Growth
If you’re not making as much money in your gym as you’d like. One of these five levers is most likely broken.
At first glance, it's easy to look at these things as small and not having a lot of impact on your gym but trust the pros– if you implement these small changes you will have a MASSIVE impact on your business.
For each lever, we will break down the old, broken way and reveal the new model that will transform your gym into a wildly profitable business.
The old model favored unlimited sessions. The rationale behind this is that if your members have access to everything they will see it as more valuable than limited sessions.
But no- this is not true in reality. Think about the unlimited things around you: Netflix, Planet Fitness, the buffet line at Golden Corral. Now, think about the price points of those things… some of the lowest on the market. That’s because the more access we have to something, the less valuable we actually perceive it to be.
The new model that benefits gyms is to switch your access to three sessions per week. Two things will happen after making this switch:
Boom. Now, you can sell more memberships, at a higher price.
To be blunt, most gyms are screwing this one up. Most gyms offer two packages; one at $99/mo and a premium option at $129/mo (Even $150-$160/mo is still too cheap).
If you have people who are willing to pay more, you should allow them to pay more. And your price points should actually mean something…
Here is the pricing that we have found to work the best:
$49/ week for large group training sessions (16+ participants)
$119-$149/week for semi-private (about 6 participants)
$199+/week for private sessions
That's it. 3 sessions per week at these price points. Implement it and make some money.
Most gyms charge their clients on a monthly basis (That’s 12 billing cycles per year). There is a super easy lever you can pull to make an extra $20,000+ a year without even adding a single client.
Change your billing cycles to every 4 weeks, or every 28 days. This will give you 13 billing cycles in a year. That’s an 8% increase in revenue just by changing your billing cycle.
When you’re selling to new members, position it like this: “It’s $49/week and we bill every 4 weeks”. Super simple and as long as people know what they’re paying for they don't care when you bill them.
Most gyms run 60-minute sessions with a 15-minute break in between them. The problem with that is first, you don't really need 60 minutes, but also you’re limiting yourself on revenue per hour and revenue per square foot. Also, it's just plain exhausting.
Instead, we want to simplify it. We have seen zero difference in retention, or sales when we drop from 60 minutes to 45, and sometimes even 30 minutes per session. So, even in a tiny facility, if you can do 30 minutes back to back, you can increase the capacity of your gym.
Think about it this way, if you have a 1200 square foot facility, and let's say you can only fit 20 people in a class, at 30 minutes per session, you can train 40 people in an hour. All of a sudden you're making more money, and you're able to still provide an exceptional experience.
But, if you're in that scenario where you feel like, "No, I've got to do more than 30 minutes. 30 minutes isn't long enough." Do 45 minutes. Trust me. It will crush and it will help with how much you're actually paying out for your services and your trainers. You’ll be able to fit more classes and sessions in a day which means more people within the same timeframe.
The old model that most gyms follow is having seven or eight sessions per day. In this case, even if some of those sessions aren't full you’re still paying for trainers to run those classes– which is way too expensive.
The sweet spot for the number of sessions you offer per day is five or less. This will decrease your payroll from 160 sessions a month to 110 sessions per month if you're going from seven or eight to five. That’s a lot less payroll each month.
Now you’ve decreased your costs and increased your profitability. This will benefit your members as well. Let's say you have a 5:30 evening class with 15 people in it and a 6:30 evening class that has like 5 members in it. Cut the 6:30 class, have them come to the 5:30, and now you have a full class of 20 people
It's a better group, it's a bigger community, it’s more energy, and it's a better vibe. You want full classes, you don't want small classes.
