https://www.youtube.com/watch?v=mOKl6dodMTg

1 00:00:00.000 --\> 00:01:00.000 going everyone uh welcome back so i
want to make this uh video because i uh in our community was talking
yesterday about the math behind how to know how many sessions you should
have uh as you're reopening to make sure that you are profitable
\[Music\] one of the big issues that's going to come up is a lot of
different states have different recommendations some of them are based
on percentage of capacity uh you know reopening through kovit some of
them are uh you know limited to 10 people or it's the greater of the two
or the lesser of the two excuse me um and so what that does is it it
creates a lot of issues for most gyms because the profit model is not
built for large group training to not be able to do large group training
all right and so what i mean by that is if you're charging let's say
five dollars a session or ten dollars a session for what it would work
out to in terms of

2 00:01:00.000 --\> 00:02:00.000 the attendance for your hundred dollar
a month clients if you're only able to have ten people per session at
your facility that would include you and probably one other person so
now you're down to eight now if you're providing one on eight service it
doesn't make monetary sense for you to to be in business right so even
though you get permission to open back up it doesn't mean that you're
necessarily gonna have the profit to be able to do so so if you were to
come back to your full client schedule uh when you come back you
probably won't be profitable and so this is how you reopen the right way
okay so there's two main components to this and i'll go through each one
as in depth as i can all right the first is what i was mentioning just
now if you're only able to have 10 people per session then you need to
price your services at the price that that service would be normally
offered so if people are normally paying 129 a month at your facility or
150 a month or whatever for unlimited and you're only able to

3 00:02:00.000 --\> 00:03:00.000 have 60 people a day at your gym if you
had six sessions a day for example those sessions you can't even have 60
because you're going to be included in that so now you're talking you
know 50 people a day that you can service which means you can only
service 50 customers all right so if you're having a one on eight
scenario then you need to charge 300 or 400 a month for that service as
long as that happens now here's the good news the people who will want
to come back are going to be itching to come back not everyone is going
to come back but the people who do want to come back desperately want to
come back and so they'll likely you'll have the supply demand curve in
your favor meaning there's more people who want you then there is
availability of time for you to be able to train clients all right and
so when you have supply and demand in your favor then it means you can
increase your price right and so those things work together for kind of
scenario one okay if you are limited and can't do like that many people
per session etc okay you need to adjust your price to reflect the level
of service being provided not just letting people back into their

4 00:03:00.000 --\> 00:04:00.000 old price because it doesn't make
monetary sense okay now what i'm going to do is talk about the second
piece which is how do i know when it makes monetary sense so one of the
things in the joomla secrets book in section 2 which is the profit
levers which i would highly encourage you to read before you reopen
because it'll allow you to fix everything that you did wrong in your gym
this is one of the biggest opportunities of all time for people who own
a gym because right now society is giving you permission to change all
these things in your gym at once and then restart the right way with the
right price points the right hours the right amount of people per
session all of those things done right so that you can maximize the
profit and capacity of facility all right so this is like never before
will you be able to get this opportunity so take it please take 35
minutes and read section 2 of the gym on secrets book it's free plus
shipping go read it all right now here's the here's one of the biggest
pieces that i have to provide for you okay you want to make sure that
you're making

5 00:04:00.000 --\> 00:05:00.000 an 80 gross margin minimum on your
services all right this is this has been a rule of thumb that we've used
at gym launch forever if you are running on that then you will be able
to make a profit and have a good business if you do not and you're like
well we're at 75 i'm telling you every percentage point makes an
enormous difference so let me give you an example if the average gym is
running on 12.5 margins per year all right that's the average gem if you
go from 75 to 83 margins then you added eight percent to your bottom
line so if you went from 12 to 20 that would be a very big deal right
it'd be almost twice as much money so these percentage points matter all
right so for us now mind you you can set the number whatever you want my
rule of thumb is minimum 80. if you want to be at 85 or 90 by all means
go for it all right you could it's your business you can set it up the
right way but let me walk through a simple math example to explain to
you exactly how many sessions you can know by math that you can reopen
at any given moment okay so if you have let's say 150 customers before
this and then you reach out to

6 00:05:00.000 --\> 00:06:00.000 all of them and only 100 want to come
back cool so let's say those hundred who have said yes i want to come
back you can build my card now all right are billing at 100 a month i
don't recommend that price point but i'm saying if that is what they're
saying then that's what we're going to work off of for the for the money
math all right so that's ten thousand dollars a month of recurring
revenue that you have built in now if you're running an 80 gross margin
that means that on the cost of delivering the services that doesn't
include rent that doesn't include admin it doesn't include marketing
just your hard cost of fulfilling a session all right is 20 or less of
what you are paying or what you are making okay so what that means is if
you're making ten thousand dollars a month for your services then it
should cost you two thousand dollars a month or less to fulfill those
services so if we know that we only have two thousand dollars that's
earmarked for payroll for fulfillment of those services and you know it
costs you twenty dollars per session then it means you have a hundred

7 00:06:00.000 --\> 00:07:00.000 sessions that you are able to fulfill
on per month now if we're gonna be smart about this then we're gonna
divide our 100 sessions by 4.3 which is how many weeks there are per
month on average which means we have 23 sessions per week that you're
going to be able to fulfill all right given the number of people and the
amount of revenue that's being brought in that is already happening all
right don't go off of promises i'm begging you go off of reality all
right you're gonna have like some people's cars won't go through because
things have changed over the last two months some people say they're
gonna come back and then don't some people are like actually gotta wait
for my kids blah blah blah all right go only off of reality go off of
what goes through so you get everyone in you start their billing and
then you see what happens and then you dictate the schedule right if you
can do that if you can't then you're gonna have to down downgrade your
estimation by how much you were making before with all the cancellations
included and then drop another 10 just in case and then use that as the
number to base this off of so 10 000 2 000 for payroll that means

8 00:07:00.000 --\> 00:08:00.000 if we're getting twenty dollars a
session that's a hundred sessions we divide that that's per month by uh
the number of weeks in a month which is uh 4.3 so we have 23 sessions
per week okay and so you can allocate those let's say that we've got
five days a week monday through friday that might be normal hours all
right so on those days let's say we did four sessions a day two in the
morning two in the afternoon so now we got twenty we got three left over
and so we can go three on saturday right in the morning if that's what
we wanted to do right and so just like that you can get your payroll you
can get your business to a point where you have an 80 gross margin or
higher right and so like i said that is the minimum but that is the way
that you can know in your gut that you're opening up in a position to be
profitable now if you've done the math and you're like you know what i
can only have ten thousand dollars a month recurring and my rent is six
well then you're probably not going to start out profitable anyways and
so at that point you're gonna have to make harder decisions of like do i
wanna uh do you wanna do a big pre-sale and

9 00:08:00.000 --\> 00:09:00.000 then get another you know 50 or 100
people pre-sold on a trial to to be able to monetize this um and that's
where cash is really important right but big picture most of you don't
have that situation um and if you did have that kind of rent then
hopefully your revenue is higher than that hopefully your price is
higher than that etc um but that's how you that's how you can figure
this out and most people do this wrong most people are like i'm trying
to open up as many available times right or the worst scenario you can
have is and this is what i feel like it's going to happen for a ton of
people is i'm going to be limited to 10 people per session i've got 100
clients i'm going to increase my overhead so that i can have 10 sessions
a day so i can see all my clients and there goes your margin forever and
then how do you transition back and having to cut sessions right it's
not a good way to do it start as little as you can start with two
sessions a start with 90 margins right that's fine it's okay start with
90 margins work at two sessions a day and work your way back start at
three sessions a day whatever right

10 00:09:00.000 --\> 00:10:00.000 and so from there um this is one of
those beautiful opportunities that if you ever had that session that
never really had good attendance right cut it right cut it get your
margin back right and uh like i just want everyone like think kobe like
sure there are things that you probably wish didn't happen okay but but
take what you can right right now you can click reset on your business
these are the five things that you need to do right now all right i'm
going to give you the the cliff notes on what you need to do one you
need to switch from unlimited to two or three times a week as your main
offer all right because right away that will double or triple your
capacity two you need to switch your billing to a weekly cadence now it
doesn't have to actually be weekly but it has to be on a weekly
bi-weekly or four-time or every four week cadence why because if you do
it on every 28 days you're going to get 13 billions a year instead of 12
which means you get an extra almost eight percent in top line revenue
for the same amount of service right what that means is if you have 12
margin you get another eight percent now you're at 20. right almost
doubles

11 00:10:00.000 --\> 00:11:00.000 how much you make just from that one
change all right each of these levers is like that okay so unlimited to
two to three times a week you're going to switch to a billing a cadence
of weekly bi-weekly or 28-day cycles you're going to change your pricing
to match your service all right which means when you make these
adjustments typically when you limit people's sessions fewer people show
up which then means that number of people per session goes down which
means your value goes up and so that means that you can build more
believe it or not because people change it changes the value proposition
to the end user so just remember that you're not cutting sessions you're
adding value by making it more personalized because the sessions are
going to be smaller and more controlled okay and so when you do that my
minimum recommendation is 167. all right that's my minimum bare minimum
bear bear bear bear bare minimum which works out to 39 a week all right
bare minimum most people will be at 49 a week or 59 a week or 69 a week
okay and that's what you can do for those uh and that's what the overall

12 00:11:00.000 --\> 00:12:00.000 pricing would be so if you did it at
forty nine dollars a week uh it'd be 49.99 don't forget your 99 cents
all right which means you're gonna be 199.99 every 28 days all right
beyond that if you typically have uh exercise is that you use that you
wanted to get rid of because they take too much space up and they eat
too much square footage this is the time to get rid of those things and
take them out of the programming in terms of your sessions instead of
being 60 minutes cut them to 45 all right it'll also increase your
capacity and decrease your payroll so all of these things are things
that you can do right now doing it the right way starting with the right
price with the right services the right amount of sessions the right
margin so that you can actually come out of this profitable or even more
profitable than you did before every person who goes in and tries to
increase the amount of sessions they're doing keep the pricing the same
and then have more individualized service that they're going to do is
going to go out right the math doesn't support it

13 00:12:00.000 --\> 00:13:00.000 and so just like if i can give you one
thing just trust the math all right you will be able to make a profit be
able to provide more value your customers and actually get through this
so you can grow your gym which hopefully is your goal so um that's uh
that's that's part one of how to reopen the right way is structure
everything properly um i'll probably make another video on how to how to
market and sell before that but right now make sure to get this stuff
right if you get the book there's a letter inside the book on how to
communicate the changes um you can literally copy it go for it um it's
my gift to you but yeah if you don't know where the book is just go to
alex'sbook.com there's a free book there i think it's on amazon too if
you do by the way leave a review lots of love um anyways happy wednesday
wanted to make sure i got that out for you and uh keep being awesome
\[Music\] you
