Here’s a fact. My business is exactly like yours.
- I have administration.
- I have operations.
- I have sales and marketing.
- I have financials.
While I don’t have an onsite staff, I retain the services of over 50 different freelance experts. As such, I manage their time and budgets for all of our projects, services and products.
So — you and me — we’re really NOT that different…. except, perhaps, for this ONE THING.
The Smartest Thing I Ever Did for My Business
When I first started up… way back in 1988, I had a very specific plan.
Oh sure, it changed over time. But, one thing remained constant thanks to a business mentor who convinced me of the most important thing I could do for my business.
He said this: “No matter what, make sure you have a smart EXIT STRATEGY.
At the time I didn’t know what he was talking about. I’d never heard of an “exit strategy.”
Hell, I was just starting up. Why in the world should I be thinking about an exit strategy..??
But, I trusted his wisdom. So, with his guidance, I set-up my business to MAXIMIZE its total worth over time.
As it turns out, he was right.
My exit strategy proves itself over and over.
Almost every month for the past two years, I receive inquiries from either brokers or individuals interested in BUYING MY BUSINESS!
There are public records that show I’m closing in on retirement age. So, they all figure I’m ready to cash out.
NOT For Sale
First off, I’m NOT selling my business. I absolutely love what I do.
But, what if something were to happen to me?
My wife, Gigi, (the lovely therapist) successfully operates her own private practice.
My daughters, Chelsea and Roxanne, both have their own careers.
So, having a solid exit plan is great insurance for worse case scenarios.
But, the real value in having an exit strategy is that it will absolutely guide you into building a “higher net worth” for your business.
It’s NOT About Selling. It’s About Building Equity.
Here’s what I mean.
Most trainers, boutique studios and small clubs have just one revenue stream: —> Sessions.
If you offer memberships, then, you have two revenue streams:
- Sessions (group, one-on-one, etc.)
- Memberships (EFT – monthly recurring)
So, in terms of net worth, you have two revenue streams (both of which are quite volatile) and some assets if you own the equipment.
Knock, Knock… It’s the Shark Tank!
Imagine there’s a knock at your door and in walks Mark Cuban, Barbara Corcoran, Daymond John, Lori Greiner, Robert Herjavec and Kevin O’Leary — yes, the Shark Tank.
And, they’re interested in your business. How well would you hold up to their scrutiny?
The great lesson to be learned from the Shark Tank is that once they get beyond the passion of the entrepreneur, it’s ALL about the NUMBERS.
In this context, most health and fitness businesses would fall short. Way short.
But, what if…
Undoubtedly, the Sharks will ask this question: “Tell us about your revenue streams.”
But, instead… imagine yourself standing confidently in front of these mega-investors and calmly responding with these answers, “I generate monthly revenues of:
$_______ for sessions
$_______ for online training
$_______ for memberships
$_______ for branded supplements
$_______ for fitness accessories
$_______ for branded apparel
$_______ for online affiliate commissions
$_______ for online workout videos
$_______ for online fitness courses
$_______ for custom mobile app
$_______ for monetized YouTube Channel
$_______ for sponsored podcast
$_______ for vending machines
…. JAWS DROP!
The Overnight Success
Sure, those are a lot revenue streams and it takes a ton of work to set them up.
But, listen, almost all overnight success stories took over 10 years or more to happen!
In other words, if you have a planned exit strategy, that MAXIMIZES your business value/equity over time… then you undoubtedly plan for these revenue streams — and build them out over time.
They are constantly on your radar.
Therefore, EXECUTION and IMPLEMENTATION are just a matter of TIME.
On the flip side, if you don’t create multiple revenue streams — and you don’t build VALUE / EQUITY into your business — you’ll end-up chasing clients, growing old — and have nothing to show for it (other than a list of clients).
As a result, just like thousands of other trainers, boutique studios and small clubs…. after years of hard work there’s no real value to sell. There’s no solid equity in the business. Thus no incentive for anyone to purchase.
One Step at a Time
If you know my story, you know I started up in 1988 with a nutrition and lifestyle consulting firm in Newport Beach, CA., called MediCorp.
Within 2 years the business morphed into a publishing company with ONE PRODUCT. The Daily Journal.
We sold thousands of Journals to fellow trainers, studios, clubs, corporate wellness programs, etc. We enjoyed very early success.
But, it was a single revenue source.
Heeding my mentor’s advice, I developed multiple new revenue streams. in order to increase the VALUE of my company. There are hundreds of other reasons to expand and diversify… but increasing VALUE is the priority.
Now, 30 years later, I oversee numerous offerings from printed materials and video production to supplements and software. Plus, I still provide marketing consultation for a small group of clients.
The VALUE of my little company is 20,000% more than what it was when I started.
The 30 years went by in a flash. And, trust me, you’ll feel the same way when you turn around and realize you’ve been at it for 10, 20 or even 30 years.
Did you spend that whole time chasing clients — or did you build something of value?
It’s Never Too Late To Start
No matter where you are in your company’s lifecycle, it’s never too late to start increasing the VALUE of your business.
It does NOT take 30 years. Or, even 10 years for that matter. You’d be amazed how quickly you can do it.
As much as this sounds self-serving (and it probably is..) the process of building EQUITY and creating VALUE starts with your BRAND.
And, then, placing your BRAND on as many products and automated services as you possibly can (review the list above).
Talk to the Experts…
It seems like all the workshops and seminars in the fitness business are all about “Getting New Clients” or “Exercise Protocol” or “Operational Systems.”
That’s because these topics generate the most interest. And, they are actionable topics that can be implemented “right now.”
But, it’s short sighted.
I’ll bet my bottom dollar that if you cornered a top industry expert like Thomas Plummer and asked him how you can MAXIMIZE the VALUE of your business… OVER TIME…
Well, among the hundreds of tips he’d offer… a big one would be BUILDING BRAND EQUITY via MULTIPLE REVENUE STREAMS with BRANDED PRODUCTS and SERVICES.
Thomas, himself, is a “Signature Brand.” And, he has multiple revenue streams with his various workshops and seminars. Plus, individual consulting and 11 published books on Amazon.
The Thing About Branding
The thing about branding – and the reason it doesn’t resonate among health and fitness professionals is this:
Our industry is totally sales driven.
We only eat if we have sales. So, all of the sales strategies and tactics are about “response” and immediate “conversion.”
Branding, on the other hand, is playing the “long ball.”
It’s slow and methodical. It’s a super long-term investment.
It’s difficult to even talk about “BRANDING” in an industry driven by instant gratification.
But, trust me, you can take this to the bank.
Some day, somewhere, someone is going to ask you this question:
How much do you think your business is worth?