becoming exponentially more expensive, competitive and consumers are just getting flogged with so many offers that the responsiveness of these campaigns is becoming more unpredictable.
Now don’t get me wrong, I’m not saying you shouldn’t be advertising on Facebook, in fact I’m certain for most it’s still where the largest portion of their fitness marketing budget will go.
But…you need to be beyond Facebook.
In fact I’d even argue that when you utilize multiple channels well they will all even work better making your cost per lead and marketing ROI dramatically drop.
In this video I explain the 5X25 Fitness Marketing Model, simply put we want to be drawing at least 25 leads from 5 different sources each month, so this way if one or more fail our business doesn’t stall.
While others freak out that Facebook or whatever is down or not working, you’ll continue to grow and in times where adaptation is needed you’ll be able to take your time and do it right!
Hope this helps!
If you like it I hope you’ll subscribe! (Just click here to subscribe www.youtube.com/mrfitnessmarketing)
You can be the best marketer in the world, and generate tonnes of new leads to sell personal training to but if you can’t keep your clients (AKA Skyhigh Attrition) then you are dead in the water!
I’ve found for a lot of trainers it’s when they open their studios and hire staff that their personal training client attrition appears, increases and becomes alarming.
And it’s no surprise, I mean when we’re solo, we live, breathe and die by our clients.
We have to fight tooth and nail for every single one, and each personal training client we lost to attrition was like a mortal chest wound! (Ok maybe that’s dramatic but I remember plenty of times when someone quit I had that sinking feeling in the pit of my stomach because I wasn’t sure I was going to be able to pay my rent on time.)
So as time goes one and we become industry veterans, well we do things naturally that keep our attrition low, and then we hire people and try to train and expect them to do the same. Only…they don’t.
They like the grind, hustle and ability to foster and maintain relationships like we can, and it’s no surprise, or skill was born of pain and frustration; they just work here.
What’s worse if you’re like me, I had no idea how to train or teach other people to do what I do, it just kind of developed naturally for me and I’d known it so long it seemed crazy that they didn’t, hence I too struggled with high personal training client attrition.
Now, results are a given, you’ve gotta get results for people, but beyond that there are three relatively simple things that you can do with your growing business that will put you back in the drivers seat and pretty much stop attrition dead, and once these things are in place you can delegate and let them go, though the rule is slowly, very very slowly.
Here watch this video I made on personal training client attrition and how to stop it, if you like it I hope you’ll subscribe! (Just click here to subscribe www.youtube.com/mrfitnessmarketing)
What a year 2018 has been, I can’t believe it’s already drawing to a close.
I hope you are set to take time off and enjoy family for the next few days.
Don’t forget to take a deep breath and reflect on all this year has brought, and then gaze ahead to the horizon…what is your biggest goal for 2019?
Since it’s the end of the year I’ve been doing a lot of reflecting myself…and a lot of thinking.
I always get asked; what do I see happening in the coming year? What will be (if any) the biggest changes in the coming year?
Truth is, it’s kind of already happened and you’ve likely felt it.
Facebook ads getting disapproved more than ever before, ads initially approved and later shut down.
Pushed by Facebook to limit what we show on our landing pages.
Our industry thrives on social proof more than many others and we’ve become more and more limited in how we can proudly display our social proof than ever before.
And it’s only going to get worse…
This is actually GOOD NEWS!
Yup, not a typo, this is good news.
Everything comes full circle, and this is no exception.
If you’ve been around as long as I have you likely remember what it was like before things like Facebook.
Getting new clients was largely referral and B2B based.
You had to put yourself out there.
Form real relationships.
And it generally took more than one interaction (think of it like dating.)
It took time to get people to know, like, and trust you before they would commit to buy a premium service like yours.
Well, that’s come back around.
You see for basically the last 10 years direct response marketers had a heyday on Facebook.
We ‘d put up an ad, take people to a landing page then use long form sales copy with fancy headlines, videos, testimonials and before and afters to build the relationship there.
The longer we kept them on the page the better chance we had at getting a sale.
Now I’m not saying this is completely gone or done, in fact quite the opposite, you’ll still see plenty of this and many of these same strategies will work…only just not like before.
In 2019 and beyond you’ll need to be in the groove of building relationships with potential customers on platforms like Facebook through multiple interactions.
Only then will you find the Facebook advertising rules will make it easier to show them your landing pages the way you’ve intended.
And here’s why that’s good news:
- You’ll soon only be showing your ads to highly qualified prospects who know who you are, what you do, and are somewhat actively on the lookout for you. This will make those ad clicks much much cheaper.
- Your offers and content will become perpetual, which means you won’t need to constantly reinvent the wheel. Your brand recognition will grow as a result, and it’s going to take you less time to market more effectively than ever before.
- And maybe the best part of all, it’s going to be really, really hard for your competitors to duplicate, see fully and harder still to understand just what your true marketing strategy is.
All of this will be accomplished with content cycling and custom audience targets, and I’m excited about it!
Well because everything comes full circle, and in 2019 we get to return to what made us great, we can focus more on being the phenomenal educators that trainers are.
Our marketing will become a showcase for all the amazing knowledge we gathered around training and nutrition, not just the latest marketing mumbo jumbo!
2019 is going to be a great year, are you ready?
If not, you still have time, that’s my Christmas gift to you, this new process is a marathon not a sprint, you start today and your results will steadily increase, your costs will decline and unlike your marketing now each new piece of content will increase your brand and recognition in the community!
Let’s do this!
Merry Christmas from my family to yours!
P.S. In January my coaching clients now get to enjoy our ad setup and management services, meaning if all of the above sounds great but leaves you ever confused well we could just do it for you. J I’m taking on new clients in the New Year, would you like to schedule a consultation? If so reply to this email, I’d love to help you make 2019 your best year in business!
A lot has changed, for instance when I first started there was no Facebook or Twitter, in fact it was amazing if as a small company or solopreneur you had any kind of a functional website.
I had no idea what I was doing, so I did like everyone else, I put up posters in the gym, I printed brochures and business cards.
And I had no customers, in fact over the first few years I’d bounce between jobs trying to make ends meet in hopes that sometimes I could take up personal training full time.
I didn’t know anything about email marketing, I guess that existed back then but it wasn’t something I knew about.
But somehow, I still stumbled upon the importance of content.
Soon my brochures became articles that I’d leave at coffee shops, etc.
From there someone put it in my head to reach out to the paper and see if they’d give me a column, I did so relentlessly until they finally said yes.
That lead to a couple random contacts from people asking if I’d come present to small groups in their offices, which low and behold lead to customers.
From there I began to try to speak more, and over time my website became more and more cluttered with articles and resources I developed and posted for people.
Kind of by accident for a long time in my city of then 70,000+ people I was “the fitness guy” if you wanted to get in shape or learn how to you sought me out.
As time has went on this hasn’t changed, except that it’s easier to reach more people faster and harder to keep up.
In fact it’s almost too easy to reach people now, so easy that we are inundated with more content than ever before.
And there are more places to post and deliver your message than ever before (Facebook, Youtube, Twitter, Instagram, Email, Website, etc.)
Just thinking about it is exhausting and a daunting task, and I’ll be the first to admit I find it easy to burn out.
And with that has come some hard lessons.
Content truly is king, when you lose your focus, burnout or become inconsistent with your content your business will suffer, whether that’s a little or a lot only you will know but it happens…without fail.
Truly that should be obvious, I mean there’s just so much now, so many businesses, services like yours, people doing basically what you’re doing.
It becomes harder and harder to differentiate yourself except that only you can be you, and people want to buy “you,” I want to buy you.
What you have to say is important, what you have to give is golden.
Only first, define who is the ideal person for your message. Know their age, what they like, the clothes they wear, the places the hang out, the things they like to do, the products they buy and more.
Craft an image of that person that you can “speak to” every time you step in front of a camera, add text to a page or through whatever means of deliver.
My challenge to you is from today forward try to post something every single day, but don’t get spread to thin trying to service all the mediums.
Focus on your blog (which also goes to your email list), your Instagram account (which also goes to your Facebook page) and if you have a private group for your clients that rounds out the third.
If you can commit to this every day, even 2 posts a week in each of those places (take Sunday’s off or give one channel bonus attention) in time will have a significant impact.
Total truth, I find generating new content very tough to do each day, and I prefer to write which seems to take the most time for me, but what I see from my mentors is like anything else this is a muscle, work it out and it will get stronger.
In time try to increase your frequency to each channel once per day, I can do it, you can do it.
Here’s some tips and tools I use to help you get started:
- Spend 30 minutes brainstorming topics you could talk about confidently with no preparation for 10 minutes. Set a goal for 10, trust me you will easily come up with 20. Use this list each day you’re stuck for an idea what to write on/talk about, even using the same ideas over you’ll share new things.
- A great little app I’ve found I like for generating Memes for blog post images and social media posts is called “Typorama.”
- For Instagram I always use the “Hashtagger” app for my hashtags posted in the first comment and have had good success with this.
Finally remember, and this is the tough one for me, your content doesn’t need to be perfect, it just needs to be you, authentic and come from the heart. If you really find yourself stuck for a day, take the day off instead take those 30 minutes to go read your current professional development read I find this helps me get back to creativity sooner.
Oh and maybe one last weird suggestion that truly does help me, I’ve fallen in love with a supplement from Perfect Sports called Onset, a blend of Agmatine Sulfate and NAC etc that helps with focus, I find it has a tremendous impact for me when it comes to creative tasks.
Do you find your financial numbers confusing? Are you afraid to or not sure what you should be looking for?
Your income or profit and loss statement and your balance sheet are key roadmaps into how well you’re business is doing, what is and isn’t working, and even how you’re likely going to do going forward.
I don’t know about you but even having went to school for business I still found deciphering my business financial statements to be confusing, in fact for the longest time I never looked at them.
And for most of that time I still continued to struggle.
I’m guessing if that was true for me it might be true for many of you.
I’m truly committed to help you grow a bigger, better, more profitable business and in turn allow you to help even more people. (Once a trainer, always a trainer, I truly believe together we can change the world.)
So it would be a tall task I think to fully break this down in one short article (and likely rather dull, long, boring and confusing.)
So today I just wanted to get you aware of and thinking about some key areas of you Profit & Loss/Income statement.
First, if you’ve never even seen one of these that’s the first problem we should deal with.
If you have a shoebox full of receipts and statements you deliver to your account 1-2 times a year, you’re really shooting yourself in the foot.
I can’t urge you enough to make sure you have a bookkeeper you work with on a monthly basis, make sure they’re doing a bank reconciliation (I think it would be rare to find one these days that doesn’t but you might as well get familiar with the term.)
Essentially this means they’re going through your bank statement and identifying, recording and classifying every transaction; so you’re left with information that follows your actual bank account.
I say follows because what you see in your account will NOT correlate to your statements on any given day, cashflow and what has already processed are very different things.
But let’s focus on some key information in your profit & loss/income statement that can help you right away today.
First the obvious stuff.
The big numbers at the top, the good stuff AKA revenue.
In addition to the obvious of how many dollars/month your business is currently generating you may wish to look at this in a couple of different ways.
- Do you have multiple services or products? If so you might want to look at each in terms of what percentage of revenue does it account for? Let me give you an example, if 80% of your revenue comes from your group program, and only 20% comes from your one-on-one training program, which one would you most likely want to spend most of your marketing dollars on?
- Another way you may want to consider your revenue is to divide it by the total square feet of your business effectively giving you revenue per square foot. This can be useful in understanding the pricing of your service, or as you get fuller what opportunities may exist and even how it evolves and changes through quarter after quarter based on heavy promotion etc.
Those pesky expenses.
Of course inverse to revenue is all the costs to run the business, and more importantly what’s left AKA profit or income (we hope there’s something left anyways.)
Either way revenue minus expenses gives us a dollar amount for profit and loss, divide this number by the total revenue and now have our gross profit margin (gross because we haven’t considered taxes, but we’ll leave that out of the discussion today.)
These few numbers alone can be very helpful in understanding how healthy your business is or how it’s performing, but let me give you a couple more specific things I always teach my entrepreneurs that I think can have a really big impact in your decision making.
The first is: percentage of revenue attributed to payroll.
Within your expense categories you should find entries for payroll/wages, possibly subcontract expenses, and if your provide benefits for your employees at shared cost don’t forget to add that in as well as what you pay yourself.
The later can be a bit confusing as for tax purposes you may pay yourself primarily via dividend which will not show on your income statement, this is recorded on your balance sheet.
For our review purposes it’s still important to add it in because we need to think of our company as a living breathing entity that must support itself, and of course you need to know that the resources you’re using to support yourself can continue.
Once you have a total of expenses related to paying others (and yourself) divide this total amount by total revenue, this gives you percentage of revenue attributed to payroll.
Is it over 40%? If so I’ve got good news and bad news. The good news is, if you’re presently struggling, you’ve found one of your biggest problems, the bad news is I can tell you from seeing hundreds of fitness businesses that this isn’t going to be sustainable long term with much hope for real profitability. We’ve got to get revenue up, or payroll down if this is where you’re at.
35-40% This is a common area to find yourself if your business is new or within a heavy period of growth and expansion.
25-35% This is the sweet spot operating zone, at 25% congratulations, you are part of the 1% of very efficient fitness businesses, at 30% you are doing great and should work to maintain this long term, at 30-35% you’re doing great, you’re healthy and can continue to strive to find new opportunity!
This metric can be really beneficial when it comes to hiring, and deciding what you might be able to afford a specific employee(s) or even how you need to set certain goals for new positions in an effort to ensure payroll that may initially increase, over time, ends back up in target ranges.
Ex. Let’s say your payroll is at 30% and is a total of $10,000. This tells us total revenue is a little over $30,000. For easy numbers we could speculate that if payroll was at $11,500 we’d now be at about 35% of total revenue; still within our ideal operating parameters. So this gives you budget of about $1500/month to expand your team.
Can you spend more? Sure but now you can be aware that long term that may create additional stress if that hire doesn’t quickly impact your total revenue in a positive way.
I’ll leave you with one more.
Marketing or advertising dollars.
If you divide the total for marketing and advertising against total revenue now we get a percentage of revenue spent on marketing.
I can tell you that my recommendation to all of my clients is to work to grow comfortable with spending at least 8% of total revenue on marketing and most of my most successful clients spend much more.
You can also quickly evaluate the effectiveness of your marketing and begin to understand the implications of different seasons (like January vs July.)
If you divide your total marketing spend by your total number of new leads for that month we have a basic idea of cost/lead.
You can do the same thing with total new sales for the month, total marketing divided by new sales gives you cost/customer.
Now in theory we can calculate what we need to spend to reach certain growth targets, we can also measure the effectiveness of present and future campaigns by comparing current cost per lead and cost per customer to the previous quarter, promotion, month or benchmark.
Do you see how all of this can really help you make much clearer and better decisions regarding what to do next to achieve your next goal or milestone in your business?
If you’re going to win this game you cannot avoid or be afraid of your financials.
P.S. If you’ve watched my 4 Pillars of a Successful Fitness Business video then what you’ve just learned is most of the KPIs (Key Performance Indicators) for Pillar #4.
I’d sure love to help you with your business and can teach you the basic KPIs we use in the other areas to help your whole team become better aligned behind your goal and on the path to bigger growth!
If you ever want to know if coaching with me could be a good fit for you please reach out via a reply, direct message or the contact form on my website at www.cabelmceldery.com