Barbell Shrugged - Keeping Your Coaches - Business of Fitness #69

Starting point is 00:00:00 All right, everybody, and welcome back to the Business of Fitness podcast. I'm Jason Kalipa, and today is Monday. I hope if you're listening to this right now, you're ready for an incredible week. I know we are. I have on the show a very special, special person. His name is Matt DeLaValle, MDV. He is the CFO of our company, Chief Fitness Officer. He came to us a couple years ago ago and we tasked him with this idea of

Starting point is 00:00:26 creating culture, creating trajectory for our team, helping us keep our coaches and provide the best quality product we can on the floor. Since then, he's delivered on every expectation I had for him and sitting down today, we dive into how we're currently doing it and what we're looking to do in the future. I hope that if you're in the fitness space, you take a minute, dive in this episode, get fired up like we are to constantly be improving. If you're not in the fitness space, that's okay. Hopefully there's some takeaways for some of the things that we do for our team. And if you have any questions, concerns, anything, DM us, email us, let us know what's going on. Guys, if you have a gym in the middle of United States or somewhere else, and you're listening to this podcast, you're not on an island. There's

Starting point is 00:01:04 other people that have the same problems. Everybody has the same problems potentially. And we want to be able to help solve those through this podcast and through other platforms. DM us, message us, let us know how things are going and how we can support. Guys, I hope everybody has a phenomenal week. Let's dive right into this episode with MDV

Starting point is 00:01:22 about keeping our coaches. Let's dive right into this episode with MDV about keeping our coaches. Let's go. So MDV and I were talking in here and we're saying the topic of conversation for today is can you keep your coaches? And I'm saying to MDV, man, there's no real right or wrong answer here. Let's just go ahead and dive into a, you know, a nice conversation about the way we look at it through our experiences. And he came back and he said to me, what'd you say to me, MDV? I love this is how we're starting. I said there, there's a lot of right answers, but there definitely is a wrong answer as well, right? There are certain

Starting point is 00:02:05 things that I think owners or head coaches should be thinking about no matter the size, the scale of your organization in regard to retaining your coaches for certain periods of time. But there's also, I think, a wrong way of going about it and looking at it that you will not be able to keep anybody within your organization for any period of time. And I looking at it that you will not be able to keep anybody within your organization for any period of time. And I don't think that that's just in our business, right? You see that in all businesses. Any business. Yeah. Any business. So there's some things that I think affiliate owners and head coaches need to be really keenly aware about when we're thinking about retaining talent. But I think that this is a super,

Starting point is 00:02:43 super interesting discussion because I don't know if anybody out there has really solved the issue of keeping top talent and whether or not it's appropriate to expect to keep everybody their entire career within your organization. Yeah. And I mean, just to kind of piggyback on what he was saying, MDV, when we first said, you said, yeah, there is a wrong way. It's treating people like shit. It's if you're treating people like shit, if you're not supporting people, you're not going to retain good coaches, period.

Starting point is 00:03:13 But on top of that, we need to be aware that we're in an industry that might have some turnover. Yeah. But turnover becomes a big problem in our industry because if you have coaches leave, sometimes they can go down the street. They could take members with you. Or on top of that, you know, if you have coaches leave, sometimes they can go down the street. They could take members with you. Or on top of that, you know, if you have coaches leave, members become really attached to these people and we need to be aware of that. And so at our

Starting point is 00:03:33 organization, you know, at NC fit, we started 11 and a half years ago. And from that time, we grew more locations. We took on more coaches and we've been blessed to have some phenomenal coaches that have really, really spearheaded this organization to, to be what it is today. But it is current state with the amount of coaches we have today. What types of things are we doing? How do we dive into these five pieces where we start talking about how do we keep our coaches? And again, we're not perfect. We've had some turnover.

Starting point is 00:04:08 But I would say that our turnover is appropriate. And I want to dive into what appropriate means and then dive into these five things. Yeah. Across the life cycle of this organization, I mean, 11 years, you've had a ton of coaches come in and out of the organization. There's been turnover for, uh, appropriate reasons or good reasons, right? People have moved on for new jobs, new opportunities. They had a baby, whatever they moved. There's also probably been turnover for bad reasons, right? People being, uh, you know, unhappy with this X or Y or Z. We're not perfect.

Starting point is 00:04:42 Yeah. In the last two years, I can safely say that we've we've done a lot to clean things up within the organization and provide a process a system a structure for people to exist in and um also a culture of an umbrella culture that we have now at nc fit that has reduced turnover significantly i think we've had only a handful of coaches over the past two years. And we're talking like 60, 70 coaches in the Bay area. We've only had a handful turnover. And a couple of those were things that we were forced to act on. And a couple of those were life situations. So, um, it's a really, really, really interesting topic. Like I said, I think the things that like you, you were talking about that we need to start mentioning in this conversation when you're talking about employee happiness and keeping people in retention. One is, is pay and benefits, right? So that's a critical element of any conversation when you're talking about employment, right? And I think in our industry, a lot of people get into it because they're passionate. Of course, if they were just searching for money,

Starting point is 00:05:47 they probably wouldn't become coaches. Let's face it. Yeah. And for most service-based industries, right? If you're, I always use a barista because I'm a coffee addict. But if you're a barista, you're probably not in it to make a gazillion dollars.

Starting point is 00:06:00 You're probably in it because you want to, you love the craft and et cetera. But the big but is that you might not be in it because you want to, you love the craft and et cetera. But the big, but is that you might not be in it for the money, but let's face it. Everybody needs money to survive and everybody needs to make enough to live a lifestyle they're looking for. And so I think the first step to this, and it's not, these are not an order of importance, but I think one key element that we're speaking about is pay and also that growth potential, which we're going to get into. So what types of things do we do from a

Starting point is 00:06:29 payment perspective? What type of benefits do we, how do we add that in? What are we looking at? So I agree with you. I think most people don't get into coaching because they think they're going to be rolling up to the gym in a Benz, right? Right. Or like having a Rolex watch while they're timing an AMRAP. It's not that deal, right? Right. They get into it because they're passionate about it. They get into it because there's a certain love of the lifestyle that you're able to lead as a trainer, right?

Starting point is 00:06:59 You get to impact people in an amazing way. And you get to do it in an environment that you love and around people that you love. And in a relatively, let's be honest, low stress environment, right? It's not brain surgery. The risks of going into and performing brain surgery are much, much higher than going into and coaching

Starting point is 00:07:25 class. But it's not to say it's not a joke, right? We talk about this a lot. You have to be a professional coach, but it's also an amazing lifestyle, right? So in regard to pay, right? I think that a lot of it depends on, you know, location. We're here in San Jose and pay in San Jose versus pay elsewhere in the United States, it lines up very, very differently. We're living in the most expensive area in the world right now. We generally classify employees two different ways. We have full-time employees and we have part-time employees just for the topic of pay alone. Pay hourly rate for part-time employees, just for the topic of pay alone. Pay hourly rate for part-time employees and pay a full-time rate or a salary rate for full-time employees. And we should be noting that these are W-2 employees, not contractors.

Starting point is 00:08:13 Just because one's part-time, one's full-time doesn't mean that they're not classified as W-2 employees. Okay. Yeah. Yeah. So when we think about pay, we do pay comparisons to other comparable services in our locality. You know, Matt Walker and I, Matt Walker is our CFO president here at NC Fit. He and I sat down, we did an exercise and we do this exercise every year. We look at comparable jobs to what individuals who are in our organization might be doing and what they might be earning. And our stance on that is we always want to be towards the top of that list. We're not comparing ourselves to being an equity trader or working for Google or Apple or anything like that. It's

Starting point is 00:08:56 not comparable. You just can't compare with what those people are offering salary- wise. It doesn't make sense, but you can compare to other comparable types of employment, you know, uh, teacher, uh, fire, uh, firefighter, initial, uh, entry firefighter, um, people who are working in other areas of the service industry, uh, all those types of things, gym teacher, phys ed, uh, coach in other areas. And we want to be towards the top of that list. Yep. And so for us in terms of, you know, we have written down pay and compensation, you know, pay is not just in dollars and cents that come at you for your hourly wage, but also in other things you could provide. So if you're a gym owner out there, if you're a

Starting point is 00:09:38 business owner, something that's really important that we need to think about is what are people interested in? Now they're interested in money, of course, but they also need healthcare. And that's something that's really important to us and that we've been providing. And just so you guys are aware, the way we do it is that we provide 50%. We contribute 50% of the first person and then 0% after that. And the reason why we did this, we started this maybe seven years ago. And I think this is actually open for negotiation in the future, but we started with 50% because once you give it, you can't take it back. And so I remember when we first rolled this thing out, I was like, wow, well, if we pay a hundred percent of this person's healthcare,

Starting point is 00:10:16 we can never cut it down. And we hadn't been providing it at the time. So we're like, all right, let's start with paying, contributing 50%. You put some skin in the game, we put some skin in the game. And then for any dependents, we're not going to pay for those at this time. So we're like, all right, let's start with paying, contributing 50%. You put some skin in the game, we put some skin in the game. And then for any dependents, we're not going to pay for those at this time. Then we started incorporating 401k and that was recent. I think that if you're a gym owner out there and you haven't at least looked into health benefits, I think it's something you should look into for your team because we do have a moderately risky business. Coaches are demonstrating, that's workman's You know, coaches are demonstrating. That's workman's comp.

Starting point is 00:10:46 But coaches are also in the gym a lot. They might get injured, et cetera. And you want them to be able to have healthcare taken out of themselves. I can't tell you how many times we've had that situation come up. Yeah, it's huge. And this is a generalization, but in most individuals who are undertaking a coaching job to start, um, you know, they're typically not somebody who is going to be able to afford independent healthcare. And that's my assumption, right? It's very, very expensive. Right. And they'll be on their parents until I think they're

Starting point is 00:11:19 what, 27? No, I think it, I think it recently got bumped up to 27. So you have some buffer there in most cases, I believe, to the age of 27. But after 27, there's a good group of people who are coaching between the age of 27 and 35 who might not have health insurance. And that's a big deal. They get hurt. And not only is there all these askew of liability issues and stuff like that, but this person now has medical bills to pay, let alone liability and all that stuff that might be on the owner. Yeah. So as the owner, I think obviously look into workman's comp, look into those different

Starting point is 00:11:53 rules in your specific area. However, we believe that healthcare is a nice additional compensation. We incorporated our gym. And for hourly wages, people start off, I think at the, how does it work with that? Just to give an idea from an hourly wage. You know, right now we're starting most individuals at around $30 an hour per class. That's not having a tremendous amount of coaching experience. You know, you come in with your level one, you've maybe got one or two years of coaching experience underneath your belt. We go up from

Starting point is 00:12:24 there. And we're pretty competitive. You know, like, like I said, I think the standard, maybe like four or five years ago was probably 20 bucks a class, right? Maybe a little less 15, 20 bucks a class. We've made our standard, uh, you know, like around 30 bucks a class. To start. Yeah. And, and, and, and then our starting salaries, right? So if you're full time, those are starting around the 45,000 and then going up from there for us right now. Okay. And, and so, you know, that's just a place where we start that's in our area. We want to do better, but I think something that MDV hinted on that I think was really valuable for me at least was recognizing what similar industries in your area are paying. And we want

Starting point is 00:13:04 to not only be at the top, but probably exceeding that. And it's our goal as a business to pay for performance and to pay people appropriately and have them live up to that. Yeah. You can use a service like Glassdoor, one of those types of search engines or something like that to just Google the typical wages for comparable businesses. And it doesn't need to be an exact science. Try to look in your area, try to find four or five comparable jobs and see where you

Starting point is 00:13:29 stack up in relation to that. And at least that gives you, uh, an idea of where you're starting people and a conversation point with somebody who comes up to you and says, Hey, listen, you know, I need to make more money. Right. Um, real, I heard somebody else say this and, uh, this, this kind of is very cut and dry when you're paying somebody, you gotta be paying them better than their next best option, right?

Starting point is 00:13:55 Because if their next best option is going to be paying them significantly more or incrementally more and they're unhappy, they're gone. Right. Um, so I like the idea of being at the top of that list, pushing the envelope, exceeding it. And then making sure that your coaches have a realistic understanding of what their earning potential is for their role.

Starting point is 00:14:16 One, I think that's really important. So we have something that's called job leveling criteria. We sit down with people in the beginning, we explain on, Hey, this is where you're starting at. This is where you can go up to. We're not where we want to be, but we're at least much better than we were a couple years ago of being really clear about that type of thing. Oh, yeah. Yeah. Yeah. I just wrote down a note to Jason here.

Starting point is 00:14:37 We also got to talk about personal training a little bit. Yeah. We didn't even think about that. Now, personal training is a really interesting subject for our business. I actually want to do a whole podcast on it in the future. I think we should. Yeah. We didn't even think about that. Now, personal training is a really interesting subject for our business. And I actually want to do a whole podcast on it in the future. I think we should. Yeah. Because we've never had personal training at our gym before supported by the gym. It was always just, hey, you know what guys, if you want to do some PT, bring your clients in, get paid,

Starting point is 00:14:56 we want you to do well. But we learned a lot through that experience. But PT is a great way to incorporate some additional revenue for your coaches. For sure. I've seen it before. Let's keep it high level for now. Cause I do think it's a interesting topic to talk about on its own. And I actually, I remember a couple of years ago, maybe three or four or five years ago, you and I were talking and you know, the way that you guys frame personal training was around some of the stuff that I was talking to you guys about, where it's like, keep your hands off of it.

Starting point is 00:15:22 Let your coaches go out there, let them earn whatever, let them, let them eat what they kill. Yep. Let them charge what they want. Don't take any dimes off of the space or anything like that. And there's a huge, huge, huge upside for coaches who are go-getters who have a skillset that they can sell and they can sell it elegantly. And they're not like a used car salesman hawking a car to you in the parking lot, right? That you can have a conversation with a member about their goals and you can set up sessions to really evaluate movement and set up a plan and you can make a lot of good extra dough that way.

Starting point is 00:15:57 Yeah, we have friends that are doing it. Absolutely. But the downside of it is the fact that the company typically isn't going to put a lot of resources behind the promotion of the personal training at that point because they're not taking anything away from it. Right. And it's all on the coach. So if you have coaches who aren't good at talking about their skills or selling their skills or initiating that conversation, then they're kind of up Schitt's Creek, right? That's right.

Starting point is 00:16:21 They can't do it. We are now undertaking to bring personal training in-house here at NC fit. And that was, it was for that reason. We had a very small percentage of coaches who were taking advantage of personal training within our business. And we thought that we could help our coaches internally. We could add to their bottom line, what they're taking home by promoting it, by showcasing them on the website, by giving them the opportunity to have the member be a part of the conversation, have a member be, Hey, you know, Jason, I heard you do personal training now. Right. And start the conversation a little bit

Starting point is 00:16:55 that way, as opposed to putting it all on the coach. Yeah. And I think that's a big learning lesson for us. We'll see how it plays out. We're going to do a podcast on the PT evolution in the future. But for now, to summarize what MDV was saying, we used to not be hands off. We are hands off now as an organization, we're going to help sell it. And then what we think is our coaches will make more making 70% of a bigger pie than making that, excuse me, than making a hundred percent of a smaller pie. That's what we think. That's our hypothesis. And we'll come back on the microphone in a couple of months and see how it played out. Because what's really important for this podcast, you guys should be aware, we're just sharing what we have going on and the way we pay and the way we're working towards it. And these are our

Starting point is 00:17:37 starting salaries, these are our starting things, but we have coaches that are doing well. And once we incorporate some of that PT too, I'm excited for them. So pays number one. If you're a coach out there, if you're a gym owner out there of any type or an owner of any type, and you're not paying people at least a living wage, it's a challenge. And if you don't think you could pay people, you'll never be able to pay people because you will always be in your business instead of working on it. And so you just got to be aware of that. Go out there, grind it out, get a few more members so you can pay a coach so you can move on to the next thing. So next talking point, MDV. We got opportunity and growth listed next.

Starting point is 00:18:12 This and pay and benefits kind of go hand in hand, right? Because as the organization grows, as the business grows, there are opportunities that are going to come up that I think owners and head coaches need to be thinking about how can I how can I help create opportunity for the people the top performers in my organization that adds benefit to them and adds benefit to the organization right benefit because this person is now being challenged in a different way shape or form they have more responsibility they're more invested invested, X, Y, or Z. Potentially, they're making more money because of that additional responsibility and they're adding. And now you have this perfect storm, right? You have this growth that you're experiencing within your organization. You're doing new things. You're handing the opportunities off to people, top performers. And now you can start creating

Starting point is 00:19:03 trajectory and paths because we were discussing before this, we're kind of non-traditional in the sense that you don't look at most affiliates or gym businesses and go, all right, you have an intern, a coach, a head coach, maybe you have that structure, but then you don't have executive coach, executive vice president coach, vice president coach, president coach. It doesn't work like that, right? The opportunities are kind of evolving as the business evolves. So I think it's really important that owners stay really tuned into how can I be creative and provide opportunities to people. Yeah. And that goes into PT, that goes into multiple

Starting point is 00:19:39 locations, that goes into potentially creating a commission structure for someone that has a interest in sales and marketing. But I do think that if people don't, I think what's worse than not making much money is not a people not thinking they have any opportunity to in the future and money aside or seeing any growth potential. What I've heard more times than not from the gym owners that I speak to, it's not so much when the people come in, they're getting paid, whatever they're getting paid. It's after being there a year, two years, three years, where they're still in the exact same position, getting paid the exact same amount. That's where people start to, you know, wander. And, and not only are they wandering and not only is wandering a challenging thing because maybe you have key talent leave, but I also don't think they're going to be performing at the best or your expectation or their expectation because they might just be not feeling like there's

Starting point is 00:20:29 anything there. Right. And so I think that the growth that you're talking about is critical piece. And we got to, if you're an owner out there and you're not at least thinking that way, that's a challenge. I think this, a lot of this comes down to honesty and expectations though, with your employees as well, because let's say you have a business that just doesn't have the opportunity to give to somebody, right? And you have a star performer. I think the worst thing that you can do is not talk to that person and not be honest with them and be like, hey, listen, at some point, you're going to have to spread your wings and go elsewhere. That's an okay thing to do. Yeah.

Starting point is 00:21:06 I mean, we had a situation, we had a coach and he was incredible, incredible, incredible. And he reached a ceiling with us. He was getting paid a very good wage, but it was the best wage the company could produce at the time. And I just remember saying to him, dude, you are super talented. And I think other opportunities in the future are probably going to be what's better for you. And sure enough, he went on to go do other things and he's been thriving.

Starting point is 00:21:27 But I think you're right. And I think that starts the beginning. So what we do when we hire new coaches, we explain that trajectory, don't we? So when we bring on somebody new into our organization, there's a very candid conversation about pay and about growth of pay and about the different levels within our coaching organization. And what can that individual expect? Not only from those things, but everything else that we have available that we'll talk down this list from our culture, how we're going to treat them, education, development, all those kinds of things. It's all like, it's a package deal. I think that's the other really important thing to remember in this whole conversation that like, it's not just one singular element that stands out

Starting point is 00:22:14 as being really important. You know, obviously there's things that people might value a little higher than others, but like, it's kind of all got to come together in some way, shape or form. Right. You can't just pay a lot of money and then not have a good culture. You can't have a great culture and not pay. Yeah. You got to kind of have an intermediate. So we've touched based on pay as an important characteristic, right? And if you can't pay your coaches, go out there, drive in more members, get in more sales and get a member referral program.

Starting point is 00:22:38 And let's get some people in door to pay a coach and get after it. Now, secondly, right. We're talking about people want to see growth. And I think that setting that expectation from the beginning is a great way to have clear communication about that. That's awesome. The equivalent of being in a relationship and right from the get-go, you know, that person has chosen never to get married. Right. And you still decide to get into that relationship because you're okay with that relationship. Right. But Lisa was clearly set from the beginning, totally tangent. Right. Um. This coming from a guy who's been with one girl and been married for a long time. And I think the opportunity and growth conversation is probably the thing that plays into that question more than anything else that we're going to talk about.

Starting point is 00:23:35 Yeah. The most. Yeah. I don't know the answer to it. I have a gut feeling about it. My gut feeling is that no, you shouldn't expect to keep everybody forever and you should push your best performers at some point. If there's not opportunity and not amazing opportunity, you should encourage them to go and do and be outside of what you're doing. Yeah. I think if you take, like, let's just say you take our quarter coaching organization, let's just say we take a hundred of our coaches. I think that at the top 10%, um, maybe even the top, whatever percent are probably not going to be with us three years from

Starting point is 00:24:12 now, let's just say, because they're, they're outperforming, right? There there's going to be other opportunities that arise for them. And maybe the bottom 10% might not be with us. And that's actually a good thing for the organization potentially potentially. But then somewhere in the middle, there may be some coaches that are good but are just comfortable in what they're doing, and they might stay with you for a very, very long time. I never know. But I do think those top performers will end up finding other opportunities, right? Yeah, and it's all kind of hypothetical business where we have this opportunity right now with the NC Fit Collective in which we are able to have a lot of our top performers, people who are really diehard in coaching and programming, and they want to do this for a living. We have an awesome opportunity right now to share some of the work that goes into that with those people and to continue to up train them in our organization, right? Other gyms don't have that. Yeah. And

Starting point is 00:25:11 that's where you got to be careful where you have somebody who's living at the top of your organization and you don't have additional opportunity for them. And at some point, what might happen is they get discontented. And if there's not a conversation, if there's not a communication about what's going on, you know, that person's probably going to leave at some point and it's probably going to sting really, really badly. Yep. And, you know, I think like it's okay to have people move on. It's okay for how people go and coach somewhere else and open up another gym as long as like, uh like the communication is there and they walk out of the door and you shake their hand and it's not like there's any of this nefarious they stole members

Starting point is 00:25:51 from me and hey you got to leave and clean out your locker the next day there's all too much of that bullshit that I've heard about and it all comes down to communication though right I think a lot of it does it has to because for us if we know there's a key talent here who's looking for opportunity and we can't provide it to them we can't be mad if they go and they identify another opportunity for themselves i've never been i've never understood why a fellow coach or an owner would get mad at a coach who wants to go and open up a gym i don't understand that yeah i don't know if it's necessarily the what it's the how sometimes, but I think that what happens is, um, when someone comes and says, Hey, I have the opportunity to go open up a gym. I think that that's kind of like, um, in society, sometimes we have a tendency to not want people to thrive, whether we think about it

Starting point is 00:26:39 or not. Like, I think that that's unique. I want to see people around me thrive because if they're thriving, it just pushes me to try and be better. But maybe not everybody thinks through it that way. But you're speaking about our company. The collective, our session plans, our programming, our digital footprint. In the beginning, we started off with just traditional gyms. Then we got into corporate. We diversified our revenue.

Starting point is 00:27:03 We got into corporate. We signed these contracts, which were really helpful. Then we now have the digital platform. What's nice about these different verticals for us is that it allows key talent to find ways to disperse there and find opportunity. I don't think that's for everybody. I don't think that every CrossFit gym is going to be able to find those opportunities, but I do think that as an owner, you need to at least keep your eyes open for ways to create opportunity. And if you don't think that's in the cards for you and your

Starting point is 00:27:30 business, and you're happy with where you're at the way it is, then just have good communication with the rest of your team about that. That's all. For us from day one, we've always wanted to grow. And so, you know, I've always wanted to try and have key talent stay with us. But I was on the phone yesterday with the gym owner, you know, his business brings in to him, take home a hundred grand a year. And he's extremely content with that. And I'm hell yeah. More power to you. I think for us at NC fit, we like, we're like, I was talking to you before, before we start this conversation, we're rewriting the script for ourselves on a daily basis about what's possible for us. Right. You know, we're, we just put out a daily basis about what's possible for us, right?

Starting point is 00:28:09 You know, we're, we just put out a new offer for somebody to work on the, my end of the organization that I didn't know three months ago we were going to have that job, right? Right. So we're constantly evolving. And I think other gyms are constantly evolving in different ways. You know, with, with that individual who's at the top of your organization, the worst thing that you can do if you don't have opportunity for them is to keep them latched on to your organization and expect that they're never going to leave. You know, have the honest, open conversation with them. If it's something that, you know, you know that they are going to want to go and grow and do, help them along that journey. And I think like it's going to come back to and grow and do help them along that journey. And I think like,

Starting point is 00:28:45 um, like it's going to come back to tenfold in the long run, man, that it'll just keep the atmosphere the right way. Yeah. We've seen it. I've seen it both ways and it's better when you, when you, when you support. Yeah. So what's next culture and lifestyle? Um, I mean this one, I mean, look, yeah, this is a key component, right? For sure. It's huge. It's huge. And I think that not only is it, you know, the culture, the vibes of the gym, right? And like how things feel when you walk through the door and all that kind of good stuff. And not only the lifestyle of being a trainer and, you know, just like general, but also

Starting point is 00:29:21 like what is your coaching culture in your gym and uh what does that say about how you look at your trainers in your organization is this something where it's like everybody in your gym is like a member for barter who's on your staff which we've talked about a million times or is this like hey like we have a hell of a lot of fun we have really high standards for what we're doing and this is we take seriously. And I think like that to me in like a nutshell is probably the best combination of all three, three things is having fun, having high standards and taking it seriously, but not too seriously. And I think what MDV has done through our documents and we could share these with you guys, uh, just let us know. We have all kinds of docs. We have docs for docs to docs, but at the end of the day, early on, we didn't have

Starting point is 00:30:10 any, and it was detrimental to our business. And now that we have some, when a coach comes on board, you have, you know, uh, you know what it means to be an NC fit coach. And so I think when people come on board, they understand as part of that expectation of their lifestyle and their culture, which is so important to them, right? That's one of the biggest reasons why they became a coach. When we bring them on, we onboard them, we clearly explain not only what does it mean to be a CrossFit style coach or CrossFit coach, right? But an NC fit coach. And I think that's an important distinguish. I think it's important to distinguish that and to clearly explain that to someone coming

Starting point is 00:30:45 on the team for whatever business you have, right? That could be, you know, I don't know, car dealership, whatever. I think of it as simple as this. You have a t-shirt that you have for your gym. Jason's wearing an NC fit logo t-shirt right now. It's got to mean something when you put on that shirt. It's got to mean something for your coach when they put on that shirt in their, in your organization. And, but you know, all the documents and all that stuff is great and it's important, but you have to walk

Starting point is 00:31:17 the walk first and it's got to actually mean something to be an NC fit coach or Jim X, Y, or Z. Right. And the owner and the head coach, you guys are in charge of creating that culture and you guys have to live it first. And once you are living it and you're living it consistently, now you can expect everybody else in your organization to live it alongside you. But until that day comes, my doesn't, doesn't fucking matter what you do or who you do or what. It's all for naught. The culture starts and ends

Starting point is 00:31:50 with the owner and the head coach. Yeah. And that's what people are coming into. That's what they want. They want to be a part of something positive. They want to be inspired. Ultimately, people want to be inspired when they come into a job.

Starting point is 00:31:59 And I think that's a key component to what we're talking about here, the lifestyle. And so we hit on, what number do we have? We have five? We are three down the list. Culture and lifestyle we just kind of talked about. There's a lot of other stuff in there, I think.

Starting point is 00:32:16 We got treatment and overall happiness. And this might actually be better to talk about fifth. Let's talk about education and development. I think education and development is really important because, you know, people, how much did you pay for law school? Ah, you don't have to tell me that actually. How much do I still owe for law school? So MDV went to law school. I went to a junior college and then I went to a four-year, so it actually ended up being cheaper for me. But what happens is, I mean, people spend quite a large amount of money to go to college

Starting point is 00:32:43 and to get education a number of different ways from going to a Tony amount of money to go to college and to get education a number of different ways from going to a Tony Robbins seminar to going to this seminar. People will pay money. Most people listening to this podcast might've gone to a CrossFit seminar. Great. They want to pay money to absorb information. That shows me that people have value associated with receiving knowledge. I mean, of course. Um, and I think that that's an important piece of being a part of our organization is that our coaches want to constantly be learning and developing their craft as well. And if they don't, they might not be at the right organization. We want them to have that kind of that, you know, white belt mentality,

Starting point is 00:33:21 that learning perspective on a regular basis. And so what kind of things do we do if assuming we all agree on that education is a valuable component of compensation? Yeah. Nobody gets, very few people probably get into this and go, I want to be a shitty coach. Nobody says that, right? Everybody wants to be a really good coach or a great coach. The work ethic and the care that it takes to get there, I think people underestimate and maybe never make it there. Maybe they start out with really good intentions and then they kind of fall off. But I do think that owners and head coaches providing opportunities for education and

Starting point is 00:34:00 for development is a huge aspect of retention. It's going to continue to keep people pushing towards that, like moving target to excellence, right? Yeah. They're always going to be reaching for it. And it's not just formal seminars and employee repayment plans for going off and taking the next level certificate or certification. We do that stuff here at NC Fit.

Starting point is 00:34:23 How do we do that stuff here at NC fit. It's how do we do that? So, uh, our, our formal policy behind it is that if you, uh, work X number of hours for us weekly on an average for the past 30 days, right? Yeah. You have an opportunity to go off and take, um, not only, uh, CrossFit seminars, but any seminar that you deem is essential for your job performance. And like, I often, when I'm onboarding people, be like, hey, if your handwriting sucks, go take a handwriting course. Because you're going to be writing on the board every single day, and I would gladly pay for that.

Starting point is 00:34:55 If they qualify, we will reimburse them 50% of the entire cost of the course after successful completion. So they have to apply. They have to get a yes from us, a green light. They go off and take the course they've paid for it. They have to show us successful completion. And once they complete it, we repay them 50%. Okay. Yeah. Yeah. That's a great way for us to do. I mean, I think we've tried all different ways in the past, but ultimately that's, we've settled out. So if you guys want to steal that, go ahead. And so what else for education? I mean, obviously we put out our daily session plans, our programming for us, man. I mean, huge. I mean, how long, how long,

Starting point is 00:35:30 I mean, so we put out five programs every day, right. And six videos every day, six videos a day, five programs, right? So we have three core programs, our NC 60, which is our 60 minute GPP CrossFit program. We have our NC 4560 which is our 60 minute gpp crossfit program we have our nc45 which is a 45 minute timeline strength plus metcon 30 minute program nc30 which is our uh kind of no barbell still constantly varied functional movements high intensity but like a limited range of motion and a limited range of movements and limited loading. Right. We produce a detailed session plan for each one of those three programs every single day, every single week. So that's seven detailed session plans a week.

Starting point is 00:36:14 And we have a video, a coach video and an athlete video that goes alongside each one of those programs seven days a week. So it's 42 videos a week. So 42 videos. And hundreds of pages of videos. And yes, seven days a week. Yep. Three workouts a day, each with a brief.

Starting point is 00:36:30 And we have two supplemental programs, our Compete and Burn. And Burn is really, was established for us mainly in Asia. So we used Burn, which was kind of station rotation, more body weight style. Yeah, it's evolved a little bit, but yeah, that's where it's at. Yeah.

Starting point is 00:36:43 And we used it a lot in Asia at our corporate sites and it was really successful for running a lot of people with minimal gear. And then we incorporated it back in the United States. We've seen a lot of success with it and our collective gyms seem to really like it. Yeah. It's a really good program to run if you have a lot of beginners in your gym because everything's station rotation. There's built-in rest. It's very easy to scale. It's very low loading. The movement ranges are not hyper complex. You go from simple to moderately complex, right? And it's self-scaling. Every single workout that you do in burn is self-scaling. It depends on how hard you're going to go during that time period since it's all station

Starting point is 00:37:25 rotation. So, okay. The reason why we're talking about this is that I think it's important to recognize that the reason why we started our NC Fit Collective is for our team, but we wanted to educate them. And at this point now, we have multiple full-time people on this because it's so important for us to constantly be providing tools for our team so that they can not only produce the best product on the floor, but that they also know that we're trying to invest into their education for the longterm. And that's a key component for our retention. When our coaches look at our retention, that's just one of the things we do, right? And look, compensation bonuses, deferred bonuses, sure you can get in all that kind of stuff. But from an education perspective, I think the 50% payment for seminars with it being

Starting point is 00:38:11 approved, and I think that's a great way to do it. And then obviously the daily tools. Yeah. So two main things I want to talk about there. Number one, we started Collective for completely selfish reasons. Oh, totally. Yeah. We needed to invest in the education of our people and the consistency of our coaches, of course, our organization. And like, I was talking to somebody earlier today and I think we're solving one of the most vexing problems out there for CrossFit affiliates that exists is how do I ensure that my coaches are constantly learning every single day and the type of profession that

Starting point is 00:38:45 we're in, you need to be learning and practicing every single day. If you're not, your skills get rusty, right? Yeah. And I can speak from experience on that. Like, I'll be honest with, I mean, you know this, I mean, I spent a lot of my time doing business stuff, doing, you know, different types of traveling and whatever. And you know, when I was coaching on the floor every day all day and teaching crossfit level one seminars dude i was my my tools were a lot sharper than when i coach you know on a irregular basis every now and then and now on top of that you know when's the last time that i'm you know the the more information you're reading on your craft the better off you're going to be in that particular setting yeah i i'm consuming information from a business perspective. I don't spend as much time on that perspective as you and the rest of

Starting point is 00:39:29 the team do. Yeah. The good thing about, so this is where the beauty of the session plans comes into play, right? Jason, you're off traveling for a couple of weeks. You're doing your thing. You're working out. You're always involved in fitness. So you're thinking about it, right? You come on back and let's say there's a hole that you have to text message and say, Hey, can you coach tomorrow morning at 5 30 AM? You say yes, 99% of the time. The beauty of what we do with the session plans is like somebody who needs to knock the rust off a little bit. You could spend 20 minutes reading that session plan, thinking about how you're going to present the class and you're going to go out there tomorrow and execute a really, really darn good class. Is your eye going to be maybe a little bit slow spotting movements? Yeah, maybe, but like

Starting point is 00:40:08 you're still going to run an amazing experience. So the session plans, they're dynamic enough where it's like, Hey, if I have somebody who's very new in my organization, they can use these things like a crutch and they can learn from them and really, really rely on them every single day until they need to only rely on them as like one crutch, right? Now you got one crutch and then you go in, now it's like guardrails, right? As opposed to being crutches, you're using the session plan to help guide what you do on an everyday basis and make you better. They're super, super dynamic. It's, it's really beautiful. That's an interesting way to look at it. You know, that's really interesting. And yeah,

Starting point is 00:40:43 to your point, it was a selfish thing that we did. We did it for our team. Yeah. Just so happens. It's really good for everybody else. And I've said this before, but like, it can't suck. It can never suck. It can never be bad. It can never be okay. It's gotta be the best because like, I'm going to watch the class here at 5 30 PM. And it's going to be the session plan that we put together that that coach is going to go out there and execute on. It's got to be good. It's going to be fucking really good. It can't be okay. Yeah. No, our business is riding on it. Anyway, I get fired up about this. Well, our business is riding on it. For sure.

Starting point is 00:41:15 Education's really important. Yeah, education's really important. So what's the fifth thing? So we're talking about pay, obviously important. We talk about trajectory and growth potential. Of course. Um, you know, we go into things like, uh, culture, obviously lifestyle. Um, now, now the education piece we talked about, I think we kind of nailed that down for you guys, but, um, overall happiness, I think actually the more I think about it is a culmination of all of these items. Yeah, for sure. Treatment of your employees generally and overall happiness. Yeah. Treatment and overall happiness.

Starting point is 00:41:50 And I think, you know, look, treatment, you do the right thing. You're not a jerk. I think that's really not self-explanatory, but self-explanatory. But I do think that the overall happiness, look, are we always going to, are all of our employees going to be happy all the time perfectly? No, we're always going to have a little bit of, you know, we're always going to be pushing a little bit or pulling a little bit, going back and forth. But overall, we want every team member at our organization to know that we do care. We do.

Starting point is 00:42:17 As soon as someone says we don't, then that becomes a challenge for me. If they say, hey, Jason, you're a little nutty. You come in, you push us too hard. Okay. All right. But at least, you know, it's coming from a place of care. But I mean, would you agree with that? I mean, ultimately this happiness piece is a culmination of pay trajectory education. If you're not doing those different things to your team, then we're missing out. It's a combination of all those things and a combination of just generally how you treat your employees, how you treat your members,

Starting point is 00:42:50 how you treat your family by extension, right? Like your coaches are always going to be watching you. And I forget who, who said this. It might be Warren Buffett who said it takes 15 or 20 years to build a reputation, 15 or 20 seconds to destroy it. Yeah. Right? Yeah. And, you know, you treat one employee poorly or you do one thing that's like, let's say it's way outside of the bounds of what is like accepted. You might've just destroyed your whole organization, right? Yeah. And along with everybody else who's in it,

Starting point is 00:43:19 who you want to keep and provide all these opportunities for. So like, it's really important that, you know, I think owners, head coaches, everybody, those guys hold themselves to really high standards,

Starting point is 00:43:30 especially if you're holding everybody else to really high standards. And, you know, overall happiness, like for me, when I'm talking to one of our coaches, like I want you to be fired up. The most important thing for me when you go out and take the floor is that you have fun while you're doing it.

Starting point is 00:43:45 Yeah. Cause the members're doing it. Yeah. Cause the members can feel it. Yeah. Unlike other jobs, if you're behind a desk, they might not be able to see that. Yeah. But if you're out on the floor, people could pick up on the vibe. Damn. So if they're not happy, we have a, we have a challenge for our business.

Starting point is 00:43:56 So yeah. And if we have something to, if we have something to do with it, if we are directly responsible for that unhappiness, then we need to change it, right? I think that's our responsibility that we need to take a deep look at what we're doing. And if we examine that we're not doing something that's right, or we're doing something that's contributing to this unhappiness directly, we have to examine ourselves, right? The other aspect of that is like, make sure you stay in touch with your coaches. Make sure you have a pulse of what's going on in their lives.

Starting point is 00:44:26 Well, you talk to them all the time. Yeah, you have to. These are people. We're in the people business, man. This is a relationship business. And it gets a little bit gray at some point because CrossFit and gym ownership, affiliate ownership is unique insofar that you're very good friends typically with everybody who you work with. And there's a beauty to that, but there's also some risks that become involved in that. And I guess overall, what I want to say is like,

Starting point is 00:44:54 do right by your employees, make sure you're treating them well. Look at that list of things that we talked about, but also like make sure as human beings that they're doing okay. And make sure that you are that they're doing okay. Make sure that you are helping them along the journey and not hindering it. How often do you meet with people? Our head coaches, I see every single week. I'm in every single gym. I try to be in every gym every week. It sometimes doesn't happen anymore. In the Bay Area, he's talking about. Yeah, in the Bay Area. I have a half an hour meeting with every head coach every

Starting point is 00:45:27 week, but the organization has also grown to the point where the head coaches now, those individuals are responsible for the teams underneath them. And I'm responsible for the head coaches and everybody down the chain, right? When I first joined the organization, it was, I was trying to meet with everybody at all times to establish rapport and setting up the system and getting the structure in place. But I have a 30 minute meeting with every single head coach every week. And, uh, I try to meet with, and I'm open to meet with any head, any coach at any time if they set up a meeting. Yeah.

Starting point is 00:45:59 Guys, I think when you're thinking about keeping coaches, we touch base on several items today. I think key takeaways is we try and pay at the height of the market. We're not where we want to be. We want to continue to grow that because we believe that, you know, you pay an appropriate wage and you require the best. And if they're not doing a good enough job, you clearly communicate that and you let them go if it doesn't work out. And I think then creating trajectory, educating your team, these are all really important things. And I think at the end of the day what mdv and i really want to communicate through this conversation is that you know we might not have coaches here for the rest of their life and that might be okay that is okay and it might be appropriate for them not to be here and that's okay right but i think one thing that i always

Starting point is 00:46:38 want to rest assured is as an organization we've done everything in our power to foster develop and grow this person. And if it stays within our organization, hell yeah. And if it doesn't, then you know what? We've done our part in transitioning them to their next step on their journey. And we wish them the best. And I think as long as you could do that on a regular basis, good things will start to evolve back around. I agree.

Starting point is 00:46:59 And that's a great way to wrap it up. Guys, I hope everybody has a phenomenal day. If you're a gym owner, if you're a business owner, you know, hey, look, let's have a kick-ass week. And make sure you check out the NC Fit Collective. We've been touching base on it for a while now. But make sure you email in collective at nc.fit. And if you want to talk to Mr. MDV, it's going to be a bunch of letters right now but if you want to email him it's mdv at nc.fit yeah mdv at nc.fit email him keep it appropriate hope everybody has a great day and thanks canada

Barbell Shrugged - Keeping Your Coaches - Business of Fitness #69

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