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Happy Thursday, everybody. Hope you guys have an amazing day and start or end to your work week.

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If you're an entrepreneur, it's just the middle of anything because you're working all the time.

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Anyway, the strongest profit lever in business, and how to use it. So a lot of times,

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I mean, I like talking about this stuff. It's probably my favorite topic in the world.

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And I feel like I've made a few more mindset videos lately. So I want to make one about the

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monies. So I've been in a deep, deep, deep dive reading books. And I've come into business

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a lot with a man named Patrick Campbell. He owns two companies, one called Price Intelligent,

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one called Profile. Well, they are SaaS companies. And Price Intelligent, he is a company that

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just reviews and just works on tons and tons of data around SaaS companies. And the reason

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that I think it's really interesting is that there are so many principles that he's been able to

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back with data, looking at 10, 11,000 different companies in terms of payment structures,

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and just tons of different data that he used that I thought I would share some of the findings

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that I've had with you. So when they did an analysis of all the blog posts written specifically

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towards SaaS businesses, which is software as a service, you don't know what SaaS means.

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And for many of us, we're in the service business. So a lot of the findings, the majority of them

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apply directly to what we do. And so, anyhow, many of you or maybe some of you've heard of the

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genie in the bottle story. But basically, if you rub a lamp and you ask a genie,

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double my business and he says, okay, there's three ways you can do it. One, we can double the

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amount of customers. Two, we can double the decrease your turn by half. Or three, we can double

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your prices. And the question is which one would you choose? And he was able to back with data

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exactly what we find with that original scenario. So for those you don't know, when you double

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your customers, you pretty much double everything that's already there. And usually profit will go

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down a little bit because there's additional costs as you scale. And so if you were doing,

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let's say $10,000 a month and you had $2,000 a month in profit, if you double to $20,000 a month

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with twice as many customers, you would technically have $4,000 a month in profit. But as some of you

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may know, sometimes costs can increase as business goes up. So you would be at $4,000

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in profit. So you double across the board. If you double the or decrease the the turn by half,

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so you doubled your lifetime value in duration, what would happen is you'd be able to spend twice

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as much in acquisition because each person is worth twice as much. But so overall you would end

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up to the same number in terms of how much profit you make, but you'd have an additional benefit

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from the fact that you wouldn't have to spend as much on marketing or you could use that to

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lever and double down and grow that way because you can spend twice as much on marketing.

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All right. The third door, which is double your prices, right? If you took the original example

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of $10,000 a month with a 20% margin, and then you doubled it to $20,000 a month, but you had the

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same cost of fulfillment, which was the 8,000, right? The 80% from the original number,

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then you'd go from $2,000 a month to profit to $12,000 a month to profit. All right, so that's a

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6x increase in profitability by doubling one number. All right. And so he found when he was looking at

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all the data from 11,000 SaaS companies. And so his company does basically works on the processing

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side to help collect revenue that's lost for SaaS companies. And so he has a direct time to

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how much revenue they're making. So he has all this amazing data to pull from. And so if you increase,

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if you do a 1% increase on any of these three metrics, either 1% decrease in cost acquisition,

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1% increase in price, or 1% decrease in turn, the response was, let's say, 1x for acquisition

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in terms of how much it would increase the profitability, 2x for decrease in the turn, and 4x

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for increase in the price by 1%. And so it just showed how much more powerful pricing is

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to profit within your business. And so the reason that I think this is fascinating and

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why this can be relevant to you is that if you're looking at your business, we know that for gyms,

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the profit points for a larger training center, typically in order for it to be profitable,

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$167 a month, which is $37.39 a week, tends to be the point where you actually can make a real

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amount of profit in the business. And so we know at gym launch that we add additional services,

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or different value in order to retain customers. So we add a lot of the accountability features in,

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and handling cards, checking in every other week, all that kind of stuff, right? And so at a very

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basic level, if you don't even think about all my businesses or anything that's stuff or any of

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the hybrid stuff that I've talked about, if you were to simply bolt on the 101 coaching component

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and charge $200 a month, which is what we are, which is the number that we're seeing go all day long

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for those who are customers, to add in 101 coaching with food and helping them stay

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combo with daily check-ins and biweekly, which is twice a month, in-person check-ins where you can

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also sell supplements, then that is akin to doubling your price, right? In that example that I gave

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earlier, so you go from having a customer at $200 a month to going to $400 a month, right? And so

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that means that from doing that same thing, you can potentially six X the profits in your business,

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right? And so this is why I get so excited about the hybrid thing. So even if you're like, I don't

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want to change my gym, I live on gym, that's awesome, right? You know, that's fantastic. But if you

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want to make more profit, then ultimately you're going to have to figure out how to provide more value,

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right? And the biggest lever to increasing the profit of the business is the price. And so what can we

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do that scales price-wise, right? That doesn't incur lots of cost for a service thing.

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Real quick wise, you guys already know that I don't run any ads on this and I don't sell anything,

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and so if you only ask that I can ever have it, you guys, that you help me spread the words,

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so we can have more entrepreneurs, make more money, feed their families, make better products,

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and have better experiences for their employees and customers. And the only way we do that is if you

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can rate and review and share this podcast. So the single thing that I have to do is you can just

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leave a review, but take 10 seconds or one type of the thug that it means the absolute world to me,

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and more importantly, it may change the world to someone else.

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And that's where bolt-on comes in, right? And so you could not even not even change anything

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about your acquisition, not change anything about how you sell or how you market or any of that

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stuff, but only use it as an upsell or an ascension piece within your business and be able to upsell

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x percentage of customers. So let's say you're able to upsell 35% or let's say 33 for men's sake,

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okay? So a third of your customers would be able to take that upsell, which is a $70

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increase in average ticket per customer, right? And so we know right now, I mean this is just

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because we've got some interesting data that we just pulled from the coaching side. The average

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gym right now makes about $35 per month in profit per customer, right? And that doesn't include

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supplement sales or anything like that, but simply in just from their service side, right? And so

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if you were to add $70 per, right, per customer, then in your cost of fulfillment is $50 per

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customer that is using it, which means we have to divide it by three since it was 33%, which

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would be basically, let's say $16, right? So you take your $70 and you take out your $16,

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all right? Then you're at $54 extra per client that you would now make across the board by

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implementing bolt on on top of your existing business, okay? And so that would mean that your

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profit went from $35 per customer to $54 per customer, all right? So it would 2.5 x the amount

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of money that you make every month by simply implementing one thing that adds value to your

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existing customer base that doesn't fundamentally change your model at all. And so if you want to,

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2.5 x the profit of the gym that you were working with that you have right now,

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simply simply bolting on this additional revenue stream without changing anything else in the

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business, well, 2.5 x how much you take home? Is that a worthwhile endeavor? Especially considering

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it only takes about one month to implement the entire thing and then you're done with it. And then

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from that point going forward, it just becomes a consistent upsell that you have for people who are

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coming in the door, all right? So look at your math and pull the numbers for yourself. These are

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the averages that we had. So if you're like, okay, and the way that you pull those numbers in terms

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of when your average profit per customer is per month is you look at how much revenue brought in,

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how many customers you have, right? And then how much you took home? So let's say you took home

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$6,000 last month, right? And you have $155 customers. So if you took home $6,000 from $155 customers,

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right? You might want $6,000 from $155 means you're making $39 per customer in profit per month,

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right? And so when you see those numbers and you know that you can get one third of your clients to

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upsell and take something at $200 a month extra in service that cost you $50 or less to fulfill,

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right? Not including the extra revenue you can sell with nutrition-based supplements and things

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like that, but purely from the service side because you may have limiting beliefs around selling

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nutritional products, which is fine, whatever. But just doing this one thing, which is going to enhance

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the value that the customers get, decrease your churn as well, which is an ancillary benefit, an

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additional benefit, because when you have a one-on-one coach, a one-on-one point of contact,

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then your churn decreases because you have a consistent relationship, right? And so they don't get

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lost in the masses of group training, which is typically what happens, and we have to recreate

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a one-on-one experience by having scalable delivery with the accountability and retention pieces

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that we have to build in normally to a training business. But when you add in this one component,

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this one additional upsell, the amount of money that you can make in your business literally two

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and a half x's. And so rather than opening two and a half more gyms, right? Exposure yourself to

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two and a half times the liability, you can do this one thing, make two and a half times the money.

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So that is my big case here. So the strongest profit lever in your business is price, and the way

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to get the price is to add more value. And so right now, ascension, this is another great

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step that he had is that upsells cost one quarter the amount in total cost as acquisition.

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And so that means the revenue is four times as valuable from a business standpoint. And so

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this is essentially what this is. It gives you an upsell that you don't have to have more square

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footage to fulfill, and it drives down your churn, so it increases lifetime value of your

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service side, of your training side. So you literally increase the lifetime value of your service side

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by simply implementing this on top of this. So it has two benefits because they think two

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of the growth levers by doing one thing, which is adding this additional service on top that

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which is the one I want to accountability that you can do and fulfill remotely. Okay. So as a

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tangential benefit, it also allows you to pay some of your trainers if you have like one or two

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or like strong stallions, awesome trainers. It allows you to pay them more, right? Because now you

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can give them that little piece of these people who took the upsell. And so now you can have that guy

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here like, man, I wish I could pay him four grand a month, but I can only pay him three five hundred.

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This allows you to do that. So let's take the example of the 155 client gym that I just made up,

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right? So you get 155 clients and you upsell one third, right? Time's 233. Then you have 51 clients

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who now are on $200 a month, right? It would actually be 212 if you do the math. So it's $10,843

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additional revenue, right? But then let's do the how much the cost is. So 51 clients times the

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the $50, right? So you have 25, 2550 in cost. And then you take out your 10,800, right? And so you

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make an extra $8200 a month, which is an extra 100 grand a year. That's it. So you add an extra 100

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grand a year to the business in profit, right? By adding this single upsell to your core model.

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That's it. You don't need more spare footage. You don't need more training times. You don't

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need more trainers. All of this can be done by implementing one thing, right? And that's the deal.

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That's how it works. So any who that this is just something that I get excited about because I

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geek out on pricing and data like when someone really just backs everything with data, and especially when

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it supports some of the anecdotal things that we have seen just from trial and error between all the

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facilities that we that we work with, right? I get excited about it when I show it. So if you

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if you if you if you haven't gotten on board that then hopefully the numbers speak louder than

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any story ever can, right? But I know humans and that's not actually how it works, which is why we

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only give testimonials because people are emotional. They don't make rational decisions about their

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business. But if you do choose to make rational decisions, which is usually how you make more money,

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then you should definitely implement this in your business. Obviously, if you help, you know,

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comment, tag somebody, whatever. I'm sure there's a million ways you can apply and get on the phone

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with all of our guys. But that was not a pitch. It was literally just to talk to you about how pricing

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is so powerful and how you have to add value in order to remain competitive in an increasingly

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saturated market, which is going to drive down the price of training, right? Group training. It's

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always going to drive down that way. So in order to escape that, we add more value and we

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had differentiated services on top of it so that we can recover something that might be lost on

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the price originally. All right. So hope that makes sense. Hope you enjoyed that and tag someone like

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someone or whatever, whatever you do, you know, share it, tag it, all that good stuff. All right. How

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amazing day, guys. And I will talk to you guys on the flip side.