I heard a story recently told by a famous marketer about a hotel manager that would look at the capacity of the rooms in an interesting way.  

Let’s say he had 100 beds and 70 of them were full. 

By the way most people look at it, He would have been at 70% capacity.  

The way this guy looked at it was 30 beds open and each bed had the potential to be a $200 customer.  

He motivated himself by looking at this as a $6,000 loss per night.  

By not filling these available spaces he was losing money!  

Can you imagine how much different you would run your gym if every empty space in your classes or sessions was considered a loss? 

This message is not meant to have you freaking out over every empty spot you have and act like the sky is falling.  

It’s just to help make you more aware that capacity drives profitability.  

The reality is people do not look at usage enough in the fitness industry. 

Start looking at the profit you make per session and see where can you improve. 

Do you have a session that needs to be removed because it’s been dead for a few months? 

Do you have a time slot like lunch time where nothing is going on and you have an opportunity to get innovative and fill it? 

Are you using a 1-1 model and getting $80 per hour when you could bring this to $50 per person and get $200 for training 4 people and keep your costs the same?  

Are your prices too low? 

Is your payroll creeping up and becoming too big of a percentage relative to your revenue? 

The gym business is not an easy business and the owner that does not pay attention to profitability will struggle. 

One final thought.  

I am not a big believer in saving yourself into profitability.  

I think this make you play small. I believe you need to invest yourself into profitability.  

You just need to be smarter with the money you invest. 

Spending money to acquire a customer is an investment. 

Spending money to hire a business coach is an investment. 

Spending money to hire someone to be your operations person is an investment that will give you a ton of time to continue to grow your gym. 

Top line revenue is cool but it’s what you take home that matters.  

Be sure it’s on your radar. 

Vince