Chris Cooper is the founder of Two Brain Business. If you own an affiliate, you have come across Chris's books, podcasts, and resources.
Chris and I were talking the other day about apparel plans. The goal with the apparel plan is to keep you on track and to save you time. Chris wanted to take this a step further: how does an apparel plan fit into the big picture planning for your business? In this post, Chris explains how he walks his mentor clients through an annual plan and how an apparel plan saves you time, money, and effort:The gym business might not be cyclical, but it is predictable.
Every year in August, Catalyst clients disappear to cottages and lakes. And I can’t blame them a bit: we have short summers and gorgeous lakes. I don’t want to stay in the city either!
But I can remember one particular August when I almost shut my gym down. It was a poor month for cash flow; I didn’t understand why my clients didn’t want to work out; and I was still working the same hours for tiny classes. My kids were at the beach without me. And I didn’t think I’d be able to pay September’s rent.
Gyms in a resort area will see a natural decline in attendance in the winter, because their clients want to go skiing. They have to plan to make most of their money in the shoulder seasons. Gyms in Australia have to plan for kids’ school breaks every quarter. Gyms in Europe sometimes look vacant when their clients take prolonged vacations.
The good news is that our clients are usually just out doing other awesome stuff. The bad news is that our rent and wages never take a vacation when our clients do.
At TwoBrain, this is the season for writing Annual Plans. We don’t want gym owners to experience the cash-flow roller coaster I did a decade ago, when I almost gave up on my life’s purpose for all the wrong reasons.
Here’s how we do our annual planning:
- We start with goal-setting. We ask these questions:
“Where will you travel this year?”
“What will you learn this year?”
“How will you upgrade your lifestyle this year?”
“Who will you serve outside your business this year?”
Those answers will help determine the owner’s income goals.
Then we say, “Given your profit margin, here’s how much the gym has to generate next year.” We break that number down by month, then by revenue stream, and set concrete growth goals (like 4 new members, and 6 PT packages, etc.)
- Then we draw a big circle, like a clock face. This is our Work Plan.
On the circle, we write the months of the year, and then highlight key events, upgrades, hires…the “big stuff” that occurs only once or twice per year.
- The next phase is to create our Sales Plan.
Looking at the key events on the clock face, we can work backward to identify opportunities for more revenue. Or we can add events during low periods.
One of my first solutions to The August Crisis was to add a big event in September, and charge a big entry fee. This increased adherence (people were training for the event in August) and also made me an extra $5000 to carry me through the end of the summer.
- On top of the Sales Plan, we overlay our Marketing Plan, Coach Development Plan, or whatever else the gym owner needs. One of those is our Retail Plan.
Then look at the seasons: when do you have the most drop-ins? You’ll need an inventory of basic t-shirts for your visitors. When does the weather change? That’s when you’ll need hoodies. Work backward from the seasons to set your Order Dates.
Then, if you design your own shirts (cringe) work backward from that date to take time out of your schedule to do the design work.
I can’t resist making a suggestion here: take that design time and use it for a high-value task, like Affinity Marketing, instead. Let Matt handle your design: he’s better, and you don’t have time.
Here’s my schedule:
March – team shirts for the Intramural Open. Participants preorder; I don’t inventory shirts that have a shelf life. Zero risk, and we net around $650. Forever Fierce does all the work.
May – Add inventory for the summer. We get a lot of drop-ins. We don’t give shirts away with a drop-in fee (our coaching is worth the price) but they usually want a souvenir. So We order 100 shirts of various sizes with no shelf life (just our logo, no inside jokes or fancy art that no one wants.)
August – Catalyst Games shirts. Forever Fierce does the design and builds an order form for my clients. When they sign up for the Games, their receipt contains a link for their shirt size. I literally don’t touch the shirt process.
September – Catalyst Hoodie pre-order. A big hit every year. Again, I don’t inventory anything, but I do order 8 extras as gifts for my coaches.
When I need Coaches’ shirts, I just ask Forever Fierce to create a design and an order form. My coaches choose their sizes, FF charges my card, and it’s done. I should probably put this on an annual schedule too.
That’s it. I spend less than an hour per YEAR thinking about t-shirts. I don’t have an inventory tying up my cash; don’t waste time trying to guess what my clients will want to buy; don’t try to figure out Adobe Illustrator or whatever designers use.
Could I save a couple of hundred bucks by doing the design work myself? No. I’d waste opportunities.
I used to get our shirts printed locally. I’d pay setup fees and design the art myself. Let’s say I went back to that, and saved $200 on printing (doubtful, but I’m overestimating to make a point.)
In the time it took me to design the shirts, I could have done 4 client goal reviews, or taken coffee to a neighboring business, or called 6 clients to come back. I could have set up a Facebook ad…and any of those would have created far more value for my business.
The only reason people waste time sourcing their clothing locally is because they don’t know what else to do with their time. Some of us like doing design work, and that’s great; when you’re retired, go ahead and do it all day. But for now, work on the stuff you’ve hired yourself to do, and hire Forever Fierce to do your retail.