WEBVTT

1
00:00:00.000 --> 00:00:04.160
Good morning, everyone. Happy Sunday. Hope you guys are rocking and rolling on your restful

2
00:00:04.960 --> 00:00:12.320
end of weekend beginning prep for the week. I came off a really great week. Got a lot of stuff done

3
00:00:12.320 --> 00:00:17.840
and I, among those, was writing something that I'm calling the hybrid manifesto. I'm playing around

4
00:00:17.840 --> 00:00:26.240
the title, but more or less kind of a very in-depth look at industry trends where we're looking,

5
00:00:26.240 --> 00:00:32.080
what's going on now, that kind of thing. In writing the hybrid manifesto, it became clear when

6
00:00:32.080 --> 00:00:36.640
I got to the last section, which is kind of like, what do you do now? What is the path ahead? What are

7
00:00:36.640 --> 00:00:42.400
the choices that you need to make? Give in different scenarios, etc. When I was looking at that,

8
00:00:42.400 --> 00:00:47.200
it became clear that there was really only one choice that needs to happen, and then there's

9
00:00:47.200 --> 00:00:52.880
just two paths that split off of that. It was good for me because when we first launched

10
00:00:52.880 --> 00:00:56.960
hybrid, I was like, there's five kind of different scenarios, and then developing it more. I was

11
00:00:56.960 --> 00:01:00.720
like, well, these two are kind of similar. This just applied differently, so there's really four,

12
00:01:00.720 --> 00:01:06.160
and then going from four, now it really comes down to like one central choice and then two paths.

13
00:01:06.160 --> 00:01:11.760
And so if you allow me, I'll show you, share with you what those are. And so the single question that

14
00:01:11.760 --> 00:01:16.960
has to be answered at the beginning before you go down the path of whether you want to convert

15
00:01:17.040 --> 00:01:23.040
into having a facility or not is simply, do you want to want to have an in-gym training community?

16
00:01:23.680 --> 00:01:30.800
That's it. If you want to have an in-gym training community, you want to keep the in-gym experience,

17
00:01:30.800 --> 00:01:36.480
etc. You love that, and that's amazing. That's awesome. Then there's one really clear path

18
00:01:36.480 --> 00:01:42.240
that you need to go down, right? On the flip side, if you say, you know what, I don't need that

19
00:01:42.240 --> 00:01:47.200
necessarily. I just like getting clients results, and I don't have an in-person

20
00:01:47.200 --> 00:01:50.960
requirement to actually watch them work out at my facility, then there's a second path.

21
00:01:50.960 --> 00:01:57.040
And it's all good enough. So if you want to keep your facility and the community and the training

22
00:01:57.040 --> 00:02:02.880
that you have intact at your facility, then the only thing that you were going to do

23
00:02:03.680 --> 00:02:08.160
is simply add it as an additional level of service, which is what we call bolts on. So instead of,

24
00:02:08.160 --> 00:02:13.200
or in lieu of having a semi-private training, which you might have, and that's what I espoused

25
00:02:13.200 --> 00:02:18.880
for a really long time, instead of needing to spend the money on the equipment, spend, use the

26
00:02:18.880 --> 00:02:23.920
extra square footage, deal with scheduling and logistics around trainers for semi-privates,

27
00:02:24.720 --> 00:02:29.360
you can have the same revenue per customer except, and the same profit per customer, because

28
00:02:29.360 --> 00:02:35.520
HCP's also 20% goes to the coach. And so both of them are actually the same in terms of profit.

29
00:02:35.520 --> 00:02:39.760
It's simply that, with hybrid, you don't have all of the constraints that are associated with it.

30
00:02:39.760 --> 00:02:44.080
And so you would take your existing customer base, you'd add an additional level of service,

31
00:02:44.080 --> 00:02:48.880
which is bolt on, and then from an acquisition standpoint, when someone comes in, all you're

32
00:02:48.880 --> 00:02:55.040
simply doing is offering them a choice, right? And this is the long-term sustainable way of doing this,

33
00:02:55.040 --> 00:03:00.160
because you say, you get to the end of the sale, and you say, listen, you can do this at predefined

34
00:03:00.160 --> 00:03:06.480
times in a group at our facility, or would you prefer to do this one-on-one with me at your own

35
00:03:06.480 --> 00:03:11.520
convenience, right? And that's simply the question. So everything up to that point is the same. So it's

36
00:03:11.520 --> 00:03:15.280
the same external promotion, you don't need to change anything there, you don't need to change

37
00:03:15.280 --> 00:03:19.920
your landing pages. When they come in, you don't need to change your pitch, you literally just

38
00:03:19.920 --> 00:03:26.080
say at the end of this, would you prefer to do X or prefer to do Y, right? AV, right? And the

39
00:03:26.160 --> 00:03:30.480
nice thing is that it's an AV closed, it's an assumed sale, and it's relatively prescriptive. And so

40
00:03:30.480 --> 00:03:37.280
you simply just say, do you want to do this as workouts in a group here at predefined times in the

41
00:03:37.280 --> 00:03:44.400
gym, or would you rather work out with me individually, one-on-one at your own outside of the gym,

42
00:03:44.400 --> 00:03:50.000
at your own convenience, right? And then from there, a personal pick-the-thing that matches their suits

43
00:03:50.400 --> 00:03:56.480
their needs, right? And so that is the sustainable way forward for gyms who want to keep their gym,

44
00:03:56.480 --> 00:04:00.320
keep their community, keep the training workouts, all of that kind of stuff. That means that all

45
00:04:00.320 --> 00:04:04.400
you're doing is you add the additional level to your existing members, which means you're ascending

46
00:04:04.400 --> 00:04:08.560
them. So you add your profit per member, which will massively increase, and I've made other

47
00:04:08.560 --> 00:04:13.120
videos about just adding that level of service to your existing membership base makes you more money.

48
00:04:13.120 --> 00:04:16.960
But then from an acquisition standpoint, so that your gym does not die out because you're feeding

49
00:04:17.040 --> 00:04:22.080
only one thing, when they come in, you give them the option A or B, which one did you prefer,

50
00:04:22.080 --> 00:04:24.080
and then you can go on your very well.

51
00:04:26.400 --> 00:04:30.800
Real quick guys, if you can think about how you found this podcast, somebody probably tweeted it,

52
00:04:30.800 --> 00:04:35.200
told you about it, shared it on Instagram, or something like that. The only way this grows

53
00:04:35.200 --> 00:04:39.600
is through word of mouth. And so I don't run ads, I don't do sponsorships, I don't sell anything.

54
00:04:39.600 --> 00:04:43.600
My only ask is that you continue to pay it forward, do whoever showed you or however you found

55
00:04:43.600 --> 00:04:48.400
out about this podcast that you do the exact same thing. So if it was a review, if it was a post,

56
00:04:48.400 --> 00:04:51.200
if you do that, it would mean the world to me, and you'll throw some good karma out there for another

57
00:04:51.200 --> 00:04:58.320
entrepreneur. And with those situations, you can actually sell both too. You can sell them in the

58
00:04:58.320 --> 00:05:04.560
in-person workouts, and then also tap on bolt-on or hybrid on top of that, so you can actually get

59
00:05:04.560 --> 00:05:11.600
your EFTU or $400 a month for that client with really no additional costs. So that is kind of like

60
00:05:11.600 --> 00:05:16.560
after writing through this entire manifest, there's about 100 pages, like that was kind of the

61
00:05:16.560 --> 00:05:23.040
distillation of like, if you want to keep your gym, this is the best way to do it. Now, the second

62
00:05:23.040 --> 00:05:28.320
scenario is you say, I don't need to keep my gym in person, I'm not married to that, I prefer the

63
00:05:28.320 --> 00:05:34.880
one-on-one or closer relationships, et cetera, I'm happy to cut my overhead, et cetera. Then really,

64
00:05:34.880 --> 00:05:39.040
if there's like in that one, there's two sub-scenaries, and this is how you can see how I got

65
00:05:39.040 --> 00:05:43.760
multiple scenarios, but there's really just two sub-scenaries. If you are in favor of a long-term

66
00:05:43.760 --> 00:05:50.080
full hybrid model, then it's just, do you have a gym already, or do you not have a gym? If you have

67
00:05:50.080 --> 00:05:55.360
a gym already, then what you have to do is essentially start it as a side business. What I mean by

68
00:05:55.360 --> 00:06:00.480
that is that you're going to continue to market and sell, but you're not going to be feeding the

69
00:06:00.480 --> 00:06:05.200
in-person business, you're simply going to be stacking up your hybrid or side business,

70
00:06:05.200 --> 00:06:09.600
a side hustle version, and then the nice thing is because the profit is so high on this one,

71
00:06:09.600 --> 00:06:13.440
this will essentially cover the decrease that will happen in your main business because you're

72
00:06:13.440 --> 00:06:18.960
in a long-term feeding. As this one increases, eventually, there will be a time or a moment

73
00:06:18.960 --> 00:06:23.440
where the revenue from this and the profit from this far exceeds the profit you're making from

74
00:06:23.440 --> 00:06:27.120
your main business and the fixed cost that you have associated with it, and then at that point,

75
00:06:27.680 --> 00:06:32.240
you could make the transition from an in-person facility to a full hybrid facility,

76
00:06:32.240 --> 00:06:36.720
and so that is where a lot of our gyms have gotten to that point already, and they're making

77
00:06:36.720 --> 00:06:40.560
that transition, et cetera. So you want to build this up. Now, if I want to give you like

78
00:06:40.560 --> 00:06:46.160
overarching numbers, I think you should shoot for 50 to 75 hybrid clients before making the full

79
00:06:46.160 --> 00:06:50.880
switch. This is just having done this with a lot of gyms now and walks plenty of them through

80
00:06:50.880 --> 00:06:57.360
that process. 75 seems to pretty much cover you. I said it at a minimum 50, but the more the

81
00:06:57.360 --> 00:07:03.280
merrier because if you're doing 75 clients, we're paying you $400 a month, you're more than covered,

82
00:07:04.080 --> 00:07:07.280
and really the rest of that will now be pocket money because you're eliminating all the costs

83
00:07:07.280 --> 00:07:12.080
that we're associated with the old business, all right? So if we have our original choice,

84
00:07:12.080 --> 00:07:17.760
do you want to keep the gym in the in-person training? Do you want to not keep it? We already

85
00:07:17.760 --> 00:07:21.920
covered if you want to keep the in-person training, and then we entered into if you don't want to

86
00:07:21.920 --> 00:07:26.160
keep it, and we just covered if you have a gym. So what happens if you don't have a facility? So

87
00:07:26.160 --> 00:07:30.000
this would be people who have like personal trainers or people who are starting hybrid facilities.

88
00:07:30.000 --> 00:07:34.400
So if this is you, it works the exact same way as if you don't have to deal with the other business

89
00:07:34.400 --> 00:07:38.880
at the same time. So in some senses, you have an advantage of not having to kind of deal with some

90
00:07:38.880 --> 00:07:43.600
of the mental attention split of having to keep this one kind of going while you're really focusing

91
00:07:43.600 --> 00:07:48.560
your attention on feeding this side business, right? So for you, it wouldn't be a side business,

92
00:07:48.560 --> 00:07:51.840
it would be the main business. And someone posted in here earlier where they just they started their

93
00:07:51.840 --> 00:07:56.560
gym as a full hybrid facility, and that's the beauty of it. There's not a lot of overhead. And so

94
00:07:56.560 --> 00:08:01.520
all of the sales that come in are just pure profit, which is fantastic. And so that's kind of the

95
00:08:01.520 --> 00:08:08.000
way that I see this crystalizing out is that the existing gym becomes more profitable by adding the

96
00:08:08.000 --> 00:08:13.200
send, no argument, and it becomes logistically easier because there's no equipment, outlet,

97
00:08:13.200 --> 00:08:16.960
from a cash standpoint, you don't have to put square footage and allocate that, so you don't have

98
00:08:16.960 --> 00:08:21.280
to decrease your class sizes, and you don't have to deal with scheduling and coordinating with

99
00:08:21.280 --> 00:08:26.400
trainers, right? So which is all the downsides of semi-private, right? Now, semi-private's great,

100
00:08:26.400 --> 00:08:31.120
it's just that those are some of the costs associated with it. And so hybrid gets you all the benefits

101
00:08:31.120 --> 00:08:35.200
of an HTTP type setup or a high ticket program type setup for some eyes, except you don't have to

102
00:08:35.200 --> 00:08:38.640
deal with all the other stuff. So pretty much any of your training facility can add this as an

103
00:08:38.640 --> 00:08:43.600
additional level of service, make more money, really not change anything fundamental about the gym,

104
00:08:43.600 --> 00:08:47.600
even the acquisition just becomes an AB close, which direction they want to go, and you feed both

105
00:08:47.600 --> 00:08:53.280
businesses simultaneously, which allows you to keep above average profits by a long shot compared

106
00:08:53.280 --> 00:08:58.320
to facilities that aren't executing that. And then the alternative is you want to go full hybrid,

107
00:08:58.320 --> 00:09:04.240
you like that model of just having a very small fixed cost at the rent, and then having 20% cost

108
00:09:04.240 --> 00:09:08.480
that's variable that goes up as you scale more clients and goes down if you have less. And then in

109
00:09:08.480 --> 00:09:12.800
that case, you either transition by building that up so that it can replace your existing revenue,

110
00:09:12.800 --> 00:09:17.440
and then cutting that one off, and then keeping this, or if you don't have one, just building it from

111
00:09:17.440 --> 00:09:24.400
the onset as a full hybrid facility with no in-person training. So, anyway, I hope that clarifies

112
00:09:24.400 --> 00:09:29.200
it for anybody who is unclear. I know that I've had multiple scenarios that I think some of the

113
00:09:29.200 --> 00:09:34.400
case days that we have have five scenarios. I think this kind of distills it down into really the

114
00:09:34.400 --> 00:09:39.040
one decision that needs to be made. Do I want to keep in-person training? Do I not want to keep

115
00:09:39.040 --> 00:09:44.480
in-person training? And then once you've made that decision, the path is fairly straightforward,

116
00:09:44.480 --> 00:09:51.120
right? At a digital level of service, AB closed on the front end, and then, or just feed 100%

117
00:09:51.120 --> 00:09:54.960
the new business, let that one cover the cost of the old business until eventually you can shut down

118
00:09:54.960 --> 00:09:59.600
the cost of the old business, and then reap all the rewards and profit of the new. And that is all.

119
00:09:59.600 --> 00:10:03.280
So, I hope you guys have an amazing Sunday. Have that answered some of the questions that you might

120
00:10:03.280 --> 00:10:07.760
have had surrounding hybrid. I love the questions. So, thank you. Keep them coming. I get

121
00:10:08.400 --> 00:10:12.320
I get them all over the place. So, I try to do my best to kind of consolidate them into

122
00:10:12.320 --> 00:10:16.800
simple frameworks. So, have an amazing day. Keep being amazing. I'm going to say amazing more times.

123
00:10:16.800 --> 00:10:25.520
All right. Talk to you soon. Bye!