Navigating the Uncertainty of Down Months in Your Business

Speaker: [00:00:00] 1, 2, 3, 4. Welcome to The Business for Unicorns podcast, where we help gym and studio owners create a business and a life they love. I’m your host, Michael Keeler. Join me and the business unicorns team each week for actionable advice, expert insights, and the inside scoop on what it really takes to level up your gym.

Get ready to unlock your potential and become a real unicorn in the fitness industry.[00:00:30]

Yeah. Hello my friend. If you are looking for a business expense paid trip to get out of town and you wanna get around some like-minded business owners and maybe spend the weekend learning from me and the rest of the business unicorns team, you’ll really wanna check out our next Unicorn Society retreat.

Although this event is really for our members of Unicorn Society, we always open up a small handful of seats for gym owners who are curious to see [00:01:00] what BFU is all about. Our ABLE retreat is happening on Friday, April 3rd and Saturday April 4th, and it’s in Atlanta, Georgia, and it’s all about marketing and sales.

That’s our theme for those two days. You’ll learn what the best gym owners are doing to grow their gym. Month over month. You’ll get a shot of inspiration, some momentum and clarity, and you’ll spend some quality time with some of the most successful. Driven and honestly friendly gym owners in the industry.

So to get our full agenda and learn more about what the weekend includes, click low in the show notes [00:01:30] and you’ll have all the information there. Hope to see you in April.

Speaker 2: Hey Pete, how you doing today? Hey,

Speaker 3: this is what happens when we don’t say, Hey, who’s driving this train? Where are you? Keeler?

Speaker 2: Yeah. We have a really good topic of what we think is a really good topic today, and then we’re used to, used to Michael driving the bus.

Speaker 3: Yeah, we’re gonna, we’re gonna kill it though. I’ll set us up. I’ll tee this one up.

Speaker 2: Please

Speaker 3: do. Ben suggested that we get into a conversation around the [00:02:00] inevitable swings of cashflow and client acquisition and just entrepreneurship really. We all have good months and we have bad months, and what I have that maybe the average listener doesn’t have is not 1, 2, 3, but 19 years of this, and it happens every single year.

So we’re gonna, we’re gonna talk about how we deal with it, how we navigate it. The pitfalls of navigating it poorly and go from there. Sound [00:02:30] good?

Speaker 2: This sounds wonderful and it, and it, there’s a couple different aspects to do. ’cause there is the financial aspect, like we do need to make ends meet in our business and lives in order to make those a viable long-term thing.

There’s also the mindset and emotional piece, which I’m hap I’d love to talk more about with you, but I, in my experience, a lot of it comes from just reps to a certain degree. And then there’s also maybe the like operations, optics with the clients, optics with the staff as well. So maybe we can kinda [00:03:00] hit those are the three Ps that come up for me and maybe we can kinda hit those a little bit independently.

Speaker 3: Absolutely. Why don’t I start by explaining why there is such a consistent, uh, return of these down seasons for me, because my business is extraordinarily seasonal, in a little over six weeks, I’m gonna see. Upwards of 75% of my training population go in season, or I should say over the next six weeks, 75% of my clients are gonna go from here to baseball fields.

[00:03:30] It has started with the college athletes. We’re recording this at the end of January. I don’t think we have any college athletes left from the winter break at this point, and. It has started with the professional athletes who need to get outside and play some baseball on grass before reporting to spring training.

They inevitably wanna leave a little earlier and throw off a clay mounds and experience the work outdoor that they’ve been doing indoor with us for months. And the high school kids are gonna go in season in mid-March. And [00:04:00] what that means to me is. We have this 60 day swing where we go from the apex of our year from a foot traffic standpoint to absolute rock bottom, and I’d be lying to you, Ben, if I told you that it doesn’t stress me out every year.

I think the conversation today isn’t about learning how to eliminate stress. It’s learning how to manage it and how to talk ourselves through this kind of seasonality of business ownership in general.

Speaker 2: Yeah, a hundred percent. ’cause you’re, [00:04:30] I assume, would also have a massive revenue swing as well.

Speaker 3: Massive.

Doesn’t even begin to describe it. However, it is also very much by design. That’s the way things are gonna go around here. And we do sell, we sell seasonal bundles. We sell commitments for in-season training. We sell a number of things. We know that there’s gonna be a significant downturn in revenues. We plan around it.

We encourage our team to take a lot of vacation at [00:05:00] that time. In the case that we do have some hourly employees. They know that we’re gonna be scaling back on hours, and that’s the way it goes. But that, I want to emphasize that I don’t ever. I don’t ever wholesale stop worrying about this. There is every single season, there is a moment where I say, oh no.

Are they ever gonna come back? Of course, it happens every single year. For me, winning is pushing that to later and later into the season every single year. [00:05:30] Having our ducks enough in a row, having our cash flow situated in a way that we’re not feeling strained and compromised, and just planning around that.

If I, if tryouts are on March 16th, which they are this year, and I’m saying that to myself on April 1st, we got a problem, but usually we have a nice workflow of initiatives planned out, be it facility upgrades or promotional initiatives that we’re gonna be chasing. During that downtime, [00:06:00] and we treat it as a little bit of a sabbatical from coaching and a time where we really put our foot on the gas with, with kind of mapping our marketing calendar for the year ahead.

Because for me, my fiscal year is like mid-May to mid-March. If you think of it. It’s, I just run a 10 month. 10 month a year for earnings, essentially.

Speaker 2: Right.

Speaker 3: And this is the downtime where we recharge as a staff.

Speaker 2: Yeah. And there’s a couple things I I think are worth pointing out here. Like one, you make sure your cash flow is handled [00:06:30] in a way where you’re not going into this season with no dollars in your war chest, because that’s gonna be problematic.

This is going to come, it’s a joke I’ve made with members is. The landscaper in Canada isn’t mad that they can’t landscape in December. This is par for the course. They can choose to diversify their income by doing something like snowplowing or whatever, or they can just like plan ahead. And if you have a killer year, like that’s when you go on vacation with your family.

That’s when you work on operations. That’s when you work on marketing. There’s no right or wrong here, [00:07:00] but to pretend that it’s a surprise. Is, who are you trying to fool? It’s not a surprise. And then, yeah.

Speaker 3: And for me, a lot of this comes down to how it impacts my sleep, I’ll tell you. And the best thing I can do is just addressing these conversations in my head before I go to bed and I just say, Hey, I’m gonna make my list for tomorrow.

This is the list of things I’m gonna wake up and stress about tomorrow, but right now I’m gonna go to bed. And that helps a lot for me. ’cause if I’m really ruminating on. Foot traffic and things like that during a time of [00:07:30] year, that is inevitably a downturn for us. I’m just in for a tough stretch and so this, but again, this can be framed in a way that is immensely valuable because it’s like the, think of it like the school teacher who’s builds their whole year around this idea of having the summer off and maybe they do some camps.

Maybe they do some tutoring, but they’re doing some things on their terms during that time of year, and my understanding is that community gets a choice. Usually. Are we gonna [00:08:00] collect 12 paychecks that are prorated to reflect their income over a 12 month year, or are we gonna collect paychecks exclusively during the school year and they’re gonna hit the pause button and we’ll figure it out during the summer.

We just have to ask ourselves, how do we wanna distribute our cashflow in that same vein? And as long as we’re not getting blindsided by it, this stuff is totally manageable. And I find myself coming back to something that I’m saying to my boys all the time. There’s so many overlaps [00:08:30] between parenting and gym or business ownership, and I just, I’ve got one son who’s pretty anxious and everything feels like the end of the world to him.

And I just say, Hey, if we could fast forward six months. When we look back on this, is this gonna be a big deal? Are you going to remember that you, like two days ago he forgot to set his alarm, which usually goes off at six ’cause he’s gotta be on a bus at 6 55. And I noticed he wasn’t up at six 15 and I went up there and he threw himself out of bed like, like the world was ending.

’cause he [00:09:00] lost 14 and a half minutes in his preparation. And uh, finally I was like, Colin, in a couple months, are you even gonna remember what day of the week it was that we lost 14 minutes to start the day? No, this isn’t a big thing. And a lot of the time we build these little downturns up in our head to be big downturns.

Speaker 4: Yeah.

Speaker 3: When in reality every gym owner who listens to this is going to have a worst month this year. Every one of ’em. Yeah. And the ones who are saying like, oh, I did double [00:09:30] digit. Wins year over year, every month of the year. That’s cool. What’s year two like in gym ownership? But otherwise, this shit’s hard.

And we’re gonna have good months, we’re gonna have bad months, we’re gonna have good years, we’re gonna have underwhelming years and. The sooner we come to terms with that, the better we’re gonna be at navigating the psychological component of this entrepreneurship.

Speaker 2: Yeah. Couldn’t agree more and chuckling at your child’s meticulous morning routine that requires that 14 and a half minutes of extra prep.

Speaker 3: Oh no, the [00:10:00] other one’s a lunatic. The other one, I could wake him up at 6 54 and he’d be like, cool. Still time to make the bus. Every one of ’em has got their own approach.

Speaker 2: Yeah, I’m with you. That step one for this is. There’s a value in being realistic about knowing that one of your months is gonna be the worst month ever.

There’s some things you can put in place, so yes, you set expectations with your hourly staff that you scale back. You set expectations with your salaried staff. This is a good time to take vacation. You’ve got cash flow management systems in place, which [00:10:30] actually as a sentence sounds very complicated, but often it’s just like the equivalent of don’t live fucking paycheck to paycheck in your business.

Like you don’t, there’s not this complicated flow chart. It’s just make sure you set some cash aside to pay for those months and it’s being realistic about that so that you can continue to operate because just ’cause you lost a couple, you’re net down, net five people this month in a gen pop gym doesn’t mean you’re gonna be net down 15 in the next month.

In my world, the difference is typically like summer and actually this time of year. And yeah, if people can afford personal training, they often [00:11:00] can afford to go to their cottage or camping or whatever in the summer, and they can probably afford to go to Florida or wherever the hell in the winter. So when they freeze for a couple weeks to go to Barbados, if I really didn’t want that, I shouldn’t have a freeze policy.

Speaker 3: Yeah. And we’re not gonna be mad at our clients for having built that kind of flexibility into their lives. Good for them. Because you know what? They’re more sane when they are around. They’re less obnoxious clients if they have that kind of balance in their life. I’ll give you another example of cash cashflow management, though you and I have talked at length about the new facility I’m in and one of the [00:11:30] things.

One of the cons on the not very long cons list of our move was that in our new space, we are accountable for plowing and with zero track record of that 18 years of having someone else handle that shit. That was just part of our. That was just part of our annual or our monthly rental fee. It was cooked in.

That just was what it was. Now I’m, every single time I’m watching the news and they’re like, Hey, we’re gonna get two or three inches of snow on Thursday night. [00:12:00] All I can think is how many dollars that’s gonna cost me per pass through the parking lot. And do I want ’em to put salt down every time they come, or just on the last time?

I can’t, I just can’t stop being angry at the weatherman and, ’cause it’s year one. Yeah. And, and thankfully John is the one who’s talking me off the ledge. He’s, look, this is 12 weeks of unpredictability and all we’re doing is learning right now. We’re not losing, we’re just learning. And we can take [00:12:30] what we see from December 1st through March 1st, and we can build the war chest.

And so when December 1st, 2026 happens. We’re already sitting on enough cashflow to not feel the sting. Plowing for the winter ahead, and that’s what we’re starting to build towards. But I admittedly, like I’ve been on chat GPT, figuring out what my threshold is at which I buy a small pickup truck and put a plow on it.

Just leave that thing in the lot, like all those numbers have been crunched and the [00:13:00] reality is that we’re gonna need another two months of snowstorms to justify that move. So that won’t be happening anytime soon.

Speaker 2: But that’s a good example of like. Us not, we’re not perfect with this. We still have things that maybe don’t spiral to the same degree that we may have in our first or second year.

When every challenge was a brand new challenge, we now have a track record of experience dealing with different types of adversity in our businesses. And like it, it is nice to hear that you’re not happy, that you’re stressed, but it’s nice to hear that you’re not also immune to those stresses. It’s not, none of our businesses [00:13:30] are just printing money and we’re living on the moon and everything’s great.

Like shit comes up. And the reality is you financially plan for it. And then this kind of leads us into the second piece here around like how you, you said it perfectly. It’s not about eliminating that stress, it’s how do you manage it and build your capacity and your grit and your resilience so you can just handle it better.

And the thing that, the shit that kept me up at night in year one and two. And now I’m like, yeah, that happens. Yeah, it doesn’t mean I don’t care. It’s just like I know that the downstream, ’cause before [00:14:00] I’d be freaking out about what if? And I’m just like, yeah, that happens sometimes and it sucks, but. The fictional story of Catastrophe is fictional.

Speaker 3: Yeah. What’s the Mark Twain quote? It’s like, I’ve known him a great deal of trouble in my life, most of which never happened, or something like that. And

Speaker 2: yeah,

Speaker 3: I told myself a lot of stories even over the last couple months. We’re gonna get, we’re gonna get blasted with snow. I’m gonna spend $8,000 on plowing this month, and it hasn’t been as bad as I thought.

[00:14:30] In fact, we just got a 20 plus inch snow storm. And I was on edge in every direction. ’cause it’s, are my kids gonna be at school? Is the gym gonna be snowed in? Are is someone gonna fall in the parking lot? Are the PTs gonna be mad? ’cause the plow guy didn’t come quickly enough. All these things, it drove me absolutely nuts.

And the storm was every bit as bad as we thought. And the bill was. Two thirds of what I thought it would be. So life goes on, we’re gonna be just fine

Speaker 2: a hundred percent. [00:15:00] So I, if you had a go-to or if you have a go-to strategy. How do you manage the stress when you have things like this come up, whether it’s downturns in business due to expected seasonality, or the new variable of you’re now accountable for plowing after 18 years?

Speaker 3: I think I’ve hammered the plowing concept enough, just showing that I have a stupid anxiety around that. But I will give you what has become best practices for me, and that is that I find I come out of these seasons less stressed and more profitable. [00:15:30] When I have a complete stranglehold on my active and recently active client roster, so when I am always thoroughly in the know of having categorized our whole community, knowing.

Exactly which collection of our college athletes are about to graduate and are no longer gonna be interested in paying for baseball specific strength and conditioning. ’cause professional sports aren’t in their future knowing exactly which high school athletes are graduating. And are gonna be going to play college baseball and [00:16:00] probably leaving a little earlier in the summer than everybody else ’cause they got an earlier report date from their teams.

Or it’s knowing about which high school athletes are about to finish hockey season or basketball season and are gonna have a little bit of a run before baseball where they might want to come back in for a little bit of a tuneup. And always just understanding the cadence of not just the people who are here, but the people who I want back.

And not just sitting back and being staring at an empty inbox and being like, when are they gonna come? I hope they show up and instead just [00:16:30] constantly communicating with them. Hey, I know you’re in the middle of hockey season. I don’t have any expectation of seeing you, but I thought I’d reach out and see how it’s going.

How are you feeling? I’m trying to get up to that game next Friday. Hope I’ll see you there and just keeping all of your recently active clients warm because the thing about the performance training space is that you just can’t hold on to everybody year round. There’s just too many competing demands, and so I’m conflicted by this term, active clients versus inactive clients.

It’s, or that’s really what they are. [00:17:00] They’re inactive, but they haven’t said, I’m done. They’re

Speaker 2: just, do you have like inactive, active, and terminated versus most gyms are active or terminated.

Speaker 3: Exactly, and so for me, I guess the short way of saying this is. Manage the shit out of your inactive list.

Speaker 2: Yeah.

Speaker 3: Make sure that the people who don’t have the flexibility to be in your space today still feel like you are top of mind because of your efforts to communicate with them and keep those relationships warm. If you can do [00:17:30] that consistently, then you have a very good feel. For how you’re gonna see an uptick in foot traffic in the time on the back end of these quiet seasons that you’re in, which year over year, you get better and better at projecting them and understanding them, and you just become like a considerably faster or more explosive busting out of the down periods because you get very systemized in anticipating people’s availability and staying on it.

But when you just sit around feeling bad for yourself. [00:18:00] And looking at the inbox and thinking, I’ve been at inbox zero for far too long. Why aren’t people in love with me anymore? You’re gonna feel like you’re losing longer than the people who meticulously stayed on top of this.

Speaker 2: Yeah, I couldn’t agree more.

And it’s obviously a little bit different in the gen pop world. Or it’s probably even more important for you to stay in touch with the inactive category that you have, but really the only answer I’ve found is yes, it’s okay to get down a little bit. Like it’s not about, we’re not trying to be robots and have no emotions.

There’s still a [00:18:30] human element to all of these things. Like after all, we’re all communities at our roots. But really the answer is get into action about the things that you can control. You can’t control when they’re gonna come back or when their coach says they have an early, whatever you call it, an early report to their season.

But you can control like shooting a hello message that client who’s on freeze, or we had clients who were in Portugal for a year, we’re stoked to come back, might have been eight months there forever. And we like stayed in touch and they sent us pictures and shit. And guess who was in the gym? The week [00:19:00] after their airplane landed, when it wouldn’t have been unreasonable at all for them to be, Hey, we need a couple weeks to get settled back in our house.

’cause we effectively moved our entire lives to another continent for a year. There’s always things you can do, and often a lot of it is like reaching out to old leads. You can do reactivations again, it’s not panic action, it’s just wait. I can actually control my circumstances because I’ve controlled the circumstances in the past, but sitting and wallowing and it just makes you feel worse.

Even if the actions you don’t work, there’s something about being in action that feels good. [00:19:30]

Speaker 3: I wanna give you a good little hack that works for Gen pop. It works for performance training. It works with anyone in this audience. If somebody says they’re going on a cool vacation, let’s say they’re, I’m going to Paris, and you say, Hey, if you send me a selfie of you in front of the Eiffel Tower wearing a Cresty Sports performance t-shirt, there’s a free training session for you on the other end.

And, and your social media content is ready to roll. They’re like, shit, that’s easy. I can do that. They are, you are [00:20:00] top of mind for them while they’re on vacation, which is crazy. And as you start posting these things, you stop having to ask people, because what happens is people are like, oh, I saw so, and I had one guy send us a picture of himself in a hoodie with our logo on it from the top of Mount Kilimanjaro.

And I didn’t even know he was going there. And so like you, you create this like culture of our brand being seen in cool places and it snowballs. You won’t have to give away a lot of free training with this methodology to [00:20:30] have it turn into something really cool and the people in your community start to like it.

And then it creates really cool dialogue on the training floor. When people get back, they’re like, was that ai or did I see you with the Grand Canyon in a CSP hat? They’re like, no. I saw people doing that, so I took one of those. And so that is one of my favorite hacks that we’ve been using for a very long time.

Speaker 2: That’s genius. I’m gonna, I’m gonna totally steal that actually makes, we have a picture of a client she climbed. Oh, she went to Peru and she did a big climate. The name is [00:21:00] eluding me right now and she probably Machu

Speaker 3: Picchu or

Speaker 2: something like that. Yes, Machu Picchu. Thank you. She brought her hoodie to Peru, which is not hoodie weather in the summer.

Went climbed the whole thing. Told us the story how she like had to get her hoodie out of her bag, put it on, take a picture, take it off like she just did it for the photo. But I love the idea of incentivized it on the front end because it also means you don’t have to do. That potentially desperate sounding, Hey Pete, hope you’re having a good vacation.

When are you coming back to the gym? Nobody wants to get that message on vacation. They want to get the, you know, I was thinking about you. How’s everything going? Oh, that, that picture [00:21:30] on Kilimanjaro looked awesome. How was your trip? Looking forward to seeing you back. That’s our regular human conversation.

That’s the connections we wanna build.

Speaker 3: And it’s not a big ask either, that’s the best part. It’s a very casual, like that’s one you’re complimenting them on being globe trotters. And two, it’s just you’re giving them an opportunity to talk about themselves, which we all know. We like that.

Speaker 2: Love that.

Speaker 3: But yeah, go use that.

Everybody steal it immediately.

Speaker 2: Yeah, that’s your action step from this.

Speaker 3: All right. I believe you have a sales call you need to get to, so we [00:22:00] are do it. Gonna call it here because you’re gonna go make money.

Speaker 2: Rosemary should cut that part.

Speaker 3: Don’t do it Rosemarie.

Speaker 2: But yeah, action steps here are like one, it’s not a surprise plan for it.

Two, there’s always things you can do and you need to get an action around it. At the end of the day, it is relatively simple.

Speaker 3: I agree.

Speaker 2: Thanks for your time, Pete.

Speaker 3: Hey, it was a good chat. Good luck with your call. I will talk to you soon.

Speaker 2: Take care.

Speaker 3: See [00:22:30] you.