When and When NOT to Profit: Starting A CrossFit Gym Part 16

After being a coach at CrossFit South Brooklyn in NYC for 6 years I moved halfway across the country to open my own affiliate, CrossFit Lumos, in Austin, TX. This series will chronicle my experience opening the gym and what I am learning along the way. This article is the final piece of the adventure, before I’m a real live gym owner. Part 1. Part 2. Part 3. Part 4. Part 5. Part 6. Part 7. Part 8. Part 9. Part 10. Part 11. Part 12. Part 13. Part 14. Part 15.

CrossFit affiliates are beautiful little unicorns. The fitness space is littered with sages, trainers, and gyms that see their clients as little more than dollar signs, but affiliate owners tend to practice what they preach. Almost all of them had their own powerful experience with CrossFit and wanted to share that with their community. You can see that in the ways gyms operate- extremely member focused, with a lot of “perks” that often don’t come at extra cost.

Still, affiliates are businesses, and an owner isn’t helping anyone if their gym has to close because it can’t keep the lights on. Owners must be able to assign value to what they do and be unafraid to charge for it. Nonetheless, because affiliates are a very different model than a “globo,” there are plenty of areas where owners should consider assuming some cost as part of improving member experience. How do we tell the difference?

When to Profit

Broadly speaking, I try and value my and my coach’s time.  CrossFit owners/coaches are a charitable lot, and it’s not uncommon to see one stay after class to talk for a long time about nutrition with a client or help them master a skill. I’ve certainly done it, but it can 1) create an expectation that you will always be there for extra help and 2) won’t be as polished and professional than a meeting or session you planned for.

Sometimes I just have to be tough and say, “Hey, I’d love to work with you on that- here’s my rate for an hour/half hour/ongoing nutritional coaching, etc.” When I first starting doing this, I was sure I’d get met with blank stares, but most people are more than willing, especially if you are confident about it and have pricing, programming, etc. planned out ahead of time. If you are gonna do this, it’s not haggling time, you should be able to point directly to a price sheet or list of services.

This doesn’t mean that we never help outside the bounds of a class, we’re nice people (I swear) and we use our discretion/adult skills here. If someone needs a 5 minute demo, movement tip, or nutrition tip, of course I’m there for them.  Sometimes this can be a teaser for a longer session or service, where after we finish I’ll say, “Hey, if that helped I think I could help with a bunch more if we met regularly or spent more time on this.” Sometimes I just do it because I’m a nice and good looking person who is adored by their community… or something like that.

When NOT to Profit

There are lots of times when I’m down to spend a little money without a direct concern for profit coming back. This doesn’t mean that these outlays won’t lead to new members or business down the line, only that there won’t be a direct correlation between money spent and money returned in profit such as I’d see when making a merchandise buy that I’ll eventually sell.

The big rule of thumb here is to spend money on events that will build trust and community within my affiliate. If we are doing a potluck, BBQ, movie night, or any other event where I’d like a good amount of people (and maybe some new folks who aren’t members yet) I go ahead and spend a little cash on food and beverages. If it’s small or impromptu, then maybe I’ll just make it BYOB, but being too skinflint on spending for fun events can make it feel like I’m squeezing my Fixemembers.

I personally treat some other stuff as a “push”- stuff that adds value to members and while it may offer some profit isn’t necessarily worth going nuts over. For me, I treat small merchandise sales this way- drinks like FitAid, Kill Cliff etc, make your members happy but don’t represent a ton of profit (unless you’re a huge gym doing lots of volume) so I provide them but don’t obsess too hard over if they are “earning” for me. At my affiliate, CrossFit Lumos, we recently started offering nitro cold brew on tap, which is notoriously hard to keep track of, and honestly, I don’t really care. We make enough sales to pay for the keg, the coaches stay happy and upbeat, and it’s a cool thing to say we have at the gym, post on social, etc.

So there you have it guys- there’s times to make sure you are realizing profit and times when it might make sense to be a little loose and chalk it up to a general sense of value. I’m sure there are business experts out there who will disagree with this, and will tell you to manage inventory like a hawk and never spend a dollar without an idea of how that dollar will come back, and they aren’t necessarily wrong. Still, I think members can tell by general feel when they are being “commodified” and if that negatively impacts their experience or “lifetime” at your gym then you are looking at a net negative. Cherish your members, don’t be scared to spend a buck or two (or at least break even) on some fun stuff for them, and have fun out there!

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