I’ve heard three times now that in 2017, more affiliates closed than opened.
It’s not an anecdote I’ve been able to track down to any credible source, but it’s a statistic I’ve heard from three different sources over the past couple months.
The suspicion that being a CrossFit gym owner is tough and seemingly impossible at times is solidified when you hear statistics like that one.
Another one from someone who is in the business of buying and selling gyms, claims that of the gyms listed to be sold, only 8% have actual profits of $1000 or more a month, after paying the owners a fair salary.
Isn’t that crazy?
How many gym owners run their gyms full-time, versus juggling it with their “main” job? How many gym owners can provide for themselves and their families from the gym? Even rarer, how many gym owners are actually wealthy?
It’s tough to say, but the undeniable reality is that running a gym and attempting to do so successfully is not for the faint of heart. No longer are the days of “build it and they will come.”
Here are a few reasons why I believe finding success as a CrossFit gym owner is more challenging than in many other industries:
Affiliate v. Franchise
CrossFit gyms are affiliates of CrossFit – not franchises. The biggest difference between the two models is that franchises typically have rules of operation that they must follow, whereas affiliates have full control over business operation.
Last weekend, we went to a seminar in Toronto for affiliate owners, and we learned so much information over two days.
None of it was rocket science, though. Most of what we learned was profound in its simplicity, to the point where there was a part of me that thought, “This information would have been great two years ago.”
It’s better late than never. We’re doing well as a gym, and I’m excited for how much better we will be.
But the fact remains that CrossFit gyms don’t get a standard “owner’s manual.” We all know this. It only takes a Level 1 (a weekend and a $1000 commitment) to open a gym.
Then you also get to see this at different CrossFit gyms. There is no real standard. We all speak “Fran,” but the layout and business operations vary widely from gym to gym.
We hear about this, too, when someone complains about the one terrible time they did CrossFit, chalking up that experience to the entirety of CrossFit itself, when really that person just had a bad experience with a gym.
Again, don’t get me wrong. This is not a complaint. If CrossFit HQ was more involved and/or ran a franchise model, there would probably be restrictions on the way we run our business that I wouldn’t appreciate.
I love the creativity we’re granted in an affiliate model, but there’s no doubt about it that the CrossFit industry is one where you sink or swim.
These leads me to my next point.
Continuing education as a business owner often seems superfluous.
The last time we got any business coaching, it was over a year ago. It was the only time in the two and a half years we’ve run the gym that we bit the bullet and paid for help in running the gym. We were struggling to figure out what to do and just needed direction.
The seminar we went to this past weekend was the first bit of continuing education we received as CrossFit gym owners since then. The value of the seminar was so condensed and stunningly undeniable for us, that we left Toronto asking ourselves, “How have we gotten this far without this information??”
Because continuing education, mentorship, and following best practices are not required in an affiliate model, to go out of your way as a gym owner to learn more can often seem excessive and “above and beyond.”
They can seem like unnecessary purchases you might eventually make once you have disposable income, when paradoxically, these are the purchases you need to make to ever have disposable income.
Because gym owners are notoriously stubborn and obsessed with self-sacrifice, we frown upon anyone who espouses themselves as a model of success, with something to offer everyone else. We’re a humble, hard-working bunch, and it goes against our nature to brag about what we’ve done.
Our culture makes it difficult for gym owners who are killing it out there to let us know that they are.
We don’t have many role models.
You’ve seen those CrossFit gym owners on Instagram that are balling out of control, right? Driving Lambos, living in mansions, taking the yacht out on the weekends… you know who I’m talking about.
Me neither. But why?
Why is the concept of a wealthy CrossFit gym owner an oxymoron?
Why, when I tell people I’m a CrossFit gym owner, do they pause and then tentatively ask, “How is that as a business model?”
No one asks a real estate developer about the viability of his/her business model.
Look, I’m as frugal as they come. I’ll drive my 2009 Xterra into the ground with a smile on my face and live in our starter home until we can pay for our second one with cash. I’m not chomping at the bit to live an ostentatiously wealthy lifestyle, but the point is having the choice.
It’s not the business model’s fault. We all run a scalable business model, where you can introduce new revenue streams to grow your wealth.
The possibility is there. But as human beings, we have this fundamental need to see others before us pioneer the way. There aren’t many role models of wealth we can point to. There aren’t many CrossFit gym owners obviously living the lifestyle that would inspire us to keep trying.
Because make no doubt about it, we may have come into this for the passion, but we stay because of the potential for livelihood. The ability to live a life of freedom and fulfillment.
So gym owners get burned out, they drop “CrossFit” from their name, they add yoga to their gym’s repertoire, and many end up shutting down their businesses, if they’re not lucky enough to sell it.
We see this, and we can’t help but lose hope.
What’s CrossFit XYZ doing down the road? What’s the average CrossFit gym owner doing?
We need to rethink what “normal” is for the CrossFit gym owner.
We talked about this a lot at the seminar this past weekend.
Don’t get me wrong. I’m not pointing fingers at everyone else and not us. Last week, Lee, my partner, told me that he had never really thought it was possible to make a proper living from the gym.
. . .
What?!! We’ve been running the gym for two years!
His admission was eye-opening to me, and it revealed an underpinning belief we have unknowingly carried that has stunted our growth over the past couple years. Although we’ve worked hard to grow the gym, it wasn’t because we had a wild, big dream of what our gym could be.
We were driving our Ferrari in the slow lane.
We don’t see many gyms that kill it. When we do, we’re usually visiting another part of the country. It’s easy for us to chalk up other people’s success to circumstances out of our control: location, demographics, weather, Netflix preferences.
As Tye, the lead for the affiliate owner seminar reminded us, “A rising tide lifts all boats.”
Whether the already successful gym owners start to reveal themselves, or the rest of us start to believe in the impossible and become part of the rare few profitable gym owners, we need to elevate the tide and redefine what is normal.
1. Pursue continuing education.
Find the “owner’s manual” by attending seminars geared toward gym owners. Get the business coaching. Figure out what the industry’s best practices are through businesses and mentors out there who are happy to help you.
2. Stay current.
You’re not a CrossFit gym owner, you’re a fitness professional. Look at what the fitness trends are (not just CrossFit gyms) and have a clear idea of what your gym offers in today’s market.
Try out another gym in your area and see what you can bring back to your gym.
I could write a whole post on books to read, but here are a few. The point in reading these books is understanding how to treat your gym like a BUSINESS not just a GYM.
You may be unique in running a CrossFit gym, but fundamentally you’re running a business. That life of wealth and freedom you’re looking for? It comes from the business end of things. Get savvy on it.
- Summary: How to create a business you work ON, not IN.
- Summary: At your wit’s end? Have no money? You still have a shot. Here’s how to clean up your business.
- Summary: Whether your business succeeds or fails, it’s your fault. Once you understand how empowering this is, you’ll love this truth. Learn how to take ownership of the success (and failure) of your gym.
- Summary: Specific to running CrossFit gyms, written by Chris Cooper. This book blew my mind when it came to actually making money from a CrossFit gym. He has the right idea when it comes to combining the desire for wealth and helping people for a living.
4. Trust in yourself and the business model.
It’s not easy to make a living from your gym, but it isn’t complex either. I don’t know one gym owner with a MBA. I’m not saying they aren’t out there, but I don’t know of one person.
My point is: everything you need to be successful with a gym, you already have.
Running your gym doesn’t have to remain a hobby. That faint dream in your head of doing this all-day, everyday? Or creating a business that works for YOU? It’s possible. Don’t rule out these options.
5. Share your experience with others.
Whether you’re struggling badly with your gym or you’re finally starting to hit your stride, share your experience with other gym owners. Too often, we hide what we’re dealing with, whether it’s positive or negative. Not only do others miss out from learning from our experience, but we also miss the opportunity to get objective perspective on how we’re doing with our gym.
I get the most return from reaching out to others and being open about our experiences at the gym. And hey, if you’re on a budget, this step is free.
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