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How We Got Started with Profit First

How We Got Started with Profit First

I have to give all of the props to one of my current clients, we’ll call her Jane. On August 24, 2014, Jane e-mailed me the PDF of the first 5 chapters of a book called Profit First by Mike Michalowicz and said, “I would like to implement Profit First process in my business.  Can you take a look at how to break out my accounts into the buckets he describes based on my income and expenses?  I will want to complete the assessment when I get back. This might be something you use with some of your clients.”

She knows me pretty well and it has changed my business in more ways than I can count. But I’m going to try over the next several months through this blog to help you understand how the Profit First process can also change yours.

Back to when I received that e-mail. My mind said, “Like I need something else right now. And yet, I have clients with different needs so why not?”

I sat down Friday afternoon Labor Day weekend 2014, only ONE short week later to see what this was all about.

And I couldn’t stop reading ALL weekend. My family was home to play but I wanted to read, read, read. I’d never read anything about accounting written from the entrepreneur’s perspective so this was enlightening to understand how an entrepreneur thinks, but also how I might really be able to help so many of my current clients as Jane had suggested.

I also couldn’t stop talking to my husband about what I was reading and how it applied to XYZ client or ABC client or Client 123. Every page applied to someone and sometimes it applied to each and every one of my clients. AND IT EVEN APPLIED TO ME! Eeek! Now that was something to think about.

Profit First

That Tuesday morning I called Profit First Headquarters to learn more about the Profit First Professional Certification and get help with Jane’s Assessment. I scheduled a call with Ron for Thursday and by the end of the week I was on my way to becoming a Certified Profit First Professional.

But first, I had to implement Profit First in my own business. Come back next month to learn why I was excited and a little scared to implement Profit First in my own business and how I did it. Eventually, you might even get an update on Jane to whom I am deeply indebted – I have no idea if or when I would have found this book if not for Jane.

If you would like to receive the first 5 chapters of the book Profit First please contact us and put Profit First, Please in the subject line. You can also learn more directly from Mike, here.

Also, please follow our Facebook page for more regular stories and tips on implementing Profit First in your business.

Connect with Shannon:

www.netbooksaccounting.com

Facebook Group: Profit First for Fitness Business Owners

www.facebook.com/netbooksaccounting

**We help stressed and struggling fitness business owners transform from surviving to making a consistent paycheck.  Learn how to improve your business finances with our Keep Your Money Method. Sign up now for our March group by clicking HERE**

Shannon Simmons, a 10-year business owner, and 5-year Profit First Coach is the owner of Netbooks Accounting Services, LLC.  She is one of the original Profit First Professionals when the concept was created by Mike Michalowicz.

NetBooks is your gym and fitness center’s business partner in achieving levels of profitability, accounting integrity, and financial reporting that will allow your business to do more than just thrive but to achieve the highest levels of profitability.

Our professionals are intimate with the fitness market and will guide you through creating the right plans, managing your operations and accomplishing your goals.  Think we might be a good fit?  Click Here to find out!

Profit First

Top 9 Tips to Increase Profitability for Gym Owners

Top 9 Tips to Increase Profitability for Gym Owners

Profitability is key to sustaining any business and gym owners are not an exception.

With as many workout types and preferences as there are people in the world, the most important part of opening a gym or fitness center is to figure out what you excel at and focus there first. But then what, you’ve opened your gym and have your first members, how do you make not just a living but create profitability for your business now and in the future?

Many gym owners are personal trainers who open a gym to make more money. With the growth in the health and wellness industry over the last 5 years and the prediction it will be the next Trillion-dollar industry, there’s definitely room for you to have a piece of that pie, but you must treat it as a business not a hobby or as your own personal gym where you work out with your friends and family.

Here are 9 strategies from leaders in the gym and fitness industry on increasing profitably in your gym. They may not all work for every gym, but find one you can implement today and track the results as you increase your bottom line.

1. Go beyond your Profit & Loss and find other indicators to measure on a regular basis. For example, know what percentage of your revenue comes from recurring monthly memberships vs. one-time purchases. With this information you can determine many other areas to improve in your business. Nick Berry, CEO and Co-Founder of Fitness Revolution, www.frnation.com

2. Diversify. Some of your best clients will want personal training. Others will want group classes and within those classes you will need a range of levels. Provide both, but limit the numbers in your group classes. Your best clients will pay more because they are receiving more personal attention than they will in a large group class. Chris Cooper, Lead Mentor at www.TwoBrainBusiness.com

3. Cross-sell a system. When a client is purchasing personal training sessions, they also need to purchase nutritional services or massage therapy sessions or chiropractic. Fitness professionals can only do so much in the gym. The client’s whole health needs to be addressed. Sell a health system, not just personal training sessions. Also, because we are selling a health system we can market fitness and health, not price, but we can’t be sales people. We are fitness professionals. It is our job to educate clients about why they need all of our products to work together to increase overall health and wellness. Stephanie Joanne, Brand and Business Coach for Fitness and Health Professionals http://stephaniejoanne.com

Profitability

4. Build Relationships. Support your trainers in building real relationships with clients. Focus on retaining trainers. The relationships trainers build with clients will lead to increased retention of clients. One way to retain trainers is to pay them more than they can earn by taking advantage of other opportunities available in your area. While this may seem counter to increased profitability, it’s much easier and cheaper to retain a current client than to gain a new one. The money you pay an excellent trainer is less than you’ll spend on marketing to obtain a new client. Craig Patterson, CEO MadLab Group, www.madlabgroup.com

5. Know and increase your retention. When a client buys a specific number of personal training sessions, know when that package is close to running out and know what conversations you are going to have with them so they realize the importance of continuing with personal training. Know their goals and work with them to reverse engineer how you’re going to get there together as you sell them a whole health system. If they’ve seen any results at all from their first buy, they’ll buy more. Stephanie Joanne, Brand and Business Coach for Fitness and Health Professionals http://stephaniejoanne.com

6. Increased brand awareness. Create a brand around your facility. Your clients are buying their home equipment, health supplements and fitness gear somewhere. If you can put your name on it and sell it to them for the same price, you make the profit, not the retailer down the street. One low risk model is to find a partner who will put a kiosk in your facility. Your clients can order their merchandise, pay for it and have it shipped to them. You have no inventory costs; your client gets what they’re already buying but with your name on it. You make a profit and your brand awareness will be increased through this client’s use of the product. Bill McBride, President and CEO of BMC3 and ActiveWellness. http://www.bmc3.com/

7. Find the right clients. First, you must understand your own value and be willing to charge for it. Second, find the people who are willing to pay you what you are worth; people you want to work with who want to work with you. When you find this sweet spot, you will be able to serve those clients better, achieve better results and keep them coming back for more. Adam Staneki. https://breakingmuscle.com/coaches/adam-stanecki

8. Get referrals. Get creative. Think outside the box when asking for referrals. For example, for a gym that doesn’t usually give guest passes, let your new client know your guest policy. Offer to reserve a guest pass for their 5 closest friends and family members. Then call their referrals to let them know a guest pass is waiting. Or, when someone is taking advantage of a promotion near the end of the promotional period, offer to extend it to friends and family if they visit within the next 10 days. Stephanie Joanne, Brand and Business Coach for Fitness and Health Professionals http://stephaniejoanne.com

9. Find your niche. There are many types of gyms out there – what makes yours special? Again, this is the first thing you should determine when you open your gym. Once you figure out what makes you special, focus on attracting and maintaining your client base. Your profitability will increase as a by-product of serving a smaller set of clients better – more effectively, more efficiently, more profitably. Shannon Simmons, Profit Advisor www.netbooksaccounting.com

Some of these tips may seem obvious. Maybe you’ve heard them before but hopefully the examples will help you view profitability from a different perspective. It’s not only about increasing the Gross Income of your gym with the next new member. There are many other ways to increase your profitability.

Connect with Shannon:

www.netbooksaccounting.com

Facebook Group: Profit First for Fitness Business Owners

www.facebook.com/netbooksaccounting

**We help stressed and struggling fitness business owners transform from surviving to making a consistent paycheck.  Learn how to improve your business finances with our Keep Your Money Method. Sign up now for our March group by clicking HERE**

Shannon Simmons, a 10-year business owner, and 5-year Profit First Coach is the owner of Netbooks Accounting Services, LLC.  She is one of the original Profit First Professionals when the concept was created by Mike Michalowicz.

NetBooks is your gym and fitness center’s business partner in achieving levels of profitability, accounting integrity, and financial reporting that will allow your business to do more than just thrive but to achieve the highest levels of profitability.

Our professionals are intimate with the fitness market and will guide you through creating the right plans, managing your operations and accomplishing your goals.  Think we might be a good fit?  Click Here to find out!

Profitability

Three Costly Accounting Mistakes to Avoid

Three Costly Accounting Mistakes to Avoid

Small business owners have a lot on their plates and accounting mistakes can happen. Time simply does not allow you to become an expert in all the areas required for running a business. Here are a couple of common accounting mistakes that we see all the time. Correcting them will help you be more productive and profitable in your business.

Mismanaging receipts

Maintaining receipts are challenging for everyone, but the IRS requires that you have proof of business expenditures. Periodically, we come across people who feel that keeping the credit card statements are enough; unfortunately, they’re not. You’ll want to create a process to keep your receipts all in one place so they don’t get lost.

Receipts printed on thermal paper (think gas station receipts and many more) will fade within a year or two, and the bad news is the IRS could audit several years back if they come calling. Correct this by scanning them in or taking a clear picture of them using your smartphone.

Some accounting systems and/or document management applications allow you to upload the receipt and attach it to the transaction in your accounting system. This is a great solution, and if you’re interested in this, please ask us about it.

 

 

Ignoring the accounting reports

There are gold nuggets in your accounting reports, but some business owners don’t take the time to review them or are uncertain about how to interpret them. This is when accounting mistakes can happen. We can help you understand the reports and find the gold nuggets that can help you take action toward profitability.

Some of the things you can do with your reports include:

  • Identifying your highest selling services or products
  • Projecting cash flow so you’re not caught short at payroll time
  • Getting clear on your top customers or your demographic of top customers
  • Evaluating your marketing or business development spend
  • Pointing out trends compared to prior years, budget, or seasonality effects
  • Checking up on profit margins per product or service to make sure you are priced correctly
  • Managing aging receivables or speeding up collections
  • Measuring employee profitability, if relevant
  • And so much more

Being proactive with your accounting will help you spot opportunities in your business that you can act on, as well as spot and correct accounting mistakes long before they manifest into trouble.

 

Mixing business and pleasure

In your bank accounts and on your credit cards, mixing business and pleasure is to be avoided when possible. All businesses should have a separate bank account, and all business transactions should go through there. It takes an accountant much longer to correctly book a business deposit that was deposited into a personal account. Avoiding accounting mistakes in the first place saves everyone a lot of time and energy.

Taking out a separate credit card and putting all your business transactions on it will save your bookkeeper a ton of time. The credit card doesn’t even have to be a business credit card.  It can just be a personal credit card that’s solely used for business. If you have employees making credit card charges, sometimes a separate card for them helps you control fraud.

The hardest area in which to separate business from pleasure is cash transactions. Be sure your accountant knows about these. The accountant can either set up a petty cash account or a reimbursement process so that you can get credit for cash expenditures that are for the business.

How did you rate on these three accounting mistakes?  Avoid these three and your accounting department as well as your business will run a lot smoother.

Connect with Shannon:

www.netbooksaccounting.com

Facebook Group: Profit First for Fitness Business Owners

www.facebook.com/netbooksaccounting

**We help stressed and struggling fitness business owners transform from surviving to making a consistent paycheck.  Learn how to improve your business finances with our Keep Your Money Method. Sign up now for our March group by clicking HERE**

Shannon Simmons, a 10-year business owner, and 5-year Profit First Coach is the owner of Netbooks Accounting Services, LLC.  She is one of the original Profit First Professionals when the concept was created by Mike Michalowicz.

NetBooks is your gym and fitness center’s business partner in achieving levels of profitability, accounting integrity, and financial reporting that will allow your business to do more than just thrive but to achieve the highest levels of profitability.

Our professionals are intimate with the fitness market and will guide you through creating the right plans, managing your operations and accomplishing your goals.  Think we might be a good fit?  Click Here to find out!

 

Get Organized with This 31-Item Year-End Close Checklist to Prepare For Taxes

Get Organized with This 31-Item Year-End Close Checklist to Prepare For Taxes

Want to learn tips and tricks live with Shannon?  Join the Facebook Group where she goes live every Wednesday at 8 pm EST to talk about these topics.

January is a busy time of year for business owners and especially Fitness Business owners. With many new members trying to find their way to a better lifestyle, your studios and gyms are hopping. In the midst of all the chaos, the accounting world insists on reminding us that it is time to prepare for taxes! 

What is the first thought that pops into your head when you hear the word taxes? Panic? Dread? Fear? One of the best ways to overcome these emotions is to be prepared. Here at Netbooks, we have compiled a checklist to take away the panic, dread, and fear and replace it empowerment by offering you the steps you need to take to be prepared for taxes.

Prepare for Taxes

How can you take advantage of this list? 

    • Highlight everything you have already done. It is nice to strike things off the list right away to help you feel a sense of accomplishment. 
    • Schedule in anything you need to complete on your own. Sometimes it is a matter of gathering the information and putting it in one place.
    • Reach out to us if you need help or have questions. We know it can be overwhelming!

 

Connect with Shannon:

www.netbooksaccounting.com

Facebook Group: Profit First for Fitness Business Owners

www.facebook.com/netbooksaccounting

**We help stressed and struggling fitness business owners transform from surviving to making a consistent paycheck.  Learn how to improve your business finances with our Keep Your Money Method. Sign up now for our March group by clicking HERE**

Shannon Simmons, a 10-year business owner, and 5-year Profit First Coach is the owner of Netbooks Accounting Services, LLC.  She is one of the original Profit First Professionals when the concept was created by Mike Michalowicz.

NetBooks is your gym and fitness center’s business partner in achieving levels of profitability, accounting integrity, and financial reporting that will allow your business to do more than just thrive but to achieve the highest levels of profitability.

Our professionals are intimate with the fitness market and will guide you through creating the right plans, managing your operations and accomplishing your goals.  Think we might be a good fit?  Click Here to find out!

Prepare for Taxes

Ready to MAXIMIZE Your Profits?

 Learn how with a FREE Download of the first five chapters of Mike Michalowicz’s book, “Profit First”. 

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