100 Starting Strength gyms in 5 years

[mgil]

PS. I had a response to your comment about cross-fit, which is a good one, but I lost it. UBE (ugly but effective) summary: usually, something unexpected happens, good and bad.

When you look back 10-15 years ago, Xfit was about the only fitness-related activity using barbells online. They were early to the marketspace.

In 2005, there were 13 gyms. https://en.wikipedia.org/wiki/CrossFit

Rip wrote articles like this for Xfit in 2007:

http://journal.crossfit.com/2007/11/be- ... y-mark.tpl

Rip continued putting stuff out for Xfit though at least 2009:

http://journal.crossfit.com/search.php? ... oe&x=0&y=0

Article and references to Rip typically included a link to find the book.

Given the growth of barbell related fitness and Rip being granted access to Xfit at the time as the primary strength coach, I would assume that a significant amount of awareness is due to Glassman. Rip has worked hard to update the copy since then, but initial exposure (and subsequent vacuum of published "manuals" since a lot of content started migrating to video with the advent of YouTube) certainly helped drive book sales.

[mgil]

Data point: Wolf used to teach a two month class at a xfit gym in NYC for about 12 people for $340/month. AFAIK he always sold all slots.

Most of his base would be considered "affluent" and having access to the largest Xfit gym in Manhattan certainly helps.

There are certainly markets to support these cases. Again, how well does this extrapolate? Would Manhattan support 100 active clients per month?

[quark]

Data point: Wolf used to teach a two month class at a xfit gym in NYC for about 12 people for $340/month. AFAIK he always sold all slots.

Most of his base would be considered "affluent" and having access to the largest Xfit gym in Manhattan certainly helps.

There are certainly markets to support these cases. Again, how well does this extrapolate? Would Manhattan support 100 active clients per month?

Given the Manhattan real estate market, that could be a problem.

BTW, Wolf taught two classes and another coach (not a SSC) had a third, so it's not implausible that they could attract 100 clients at these rates, but 100 clients would not likely pay enough to cover the rent.

[KyleSchuant]

Another aspect I was thinking of last night: the requirement for the owner to either be or hire an SSC. On the face of it, this makes sense, much like Crossfit's requirement of having the Crossfit cert. The difference is, of course, that there are (going by the site's map) just about bang on 100 SSCs worldwide, while there are countless Crossfit coaches.

Let's say you're not an SSC but think this might be a good investment. You find a local SSC and hire them to work in you gym. That's SSC Jo Jones, a very capable coach - she's doing her degree in physiotherapy. 18 months from now she graduates and goes to work as a physiotherapist. She does part-time for a little while but gradually drifts off, she's had her fill of working 0600-2100 every day. You can't find another SSC - so now you have to close the place? But you're in luck! After six nervous months hoping the SS franchisor doesn't notice you're using a non-SSC, Jo's brother Joe Jones just got his SSC, so you bring him in. His wife's pregnant so as a family man he should want job stability. And he does, in fact he says, "I want $10,000 more than my sister got, oh and I want a clause that if the place ever closes I get a $100k payout."

So you decide to give up and sell the place. But can you? You can only sell the business to an SSC, or someone hiring an SSC. And it's not like there are 400 of them in your state, if you're lucky there are 1 or 2. Do they want to buy a business? Can they afford to? Will they move across the country to do so? Many people get into business with the thought that if it does badly, they can always sell it and move on - and if it does well, they can sell it for a good profit and go on to their next business.

Likewise if you yourself are an SSC but want to sell the business for some reason.

Again, Crossfit faces similar issues, but they've so many coaches it's not a big restriction, and anyway the affiliate fee is only $3k and HQ does little oversight of how you run your gym. But SS is offering fewer coaches and though we don't know about the fees there's certainly more oversight planned, by the looks of it.

[Hanley]

that could be a problem.

That's why God invented Weehawken.

[KyleSchuant]

When I asked the coaches of SS who among them was making the median income (or more) of their location/place of living, solely as an SSC nobody responded.

You get a similar mysterious silence from personal trainers. It's one of the truths of the fitness industry nobody speaks about: not many make much money. The actual money is in seminars, training the trainers, books and so on. As I've done before I point to the SS seminar as an example. They get 15-25 people at $1,000 each for a weekend. That's $20,000. Even allowing $2k for each of 5 coaches plus Rip, that's $8k profit in a weekend. Now divide that into how many Crossfit members or personal training clients or general gym members you need, and consider how much more hassle and time it is to handle all those people compared to doing just one weekend.

Obviously, not just anyone can start offering seminars, you need some kind of reputation first. So you do have to do your time on the gym floor. And of course, the work is not just on that weekend, there are things to prepare and do afterwards. Still: the real money isn't in actually training people. Most trainers and coaches are working part-time and making less than median income for their area. Everyone can name someone who's an exception and makes six figures. And that's the point: you can name them. Whereas you cannot name all the (for example) lawyers and doctors making a lot of money.

The main limit is just the hours. In order to get 8 hours a day of training people you have to be in the gym 0600-2100 or something like that. That takes a lot out of you. And with training people being a personal service, well ask any waitress or psychologist what they're like after talking to people 8 hours a day. Ask yourself if you can give the 40th client that week the same service you gave the 1st client that week. Sheer interaction fatigue tends to limit growth even if you're willing to do 0600-2100 for five days a week.

For these reasons, a franchise may appeal to some SSCs.

My point is that none of us know.

I agree. And I stress that I would like to see it succeed, because more people getting barbells in their hands is always a good thing. And if it succeeds then more coaches and trainers stay in the industry, instead of 80% (in Australia, at least) of them leaving within 5 years - and if they stick around long enough, they get better, which can only help the general public.

Still, it's interesting to talk about the issues and implications.

[neandrewthal]

Guise, too many numbers. It's hard to read this thread as quickly as I normally would. Well, I guess I could technically read it just as fast but if I don't slow down to think about what the numbers mean then there's no point.

[neandrewthal]

And as for people blowing money on hobbies, I just hopped over to my home forum and saw this right away. Thought it was very appropriate:

[Cellist]

Interesting to see the experts talk shop. Sounds just like the BL intern pyramid; an idea for the brand to make the most money possible from zealous coaches and PTs, ie. those who have or have considered the cert. Some are going to be absolutely convinced that the publisher, brand and it's owner will do his best to generate their franchise business so that they can fulfill their dream of coaching full time, making a living and making the most of what they learned at their first weekend seminar. The hope is that this idea is so alluring that rational investment considerations get thrown out the window. Newly minted SSCs will be borrowing from banks and family, to acquire equipment with poor resale value and rigid, controversial methods and a brand lacking recognition in the broad market. I'm imagining something like Uber for personal training. Maybe there's a better analogy.

[DoctorWho]

PS. I had a response to your comment about cross-fit, which is a good one, but I lost it. UBE (ugly but effective) summary: usually, something unexpected happens, good and bad.

When you look back 10-15 years ago, Xfit was about the only fitness-related activity using barbells online. They were early to the marketspace.

In 2005, there were 13 gyms. https://en.wikipedia.org/wiki/CrossFit

Rip wrote articles like this for Xfit in 2007:

http://journal.crossfit.com/2007/11/be- ... y-mark.tpl

Rip continued putting stuff out for Xfit though at least 2009:

http://journal.crossfit.com/search.php? ... oe&x=0&y=0

Article and references to Rip typically included a link to find the book.

Given the growth of barbell related fitness and Rip being granted access to Xfit at the time as the primary strength coach, I would assume that a significant amount of awareness is due to Glassman. Rip has worked hard to update the copy since then, but initial exposure (and subsequent vacuum of published "manuals" since a lot of content started migrating to video with the advent of YouTube) certainly helped drive book sales.

I completely agree. Weird circumstances, and some luck. But it happens a lot, and I'm speculating that we are seeing the beginning of the second chapter (which is starting badly for SS by alienating some customers). Examples of chapter 1: Skadden Arps co-founder (maybe Joe Flomm?) became the leading M&A lawyer because he was Jewish and closed out of Wasp firms, who thought it was not dignified to practice sharp-elbow M&A. Microsoft didn't sell a disk operating system, and hadn't developed one, when IBM was looking for PC software. But the leading supplier didn't want to sign a one-sided non-disclosure agreement and didn't want to commit resources to the project. And Gates himself wasn't enthusiastic about it. But MS licensed in a DOS, got the contract to supply the IBM PC. Chapter 1 involved some "luck" (even though it wouldn't have seemed so to Joe Flomm at the time). But with a lead, like Rip's lead over, say, Stronglifts, Skadden and Microsoft did well afterwards.

[mgil]

If you’re looking at stronglifts in terms of monetization, they actually monetized the app first and got a spot on an iPhone super bowl ad.

Regardless, luck is important, as you point out.

[torkins]

But with a lead, like Rip's lead over, say, Stronglifts, Skadden and Microsoft did well afterwards.

What lead does Rip have over Stronglifts? Anecdotally Stronglifts seems far better known, albeit it is a web/mobile-only presence as far as I know.

[mgil]

But with a lead, like Rip's lead over, say, Stronglifts, Skadden and Microsoft did well afterwards.

What lead does Rip have over Stronglifts? Anecdotally Stronglifts seems far better known, albeit it is a web/mobile-only presence as far as I know.

Stronglifts as about 25,000 reviews on the Apple App Store.

The SS app has 721.

Stronglifts app has been around since 2011 or so? SS is maybe 1.5 years?

[KyleSchuant]

Wow. I wonder if Mehdi has access to all the training data? That could be some good stuff.

[stantonjordan]

At $250 it would be under-priced, especially in a franchise model. I think there are plenty of locations that could achieve 100 people and there exists a price that it can be profitable. I am able to keep my costs lower so I can charge less and still profit. I have my own model figured out. The franchises are better suited for those that would rather work in a model established for them.

In my experience the market has no problem with $250 per month for novice classes. In fact the bigger barriers are committing to coming three days a week. In my opinion the class environments are well worth their money. I can get a group of 6-8 moving very well and a lot stronger in 8 weeks time. I would have done that when I was a novice and been happy.

I definitely did not open at capacity but again I don't have the same tools that the franchises are going to be working with. Maybe they can I don't know. Will be interesting to find out for sure.

I wish nothing but the best for any gym bringing barbells to the public. Its an important service. I know I felt like I have accomplished more good as a coach then I did as critical care nurse.

What do you think about the rule of capping the membership at 100 people? Would 100 x $250 or $300 seem like enough revenue, considering the SSC pay and the facilities costs? And 100 seems achievable for the right coach (good, but not exceptional) in the right location - right?

[DoctorWho]

Maybe I'm wrong about the lead. I'm a little skeptical about the meaning of web metrics, but I might be wrong about that too. Does Mehdi have StatonJordans out there?

[mgil]

I’m struggling with the logic of a “franchise model” setting costs that are ultimately determined by the market.

[Hamburgerfan]

At $250 it would be under-priced, especially in a franchise model. I think there are plenty of locations that could achieve 100 people and there exists a price that it can be profitable. I am able to keep my costs lower so I can charge less and still profit. I have my own model figured out. The franchises are better suited for those that would rather work in a model established for them.

In my experience the market has no problem with $250 per month for novice classes. In fact the bigger barriers are committing to coming three days a week. In my opinion the class environments are well worth their money. I can get a group of 6-8 moving very well and a lot stronger in 8 weeks time. I would have done that when I was a novice and been happy.

I definitely did not open at capacity but again I don't have the same tools that the franchises are going to be working with. Maybe they can I don't know. Will be interesting to find out for sure.

I wish nothing but the best for any gym bringing barbells to the public. Its an important service. I know I felt like I have accomplished more good as a coach then I did as critical care nurse.

What do you think about the rule of capping the membership at 100 people? Would 100 x $250 or $300 seem like enough revenue, considering the SSC pay and the facilities costs? And 100 seems achievable for the right coach (good, but not exceptional) in the right location - right?

I would never pay 250 for that. I think you’d have to be out of your mind to pay that.

[alek]

At $250 it would be under-priced, especially in a franchise model. I think there are plenty of locations that could achieve 100 people and there exists a price that it can be profitable. I am able to keep my costs lower so I can charge less and still profit. I have my own model figured out. The franchises are better suited for those that would rather work in a model established for them.

In my experience the market has no problem with $250 per month for novice classes. In fact the bigger barriers are committing to coming three days a week. In my opinion the class environments are well worth their money. I can get a group of 6-8 moving very well and a lot stronger in 8 weeks time. I would have done that when I was a novice and been happy.

I definitely did not open at capacity but again I don't have the same tools that the franchises are going to be working with. Maybe they can I don't know. Will be interesting to find out for sure.

I wish nothing but the best for any gym bringing barbells to the public. Its an important service. I know I felt like I have accomplished more good as a coach then I did as critical care nurse.

What do you think about the rule of capping the membership at 100 people? Would 100 x $250 or $300 seem like enough revenue, considering the SSC pay and the facilities costs? And 100 seems achievable for the right coach (good, but not exceptional) in the right location - right?

I would never pay 250 for that. I think you’d have to be out of your mind to pay that.

In just over 2 years of training, I've spent about $300 on gym fees, $200 for shoes and a belt, another $150 on clothes, chalk, straps, and wraps, and let's throw on another $100 for good measure. That totals $750, or probably 2 months at SS franchise gyms. Yeah, out of your mind seems right.

I could also see the conversation with my wife.
Me: "Hey babe, I'd like to spend $375 a month to go to a gym 3x a week doing a program that I can get for free on the internet. Oh, and there will be a coach at every session to make sure I'm doing everything right."
Wifey: "You must be out of your mind."

[mgil]

Most of us, even if we have the income to cover an SS gym, aren’t in the target market.