Yesterday I told you why it’s important to make sure you’re marking up your competitive fees. Today, I will talk to you about how to profit and why it’s necessary.
There have been days in my business that really sucked. I’ve had days where I’ve left and felt like I was ready to throw in the towel. I remember one day pretty vividly a few seasons back. For the most part, we’ve built an incredible culture at our gym. But this particular season, we had a lot of parent drama. I blame much of this on post-COVID stress, but nevertheless, one team, in particular, had parents who were consistently gossiping and making life hard for everyone else.
Just a month or two from the end of the season, we called in the ringleader. She needed an opportunity to air her grievances, and we needed an opportunity to tell her to cease and desist with the drama. There are four owners in my business, and three of us were in the room at the time.
It was one of the worst experiences with a parent to date – and one I won’t easily forget. Though the parent spoke, she refused to look at me – often yelling at my poor business partner or even at the floor. We were genuinely trying to let her daughter finish out the season, but she was making it really, really hard. When she left the office, three or four parents followed her to the parking lot, where they talked trash for the next hour. I live next door to the gym, so you can imagine how fun it was for me to walk through the parking lot to go home for the night. (I won’t tell you how it ended, but I can tell you she’s about to head to the third gym in three years now.)
Even the next morning, I was drained. What kept me going was that this was my job. Even after a bad day at work, you must go in the next day because people are counting on you.
At that moment, I was grateful I was paid appropriately to deal with situations like this. If I had treated this like a hobby, I would have probably closed up shop that day. But because I treat this like a business and I pay myself and my staff well, I had the willpower to keep going.
If you’re not profiting from your business, the bad days will be terrible. They’ll feel pointless at times. When I didn’t pay myself very well, I’d go home and complain to Justin. He would ask what the point was. “You can make more at your full-time job, so why bother with all this?” That was fair, and he was right.
At the same time, if your gym is allowing you to take your family on vacations, upgrade your lifestyle and pay the bills with ease, your family is going to understand that this is just part of the job sometimes. You’re going to feel valued by your business, and you’ll have a little more willpower to put up with the tough situations.
Yesterday I told you that markup on competitive fees is vital to simply break even. But, a profit on your gym is vital to feeling valued.
Profit can come in a variety of ways.
- You can mark up your fees to break even and then consistently challenge yourself to bring in more athletes for that program than you had anticipated – thereby profiting as your fees were covered twenty athletes ago!
- You can invest in highly profitable programs in your gym like recreational classes, birthday parties, and preschool programming.
- You can offer highly demanded pro shop items on a pre-order basis to ensure you never have too much stock and too little profit.
- You can promote open gyms, private lessons, and clinics to make sure they’re sold out every time and have great profit margins.
- You can hire a mentor that will go over your numbers and find places you’re spending too much and collecting too little.
When you profit, you can pay yourself what you’re worth. On those days when hard things happen, you can know that you’re paid to take care of issues like this. Imagine making $10 per hour and having a parent speak to you the way that parent spoke to me that day. A Walmart employee would take off the vest, put it on the counter, and say, “This isn’t worth the $10 an hour I make. Bye.” But so many gym owners are paying themselves even less than that!
If you love cheerleading and you love your gym – you only have one option. Profit and pay yourself what you’re worth.
Profit is not greedy. In fact, someone recently asked Dave Ramsey this on his podcast. They said, “How do I know if I’m profiting too much and being greedy.” In short, he said it’s all about intention. Profit is necessary, but are you profiting and leaving your staff out to dry? Are you paying them the bare minimum and pocketing every available dollar? If you’re taking care of your staff, improving your programs each year and still paying yourself well, then you’re right where you need to be.
If you’re not consistently paying yourself and your staff what you are worth, then you need to look at investing some money into business coaching so you can learn how to do that. (Remember the adage, “It takes money to make money?” That’s exactly what business coaching requires sometimes.)
Business coaching will help you not only to figure out how to profit, but it will help you figure out how to pay yourself a fair hourly rate that makes everything you’re doing worth it. Maybe you pay yourself well, but you’re working a thousand hours a week. Do the math. It’s likely that your effective hourly rate (EHR) isn’t adding up to all that great of pay. However, if you can buy back that time through the methods we teach at Next Gen, you can pay yourself fairly and make those tough days worth it.
To learn more about business coaching through Next Gen, book a free call at nextgenowners.com/book-a-call. We’ll learn about your business and see if one of our programs might be a good fit for you!
