ace personal trainer manual 5 th edition chapter 18: personal-training business fundamentals lesson...
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ACE Personal Trainer Manual 5th Edition
Chapter 18: Personal-training Business FundamentalsLesson 18
© 2014 ACE
• After completing this session, you will be able to: Differentiate between the direct-employee model and the
independent-contractor model, and the considerations for both when starting a career
Identify the components of a business plan Discuss the importance of creating a brand and communicating
the benefits of that brand to gain clients Understand how marketing affects prospective clients as well as
the retention of existing clients Evaluate various factors when choosing a business structure Identify professional services necessary for starting a business Understand how a financial plan establishes budget and revenue
goals Manage time by creating a schedule that establishes a balance
of work and personal time Identify the traits of a sales professional and basic guidelines for
selling personal training
LEARNING OBJECTIVES
© 2014 ACE
• A personal trainer must decide where and how to work:Directly for an employer Independently as a contractor at
a fitness facility or training studio
With clients in their own homesAs an entrepreneur by starting a
training business• Each option has specific features,
advantages, and disadvantages for a fitness professional.
EMPLOYMENT OPTIONS
© 2014 ACE
DIRECT-EMPLOYEE MODEL
• Advantages The employer pays for marketing to
all facility members who are potential clients.
The employer pays for equipment and expense for repair.
The employer may provide benefits (e.g., paid vacation, healthcare, or retirement contributions).
Taxes are submitted on behalf of the employee.
Opportunities exist for advancement, promotion, or reward.
Opportunities exist for small-group training or group fitness instruction.
• Disadvantages Must conform to the company’s
culture and standards, such as a uniform
Compensation may be 40–70% of the training fee, less than if the trainer was independent
May require a minimum number of hours worked per week or month
May require sales goals, which could create a high-pressure environment
© 2014 ACE
INDEPENDENT-CONTRACTOR MODEL
• AdvantagesAbility to establish a
fee structure based on experience and market
Ability to move around and work at different facilities
Ability to develop personal financial goals
• DisadvantagesMust maintain business
records and pay quarterly taxes
Responsible for operational costs (e.g., marketing, rental fees, and healthcare)
Time and expenses relating to travel and commuting between different locations (e.g., traffic, gasoline, and car mileage)
© 2014 ACE
STARTING A CAREER
• One of the best ways to get started as a personal trainer and learn about the industry without assuming any financial risk is to work for an employer.
• There are many benefits of working at a health club or other fitness facility as an employee: A continual stream of new members, which leads to
potential new clients Training to market skills and make sales, which can
provide valuable experience before opening a business Experience in marketing and working with the public, as
many health clubs are often involved in community projects
Media opportunities to be featured in a local newspaper, television, or radio show talking about fitness-related topics
© 2014 ACE
BUSINESS PLANNING
• A comprehensive business plan will serve as an operating guide for achieving specific objectives as well as a marketing plan for attracting new clients.
• The components of a business plan are: Executive summary Business description Marketing plan Operational plan Risk analysis Decision-making criteria
• Any of the direct-employee, independent-contractor, or business-owner operating models will require a detailed business plan.
© 2014 ACE
EXECUTIVE SUMMARY
• An executive summary is a brief, one-page overview of how the business fills a need within the marketplace, and includes:
Business concept:o A description, the service it provides, the market for
that service, and why this particular business holds a competitive advantage
Financial information: o Start-up costs, the source of capital, and the
potential for sales revenue, profits, and return on investment (ROI)
Current business position: o Information about the owners, their experiences,
and the specific legal structure Major achievements:
o Awards received, specific protocols of the business, clients or local/national celebrities who agree to be used in marketing materials or endorsements
© 2014 ACE
BUSINESS DESCRIPTION
• The business description provides information to potential lenders or investors regarding the business structure, the market it will serve, and the people who will run it: Identify the operating model and how it is different or unique
when compared to other training studios in the area Describe the fitness industry specific to the local market,
including the present financial situation and the outlook for future growth
Provide details such as the number and location of competitors, how many employees they have, and the number of clients to whom they provide services
List the members of the management team, highlighting their knowledge, skills, and experience
© 2014 ACE
MARKETING PLAN
• The marketing plan specifies how prospective clients become paying clients.
• A trainer should first identify a target audience that can benefit from his or her personal-training services.
• An effective marketing campaign will communicate how a specific product or service meets the needs of a potential client.
• The marketing plan should list: Demographic information for the area around
the training business The demand for personal-training services The specific type or brand of training services
being offered The plan for communicating the benefits of
personal training to potential customers
© 2014 ACE
OPERATIONAL PLAN
• The operational plan describes the structure for how a business will operate.
• This includes: Creating an organizational chart Identifying key decision makers Identifying employees responsible for executing decisions
• An operational plan for a trainer who is working directly for an employer will be brief.
• If a trainer is an independent contractor, he or she will decide which operational model to use to create a business structure.
© 2014 ACE
RISK ANALYSIS
• Risks can be categorized into one of the following general areas: Barriers to entry – costs associated with starting a business (e.g.,
rental fees, equipment, employees, and marketing) Financial – access to the capital required to start or expand a
business Competitive – other players in the market who are competing for
the same pool of customers Staffing – managing employees and budgeting for a consistent
payroll Direct employee – most financial risk is covered by the employer;
minimal risk from competition of other trainers or nearby facilities Independent contractor – conduct a SWOT analysis to categorize
risks:o S – strengthso W – weaknesseso O – opportunities o T – threats
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SWOT ANALYSIS
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DECISION-MAKING CRITERIA
• The decision-making criteria of the business plan includes: A detailed cost-benefit analysis to
demonstrate that the benefits of operating the business are worth the financial risks involved with establishing operations
Highlights that prove that the business will be a successful venture
• More time spent in the early planning stages allows for a business owner to: Focus his or her efforts on
implementing the plan Attract clients to the business Provide the service once the business
starts operating
© 2014 ACE
CREATING A BRAND
• A trainer should use the business-planning process to develop a brand identity for his or her training service: A brand represents what a service or product stands for and is an easy
way to communicate its value to potential clients. Creating a brand to define the quality of personal-training service that
a client can expect is an important step in establishing an almost immediate emotional connection with a client.
If a trainer invests the time to develop a specific brand for his or her service, it will help prepare the client for what to expect during the personal-training experience.
A brand establishes an instantly recognizable value for the product or service being sold.
The benefit of developing a distinct brand of personal-training services is the establishment of a unique identity that effectively communicates the benefits of working with an ACE Certified Personal Trainer.
© 2014 ACE
MARKETING
When building a brand and identifying a target demographic, a personal trainer should take a few minutes to answer the following questions: •What can be done to create and communicate a unique brand identity that will attract the target demographic? •Who is the ideal target customer? •Where is this target customer located? •What time of day will this customer be interested in working with a trainer? •What marketing efforts can be used to reach the potential customer to convert him or her into an actual paying client?
© 2014 ACE
COMMUNICATING THE BENEFITS
• There are a number of different ways to market to prospective clients and communicate the benefits of a brand of training.
• Identifying the most cost-effective methods that will have the greatest reach, such as: Offering a complimentary training session to new clients Working on the fitness floor to build relationships that
can eventually lead to new clients Distributing business cards and using them as a session
reminder card Creating a portfolio or web pages of testimonials from
satisfied clients Working with clients in a visible area for exposure to
prospective clients Becoming an ACE Certified Group Fitness Instructor and
teaching classes
© 2014 ACE
MARKETING FOR CLIENT RETENTION
• To retain a client for the long-term, a trainer should develop a long-term exercise plan: By applying the science of periodized training, a personal trainer
demonstrates the benefits of working with a trainer on an ongoing basis. A trainer who designs a long-term program for clients based on
periodization creates an added value to the personal-training experience.
© 2014 ACE
MARKETING THROUGH GENERAL COMMUNICATION
• Communication begins with a professional appearance – if a trainer looks professional, potential clients will likely treat the trainer like a professional.
• Additionally, trainers should: Conduct business in a professional, fun manner to
help establish effective nonverbal communication with prospective clients
Leave a positive impression with every interaction Realize time is an extremely valuable resource,
arguably more than money Understand that clients hire trainers to maximize the
efficiency of the time spent exercising Focus marketing efforts on why potential clients
should invest money and time on a trainer and the value they will receive
Focus communication efforts on helping prospective clients maximize their return on training time to achieve specific results
© 2014 ACE
CHOOSING A BUSINESS STRUCTURE
• A personal trainer must think about all aspects of starting, owning, and operating a business.
• Factors to consider when starting a personal-training business include: The level of experience in the fitness
industry The level of self-motivation and ability to be
a salesperson The ability to create and execute a business
plan The size of the proposed business The location of the proposed business The cost of running the proposed business The structure of the proposed business
© 2014 ACE
PROFESSIONAL SERVICES FOR STARTING A BUSINESS
• Working with other professionals is an important part of establishing a business and must be accounted for when calculating costs: Attorney – to provide legal advice and guidance
to comply with the law Accountant – for learning what expenses and
costs can be deducted as part of normal business operations
Web developer or graphic designer – creating a brand and an appealing logo
Insurance broker – to provide the necessary levels of protection
Real estate broker – for finding an optimal location and negotiating lease terms
Contractors – to address any situation to keep a business operational and profitable (e.g., electrician, plumber, interior designer, or janitorial service)
© 2014 ACE
FINANCIAL PLAN
• The financial plan provides the specific details for how a business will generate cash flow and produce a profit.
• The total of all monthly expenses must not exceed the trainer’s earnings: Rent, utilities, repairs, and maintenance on
the facility, or rental of a training space Overhead costs – salary or compensation
for employees Professional development Transportation, food, and entertainment Establish budget and revenue goals to
determine the:o Amount of money to charge per session as an
independent contractoro Number of sessions to conduct if working as a
direct employee
© 2014 ACE
TIME MANAGEMENT
• A successful personal trainer will adjust his or her schedule to be available for clients at peak times, while still maintaining a sense of balance.
• A schedule should include time for all of the following activities:
Establish work hours – consistently adhere to a schedule to avoid burnout; uphold a 24-hour cancellation policy for clients
Client management – time for paperwork, phone calls, invoices, scheduling appointments, creating exercise programs, etc.
Prospecting for new clients and developing marketing materials
Exercise – maintaining a healthy lifestyle and serving as a role model
Personal time/home life – schedule time for family, friends, and activities not related to work
© 2014 ACE
HOW TO SELL PERSONAL TRAINING
• In order to have a successful career, a trainer must be comfortable asking potential clients to make a commitment by spending money on the purchase of training sessions.
• Traits of a “sales professional”: Will help a consumer make an informed decision to
meet a need A problem solver and educator who can offer the
consumer options for a solution and how they will benefit
A leader who help clients make the best decisions for their needs by investing in a product or service
• The Sales Bible, by Jeffery Gitomer, states that “the best salespeople are the ones with the best attitude and product knowledge who give the best customer service.”
© 2014 ACE
HOW TO SELL PERSONAL TRAINING
• Seven basic rules for selling by Jeffrey Gitomer: Say it (make the presentation) in terms the
customer wants, needs, and understands Gather personal information and learn how to use
it Build friendships Build a relationship “shield” that no competitor
can pierce Establish common ground Gain confidence Have fun and be funny
• Ultimately, a client is spending their personal time exercising, so the exercise session must be fun as well as productive
© 2014 ACE
SUMMARY
• Earning an ACE Certification and starting a career as a personal trainer can be personally, professionally, and financially rewarding.
• A successful career requires forethought to develop a plan to attract clients and operate the business.
• Working for an employer is an invaluable way to learn how a fitness business operates from the ground up without assuming the financial risk of starting a business.
• As a trainer takes on more clients, time management becomes even more important in establishing a healthy balance of work and personal time.
• A trainer must become a “sale professionals” and be comfortable asking potential clients to make a commitment by spending money on training sessions.