The Game with Alex Hormozi - 3 Ways To Make $10k 💵CASH 💵 With No Ad Spend In 30 Days or Less | Ep 152

Episode Date: September 24, 2019

"Cash flow is oxygen." Today, Alex (@AlexHormozi) talks about the importance of cash flow and prioritizing opportunities that can generate quick cash for businesses. He gives examples of three ways businesses can make cash quickly, including selling to existing customers and adding additional services.Welcome to The Game w/Alex Hormozi, hosted by entrepreneur, founder, investor, author, public speaker, and content creator Alex Hormozi. On this podcast you’ll hear how to get more customers, make more profit per customer, how to keep them longer, and the many failures and lessons Alex has learned on his path from $100M to $1B in net worth.Timestamps:(1:27) - Find cash flow opportunities that are threats.(3:55) - Experienced coach focuses on best opportunities.(4:56) - The 3 important plays(10:13) - Fixing culture may not provide fast results.(12:20) - Choose the most profitable option with the least resources.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

Wednesday, everyone. Hope you guys are having a wonderful, wacky, fantastic, Wednesday. And so what I wanted to cover today was I was calling cash flow, it's oxygen, how to get some. But this is actually part of a larger discussion that I'm half targeting towards my coaches and half y'all can just join in on what I would be talked to him about. And so one of the skills that a coach has to have, and if you are coaching yourself, you're the coach, you're the master of your own domain, you're the coach of your own business, right? And you have to coach you better than anyone else can, right? That's good to have outside counsel. That's what we have coaching. That's what we have coaching. But you have to be your

own coach because you're the one who's going to be making the decisions for your business more than anyone else more. Right. And so oftentimes when I am on the phone with a business owner, I am listening for the majority of the time of that call and I'm looking for certain things. And so some of you may have heard of a SWAT analysis, right? Strength, weakness, opportunities, and threats. More commonly now in MBA schools, they've actually reversed that. And they called an otsu. And what that means is opportunity's threats are disproportionately weighted as far more important. And then you have strengths and weaknesses. And so the reason that I'm saying this is that most times when I'm listening to a client who's saying, I'm struggling, I'm having an

issue where I'm at a bottleneck, doesn't necessarily need to be that they're losing money, but just like, I can't get past this point. What's the issue? I'm going to be looking for cash flow opportunities that are sitting on the ground and massive threats. Those are the two things I'm looking for in the beginning. Once those boxes check off, then we go down to strengths and weaknesses. For example, if someone is bleeding cash, I'm not going to tell them to fix their culture, right? Fixing their culture is something that they absolutely need to do,

but it's not going to be the thing that's going to save their business tomorrow, right? They need money. And so, like, it's one of the things that drives me nuts because it's not prioritizing the actions according to the, to how important they are, right? And so an example of this, I mean, I just use the culture example, but let me look at another one. Here's a more relevant one. Retention, right?

And believe me, I'm like the king of making sure that you're doing a good job to your customers, right? But if your retention is shit, right? It's absolute shit. That's, if you need to make payroll in the next 30 days, implementing retention system is not going to solve your problem. It's going to take 12 weeks for that to pan out. Now, this is something you should do? Absolutely. After you have milked out all the big opportunities that sit in front of you and ensured that you're not going to kill yourself with a threat state of point. Now,

if your retention is like you're, you know, you're churning 30% month per month and that becomes a threat. It's not even a weakness. It's a threat itself to your business. Now, the number one thing that I see, and this is like when I'm getting on the phone now and like I occasionally take calls which I want to just poke and listen. And I try not to advertise it because I couldn't. Like I actually thought about this yesterday to Layla. I was like, I wonder if I could take one call with everyone if I did 30 minutes for every person once a month. And I was like, oh, no, it's still taking me three months.

So I can't do it. I tried and I thought about it. It can't work. So all I do is give you the lessons that I have learned from the people that have spoken with. And so if, for example, you don't have a one-on-one nutrition and accountability program that you have plugged into your facility on top of your group training, that is the biggest opportunity that sits on top of your business right now. Would you like to have an extra $15,000 a month, spent $0 in ad spend to get it in 28 days and you have literally no risk and it's only profit that you'd add on top of your business, basically no cost? You don't have that?

Cool. Nothing else that you were going to do is going to matter. And so this is called opportunity cost. Of all of the things that we can do, doing this alternative, what other things are we doing that we're saying, to, right? Picking out which of the opportunities to focus on is usually the focus of a good coach. And this is where experience of a coach matters because they have more plays in their arsenal. They have more cards up their sleeve that they have seen be executed with precision over a short period of time. And so to a new coach, they may only have, okay, we need to run more

We need to work our lutes hard or we need to sell better. Those are all very true things. Those, in my opinion, would sit within the strengths and weaknesses area, right? But if you are bleeding cash and you need to make money fast, right? There are three things that will make you money fast. One is if, like, all three of them, by the way, includes selling shit to your existing customers. That is it. You don't have enough time to start a campaign, bring people in, market, like, that takes time.

And if you don't have it, then there's only three ways to make money in all three are selling to your existing customer base. All right. In a gym, the first and easiest and least amount of anything effort is to take three people run a reason why campaign, which is like a, hey, I just turned 30. And because of 30, I'm going to take three people with me on a one year transformation. It's going to be awesome. And I'm only, like I said, I'm only taking three people on. It's going to me $3,000, you know, text me if you want it. just like that you make nine grand all right you have 100 people you're going to have three

take the offer all right so if you need money that's number one easiest thing to do you don't want to sell all of those limit it limit yourself but those cash pops help right cash is oxygen so you can buy yourself time to have more perspective to make better judgments about the business next play is you run an internal play to your existing customers right now I guess this one would technically be like subset A and subset B which would be the final two if you have like in a normal gym if you just want to run like a big booty boot camp or an abs challenge or whatever right doesn't really matter right buns and guts any of those things you can market to your existing customer base and you have two things that you can do from there one is you can actually

sell the thing itself which normally you'll get about 20 25 percent take rate of your entire customer base if you sell between 100 and 200 dollars right and so if you have 150 people 25 percent would be whatever that is, I don't know, like 35-ish, 40-ish, whatever, somewhere in there, right? And so you have 35 people who sign up at, let's say, 150. Okay, well, made five grand, but then you have some more fulfillment. So maybe the painful thing, the three people might be a better play for that. So we'll see which one, if you did the other one recently, then that would probably be the play day. Hey, guys, love that you're listening to the podcast.

If you ever want to have the video version of this, which usually has more effective. more visuals, more graphs, you know, drawn out stuff. Sometimes it can help hit the brain centers in different ways. You can check on my YouTube channel. It's absolutely free. Go check that out if that's what you are into. And if not, keep enjoying the show. Now, if you wanted to make even more money, right,

then you should make the thing free that you're giving away and then upsell them into food and supplements, right? Upsell them additional services once they start because you'll get an 85% take rate and you'll close 80, 90% on the upsell. Right? So it's more work, but again, in a short period of time, you can sell people other stuff that's ancillary services. And that's all free money.

There's no, there's no fulfillment that really has to happen. Right. So like you buy something, or in our case, you don't buy something. You just go into prestige labs and you click send and then they, you never have to touch inventory. But point is, is like you're taking something for $5. You're selling it for $20 and then you just take the in between. And that's it. The exchange happens.

You keep the money. Great. So that's another easy way of making $10,000, $20,000 in a month. The third thing, and this is the one that I'm going to drill home for everyone, is that you have the same amount of effort that is going to go into dealing with any kind of internal plan. So beyond the first thing, which is like quick text blast, limited spaces, make 10 grand tomorrow. That's like, cool, make 10 grand tomorrow. But if you want to make, like if you want to start having established recurring revenue, right,

add an additional level of service, right? Simply giving people one-on-one nutrition, one-on-one accountability. That's it. A lot of people struggle with getting in the gym. A lot of people would love someone to text them every morning, ask them what their weight is, how they're doing, make sure they show up at the gym.

What this also does is your churn goes through the floor, as in like your retention goes up. People stop turning out because they have a regular communication hidden. Now, if I had 150 customers, what would I do? I would, being the enterprising mofo that I am, give everyone at my gym 28 days free or 21 days free or 14 days free depending on how much work I think I have right now for me if I gave everyone at my gym all 150 people an amazing one-on-one experience that they've never had before and then after this 28 days you can keep doing this for 49 bucks extra a week right and that's half what I'm going to sell new people into it so they're getting a great deal right what percentage of people do you think would say You have one-on-one contact with him for a whole month. What do you think?

Half? I think a third would stay probably higher than a third. I think half would stay. I think it's higher than a half, but let's just say half, right? Half stay. Now you're not going to get 100% take rate because you never got 100% take rate on these types of things. But you get 85%, let's say you get 120 people to take the offer, right? You get half to stay.

So you got 60. And you got $60 at $200 a month extra that are paying for 101 nutrition accountability. What's the cost of fulfillment there? very low, right? 20% goes to a coach. Cool. So you pay $2,400 out of your 12, right? So you're at 96. And now, every single month from this month going forward, you make your 10 grand a month. And that is profit that is in your pocket that you can do tomorrow. Right. So if you're, if you need more profit, if you need more cash, there's a million ways to do it. And a lot of times, like, and this is me, somebody who's a long-term player, sometimes if you need it fast,

fixing your culture is not going to do it. You need cash today. And so once you can have that, and you can plug the hole or you can plug a thread or whatever it is, right, then you can start fixing the processes that got you into this pickle to begin with. But sometimes you need cash tomorrow. And so those are the three easiest ways that you can get cash tomorrow. The last one, 101 nutrition and accountability by different because of marketing so don't get scared away nutrition accountability kind of part of the game when you're a gym owner um that being said it's free money and so if i'm talking to a gym owner i'm going to check off the boxes of which of these things they have done and most times when i look at all the opportunities they have in the floor

in front of them asking them to take it and so right now if you're looking at your business there's probably a million things that you could do and arguably should do, but which one thing, given the same amount of time, is going to make you the most money. Forget about everything else and just do that. And most times, you're going to make the right call. And what a good coach is supposed to do is figure out of all the plays that they know in their arsenal, right, all the cards that they have to play, which one is best suited to you right now that can have high impact and require low resources, right? Those are the best.

High impact, high resources, like, yes, it's going to take a lot, but it's going to cost a lot, right? Whereas here, you actually get the benefit of having the profit without the risk, right? I'm not saying front ad spend. I'm not saying, you know, like, there's literally nothing that needs to get added

to your business besides one person. With 60 clients, one person can handle that. And that can be you if you want to. You can keep the extra $2,400 a month. It's your call. But all that to say, if you're looking at your business, It is your job to be able to weigh which of the things that are in front of you because there's a million plays that are out there. And that's where people get overwhelmed.

They're like, I don't know. Should I run a 28-day transformation? Should I run an internal play? Should I run a paid and fool? Should I run a year of change? Should I run a hybrid? Ooh, one-on-one accountability and nutrition. Right?

What should I do? Look at which one makes you the most money and takes the least amount of resources. Depends how quickly you need the money. You need the money tomorrow? You got to do paid and full. It's going to be a text blast. You make the money. If you can wait two weeks to make the money.

money, you're going to do an internal play. If you can wait a month to make the money, then you should probably do hybrid. Give everyone the free play. Now you just added 120 grand a month to your facility. Top line, right? And then bottom line, you add, actually, sorry, you would add more than that top line. You add 144,000 top line, 120 bottom line. All right. One play. Is it worth it? Arguably. What most people do, not that. And that's why they struggle. So don't be one of them. Cash flow is oxygen. make sure that you prioritize the opportunities that are bigger. And once you do that, once you execute those things,

then yes, you'll have cash flow to breathe, and then you can invest in things that will actually solve your problem. Then you can pay someone to start helping retain your customers so that you don't have the term problem, and you can wait 12 weeks, and now you have cash flow from the recurring revenue stream that you took a month to build. All right. So I hope that makes sense.

Drop a like, drop a comment, tag someone if you feel like it. Three ways to make cash in the next month. Lots of love, keeping amazing. have a wacky wonderful Wednesday. Bye. Be cool. Bye.