Barbell Shrugged - 5 Ways to Increase Your Revenue Immediately - Business of Fitness Episode #66

Episode Date: July 29, 2019

JP owns and operates BRICK Fitness Co. Established in West Hollywood, LA. in 2010, BRICK rapidly expanded to tier one cities such as New York, Chicago and Boston. Applying a replicable, scalable and proven business model, JP has grown the company to license partners throughout the U.S. and several international partnerships.    JP got his start in membership-based business over 20 years ago after a decorated amateur and professional fight career. JP transferred his extensive athletic triumphs into teaching martial arts and soon thereafter opened his own commercial kickboxing training facilities. He quickly grew into one of the youngest multiple-school location owners in the U.S. Due to his great success in building strong communities and staff; he was sought after by some of the most esteemed Martial Arts academies. With a growing family of nieces and nephews Perelmutter was compelled to move back West. He sold his locations to the managers he had groomed and developed, of which still exist to this day.    Upon returning to Los Angeles, JP dove into the sport of functional fitness, a training methodology he had dabbled in during previous fight training. Instantly he had a newfound love. With a respectable run in competitive CrossFit JP was able to compete at the regional level as well as be one of the few to make it to the CrossFit Games several times over. Meanwhile his entrepreneurial spirit immediately saw an opportunity and hole in the functional fitness space. Using his tested and proven membership based business model he founded BRICK.    JP has a passion for sharing his business savvy methods to inspire, motivate and guide people to a healthier and wealthier way of life. His worldwide training and business endeavors has allowed him to gather an arsenal of powerful knowledge, teaching tools, and talents, which he has utilized to create a dynamic environment for his team and the communities he’s built. In the past JP has teamed up with Jason Khalipia to hold Box to Business seminars aimed at counseling fitness business owners to develop their business to its potential. JP aspires to share his experience and knowledge with other affiliates since he lives by the mantra “rising tides raise all boats”.    JP continues on his never ending quest of excellence while searching new opportunities to expand the BRICK landscape and provide great career growth for his professional team of which he considers family.    Brief Summary:    Absolute fire is being dropped this morning. Today Jason and JP discuss the five R’s for increasing revenue: Referrals, Reactivation, Renewals, Retail, and Retention. These tools are applicable and easily executable by gym owners of any caliber. If you’re trying to increase profit, build your business, community, and yourself—you don’t want to miss this.    Minute Breakdown:    0-10 – How to Get Better at Asking for Referrals  10-20 – Reactivation and the “Second Chance Dance”  20-30 – Renewing Members Everyday   30-40 – Retail: The More They Buy the More They Buy-in  40-50 – Retention and Building Rapport    Get in touch with JP: [e-mail]  Find Jason at @jasonkhalipa  Work with Jason and the NCFIT Collective Crew at ncfitcollective.fit 

Hi everyone and welcome back to the Business of Fitness podcast. I'm Jason Kleep and on today's episode we have JP. JP is the founder of Brick. He has multiple locations including licensed partners which is really cool and he also had started a ton of martial arts studios. His background is extensive in terms of service based business and I was listening to him give a presentation the other day and he spoke about the five R's, five R's of revenue. And I'm like, huh, this is intriguing. I sat through the presentation. I loved it. And I wanted him to come on the podcast and share it with all of us today. Guys, if you're dialing in your business, if you're looking for ways to increase your revenue, let's listen to the five R's, whether you're in the coffee business,

the fitness business, whatever. There's always something we can learn from these podcasts. I know always get great takeaways, and I hope you enjoy this episode as much as I did. Before we dive into it, just want to remind you, if you're a gym owner out there and you have not checked out the NC Fit Collective, all I ask for, you don't owe us anything, but if you could, I would really appreciate the opportunity to try a two-week free trial and just see if we could earn your business, earn your trust. I'm confident it'll save you time and you could take that time and put it into other areas of your business,

like dialing in your five R's for revenue. Shoot us an email to collective at nc.fit for more information or just visit our website, which is linked here in the show notes. Now, let's get fired up. Let's start having a great conversation with JP and let's keep rising the tides. Let's go. All right, everybody. So I am here with JP, also known as Jarrett Perlmutter. And I am... Nice job, buddy.

Not bad, right? I mean... That was pretty good. I've known the guy for like 10 years. I'm just learning how to pronounce his last name. Hey, we're baby steps in this relationship. You know what I mean? We got no reason to rush.

You and I, we're on a... This is not a sprint. This is a marathon. Dude, I feel you. Well, we are in the backyard of JP's house. I am out here in Nashville, Tennessee, and my family and I, you know, it's the summertime. So my family and I have been traveling around and we wanted to go visit some collective gyms, some gyms that utilize our programs, get some feedback, want to visit some friends.

And we went and saw the Fronies, went and saw a bunch of, and now here we are with JP and we went and saw the Fronies, went and saw a bunch of, and now here we are with JP and we are talking about a subject of five R's and five R's towards revenue, which I thought was really interesting. So JP and I were recently speaking at an event together and I listened to his presentation. One of the things he brought up were these five R's and I thought it'd be a really cool podcast to discuss because there's nothing sneaky about it. It's just, it's stuff that everybody listening right now, if you're a gym owner, if you're a coach, everybody's gonna nod their head and say,

yeah, that makes sense. But I think when we actually describe it piece by piece and the way JP does it, I hope it sinks in today. So JP, thank you so much for being on the Business of Fitness podcast. You and I have done so many cool things together. JP, thank you so much for being on the Business of Fitness podcast. You and I have done so many cool things together. JP, we already interviewed you before, but let's dive right in, man. Talk to us a bit. Yeah, let's get right to it.

Let's talk about these five R's. For sure. So as you'd mentioned, you and I have done a ton of seminars in the past, tons of consulting for people all over the world. And through that, we've basically whittled down and been able to filter out five executable items that people can take back into their gyms virtually immediately to start generating what we call the Royal R in a business, which is revenue. All right, the Royal R. I hear you on that one. Yes, sir. So we've got five R's that I'll go ahead and outline, and then we'll break them down as we go through this discussion. So the first R is referrals.

Second R is reactivation. Third R is renewals. Fourth is retail. And the fifth is one of the most important, really, through all gyms retention right because you can get as many people as you want in the door but if they don't stick with you then what are we really doing here that's right you've just got what they call like the back door method right they walk in through the front they sneak out the back that's right yeah so well starting with number one um

when a gym owner is thinking about these five r's and at the surface, I see referral. I'm like, okay, well, members just naturally refer their friends, but it's deeper than that, right? You got to ask for it. That's right. And you know, one of the interesting things, and I learned this early in my business career and more of like the on the job style business career with my mentors is that many people have such a hard time, like a psychological barrier of, of asking, whether it's for money or a referral. It's like, they just have this weird barrier of asking. We get on the floor for workouts and we'll ask our members to basically like give themselves hemorrhoids and explode in their shorts, right. Over putting weight on a bar. However, to just ask them to bring a buddy in for class,

we like start shaking in our boots. It's crazy. I totally get it. Oh, man. Never a dull moment, my friend. Never a dull moment, but I think you're totally right. And I think it's just a comfort level that we're used to coaching and we're used to certain things on the floor,

but then all of a sudden when we ask to, ultimately what I always ask people, and I'm sure you feel the same way, do you feel like your gym is going to change somebody's life? And the answer is, yeah, it should. Do you think it's going to give them results? Yeah, it should. Then why wouldn't you want to go tell people about it? Why wouldn't you want to go tell people to go tell other people about it? You just got to ask. Exactly. And you know what's interesting? And so it's cool that we can go through it this way, because I think this is a more realistic way of going through these five R's. When you communicate with an owner, you and I have done this a thousand times, you can talk to them about stuff and they get really insecure, right? They start to shake and

fumble their words. They overthink, oh, am I getting judged on what I'm saying? They start to get nervous. the second you ask them to sell you on why they should be doing what they do almost like putting their back up against the wall like why would i join your gym right i'll join your gym your gym shit's probably like all the others boom what do they do eyes get big chest gets big confident they come in and they start telling you i got into this to do this i I know this. My capacity of knowledge in fitness is this. When it comes to the squat, I know this, that, and the other. They'll give you 100 cues for the most technical component with all the confidence in the world.

Then you say, okay, go ask John to bring a buddy into class because of all the stuff you just said you're going to do for him. He should ask his friend to come in and get the same benefits. And all of a sudden they shrink back into themselves. And so if you are an owner like that, or if you're a coach like that, and I was fortunate that I had a lot of sales experience before I opened up a business. And you had martial arts before you opened up a CrossFit style gym. Tell me, what could someone do if they do have a hard time asking their members for referrals and what type of referral campaigns are we talking about? What is a referral and how do you get better at it? Great. Two great questions. First thing, which was something so

super hard for me, and I even took a lesson from you a few years back and I'll touch on that. First thing is video yourself, like video yourself doing anything in a speaking capacity, whether it's conversing with your significant other, talking to yourself in the mirror, walking around. You know what I found is a great exercise, which anybody can do. Nowadays, we see so many people filming themselves and doing all these videos. You do it all the time and you're phenomenal at it. But most people are really shy and uneasy to do it, right? Especially owners. And you can almost attribute their uncomfort level to the success and referral capacity they have in their gym, right? If you ask somebody to go film themselves and they threw their camera out and started shooting themselves, they're probably not the individual that's insecure about asking for referrals.

Yeah, yeah, yeah. If you are uncomfortable in already doing these things that I've just mentioned, you're the person that needs to be doing it. And I remember you said to me something. When we first started in the early days of doing the box to business Instagram, and we were going to put up video content, I think it was even by text message. You're like, don't even worry about it, bro. Just shoot yourself right now walking. And I don't remember what the topic was, but I remember exactly where I was because it was the first time I'd ever thought like, dude, what am I doing? I'm talking in front of people all day long, every day. All of a sudden I turn on a little camera and I'm concerned. Right. And I was

walking on the riverfront in Chicago and I did it and I shot something and I don't even remember what it was at the time. But that was when I said to myself, wow, even me who's confident in communicating in front of large groups, this is an area of weakness I have. I need to develop this. And so I started doing it. I started doing it in airports. I started doing anywhere I was, which was just pulling the camera out and shooting myself, talking about the topic of anything I thought was necessary. Most of that content I never even used, but it really helped me. And I think if I could give one takeaway for everybody on this, how to get better for asking referrals, is do whatever is the most uncomfortable for you and practice that over and over again. And baby step into it.

Pull your camera out and shoot yourself. Go practice with some of your staff members. Because even that, even just getting up in front of your own team, for some reason people are uncomfortable doing. That's right. And so now when they go out there and they're filming themselves, or I agree with you fully, you know, you got to get reps in. That's it. And one way to get reps in, and this is another just pet peeve, is that if you're going to go out online and go spend a bunch of money for social media ads, but you're not comfortable yet engaging with people about your product, start with your referrals. Start with

your gym members in the club because they're free. They're already members of your gym. They already love you. They already love you. And so it's a great way to develop your skill on how to talk about your product. Hey, John, I know you like coming in here. We would love to introduce your friends. And so tell me now, before people go out and they spend money on social media ads,

they're trying to develop this skill, just like coaching is a skill. When you first started coaching, you're a little insecure, but over time you get more comfortable on the floor. That's right. It's the same thing with anything. It's like an inherent talent. It just becomes like a, it's like muscle memory. Exactly. Now, if you're trying to get a referral though, when we're talking about referrals, let's talk meat and potatoes. That's right. Referral programs. What do we have in mind? Yeah. So the first thing I always say is you should be asking for referrals every single day. It means that if you're in the gym and you're the owner and you know that the lights stay on because of new members that come through the door

and how you operate your business, you should be the first person doing it. Don't go and delegate that out to two other members of your staff. If you're not good at it, how can you assume the rest of your team will be? Now, again, if you develop your business over time, you and I talk about know what you know, know what you don't know, hire people that are better at what you do than even you. Sure. But in the meantime, you got to get at least good at everything, right? You don't have to be great. Yeah. So first thing is, ask your existing your A plus members, as we would call the people that are coming on average three days a week. They've been members for quite a while.

Go up and say, hey, like you say, we always use the term John. It could be Jessica. It doesn't matter. Go up to them and say, hey, you've been enjoying this program. We've seen great results. XYZ. Hype it up. Talk it up.

The greatest thank you you can give to us is by simply giving us a referral of a friend who could also benefit from the great things that you've seen from this facility. And now when that referral goes down and you actually ask for it before class, after class, whatever it may be. Sure. Right. There is no wrong time basically, except at a funeral. Now, when you say it, what are you providing them? What's a typical thing you've seen? Cause I know we do different things, but what do you guys do? Great. So some of the things that we'll do is we'll run a referral rewards program where if the individual signs up, they get 50 bucks. We'll run sometimes $100 Mondays. So if you refer somebody that signs up in front of the entire class when you show up on Monday, we call it

$100 Mondays, but maybe you don't get there until Tuesday. Hey guys, Jason, come up front. Jason got one of his buddies to sign up. Boom, here's a C note for you. Right. Here's a Benji. Put it in your pocket. Good job. There it is. $100 bill. What do we do? We just gave it out in front of everybody, which is what in the psych world called social proofing. Right. Because now everybody's seen it. Everybody wants to be a part of that. They want to engage in that. They see the support. They see the positive side of that. Nobody can get mad at getting a $100 bill. Yeah. And so I think, you know, throwing out hundreds on the, on the gym floor is, is one way of doing it. It's one way. Right. But it's not the way. It's not the way. Right. I mean, something that we do is you could partner with local people. So you say, Hey, we partnered up with the local, you know,

coffee shop. You get a $50 gift card to the local coffee shop. If you refer a friend this way, it's local, local, feels less salesy. But the key for referrals, and I know you'd agree with me on this, is you need to get comfortable asking for it. And it's for all of you thinking, okay, yeah, but you guys are super salesy. We're not salesy. We just believe in our product. That's it. And we believe in it so much and so do your members.

But they just need to be reminded to just tell a friend. That's it because we've created an environment where they feel safe and comfortable if you're doing your job. Right. Your gym has created a place where they feel safe and comfortable. So it's not necessarily something that they just think about like, oh, I love this place. I want to bring my friends in here. Right. It's not necessarily the first thing they're thinking.

They may be thinking about releasing the stress of the day, things that they've got going on at home. And this is, they want to just let loose. They don't want to do, they don't want to overthink their experience. So what do you do? You ask. And my message is always saying, when do you ask? Every day. How often? All the time. When you say every day, maybe if you, not every day to every member. That's right. And it's not every day to the same member. Right. The idea is you should just have a moment in your day where you've communicated with members and have asked them for a referral in some capacity. Right. Guys, if you're not doing that, you already have 100 people,

120 people that love you. They are now spokespeople for what you're doing. So that's the first R, referrals. You got to get there. Before we even skip, let me just give you one other place. Got it. Because there's a lot of people out there right now that are hot on doing digital advertising and generating tons of leads. Yeah. So where is there an easy way to turn one lead into possibly two to four to eight multiple of a lead is when that lead actually calls in for information and or schedules an appointment. Hey, you know, welcome to NC, you know, how's it going? NC fit. Great afternoon. How can I assist you? Oh, this is John. Listen, I got your information. I saw it at the coffee shop.

Love to come on in and check out a class. When can I do it? Great. What are you going to do? Make sure you get their name. Make sure it's spelled correctly. Make sure you get some of their basic information so you can follow up and schedule the appointment for them to come in. Great, John. No experience, experience. Whatever your programs are, come in at XYZ time. Hey, John, by the way, what we have found is that most of the people when they come in for their first time have a better experience when they bring a buddy in to enjoy the sweat with them. Right. So do you have a friend who'd love to take advantage of this class? Actually, yeah, the person I normally work out with or my buddy, my brother, my sister, my girlfriend, boyfriend,

husband, doesn't matter. Yeah, let me get them in there too. Great. You also have a higher success rate of converting them because they're immediately more comfortable when they have a familiar body next to them. Guys, I hope if you own a gym, if you have any type of service-based monthly reoccurring, you heard that. Ask for referrals. Track the information. If someone calls your gym, please answer your phone. Please answer your emails and get that information. Then either say, hey, do you want to come in today or tomorrow? Schedule an appointment and then ask them to bring in a friend potentially with them. I think you're totally right on that. So we got referrals. Now, what is a reactivation? Because that's another R. Yep. So that is another R, Jason. You are correct. I just graduated from college. Yeah. Good job. So the second R we have is reactivation.

Now, this one also ties into the idea of retention. But the idea of reactivation is that everybody's memberships are on some sort of cycle, whether they're on a class pass, a monthly membership, six-month, one-year contract, whatever it is you might be doing. The idea is that at some point people either come and don't sign up or they quit. Right. Right. So, or they've tried a trial program. They've tried to, they've got it, came in for their first trial on ramp, whatever you call it. They came in and sampled your goods and didn't like it. What do you now have? A database of individuals that at one point may have experienced your product, it didn't like it, and you have an opportunity to reactivate that existing lead or old member.

This includes cancellations, obviously. That's right. Yeah. That's right. So what do you do? At this point, it's not even a retention issue, right? We're not even touching on retention. Right.

They're already gone. They gone. Right. They gone, and we got to go rescue them. Right. So now they cancel from your gym. Cancellation logs, I'm sure we're going to talk about. Sure.

But talk to me about reactivation. What are a few things that people probably aren't thinking through? A couple quick things. One of the things that we like to do and you and I have talked about is the second dance. That's right. Second date. Second chance dance. Second dates.

We love this concept. It's cute. There's a lot of fun email campaigning angles you can do. Stock photography online. It's great even during. It's cute. There's a lot of fun email campaigning angles you can do, stock photography online. It's great even during Valentine's Day. There's just some really cool, fun things you can do. Or I like to do, you just got your toes wet, now dive in. So it's a softer way of saying, hey, you came in.

Maybe you didn't love the experience. Come on back and try us out. Or you can do the noble method, which is literally saying, hey, we didn't earn the right to your business. Give us a second shot. Right. We failed. And this is through an email campaign you're referring to. Yeah.

And how often do you continue to email these people? So there's two schools of thought, right? Right. One school says you email them until they tell you to take a hike. Right. In polite words? Right. One school says you email them until they tell you to take a hike. Right. In polite words. Right. Right. The other one says that you email them three touch points. If at three, they don't respond. You put them into your general campaign, sending them your newsletters and your standard broad based emails until they choose to opt out. Right. Opt

out. Right. But you don't aggressively continue to hit them with promotions. Yeah. I like the second date one because you say, hey, you know, at one point you loved me. Can we re-harness that love? And it kind of keeps it cute, kind of keeps it fun. Lighthearted. But at the end of the day, these reactivations are really interesting to me, especially cancellations. And what we do is we label cancellations red, green, yellow, based on the reason for cancellation. That's right. If you aren't tracking these things, it's a big problem because let's just say someone canceled because you don't have a 5 a.m. Well, if you had a 5 a.m. class, that's always a great reactivation component

to email out that crew and say, Hey, guys, I know you wanted a 5 a.m. We brought it back just for you. We'd love to see you back in the club. But if you didn't track that person, you're never going to get them back in the gym. 100%. And so many people make these decisions off of whims, off of gut feeling, off of emotions, where when you've got simple data

that can allow you to make a really hard-based, finite response or reaction to a situation, now instead of, let's say, negatively reacting, you can properly respond. Say, wow, we lost people because X coach apparently wasn't doing a great job on intros. Right. Right. They were getting new leads, taking them through an intro. We've now realized that seven out of 10 people aren't signing up. Yeah. Which goes into, you know, you got to know your numbers to grow your numbers, right? If you're not tracking those numbers, that's a big problem. Sure is. So now you've got that data,

you go into your reactivation campaigns and you send these people these simple emails. Give us a second chance. And what the beauty is, is anytime you have something new that you can highlight, you have an opportunity to send this. Right. We just got in showers. Boom. We just repainted. Got a new rig.

Got it. So we talk about referrals. You got to develop that skill. Get comfortable with this, especially as a business owner. You chose to be a business owner. If you aren't comfortable selling your product, well, you better become. And we talk about reactivating, tracking cancellations, getting second dates. Now talk to me about the third R. So the third R that we have in place is renewal.

So we're talking about like if someone did a paid in full for a year, paid in full for six months, what are we talking about like if someone did a paid in full for a year, paid in full for six months. What are we talking about here? So you're right. We're talking about all that, Mr. Jason. We're in Tennessee, so this is his accent. All right. We're talking about all that, Mr. Jason.

So check it. Renewals. The idea is that every single one of your members is in a position to potentially cancel every single day. Right. So I actually don't care if they're on a six-week, a one-month, a six-month, or a one-year. They are literally one bad experience away from canceling every single day. Yeah. So as you know, and I try to preach this, is that they need to be renewing when?

Every single day. Every single day. We were at this seminar, and JP had everybody yell. He thought he was some type of rapper. He's up there. Every single day. Every single day. We were at this seminar, and JP had everybody yell. He thought it was some type of rapper. He's up there. He's like, all right, holding the mic back out to them. I was having my little John moment.

You know what I mean? Because it's the truth. Once you ingrain that in your head, then you know as an owner when you walk into your gym, every single person that's in that gym the day you walk in may never come back. They are one bad experience, whether it's at the front desk. It's just a bad programming hiccup that day, maybe it wasn't their vibe on the workout, maybe you were focused too much on muscle-ups and they're years away or never going to get one.

Something got them, whether it's legit or it doesn't matter. See, our reality doesn't have to be theirs. Their reality is their reality. And so on this concept of renewing, you need to be at the forefront of social awareness and acuity in your gym where you are vibing, right? You're catching the vibe. You're seeing the energy across the floor. If you see somebody who's got a down moment, you need to be on it. And this is where your front desk and your coaching staff are so intricate in this component.

They're integral in the factor of success when it comes to renewing. Because it's possible. This is why front desk is so important in a gym too. It's not just about leads and phone calls. But imagine owner can't be everywhere at once, especially if you're in a growing, really successfully thriving business. Or you're coaching. Now you're coaching, right? And you know that so-and-so was off that day.

Right. You can give an eye. You can give a wink, a finger of some sort, some sort of wave. Or maybe your front desk catches on it and sees John or Jessica rolling out the door and is able to give them that final touch point of, hey, man, whatever it is, break the ice or cut to the chase. Hey, something's not vibing right today. It's got you in the workout, whatever it might be.

Maybe it is something there. Maybe it's something outside factor. Right. But that beeline to that concern might be the thing that saves them as a member. Yeah, I think if any owner of any service-based business is not picking up on this, then they're missing the boat because how many times have we gone into restaurants?

How many times have we had an experience and we never go back there again? Oh, man. And you could go there 10 times, 20 times, 30 times, and all of a sudden, a few times, like, oh, man, it's not great, but okay, not great, but okay. Then finally, just one day, you're like,

you know what, I'm done. And if we're not renewing our members every single day, and if each person has that same mentality that we have to renew them every day, I think you're creating a great sustainable program. So you're asking for referrals. You know, you're reactivating where there's an opportunity, which is, you know, anybody who canceled, anybody. Anybody who ever just came in, breathed on your which is anybody who canceled, anybody. Anybody who ever just. Came in. Breathed on your location. Right, right, right.

Like they're an opportunity to get them back. Right. And then we talk about renewing our members every single day. Every single day. So those are three R's so far for revenue, which each one of these directly impact that top line number. You're absolutely right. And if I can touch just get a little more spiritual on the renewal factor. Preach.

On a renewal, it goes just beyond the fact of renewing their membership, right? Because we're in the people business, right? We're in the sales business. We hear all these funky deals. But we deal with humans. Right. So we are in a people-based business, right? We're not just selling apps.

This is a people-based business. Yep. a people-based business, right? We're not just selling apps. This is a people-based business. There's a possibility of an individual having a really life-changing moment in your facility. And if you want to go deep, they could be on the verge of suicide, falling off the wagon in drug use, alcoholism, potentially going doing an act that they would regret forever. You actually don't ever know. And the fact that you have the power to potentially shift that, that's unbelievable, right? We are harnessed with great responsibility. So taking it just beyond them buying, you know, rebuying, let's just say their membership,

you are doing a real serving justice to your community. You want to be a guy who develops community? That's the real deal. Well, yeah, and I think that's why most of us got into this in the first place. When you hear from people, hey, when I first joined the gym, I was a recovering alcoholic. This changed my life. You hear about it later. You don't hear about it right when it happens.

You hear about it six months, a year later when you develop that comfort. But you develop that comfort with that person. You develop that rapport by going after the renewal every single day. It's not just a money play. It's a service. It's life. Yeah.

It's real. And the last thing on that renewal too is to note to owners and general managers and head coaches is that many times it can be your best member that's the one that's the soonest to quit. Never take for granted. Never become complacent in your membership group.

Your A-plus member not only might be your first to quit, but they're the first to quit and bring as many down with them as they can. Yep. They deserve the same amount of attention just as a new person and everybody in between. That's right. And sometimes we take it for granted.

Oh, John's been here for 10 years. Oh, he's good. That's just the way he is. Yeah. He's just grumpy. He sits in the corner. He does his own thing. Like, no, that's not the way it operates because John might be the first to quit or having

some issues at home or could potentially be taking others with him. Got it. Right. All right. So rolling into that fourth R is retail. Yeah. And would you say that these are in order of importance? No.

So for me, the most important in this five R category is understanding that revenue drives the business, right? It drives the backend operational component of the business because without revenue, you don't pay bills, rent, payroll. There's no food on the table, right? Yep. I'll never forget the first time I met with my tax, my tax guy. I was fresh out of college. I met with him. I'm like, Hey man, I don't want to pay any taxes. I don't want to pay any taxes. And this guy just looks at me. He's like, he's like, you know, 70 years old. He just looks at me. He's like, Jason, calm down. I was like, I don't want to pay any taxes. I don't want to pay any taxes. And this guy just looks at me. He's like, he's like, you know, 70 years old. He just looks at me. He's like, Jason, calm down.

I was like, I don't want to pay any taxes. He goes, Jason, you don't worry about anything except for one thing. You go out and you go build your business. You go generate as much revenue as humanly possible. Because what would you rather have? A million dollar tax liability or a hundred thousand dollar tax liability? And it just sunk with me that the bigger you could grow your revenue, you could minimize your expenses all you want.

But if you don't have any revenue coming in the door, you don't have a business to sustain. And when we pull this revenue, then we can get creative with tax, whatever it is, right? That's a different conversation. But our goal should be as a business, provide the best service possible to ultimately drive revenue. And then from there, you can start getting creative with expenses and things like that. But if you don't have any revenue coming in the door, what are you going to do? That's right. And people always start to trip because they think that we're drawing the line and saying

that experience, customer experience, quality of the workouts, the quality of programming is not important. It's all about money, money, money. That's their own hurdle. That's their own limiting belief. It's not ours because as I've told certain staff members that I've had who

throw that on me oh JP you're just all about the money I said hey I won't use name hey X you can't pay bills with PRs you know what I mean right and you can't pay bills with shitty service either that's right PRs don't pay bills.

They don't work independently. You need to be working together to work to increase revenue by increasing your service you're providing on the floor. Because that's going to lead to more member referrals, more retention, more activations, etc. It's all a beautiful landscape. But talking about retail, that's one that, at least in the CrossFit space, is kind of a catch-22 for some gyms. That's right. Right? Yeah, 100%.

And as you've heard me say, we see it all the time, is we've seen a lot of gyms spend more time and effort and energy on designing their next cool, quirky t-shirt and sticker pack than they do on the actual importance of the business, the internal operations, and the quality of the service they're providing. They will spend hours in the office asking 10, 20, 50 people their thoughts and feedback on a t-shirt design. Meanwhile, they haven't asked anybody if they like the workouts for the last 30 days. They haven't even asked their staff if they like X, Y, and Z. All they care about is the next t-shirt concept. So what are we going to do? So that's not the side that when we speak retail is where we're putting the importance. What we're saying is that

when you get into the area of retail, we're not a t-shirt company. But you need to have the basic items that help serve and create convenience for your members. And as they say, the more they buy, the more they buy in. The more they buy in, the longer they stay. How is this proven? Well beyond us. It's proven in hundreds and thousands of years of pageantry, right, with family crests and teams in old, you know, historicals in football, soccer, anything. There's always a pageantry, whether it's colors and logos and branding, but there's a pageantry, which takes us to the more important word of all that. It's consistency. Just have a little consistency.

Create a simplified t-shirt design. Keep it in stock in your most popular sizes in some simple colors. Don't try to be the outrageous one, right? You're not a fashionista. You're not shaking up the fashion world, right? Don't get all Kanye on people. This ain't Yeezus, right? We need to stick to the

basics. Create your t-shirts, keep them on the rack and make sure you're first and foremost, you are wearing it. Yeah. Your coaches are wearing it and then your members will wear it. Right. I mean, if your coaches aren't wearing your gear, that's kind of odd. That's right. That's the first, that's the first marker. The first marker is like, look in the mirror. How many days a week are you wearing your own gear? If you ain't wearing it, how do you expect anyone else to wear or buy it? Right. So if your first step in retail is for you to go out, buy a $10 t-shirt,

and then somehow get it screen printed with your logo on it, or go find a local manufacturer, right? And you can get it made for $15 for one shirt or whatever it is. And then you as the owner can start wearing it gives a whole new professional vibe from there your coaches and your team obviously can start wearing it and then from there you have a small retail display and including you know t-shirts by far are the most sold items hats are nice because you can kind of have a one-size-fits-all that's right but those are the kind of things that we try and keep in stock we try and avoid you know sports bras that, that, that are a little bit higher cost and aren't as common.

You know, we don't really sell shoes anymore in the gym, things like that. People can find those online. That's right. And, and at the end of the day, your retail products outside of your proteins and these other accessories, those are convenience items, right? Your retail products, your hard good-based items are about creating an emotional attachment to the brand. Yep. So with that, without going on into a branding seminar, make sure the t-shirt is very broad in its spectrum. Don't have political statements on it. Don't have crazy sayings on it.

Don't have any sexual innuendos on it. That stuff's all of the past, man. You know what kind of deals – my mentor one time said to a room of people, he's like, man, that idea is broken. And the guy is like, what do you mean by that? He's like, because from that idea, you will be broke in no time. And I was like, oh, that's broken, like broken, no time. Right. And so that's something to just remember, like make sure your ideas are not broken. Like you'll be broken in no time. I like that. Yeah. I like that. Okay. So branding,

obviously keep yourself simple, et cetera. Now we're kind of driving home. So that's our fourth R. What's our fifth R of revenue? All right. Ooh. Yeah. The big daddy R, right? Yeah. This is the seeder and the breeder right here. And this is retention.

I'm going to start off this conversation in retention by saying less than 3%. You agree? Absolutely. So what we're looking for, what we mean by that, is that if you're losing more than 3% of your membership on a monthly basis, we have a pretty big problem there. That's right. And if I can help the listeners with the math on how this works, so they understand a little bit better, right? It's not about losing 3% of the number that you've signed up that month. So if you signed up 10, right? It's not about losing 3% of the 10. What we're saying is if you have 100 members. Right. What's three percent of 100. Right. Right. Which would be three. Right. So if you're losing three members a month, that's three percent. Right. Of your total membership. Right.

Now, if you're net gaining every month more than that, that'll help that number. So nobody like start freaking out if you're losing 10 members a month, because if you're gaining more, there is an average that sets that math, but they have to understand because once you start getting into bigger numbers than that, you are losing over a hundred percent of your membership potentially in a month. If that makes sense. Right. So you've got to be careful if you're like, if you're gaining 10 members a month. Right. But you're losing 10. Right. But you're so you're net even and you're like, it's cool. I'm net even. I have 105 members. You're losing 120 a month. A year. A year. I'm

sorry. Yeah. 120 years. That's over 100 percent of your existing population. Yeah. I mean, so that's a really powerful thing just to kind of stamp home and then move on, which is if you're gaining 20 new members, great. But if you're also losing 10 and you only have 100 members, that's a big problem, right? It's a big problem. You're losing 10% of your membership base. And so are you attaining with the expense of not retaining, right? You want to attain and retain. And you know, the only way you would really know this stuff is if you actually track your information. Right. And that's why I want to say it's so important for people to understand that it's,

especially in today's world, you and I know this, that there's a ton of guys out there and gals that are sending, selling lead generating concepts. The problem is it's not about spending 10 grand to get a thousand leads because you're not fixing the internal problem that's causing the backdoor issue. If you had better retention, you wouldn't have the stressors of trying to go out and sell, sell, sell, sell all day long, 30 days a month, 365 days a year. Yeah. It's because you're getting caught up and you're thinking it's easier to get new leads. But the fact of the matter is it's actually easier to over-service your current population. That's right. And then get new leads, of course. Right. And then you,

you and I always hear, oh, but I'm in a town of five or eight or 10,000, then serve even better. Right. You only need, you only need a couple hundred. That's it. And now you're in a, now you're in a position where it's even more obvious that you should stop worrying about generating more leads and service the members you already have. Yeah. And then there's a way to optimize that. You can start talking about OPT, different types of stuff. But with retention, what are some key things? I mean, I know we're talking about less than 3%.

That's at least a metric we could talk about. And we're also talking about, you know, if you're out there pumping, pumping, pumping member referrals. So all of this is really predicated on retention, though, in a nutshell. I mean, you could have the best retail space in the world. You could have the best re-engagement policy. You could have all this stuff. But if you're not retaining them, it's just boom, boom, boom, boom, boom, boom, boom. That's right.

That's right. And let's not even highlight the fact that you used the word predicated, right? I mean, that's like a $100 word you just used. Golly, buddy. You just dumped that one on me. So when we come to retention, we can go through some simple things that people can work on to create better retention in their facility the minute they finish listening to this podcast. And the first thing is we always say that retention comes down to building rapport with your existing membership, right? Creating sound, solid, high level, professional relationships with your membership base. Right. That goes with the front desk. It goes with the coaches. It goes

with you as the mayor, all the team. It's top down, right? It's even the way that you, you have the relationship with yourself. If you're a fitness owner and you don't look like you do fitness, there's a broken communication line with yourself in your own rapport, right? There's a lack of certain self-respect. Now, I'm not talking about medical issues, so I don't want to get bombarded with a thousand emails that I'm like fat shaming. That's not what I'm talking about, right? But if you're not coming in and making a legit effort in the way that you consume nutrition, your knowledge of said consumption, your participation in your own product and programs,

then how do you expect your local community to want to participate? Let's just take you as a parent. Would you want to send your kids into a classroom? If you looked at the teacher wearing like cut t-shirt, holes in it, torn jeans, crazy amounts of piercings, tons of tattoos, and now you're sending your malleable child in there that is going to be influenced, is the word I'm looking for, influenced, have an impression put upon them by someone that they would look up to that's going to teach.

We are teachers. We're coaches. We're inspirational figures. Call you what you want, but we are teaching. And so now you want to go in there and have an individual be taught by that, and you're the lead factor in that? So think about it. You want to create these relationships, but meanwhile, the one you have with yourself is the worst one there is. Yeah, and just to kind of put a button in that one is to say, you know, you got to take your classes.

I think, look, the tattoos, the piercings, that kind of stuff, that's a different conversation. You have to take your product, though. Put it. You want to give your finances or your hard-earned life savings to somebody walking there. They're in torn shorts. You can smell their dirty underwear. Their armpits are sweating. They've got piercings all around, and they don't look well-kept. How do you trust that that person is going to keep your finances in check? You're going to walk in for a major surgery, and your doctor doesn't look like they can handle what they need about to perform? Yeah. How do you expect somebody who's got major food relationship issues, they've got major issues with their own body dysmorphia? I mean, these are real problems that we deal with. And meanwhile, they come in, and they're looking at you like,

holy shit, this gal's got it worse than me. JP's getting fired up. All right. You know what I'm saying? Yes. So look within and then what? Look within. So look within.

Yeah. Second thing, which are really easy tasks, exercises people can do, are pogo or form, right? And these are ways that you can you can help yourself get better at creating conversation with people and keeping it at what we would call like friendly not friends level and that is form stands for family occupation recreation motivation and i always make this joke that a cousin who was older than me when i was younger was like hey man if you ever go on dates this is the easiest way to keep conversation with the girls you go on dates with.

He's like, talk about their family, talk about what they do for work, where they're working at. At the time, probably all we did was work at the mall. We worked at Forever 21 or something, if that even existed back then. Recreation, what do you do for fun? And motivation, what are things that inspire

and motivate people? Form. Which is simple. Family, occupation, recreation, motivation. Hey, so those are just talking points we have motivate people. Form. Which is simple. Family, occupation, recreation, motivation. Hey, so those are just talking points we have with people. So super easy to remember. Another one is called POGO, which is like personal objectives, goals, and obstacles, which just means the same exact thing.

You can just Google them, define those words. Yeah, form was pretty good. Yeah. So it's POGO or form. Depending on your school of thought, they both basically mean the same thing. Okay. All right? So that's another thing, right? Which is you talk about filming yourself, film your staff communicating with each other, practicing how to naturally engage in coming up with the form concept, right? Which also comes down to, Jace, without getting too long-winded on this, on building rapport is being a little bit more sensory acute to the things that you see.

Like if I saw you, you know, maybe you had something that showed signs that you were into nautical, boats and yachts, and I needed to find a connection point with you. And I know this is totally random. I don't even know how I thought about this. But if this came up. I have an anchor tattoo on my arm. Right. Maybe it's the anchor, it's a Popeye tattoo you have that is such an easy way for me to just connect in

and naturally talk about it, right, and now we've got a common ground and maybe it's not even that I'm into being Sailor Jerry, but I know enough about it or I can even talk about it, like oh you're big into boats or you like the water whatever it is. Right, or educate me more on it. Like, oh, you're big into boats or you like the water. Right. Whatever it is. Right. Or educate me more on that. That's right. Yeah.

It's just an icebreaker. And just to hit that one home to impress upon the group, I can't tell you how many success stories I've heard of people that have gone in and done little things that have touched on things that they've seen other people are interested in that have been the deal break, I should say the deal maker, as opposed to the deal breaker in mega deals, right? Just you hear stories about someone going in for a massive opportunity in a deal. And while they were sitting in the waiting room, they saw that the owner of the company had, I don't know, car magazines and little car models around. And while they were in there, instead of getting right cut into the chase of whatever it is, the job, the promotion, you start talking about cars, game changer. Right.

Right? Because then you're on mutually, yeah. Exciting grounds. Right. You're touching on things that are exciting and of interest. Right. And these are all things for retention. That's it.

These are ways that you can become, you know, the form I think is a really interesting term. And so these are just additional five R's to ultimately help owners drive revenue. That's right. Because we talked about one experience away from quitting, right? This is where we get back into renewal, reactivation, all are so similar and closely connected because they're one bad experience away from quitting, right? This is where we get back into renewal, reactivation. All are so similar and closely connected because they're one bad experience away from quitting. If you are great at creating these relationships, you will be more confident approaching Jessica, John, Sam, and Sally on saying, Hey man, I can tell your vibe is off. Let's talk about it. Yeah. Or you'll be more comfortable to go ask them to bring in a friend. Boom. Yep.

Hitting it right on the head. I love it. Well, guys, you know, JP, as I mentioned in the intro, he started Brick a long time ago and has expanded out, incorporated licensed partners. And he's been in front of thousands and thousands of people on the floor. And when we talk to gym owners, whether you have 50 members, 100 members, 1,000 members, one thing's for sure, revenue helps the business. I don't think anybody's ever going to disagree with that. And the tools that he's sharing with us today, these five R's,

they're not gimmicky. They're fundamental truths, but you got to get out there and you got to actually put them into action. And so today, if an owner can go out there and go do one thing to improve their business, just one, based on the five R's or not, what could they do? One thing. We talk about looking the part, having the brand, reactivating, all these different things. It's a lot. It's a lot to unpack. What's one thing? As an owner, I'll give you the one thing. It's funny you ask. So here's the one thing. They can go back into their location and immediately start scheduling what we call TTI meetings. That's just taking their temperature and interest. This will cover all of these things we literally just covered outside of like second chance dance. Right, right, right.

Outside of that on a renewal, it basically will cover four of the five R's because what you're going to do is you're going to go in and schedule what we call taking your temperature and interest meetings. It could be five or 10 minutes. Sit down with your members because by the way, if you're worried, oh, but how am I going to have enough time? If you're, if you have so many members that you don't have enough time, then probably this podcast isn't, isn't anything groundbreaking, right? Right. But if you've got a hundred members and you tell me you don't have enough time, I'll tell you, right? Because your time is up. You are literally shutting your doors tomorrow, pal. You're right. You are out of time. It's not that you don't have enough time. You got no time, right? So take temperature and interest, sit down with your members and do simple conversations. Practice your family occupation,

recreation, motivation. Get to know your members a little bit better. What can you do while you're in that TTI meeting? Ask them to bring in a referral. Talk to them about what's going on. Maybe get them to buy a new t-shirt. Like, hey, we got these new things coming out. We're starting to try to promote our brand better. We'd love for it. We're selling them at cost. You know, support what's going on here.

Whatever you want it to be. Or thanks for the 10 minutes. Here's a free t-shirt for your time. Exactly. Right. And I want to give everybody just one little bonus tip if I can. Right? If I can.

And that's this. People have a distorted understanding of why members quit. And usually that distortion comes from ego and the ego forces their internal psyche to blame it on external factors, right? Internally, they convince themselves it's not their fault. It's not their program. It's not the gym. It's the coach. It's this. It's because the air conditioning was out. It was the other thing. I want people to understand. The first reason why people quit is because their expectations weren't met. You set an expectation when they came in on how great your facility

was and guess what? It fell short. weren't met, right? You set an expectation when they came in on how great your facility was, and guess what? It fell short, right? You crapped the bed on it. You did not deliver. The second thing is they're not feeling success. It means that they're not actually seeing any results. Now, the results might not be physical. It might be emotional results. They're not feeling like they're connected into the membership. They're not connecting with the staff. That's all part of success, some sort of gain, attribution, some sort of acquisition of feeling accepted and a part of your community. They feel like they've failed and they'll, what do they'll do? They'll blame it on the location. So that's the second reason why they potentially quit. The third one is they perceive a lack of

indifference whether it's with a members or staff lack of indifference means maybe they didn't connect or there was some sort of conflict that didn't get resolved yeah or you have a coach that always has to be right without knowing how to possibly cue and correct somebody right and so that's a third reason because people don't want to come into your location after working their butt off all day and now feel like, especially if you're working for somebody, right. That now they're working for somebody again for their, what's supposed to be their best hour is just another hour of their day. Right. The fourth is that they don't feel that they're important enough. It means that once you've collected their money and got them on a membership, all of a sudden you're not as eager.

And I won't use all my analogies in this PG-level podcast that we're doing, but they stop feeling important. And this is in everybody's relationships, even with your significant others. Where do they start to tank? They say like at the six, eight-month mark, you start to take the relationship for granted. You're not as invested, not as involved. You're not making them feel as interesting, right? You're just trying to make yourself sound interesting. And then there's the fifth, which is they stop feeling as if they're even able to contribute to your situation, right? So a member, when they join, you basically seeded in them that they could contribute to the facility,

whether it's because they become a paying member, they become a positive attribute, their energy on the floor. They stop feeling that that's actually happening. And why or how? Maybe you didn't create the relationship with them. You stopped communicating with them in a way where it was showing them how important it was that they showed up to community events, or they stopped up to 6 30 a.m and you didn't even recognize it you're only doing open gym now right and you didn't even address it you just took it for granted when it was like hey john jessica sam sally you normally came at 6 30 how come you're not coming anymore or i only see you coming in for this or i don't see you as often whatever it is they just don't see you as often. Whatever it is, they just don't feel like they're a positive asset to the community anymore. And so those five quick tips, why people are actually quitting, right, which is expectations weren't met, not feeling success.

They perceive a lack of indifference either with members or staff, not important enough, or they're not feeling as if they're able to contribute anything to the facility. Five things. Bottom line is- Boom, face melt. Yeah. And you got to always pull it back on yourself. As an owner in the business, ultimately, it stops with you, which is a blessing and a curse, but you got to take responsibility for that.

And so JP, I thank you for going over the five R's. I am eager to see how owners can dive in to increase in their revenue. If they want to find out more about you, if they want to talk to you, where should they go? What should they do? Yeah. So feel free to email me, jp at brick.fit. And as you know, I've got no agenda. I've got nothing to sell, right?

Yeah, he'll give you the real and he won't feel bad about it. So it's jp at brick.fit. There's no.com, just brick.fit. Brick.fit. Same with us. That's it. Hit me up. It's me you're going to hear back from. I'd love to hear your thoughts, not just on how this may or may not impact your business, but on how you receive the way I deliver the information because I'm just trying to make myself better too. Yeah. He's also gives relationship advice for $9.99 an hour. No, I'm just kidding. That's right.

Whatever you need, man. I got it. All right, guys. Well, hey, keep rising the tides. Keep making it happen. And I look forward to talking to you again for another episode of the Business of Fitness podcast next week. Thanks, JP. Suck, suck, suck.