8 Steps of Successful CrossFit Box Affiliate Management
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Congratulations on starting your CrossFit box. The hardest part is over. Now it’s time to start managing your box like a true pro. Good management is key to business success. Poor management can have some painful consequences.
Though we’re no experts in CrossFit box management, there’s a good chance that most business management fundamentals will go a long way to making your affiliate a success. Running a CrossFit box is no different than running an ice cream stand; if you spend more than you make, you close down shop. Plain and simple. People like to get stuck in the nitty gritty details of running a box, but that’s what it comes down to, more money in than out.
Okay, so how do you start getting more money in the door? Below you’ll find seven simple steps to help your manage your CrossFit box on a day-to-day, as well as long-term, basis. They’re easy ideas that you can put into action in a matter of days or weeks that will have long-term results for your CrossFit box’s profitability.
1. Create & Follow a Long-Term CrossFit Business Plan
Even though you might think your CrossFit business will be over capacity the second you open for business, that’s usually not the truth. It’s going to take time for your business to grow and increase membership, and you need to have a plan for building your business. Take time to work out a thorough a long-term business plan, taking into account long-term profitability. How many members do you need to break even? How many members until you need to open a second location? These should all be thought out well before opening the doors. Now that you’re up and running as an affiliate, it’s time to go take a look at your original business plan and see if you’re still following it. Most businesses deviate from their business plan, but it’s always good to keep it nearby.
Marketing is an integral part of any business, and is the lifeblood of continual membership growth. Word-of-mouth advertising is great but it’s also wise to increase your reach by employing other forms of marketing.
2. Develop & Execute Your CrossFit Business Model
First and foremost, you need to think about your CrossFit business model. Are you looking to be a high-volume-class location, or will you be a box that gives more individualized instruction? Keep in mind that high-volume-class locations can’t charge overly high rates because clients won’t be willing to pay high membership rates if they aren’t getting extra attention. There are benefits to being small size. Small class sizes mean that you can charge higher monthly membership dues. However, this also means you need to hold more hourly classes per day to make the same amount of money as a high-volume-class.
Take time to think about where your skill set is best utilized. Since you’re going to be the first trainer of your business, would you rather wear a microphone and have a group of 10-20 per class to instruct, or would you prefer to have 5 clients per class that you can really guide and develop relationships with? Once you gain some traction in your local market, you can start having specific classes and different pricing strategies. Maybe from 5am til 6am you have “bootcamp style” classes where there’s a 20 person max class size, and from 6am til 7am, you have a 5-person class for those who want more instruction.
3. Define the Target Market for Your Affiliate’s Region
Once you’ve decided on a facility and the type of business model you will use, it’s time to figure out who’s going to be your target market. Any marketing consultant worth their weight will tell you one thing, start with a narrow focus and slowly expand to new demographics once you have traction with your current one. There’s no use in spreading yourself too thin before you get established with your current demographic. Don’t go for the college crowd while simultaneously trying to cash in on the baby boomers and stay at home moms.
Based on the anecdotal evidence we’ve seen from working with so many CrossFit boxes, the best demographic to start with would be males from ages 25-35. These are the guys who are most concerned with their physical appearance. They also tend to have a few years of work experience and are therefore earning enough money to pay a $100/month CrossFit membership.
Once you’ve got a good following of these guys, you can branch out into new areas. We’d suggest going after the same age demographic, but women this time. CrossFit is becoming more and more popular with women, so making sure to accomodate female clients is necessary to ensure long-term success and profitability.
You might want to consider having male and female classes so that women don’t feel like they’re being oogled by the male clientele. If your females clients feel they’re just being eye-candy for your male clientele, you’re going to lose them as students. Keep this in mind.
4. Set a Monthly Marketing & Advertising Budget & Spend It!
If there’s one thing that new businesses don’t like to do, it’s pay for advertising and marketing services. Can’t blame you. With social media ads being a waste of money and most PPC companies charging $1000/month minimums, it’s hard to decide where to market. However, it’s best to set a advertising budget and stick with it. Spend every last dollar, every month, so that you know you’re doing all you can to make your business succeed. Until you can rely on word of mouth marketing, you’re going to need to pay for some marketing services. Take a peek at FitnessTexter (that’s us!). We do text message marketing for a variety of fitness businesses.
5. Utilize CrossFit Box Promotion Techniques to Increase Market Share
It’s no shocker that there are a lot of CrossFit boxes out there right now. It’s by far one of the fastest growing fitness businesses in the world. How are you going to separate yourself from the other boxes in your city? This is where promoting your box comes in. Running a successful CrossFit box is more than just creating the best workouts for your athletes, it’s also about getting more athletes in the door.
You need to figure out ways to get the word out about your CrossFit. If you’re a new box, you can always look into doing a Groupon. They are a great way to get the word out about your business. They have a huge mailing list and you’ll instantly start getting some website traffic which will help your PageRank. You can also look into doing some social media marketing. If you can boost the amount of people talking about your box, there’s a good chance that you’ll get more people in the door.
6. Work on Increasing your CrossFit’s Profitability
When it comes to owning a successful business, be it a CrossFit box or lemonade stand, the end goal is the same, increase profitability. It’s true, CrossFit boxes can be a very profitable endeavor. However, if you’re not running your affiliate correctly, you’re going to be hemorrhaging money. Dissect your affiliate’s current profitability and see where you can make some changes. Perhaps an increase in monthly membership prices. Maybe you’ll realize that you could squeeze an extra class or two per day. Based on your earnings-per-class, you could see a significant boost in monthly revenue from simply adding a one or two more daily classes.
7. Emulate the Business Practices of Successful CrossFit Affiliates
As they say, imitation is the biggest form of flattery. The same goes for business. If you’re a new box affiliate owner and you’re looking for ways to make your CrossFit successful, look no further than the best boxes out there. Take a peek at what Rich Froning and the guys and gals of CrossFit Mayhem are doing. Seeing as Rich is a multi-year winner of the CrossFit Games (and fittest man alive), there’s a good chance they have some keys to success figured out. You’ll probably see a few main characteristics amongst the successful boxes; they have great community, a strong membership (that socialize outside of the box), and they have competitive rates for their geographic region.
8. Create Exit Strategy if You Decide to Sell Your CrossFit
You might not even be thinking about it now, but there might come a time in the future when you decide to sell your CrossFit box. It’s always a good practice to have an idea of what kind of value you put on your business. How do you even valuate a CrossFit box? The best way is to use the affiliate profitability spreadsheet that we created. It will help you figure out how much you’re earning, and give you leverage when you decide to sell. Don’t sell yourself short when it comes to deciding on your sale price. A CrossFit box earning $60K per year can easily sell for several hundred thousand dollars. Don’t just sell what your business is earning, sell it for what it COULD be earning, in the long term.