Tag: Strategy

16 Retention Tips & Tools for Your Martial Arts Kids Classes

Posted on by Member Solutions
Two boys sparring in martial arts class

Client Question: Could you provide some in-the-classroom retention tips that work for your school?

At Combined Martial Arts Academy, we implement several techniques and tools within our Kids Martial Arts programs. The tips I’ll provide here are used within our Little Dragons Program (3 to 6 year-olds) and in our Beginners Program (6 to 10 year-olds).

  • Age-specific classes – All students are grouped in their respective age group. This is important as it helps with learning and stops bullying. Grouping by age group also builds up confidence and increases the student’s self-esteem.
  • Achievable curriculums – We set a grading curriculum that is achievable for the student’s age.
  • Break it into four – Each class is broken down into four stages. This helps with students’ concentration as they are not repeating the same thing over and over again for 45 minutes.
  • Disguise repetition – Changing the order, instructors and equipment enhances and disguises the repetition of learning.
  • Use students’ names at least 3 to 4 times throughout the class – This shows the students that you care about them. I believe this is one of the most important things in student retention.
  • Special Events – We continually host special events throughout the year. This allows students to show their friends and parents how well they are doing.
  • Take photos and give out awards – We take a photo whenever a student makes an achievement, such as white belt. We also present an award. The award says: “a black belt is a white belt that never quits.” We present the award to the student in front of their peers in the class.
  • Stickers – A constant reinforcement and recognition of the hard work and dedication to training.
  • Training certificates – 3 to 4 are handed out in each class.
  • Monthly attendance awards – These awards are handed out to students who have not missed any classes for the month.
  • Shihan’s Super Star Award – This award is given monthly to a student in each division for their effort in school, at home and in class. The student also receives a special badge that is put on their gi.
  • Birthday cards – Cards are mailed to each student and they get to wear a black belt for their class. Photos are provided of them wearing a black belt.
  • Report cards – Done on a quarterly basis.
  • Get well soon and miss you cards – These are sent on a weekly basis to connect with the students so they are not away for too long.
  • Pizza party – Students who bring the most awards from school receive a pizza party. This encourages students to not only do well in Martial Arts class, but also other activities, including school.
  • Free birthday parties – All children under the age of 10 can sign up for a free birthday party. We include details of this in our information packet.

Consistency and persistence breeds results. These 16 retention tips need to be consistently carried out every month if you want drop-outs to stop. At Combined Martial Arts Academy, we try to be as consistent as possible with these retention efforts. I meet with my management and office staff every third Monday to remind them of these systems and to make sure they are comfortable and using the techniques. Every two weeks I have an instructors meeting and training as well to check to see if they are implementing these systems.

Bill Wakefield is one of Australia’s pioneers of growth and success in the Martial Arts industry, www.c-m-a.com.au. He is a well-known and prominent speaker on the subject of Martial Arts business, as well as a Member Solutions Advisory Team Member.

8 Retention Strategies You Need to Grow Your Gym

Posted on by Member Solutions
8 Ways to Improve Gym Member Retention infographic

The most successful gym and fitness business owners understand that gaining a new member is just the beginning. Over time, your members become much more valuable to your business the longer they stay at your gym. So what do you need to do to improve your member retention?

You coach your members on the importance of being consistent in order to hit their fitness goals, and the same is true for maintaining your relationship with them. To increase your members’ loyalty and retention, you need to consistently offer them a stand-out experience every time they interact with your business.

These eight simple retention strategies will help you identify ways that you can improve your members’ experiences so you can keep them around for years to come.

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Help! How Can I Prevent Severe Member Attrition This Summer?

Posted on by Member Solutions
Kids laughing, playing in water at outdoor summer camp

Summer’s coming and I’m worried. A lot of our students, both children and adult students, took extended vacations last year and then never came back.

Any advice you can give? Ways I could be proactive … increase my chances that students will take part in training during the summer and return after vacation?

Korbett Miller’s Answer on Preventing Summertime Attrition:

You’re not alone. Summer is typically a challenging time for Martial Arts schools. We’ve had downturns in our enrollment and our gross/net almost every summer since opening our school in 1996.

In the beginning, when we didn’t have any financial cushion, it was desperation and panic in the summer. As my school became more viable, I began to just accept the fact that summertime was a down period and part of a business cycle. I resolved that there wasn’t much I could do.

A few years ago though, I realized that just isn’t true. You CAN do something about it. You CAN have a profitable, stress-free summer by taking some purposeful actions.

Here are two categories I recommend you consider. These will help create a sustainable summertime and a fun environment to maximize profitability and minimize member attrition.

#1 – Make Decisive, Positive Changes in Your Culture

First and foremost, everyone who has earned a black belt understands the value of commitment. Martial Arts is about consistency and commitment. Commitment is staying with something even when it’s a challenge or obstacles stand in the way.

Action Step: Make sure “commitment” is part of your instructors’ vocabulary and stump speeches, so that “commitment” is being reinforced with students.

Second, hosting events at your school is a great way to keep your culture fun and exciting, and your students involved and committed to training.

Action Step: Schedule fun events each week in your school. Take advantage of the warm weather. Go outdoors if possible to change things up.

Here are some event ideas for kids and adults:

Kids

  • Balloon Training
  • Water Balloon Toss
  • Dunk Tank Day (each year we have a “Get Back at Instructors Day”!)
  • Chux Days
  • Obstacle Course Days Ninja Warriors

Adults

  • Host a BBQ
  • Go hiking with your students
  • Host a special seminar

#2 – Change the Mechanics to Change the Mindset

Whether you offer ongoing or term memberships, I strongly suggest NOT offering summer holds or freezes. Here’s why:

If you “hold” people’s tuition during the summer, this is the mental conversation that you and your families will have come September when they are no longer attached to your school financially or physically:

Parents: “Johnny’s done Martial Arts for a while now. There’s that new sport, _______ or activity _______, he wants to try. I will just call and tell them we’re not coming back.”

Now here’s the mental conversation if you don’t “hold” someone’s membership for July and August, and they continue to make payments.

Parents: “Ok, I have paid for two months over the summer. I’m going to get my money’s worth with tuition. Johnny starts back right after Labor day.”

It’s a completely different mindset.

Action Step: Don’t offer summer holds or freezes. If you offer term agreements, credit the missed time to the end of the student’s enrollment period.

If you offer ongoing agreements, stress that you want to keep the student enrolled in the program and offer FREE private make-up classes for the weeks they missed.

This simple shift in the mechanics of how you run your school can dramatically change the complexion, cash flow and culture of your business in the summertime.

I hope this helps and wish you a successful, profitable summer! If you have any other questions, feel free to comment below or send me an email.

Thanks,
Korbett Miller

Korbett Miller has been teaching at his Martial Arts school in Kirkland, WA for the last 17 years. Korbett still actively trains in Muay Thai and Brazilian Jiu Jitsu, and most recently received his Black Belt from the legendary Saulo and Xande Ribeiro and won the Brown Belt Senior II World Championships in Jiu Jitsu. He is most proud of his three daughters and 17 year marriage to his wife, Elise.Visit http://www.de-mythify.com to learn more about Korbett’s book and mini-course on finding freedom in a small business. Korbett can be reached at korbett.miller@gmail.com.

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Help! Our Front Desk is Costing Us New Members

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We’re in the middle of the New Year’s resolution rush, but no one is joining. We think our front desk and approach to sales might be scaring people away.

Can you give us some tips to make our facility more welcoming, so it’s likely members join?

Chuck Heacock’s Answer on Making Your Front Desk More Inviting and Sales Approach Less Intimidating

Most of your competitors view January as just another start to another year. But if you’re reading this, you’re preparing to surpass your 2014 accomplishments … so congrats!

You’ve heard it before but I’ll say it again: first impressions cannot be changed. You can have the best program director in the world, but that won’t mean a thing to your business if your front desk — and the first impression you make — turns people off.

So here’s a quick look at my consulting notebook from 2014. Although they are in no particular order, these were the most consistent issues found in touring over 50 Martial Art schools and gyms last year:

Problem: No one greeted me upon entering the facility.

Solution: Very easy fix. If you’re open, make sure you, your assistant, your sales personnel, (anyone!) is there for a big warm hello.

Problem: Price list on the front counter.

Solution: More times than not sticker shock will occur. You need to build value to the prospective member’s dollar — or you just lost $1,200 to $1,500 by letting them leave. Brochures are for folks going on vacations. You need action now.

Problem: No action when walking in.

Solution: Hang pictures. Display trophies. Have monitors running that show you teaching class or highlight programs offered. Have something to build visual credibility.

Problem: Front desk is a tornado aftermath.

Solution: Throw everything away at the front desk that does not make you money. Clutter will kill a sale almost every time.

Problem: Walls are dirty. Paint is chipped, cracked and outdated in color, such as a pastel.

Solution: Take a picture of your location. Show it to your neighbor. Ask them what they would change to make it more inviting. Your opinion is irrelevant. You are there every day. You will not see what other folks see.

Problem: Hardcore vibe

Solution: I found that the family vibe locations are more profitable, and I will be the first to agree that money is not everything; I need to pay the mortgage. More importantly, I never want any of my members to feel intimidated, it would really defeat my favorite thing about my job: helping people become better humans.

Bottom line: Set your goals to be consistent, not explosive. Take 5 minutes at the end of every day to plan tomorrow. Ask yourself: “What can I do to make my business better?” By doing this, you will surely surpass every goal you ever set.

Chuck Heacock is a Sales Professional located in Los Angeles. He is best known for leading the licensing program for Krav Maga Worldwide, which has grown to over 240 schools throughout the world. He has been involved in every aspect of membership development from sweeping floors to owning 30,000 square foot facilities with over 35 years of experience. If your business is suffering, he will find a solution to get you back on track with his all-new 10-hour sales training course for you and your staff. You can reach Chuck at betterdojo@gmail.com.

Maximizing the Benefits of Term & Ongoing Memberships

Posted on by Member Solutions

Client Question: What Term membership length is best? What cancel notice period is optimal for ongoing memberships? Which one should I use?

I am often asked these questions about Term and Ongoing memberships so I’ll share with you my recommendation for your review and consideration. Please keep in mind a few of these upfront points:

1. Each facility is different and there are multiple good answers to provide.

2. Laws vary from state to state and country to country, so always check with your legal advisor if you have any restrictions to consider.

3. If selling isn’t a strong asset for you and your team, I recommend Ongoing memberships as an easy way to get new members on board initially.

4. Price is critical too because this determines your revenue. You need to price your memberships factoring level of commitment. Too often I hear about owners giving substantial discounts for low obligation memberships to entice buyers: this hurts the bottom line. If delinquencies and dropouts rise, your cost of business can wipe out profits faster than a Bruce Lee block and counter move. Check out a great article posted by Dina Engel, our COO, for more info on delinquency management: 10 Ways to Reduce Your Delinquency Rate & Increase Cash Flow

Ok, finally, my personal opinion …

I believe that new members and existing members should be managed differently, since they have two different frames of reference. Existing members should be willing to commit more than a new member, if I am providing great service and they are experiencing success (obtaining benefits). With this distinction, I would set up the following:

New Members: I would offer new members two ongoing membership options:

The first can be cancelled at any time with 30 days advance notice. This membership would be priced very high. The purpose of this membership is to establish the value of the program. I am not looking for many takers here because the notice period is still too short for my comfort level given that summer is 2.5 months long. But if a member is looking for ultimate flexibility, I am willing to accept the higher price point in exchange.

The second can be cancelled at any time with 90 days advance notice and I would price it at 25-35% off the 30 day notice program. It’s important that this price point not be inexpensive compared to your competitors. It should be what you actually want for monthly tuition per member. This program still offers the member a low pressure enrollment and a cost savings to justify the extra 3 payments should they terminate the membership. I like it because it gives me and my staff enough time to overcome any challenges that are causing termination and perhaps we can repair it.

Existing Members: I would offer a Term membership:

What I like most about Ongoing memberships is that they don’t expire, giving me the freedom to choose when to renew or upgrade a member. The best time to do this is after a belt exam. Once the member has been training for 3 to 6 months, they should have a more educated view of Martial Arts training and the benefits they are absorbing. This should lead to increased value for Martial Arts training and create an easier upsell to a bigger and better membership option with more commitment. Many people refer to these “Advance Training Programs” as Black Belt Club, Leadership teams, Master Black Belt Club, etc.

These Term memberships can vary in length up four years. Personally I like a full one year commitment with an auto renew option with a 60 or 90 day cancel notice. In this way, I acquire a sense of commitment from the member while also eliminating expired programs which save me from renewal work.

Your membership strategy is a critical aspect of your business that impacts your bottom line in many ways. There are many solutions that can work and sometimes you need a trial and error strategy.

Joe Galea is the President of Member Solutions. Galea, one of Member Solutions’ founders, has been counseling school owners for over 20 years, and spends part of everyday speaking with clients and industry leaders.

Share with us! Let us know what membership structure works for your business. Comment below.

What Do I Do When a Prospective Member Insists on Getting a Price from Me? (Video)

Posted on by Member Solutions

You’re on the phone with a prospect interested in joining your martial arts school or fitness club. You excitedly describe your classes, facility, and staff, looking forward to the moment when you can invite them in for a visit.

Suddenly, they interrupt to ask the question you dread. They insist on knowing your price. You swallow hard, nervous that as soon as they hear your number, the conversation will be over.

There’s no need to panic. There is an easy, effective way to handle this scenario that every owner and staff member should know. That’s why I created this video to help you address this difficult question and keep the conversation on track.

After watching the video, try practicing the sales script with your program directors, managers and staff—anyone involved in selling memberships.

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Erik Charles Russell has been in the martial arts and fitness industry for more than 25 years. He owns Premier Martial Arts and Fitness in Watertown, NY. In 2015, he published a book based on his successes called The Art of Selling Memberships. The book became an international best seller—hitting number one in three categories in the U.S., Australia, and Germany on Amazon.com.

Why Prospects Won’t Call You Back (But Will Sometimes Talk to You If You Call)

Posted on by Member Solutions
Red wired telephone used to make membership sales calls

You have a bunch of leads. You constantly place calls to these leads. You follow up by phone, leave voicemail messages, send emails, and mail letters. But the prospects don’t call you back, don’t respond to your emails, and don’t stop by in person.

Then, one day, out of the blue, you get one of your prospects on the phone and talk with them for a good hour. You end up signing them up for an introductory class or significantly moving the membership sales process forward.

Why does this happen?

You may argue that you are striking while the iron is hot. Today, the prospect’s urgency (their compelling reason to act now) passed a threshold, so they welcomed you in.

This scenario underscores the importance of consistent follow-up. You need to catch that critical moment.

But if there was urgency in the first place, why didn’t the prospect get back in touch with you sooner? Why didn’t the prospect call to discuss their urgent need?

The Reversal Curve

Most successful sales processes appear linear. We make a progression of sales or networking calls. Each touch point leads to a greater sense of client urgency which eventually culminates into a closed sale. This process is just the tip of the iceberg, the hard sales contacts.

After we make the first successful contact, we think we’ve made great progress. However, the prospect’s sense of urgency typically falls to zero right after our conversation ends. They forget we exist. The prospect―whether a child, teenager, or adult―has many other things going on. Your martial arts program or fitness class is no longer top of mind. Some combination of our reminding the prospect of the urgency, combined with their internal sense of urgency, moves the process along to a second contact point.

On the day we contact the prospect and get through to them, we usually benefit from the explosive impact of internal urgency meeting an external urgency.

Internal Urgency and External Urgency

The internal urgency is the compelling reason to act―the deep underlying answer to the question: Why? Why is the prospect engaged in a serious conversation with us? Why does Jane want to sign up for your kickboxing class? What is her compelling long-term need?

The external urgency answers the question: Why now? What is the immediate trigger explaining why they finally called you back? The external urgency is often the turning point for the prospect ― a strong desire that needs to be fulfilled now. For example, in Jane’s case, “I need to lose 20 pounds before my wedding.”

It’s important to note that the internal urgency can be recognized and tolerated for a long period of time before the prospect actually takes action. Resistance to change is so great that prospects will often times settle and not act on their internal urgency. To maximize forward motion, in general, it is best to work the internal urgency before the external.

The Problem of Limited Consciousness; Aristotle’s Contribution

There’s only so much we can hold in our conscious focus at a time; perhaps four or five ideas or concepts. Whenever we have access to a prospect, we must share succinct, powerful concepts to grab and hold them. There is a short half-life to our ideas―unless we tie them into the prospect’s long-term compelling needs. The “belly to belly” urgency evaporates when we leave, and the greater context sets in. For techniques in developing proper and powerful concepts, Aristotle is both a potent source and inspiration.

To minimize the reversal curve, book the next appointment. Take advantage of the external urgency of a visit or a phone call, and maximize your strong conceptual presentation by booking the appointment when you are face to face with the prospect or talking with them.

About the author: membersolutions has taught selling skills for 17 years. He started three businesses and has made approximately 4,000 sales calls, selling both B2B and B2C. He invented a selling process, Urgency Based Selling®, with which he can typically help companies double their closing or conversion ratio.

5 Tips to Selling Memberships during a Recession

Posted on by Member Solutions
Recession graph on computer screen

We have read the headlines and listened to newscasts of the global economic crisis. Consumers are fearful and are not spending their hard-earned dollars as freely as they did in better times.

Traditionally, the health and fitness industry has not been adversely affected by economic downturns. Consumers spend money on necessities and good valued essentials. What can be more important than one’s health?

Listed below are five tips to selling fitness memberships during a recession. See if you can add more, and share this article with your staff.

1) Sell yourself.


 The first person that needs to be sold on investing in one’s health, especially during downturns — be it financial, emotional or physical—is you, the membership advisor (I would go as far to say that every employee must feel the same way).

Believing in the value of exercise is not an option. Everyone knows the value of exercise, and now more than ever, must believe that exercise helps one’s physical and mental well-being. This helps overcome the emotional and physical challenges that we currently face and that lie ahead. Once you embrace the fact that living a healthy lifestyle is a 24/7 attitude in good times and in bad, you will close more sales.

2) Sell with passion.


 Questions membership advisers must ask themselves are:

1. Are you exercising?
2. Do you believe in the product that you are selling?
3. Do you practice what you preach?

The biggest component to selling anything is emotion. People buy on emotion. They can sense whether the representative is sincere or just putting it on to make the sale. Today’s consumer is very savvy. Do not underestimate their ability to see right through false emotion and excitement. Membership advisors must have a burning passion for fitness and living a healthy lifestyle. That passion must flow through their presentation and engulf their prospect.

2) Ignore the negativity.


 Membership advisors should not get caught up reading doomsayer headlines and watching stock market results or chaos around the world. Yes, they must know what is going on, but, should not dwell on it. They should stay away from negative people. Everyone knows who they are. Have them run, not walk, away from them. Being distracted from their daily “success cycle” will only make matters worse.

Membership advisors must keep their PMA (Positive Mental Attitude) in check every day, no matter what is going on around them or in their own personal lives for that matter. They must stay focused.

3) Provide value.


 Consumers are evaluating where to spend their hard-earned dollars. Membership advisors must make the value proposition relate to their goals and fitness needs. Showing prospects the value of starting an exercise program, and that starting now, makes more sense than ever. They must explain how spending less than $2 per day for a fitness membership (some may be as little as $0.50 and others as much as $5 per day) is a great value, especially when you determine what their daily spending habits are.

Check out these stats. According to the National Coffee Association, the average yearly coffee consumption per person in the United States is close to 4.4 Kg. Among coffee drinkers, the average coffee consumption in the United States is 3.1 cups of coffee per day. That adds up very quickly when you talk about two to four cups of coffee per day.

You probably don’t know that Americans spent 2 million on cosmetics last year alone and that cutting out cigarettes—whether you light up once or more than a dozen times a day—can save you hundreds, if not thousands, of dollars each year. A pack of cigarettes now costs more than $5 on average— with some states tacking on additional taxes that raise the price even more.

In New York City, local taxes have pushed the cost of a pack to about $10. I can add to this list, but you get the point. Members can join your program for a low fixed cost and enjoy the benefits of living a healthy lifestyle. Prepare your team by having membership advisors list as many cost benefit savings as they can.

4) Empathy versus sympathy.


 Empathy is the capacity to recognize or understand another’s state of mind or emotion. It is often characterized as the ability to put oneself into another’s shoes, or to in some way, experience the outlook or emotions of another being within oneself.

Sympathy is a social affinity in which one person stands with another person, closely understanding his or her feelings.

Membership advisers should not sympathize but empathize with prospects. They must understand their situation but not get caught up in their story. Bring the conversation back to results and benefits of joining your program. Turn each negative into a positive.

People on a tight budget usually don’t have much to do other than watch TV, read, and surf the web. That gets boring quickly and only encourages a less than healthy lifestyle. They can be at the gym, exercising, socializing, networking, and making new friends all for a low monthly fixed fee. They can read, surf the web, and watch TV while working out.

Selling memberships is not just giving a “Vanna White Tour,” as my partner and senior vice president, Deana Valente, calls it. Or as my good friend and colleague Casey Conrad calls it, the “Disney Tour,” and asking the all-too-familiar closing statement, “So what do you think?”

Selling is a profession and selling memberships is no different. Remember there is always a sale made during a tour of your facility. The consumer sells you or you sell the consumer. Which do you prefer?

Author: Tony Santomauro

5 Budget-Friendly Ideas for Your Business’s Grand Opening Event

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Client Question: I am opening a new business soon. Can you provide some ideas to drive traffic to my business on our grand opening day?

Chances are good that you have invested a lot of money into starting your new business. Here I’ll provide some low-budget ideas for a grand opening celebration.

1) Rent an inflatable jumpy or bouncy to place in front of your business. If you don’t have a front lawn, rent a sky tube. Add balloons, yard signs, and gigantic banners out front that read, Grand Opening—anything that will make people look at your location. Use your connections, too. Know someone that owns a hot rod, race car, or chopper? See if they’ll let you borrow it. Place it out front to draw attention.

2) Offer free hot dogs and sodas throughout your event. Have visitors go inside your martial srts school or gym to get a coupon for the free food. In order to get the coupon, have them fill out an info card.

3) Create grand opening postcards or flyers. Donate $250 to your local high school football, soccer, baseball, or basketball teams. In return, ask them to put the postcards or flyers out in the neighborhood they live in. This is an easy way to get cards out for little to no money. It’s also a win-win for you and your local schools and sports teams. They need money, too, and will appreciate your donation.

4) Have hourly giveaways for gift cards to local restaurants and movie theaters. Have visitors fill out an info card to enter the drawing for the prizes. Make sure you keep their information and enter it in your member management software so you can follow up with them about joining your martial arts school or gym.

5) Giveaway t-shirts with your business name and logo. Drive around to local businesses, parks, and supermarkets. Invite the people you talk to take a class. Have an appointment book on hand. Make sure they know about the Grand Opening celebration.

Remember that your grand opening doesn’t have to be just a one-day or evening event. Make the most of your new business opening. Consider running a one- or two-week celebration to keep the excitement and the momentum going.

Hope this helps,

Chuck

About the author: Chuck Heacock is the owner of the Fitness Compound, a training facility that provides unparalleled fitness activities including Martial Arts classes, special boot camps, personal training, baseball, basketball, spinning, Zumba, cardio, and more. Chuck is also a sought-after fitness industry consultant.

Get Fit Holiday Promotions: How to Calculate Your Cost of Service

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I do not know if holiday seasonal stress disorder is an actual condition, but if it doesn’t really exist, it certainly should. Every fitness business out there is being pushed this time of year to offer some sort of special or deal in order to entice people to sign up or make that first leap into health and fitness. Given that our wonderful industry also has some of the tightest profit margins, it can cause a greater amount of stress to try and exceed the expectations of the consumer.

Retail businesses can offer an 80% off discount, or a “buy one, get one free” promotion. They’ll still make a profit. But most of the fitness businesses we work with are service-based. If they offered these outrageous discounts, it would mean they would be paying people to work out. Not a bad promotion if you can swing it; “Come to my personal training studio and I will pay you to get fit!” You may get hundreds of clients, but those doors will be closed before they can even get in.

One of the best things to understand before you offer a special promotion is the cost to deliver your service. Determining your cost of service will assist you when you offer any promotions to existing and new members.

Calculating the Cost of Service for a Fitness Business

  1. Overhead Costs ―These are the indirect costs to your fitness business in providing services to customers. Examples include labor for other people who run the fitness facility or Martial Arts school, whether administrative assistants or a director of a department. Other overhead costs include your monthly rent, taxes, insurance, depreciation, advertising, office supplies, equipment lease, utilities, etc. A portion of all these costs will need to be included as part of your fees.
  2. Material Costs ― Material costs refer to stock or inventory required for the service. These are typically not huge additional costs for the average fitness business. For example, an automotive center would need the cost of brake pads and brake fluid when calculating a brake job. In our training studio, I add in the cost for our towels, laundry detergent, soap, shampoo, and razors. We purchase and supply these to our clients. They could just as easily be considered overhead expenses. In our training studio, I know that these toiletries add up to around $3 per client session, so I will use that number when calculating the cost of service and determining a promotional offer.
  3. Labor Costs ― Calculating labor costs for fitness businesses is usually pretty straightforward. Wages are typically the same per service per staff. That said, it is good to keep the average cost per service on hand and up to date. Also remember that when you give a raise to staff members, be sure to change this number to keep your costs in line.

We use our Member Manager software to calculate most of this for us with just a click of a button. I can see exactly the percentage of revenue per service that is going to labor for all staff or on a per staff person basis. Member Manager also calculates the revenue that I generate per service and pinpoints members that pay below my rack rate so I will know when it is time to raise their rates. All of these costs are important numbers to have handy when determining the discounts you want to offer. I can quickly add my costs together, along with my desired profit, to formulate an accurate price for a special.

Next week I will apply this cost of service calculation to a few fitness business models and show you some cool specials that help increase member attendance and still keep profits high.