I just read another one of those headlines the other day.  You know, the ones that promise you can make gobs of money in record time?  The ones that help you believe that anything is possible with your fitness business.  "If only you'll buy our program, we can show you the way.  We can show you the light, and bring you riches beyond your wildest dreams."

I've purchased many of these programs.  I think we all have that tendency.  As fitness professionals, we're always busy with the work of helping our clients grow and achieve results.  Work that is demanding, time consuming, and that often leaves us with little extra time to perform all the work responsibilities that are essential like marketing, accounting, leadership of your staff, management of your property, etc.

For me there seems to be no end to the work at hand.  And that's OK because I like working.  It keeps me out of trouble and helping people transform their lives and grow is rewarding.  The problem is keeping up with all of the work that must happen outside of the direct work with clients.  The problem for me is that I don't love all the extra work I have to do that doesn't relate directly to my client work.  So, in the past, I groped for solutions to this problem instead of thinking about it more clearly.  Instead of thinking about exactly how I would like to spend my time.

Some of that groping was extremely beneficial for me.  Much of what I learned in programs like Net Profit Explosion was helpful.  And at the same time much of what I learned combined with some bad habits of mine, left me over-worked, under-organized, and always hoping for that next big hit.  Kind of like that crack addict on the corner.

Here's what I've learned since then...

It doesn't matter how much money you make, it's how much you keep.  A colleague of mine, Dave Dubail, shared that with me one day.  It came from one of his highly successful clients and is a dose of wisdom that we should all let sink in deeply.  It's the heart of this discussion.

In my fitness business right now there is little room for misjudgments and error, which is another reason those ads that promise big money in short periods of time sound so compelling.  Can I really make $163,200 from one public speaking event?  That would really solve a lot of problems for me.  "Do these guys really have the secret?  Do they really have something that can help make my life a little easier?  God I hope so, because I just can't keep working like this.  I'll go mad!"

You can find the headline I'm referring to by clicking here.  It's a sales page for a program that NPE sells called Gold Rush.  It's a terrific program and I've used it myself.  In fact, I'm planning to run another one this fall.  It's a great way to accomplish many important things in your business at the same time, including finding a rush of new clients all at once.

The truth is that you CAN make that much money from one event.  But it will take you a lot longer than that one night to actually EARN that money.  This is still OK. and I would still suggest you check out this program from NPE, because it's a great way to market you fitness business.  But let me explain what I'm talking about here...

My event raised more than 2K for the Crohn's and Colitis Foundation, added 150 people to my mailing list, and I sold 23K worth of training.  Not anywhere near that $163,200 you'll see on that sales page I mentioned but not bad, especially since poor weather that night probably cut my attendance in half.

To truly EARN that 23K though, it took about 8 months.  That's how long it took to deliver the training that was sold that night to 6 clients who came to the studio on average twice per week for training.  So, in truth, this event added about $2,800 to my bottom line.  Still a really good number and good amount of money.  Just a better perspective on how to look at that money.

There are other questions to consider as well which I will only mention in this post...It took me about 40 hours to plan the event and my time is worth between $75-100 per hour.  I had to either deliver the training myself or pay a trainer to deliver the training and there is a cost to that, and there are other costs of doing business that factor in to the total.  The bottom is that yes, it was totally worth doing, but in running your business everything has a context and it doesn't matter how much money you make, it's how much you keep.

I've admitted in previous posts that I too have gotten caught up in the hype.  In fact, while I was an NPE Member, I became a leading story.  A poster child of success.  A beacon of hope and inspiration for others to model.  And more importantly for the folks who wanted to sell my story, a powerful example of why you too should buy their products.  The problem was that though I was making big sales, I wasn't really making big profits.  What I really needed to do was educate myself about how to understand the accounting of my fitness business.

Alright, that's it.  Out with it.  I've come clean.  I was making sales in the neighborhood of 25-50K per month, but I was still struggling.  And the reason I've chosen to share this with you is that it's vitally important you understand exactly what was happening so that you too don't make the same mistakes. And that you too can make the corrections I've made and begin to understand how this beast of your fitness business is really designed to work.

25 to 50K in sales per month is terrific!  And I want to be clear that I'm not complaining, and am grateful for everything I learned through my work with NPE.  I want you to understand the context.  Once again, so that you can begin to understand what you truly need to do to make your fitness business profitable (as mine is now).  And to help you understand that there is no magical formula that will take you there.  Many of these programs have great ideas and solid systems that will help you build a successful fitness business.  NPE is one of them.  You have to decide how to pick and choose which programs and which services will help you the most.  You also have to understand how and why they can tell you in their sales copy that you too can make big monthly sales from one program or one event.  Then you can make educated decisions about which programs you think can help you.  Because when taken out of context, these claims of big profits in a short amount of time are false, like a rainbow in the dark.  And they can get you into trouble...

Over the course of the last 2 years I have sold more than 50K worth of personal training per month 4 times.  NPE helped me do that.  My all time best was 52K in a 6 week time period.  Sounds outstanding doesn't it?  Well, it is, but again, let me explain what it truly means.

Let's say it took 8 new clients to generate that 50K in sales.  That means that 8 different clients purchased personal training programs that cost an average of 6K.  6K in my studio will buy you about 9 months to a year's worth of personal training.  Most of my clients (75%) train with us two times per week.  They do the rest of the work on their own.  So, in order for my business to actually EARN 50K in sales, it will take 9 months to a year.  In other words, we will have to train 8 clients twice per week for a period of 9 months to a year to actually earn that 50K in sales.  If you do the math, you can see that 50K over 9 months is about 5,500 per month.  Still pretty damn good.  But remember, context is important.  It still takes about $20K per month in overhead (including my small salary) to run my operation.

Still, 50K and 8 new clients in one month is not bad.  In one month, you add $5,500 per month to your bottom line.  But here's the catch.  If you're paying trainers $20 per hour to see those clients, it actually costs you about $1,400 per month in staff time to take care of these clients.  And that doesn't include what you pay in worker's compensation insurance and payroll tax expenses.  It also doesn't include the other costs involved in keeping your studio running each day, like heating and cooling, equipment maintenance, admin staff, etc.  In other words, there is a bottom line cost that you pay to run your business hour to hour, and many things combine to add to this cost.  If you don't know what this cost is, you need to find out.  In my situation I know I need to make $62 per hour for at least 8 hours each day to cover my fixed costs (not including labor).  So what that 50K in sales really means is about a 3K per month net profit.  There, now that big sales number in the headline is living in a better context than it was before.

What you really need to know is how many clients you need to see each week to make your profit.  That is the bottom line.  Every new client brings cash, but if you spend that cash before you earn it, you end up with a liability on your books that can quickly make you fall behind.  Ask me, and I'll share with you how this got my into a little trouble, especially when the economy did its nose dive.  Because if you spend that money before you've actually earned it, then you have one important problem.  You still owe the client the training.  And either you are going to have to use your own time, or pay someone else for their time to deliver on what you owe.  You are borrowing time and money from your own business which increases your debt.  Not to mention, that since you spent the money, you now have to go out again this month and make even more big sales to cover your nut.  You're in that hamster wheel chasing the elusion of critical mass.

Here's my suggestion...

Don't get caught up in the sales hype and the big dollar figures.  Keep in mind that regardless of how much you actually sell in a month, the important thing is how much you actually earn in a month, and ultimately, how much you can keep.  How many training sessions can you alone, or you and your current staff actually deliver?  Work hard to make sure that as quickly as possible you get to the point where you are performing the number of sessions you need to perform each month to be profitable.  This, in combination with a tight management of your expenses, will ensure that you don't fall behind and get yourself into a disastrous situation.  A situation where you have to keep spending money before you've actually earned it.

You also need to make sure you that you have a great accountant and a savvy bookkeeper who can keep up.  At least once per month, you and your accountant need to sit down and review what is happening in your business.  If you avoid this work, you will pay the price.  If you avoid this work, you're not a business owner, you're still just a trainer working in your own business.