Back Office Traps
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Publisher's Note: Gym HQ is an Atlanta-area based, 1 1/2-year old company that provides turnkey back office operations for your club(s), your personal training company or any small business for that matter. Gym HQ will increase your back office efficiency and improve your club(s) overall financial performance. I know that's a tall order. I also know how difficult back office operations can become as your business grows because I've lived it... the HARD WAY! Having spent my first four years in the club business in a partnership, including one partner who was a gifted CPA, I found myself and my operations totally unprepared when our partnership went its separate ways. To make a long story short, my poorly organized and staffed back office found me in numerous "Traps" that cost me literally hundreds of thousands of dollars after I'd grown my club group to four locations. You, however, are very lucky. You are lucky because NOW there's a great solution to this dilemma available, and that solution is called Gym HQ. I urge you to read the following commentary from the Gym HQ folks and to seriously think about what you read. I recommend that any and all club owners, both new club owners and mature club owners alike, give Gym HQ a very close look. Gym HQ is for you personal trainers, too! The following is the first installment of our Gym HQ article series that we're calling Back Office Traps. I believe you'll find this company to be very helpful. And, after you've read the following, I also urge you to go to www.gymhq.club and click on "Our Story," then scroll down a little bit for a cool, 2-minute video that will share a great deal about Gym HQ. Read on and then click!
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Probably the number one back-office trap we see a lot of fitness businesses making is failure to keep consistent and accurate financials. It's amazing how many businesses don't keep them at all! In this article, John Lewin, who has 30 years of experience, will share his top five financial musts. Some of these may seem obvious, but there is value in achieving the most basic of principles:
Five Financial Musts For Any Fitness Business
- 1. A Proper Business Plan: You have a great idea; now it's time to put pen to paper. Take the time to write a proper business plan. Think through all aspects of your business, paying very close attention to a well thought-out proforma. Put together some financial projections and compare them with your proposed capital expenditures. Know when you should reach break-even and when you'll turn a profit. Have a plan to responsibly make distributions. It's a lot easier to make these decisions when the money is conceptual.
- 2. A Working Budget: What will your revenue be? Are you making revenue projections or using sales goals? These are two very different things. Goals are pie-in-the-sky. Revenue estimates should be realistic and conservative. What can you afford to spend? Is your spending in line with your timeline for break-even that you outlined in your business plan? Are you over-spending? Throw in a line item for contingency. This will catch those unforeseen monthly costs. If you don't need it, great; but if you do, you don't blow out your budget. A budget provides a business with the structure/foundation upon which it can grow.
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