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Running a CrossFit Facility Tips and guidance on how to open and operate a CrossFit gym.

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Old 12-07-2012, 03:51 PM   #21
Chuck Swain
Affiliate Chuck Swain is offline
 
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Join Date: Apr 2012
Location: Mansfield  TX
Posts: 8
Re: Affiliate membership pricing/tips

Quote:
Originally Posted by Andrew Bolliger View Post
Great questions Brenden. Yes there is money left over, we are doing very well. My family is well supported and we use the extra to expand the business every month. Now at 250 members since I posted (the break even was 125 members to pay all my business expenses and salary). I have about only 30% of clients paying for Unlimited classes, the rest are 2-3 days per week and punch cards. I do work a lot, but completely by choice, we have enough trainers I could stay home all month... teaching about 10 out of 45 classes a week right now. I find the bulk of my work now is on back end management and expansion plans, I teach classes for fun and to stay connected. I do think my rates are too low, we are raising them very soon and will offer less discounted plans. Lastly, there are many different ways to be successful, "specials" have worked for some people... I did a groupon early on and got $800 which was badly needed at that time so I understand. But I would not do one again, I am not so desperate and the reasons I mentioned above outweigh the short term payout. I believe maybe 1-2 of the 30 people that bought our groupon lasted.
I think Brendan has hit the nail on the head. Profit/margin is the key consideration. Andrew I believe you have given good advice but you should put it into action and raise your prices, now.
I believe too many boxes operate on a model that calls for a TON of volume to create a living wage. (125 athletes, yikes!) This is the curse of starting in desperation mode. I understand it. I left a 6 figure job to start our box. I had many "spirited debates" with my wife early on. We were brand new and charging ($180) more than the other boxes in our town and area ($125-$150).
But I was confident that:
1. we were worth it and could deliver enough value to justify it and
2. That this was the best way to do business and
3. When you compare us to personal training at the local globo we were WAY cheaper and a Much better alternative. So it didn't matter what the other boxes charge.

Honestly, early on the pressure (from the spouse and small client pool) was hard not to cave in to. But... and this is important, it is the only way to go. The threshold to break even then profit is much lower. Clients that pay more are better clients when the $ is the same and headcount is lower you have less capital tied up in equipment. You can grow slower without starving. Slow growth enables you to focus on the improvement of your athletes as well as developing the culture that at the end of the day IS your box. Also, this model only required just over 60 members to replace my old pay rate. It isn't all about the money. I love to help people. But I have an obligation to my family to earn a living and this is how I accomplish both.

Bit of a rant I know, but I think too many folks are charging so little that they are killing themselves for nothing.
Just my .02 worth.
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Old 12-07-2012, 09:39 PM   #22
Brian Strump
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Location: Charlotte  NC
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Re: Affiliate membership pricing/tips

$180 x 60 members = $10,800 x 12 months = $129,600.

That also assumes that you have no couples price, and lower rates for police, fire, military, students. And that you also have a monthly overhead of less than $2500. That also doesn't take into consideration what gets re-invested into the gym, and not into your pocket. If it does, and you've still got over 6 figures coming in, kudos to you.

Most importantly, like you said. It's not about sales that makes a business successful. It's the NET profit. There are businesses that do $5mil in sales a month, that net LESS than a business that does $1mil/mon.
Giant businesses that collect in a week, what the best affiliates collect in a year go out of business each year....No business can be successful over the long haul spending more than it collects.


Quote:
Originally Posted by Chuck Swain View Post
I think Brendan has hit the nail on the head. Profit/margin is the key consideration. Andrew I believe you have given good advice but you should put it into action and raise your prices, now.
I believe too many boxes operate on a model that calls for a TON of volume to create a living wage. (125 athletes, yikes!) This is the curse of starting in desperation mode. I understand it. I left a 6 figure job to start our box. I had many "spirited debates" with my wife early on. We were brand new and charging ($180) more than the other boxes in our town and area ($125-$150).
But I was confident that:
1. we were worth it and could deliver enough value to justify it and
2. That this was the best way to do business and
3. When you compare us to personal training at the local globo we were WAY cheaper and a Much better alternative. So it didn't matter what the other boxes charge.

Honestly, early on the pressure (from the spouse and small client pool) was hard not to cave in to. But... and this is important, it is the only way to go. The threshold to break even then profit is much lower. Clients that pay more are better clients when the $ is the same and headcount is lower you have less capital tied up in equipment. You can grow slower without starving. Slow growth enables you to focus on the improvement of your athletes as well as developing the culture that at the end of the day IS your box. Also, this model only required just over 60 members to replace my old pay rate. It isn't all about the money. I love to help people. But I have an obligation to my family to earn a living and this is how I accomplish both.

Bit of a rant I know, but I think too many folks are charging so little that they are killing themselves for nothing.
Just my .02 worth.
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Old 12-07-2012, 11:52 PM   #23
Mauricio Leal
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Re: Affiliate membership pricing/tips

Quote:
Originally Posted by Chuck Swain View Post
I think Brendan has hit the nail on the head. Profit/margin is the key consideration. Andrew I believe you have given good advice but you should put it into action and raise your prices, now.
I believe too many boxes operate on a model that calls for a TON of volume to create a living wage. (125 athletes, yikes!) This is the curse of starting in desperation mode. I understand it. I left a 6 figure job to start our box. I had many "spirited debates" with my wife early on. We were brand new and charging ($180) more than the other boxes in our town and area ($125-$150).
But I was confident that:
1. we were worth it and could deliver enough value to justify it and
2. That this was the best way to do business and
3. When you compare us to personal training at the local globo we were WAY cheaper and a Much better alternative. So it didn't matter what the other boxes charge.

Honestly, early on the pressure (from the spouse and small client pool) was hard not to cave in to. But... and this is important, it is the only way to go. The threshold to break even then profit is much lower. Clients that pay more are better clients when the $ is the same and headcount is lower you have less capital tied up in equipment. You can grow slower without starving. Slow growth enables you to focus on the improvement of your athletes as well as developing the culture that at the end of the day IS your box. Also, this model only required just over 60 members to replace my old pay rate. It isn't all about the money. I love to help people. But I have an obligation to my family to earn a living and this is how I accomplish both.

Bit of a rant I know, but I think too many folks are charging so little that they are killing themselves for nothing.
Just my .02 worth.
Dang. *Bro hug* #solidarity
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