A lot of people out there are talking about the inevitable upcoming recession, and about how to recession-proof your business. Sean Buck, COO of Level Method, comes from a financial services industry background. During the “Great Recession” in 2008, he was a senior manager for one of the largest financial companies, that managed $1.6 trillion in assets. He saw close-up how the economy worked from behind the scenes. He saw firsthand how some businesses thrive in a recession, and some don’t.
What is a recession?
It's two consecutive quarters of negative GDP (Gross Domestic Product -- the output of what a country produces, whether services or products). GDP is a measure for how our economy is working. The length and severity of a recession can vary. They can be very quick like the quickest recession when COVID hit. They can be very impactful like the “Great Recession” of 2008 that impacted many areas of the economy. On average recessions can last about 12 to 18 months.
Recessions are not something to fear or freak out about. Sometimes they're a necessary correction of fiscal carelessness, such as too much money in the marketplace. In 2008, it was subprime mortgages, with low interest rates creating excess, almost imaginary money, lent for housing where people couldn't pay it back.
Housing prices started to crash, but a correction made it come out stronger. Businesses can and should come out stronger.
There's conflicting media on whether or not a recession is here, or coming. In any case, it doesn't hurt to prepare, even if the problem doesn't happen. What would hurt is to ignore the economic warning signs, so it catches you by surprise. This is the time to retool and focus on your clients and customers.
There are layoffs in recessions, and it gets worse before it gets better. It affects gym members, their income and their ability to spend.
Don't panic.
Sometimes recessions are actually referred to as “Panics.” When people hear “recession,” they start selling their stocks, hoarding money, canceling subscriptions and memberships.
There is a reason that entertainment, sugar (candy, junk food, etc), alcohol companies thrive in a recession. These are common vices, no-effort pleasures when people are stressed or anxious.
You, as a gym owner or coach, can be a leader through this, by preparing and educating members. Stay positive, don't panic, and get them focused on something they can control: health, fitness and stress levels. Educate them on the likelihood of people turning to unhealthy behaviors, so they’ll be aware if (or more likely, when) it happens.
It’s your job to show them the value of being a member of your gym -- where they can exercise, get nutrition help and find community. These are health benefits people need on a regular basis, and especially in times of higher-than-normal stress. To share these benefits, owners must focus on three things:
1. Building solid relationships.
2. Getting results for members.
3. Sticking to your systems.
You build solid relationships based on care from the coaches and trust from the client. Start by taking care of your coaches, and they will take care of your members. The care that you pass down will pour down to the members. This is how relationships with members start. When you have solid relationships with clients, they see you as indispensable -- not as an expense.
People cut expenses, not relationships.
So how do we care for our members? Check in on them. Take note (capture) if they tell you about something big in their life, and ask about it. Do weekly check-ins, and follow up after someone hasn’t been there in a day or two. Don’t wait till it’s been a month. Do regular success plans -- it's an opportunity to see what’s really going on in their lives – to connect at a deeper level. It’s the simple things, like greeting every member by their name when they walk in, giving them a hi-five or a fist bump and asking how their day is going. There's a fine line between being intrusive and being approachable. But social skills go a very long way.
Another part of building a relationship is understanding someone's fitness level, and knowing strengths and finding places of opportunity (ie. weaknesses). The better we know members, the better we can coach them. Over time they will trust you, and trust your advice and insights regarding not just fitness but other aspects of life too. You show that you care by asking how they're doing, or building a success plan with them (even if they don’t follow through 100%).
Regarding success plans, you might call them “Athlete Check-ins” or “Goal-Setting Sessions”, whatever the name, do them! This allows you and your coaches to meet members where they actually are, rather than guessing or blindly prescribing. Listening to what’s really going on in their lives allows you to see how you can support them physically, emotionally and mentally. Coaching is more than just demoing movement, tweaking technique, or writing workouts.
Make your gym their third place. One = Home. Two = Work. Three = Gym. Create an environment, a culture, a community that becomes a central point in a member's life – this is part of the recipe for a successful gym. It makes you indispensable. If they're not engaged in the community, they don't see you as the third place. Fundamentally, we want to build relationships that are so strong that the last expense anyone would eliminate is your gym. They come for exercise and nutrition support, and they stay for the emotional support and the community. Connection is the reason people hang out in bars lol. Your gym is the better option.
The second vital element is results.
Clients must know they're getting results. They may not notice on their own that they are making progress, but coaches are there to show them. A great coach will know this intuitively, but Level Method adds an additional layer of information to actually show the client. We have a universal formula: Assess, Address, and Progress. Together, these three steps unequivocally prove to members that they're getting benefits.
You can do these steps without Level Method. The steps are agnostic.
We start with Assessments, so there’s a clear starting point. Knowledge of exactly where they are. This lets us identify strengths and find opportunities to improve. Assessment is a great time to develop success plans/goal sessions, to help members stay consistent and accountable. This is a case where if you don't know where you are, you don't know where you're going.
Then we develop a game plan – we address the weaknesses, goals, desired outcomes. This can be level specific, it can also be nutritional help, technique work, personal training. Every single person is unique, but you may have ‘prescriptions’ based on common goals.
When we see the successful outcome of the plan, and the action required to see it through, it’s time to celebrate their progress! You can do this in a variety of ways, but one thing we do with Level is award a Level Up certificate. We make a big deal about it, by getting a photo with their class/community and sharing it on social media! This process repeats, forever! The magic is in Assessing, Addressing, Progressing … and Celebrating!
Systems are better than brains, or sweat, or luck.
To consistently wow clients, over a long time, you need systems. Otherwise, things can deteriorate fast. Ask yourself if every primary operation in your gym has a defined SOP (standard operating procedure). Without this, it's impossible to consistently deliver long-term, high-quality service. Remember all that stuff about relationships earlier? Checking in… following up… all that work. The only way that happens at a consistently high standard is with systems.
They ensure consistent and reproducible results -- systems for marketing, social media, sales, onboarding, coaching, powerful moments…. We are constantly refining systems to make them run optimally -- smooth and focused.
Don’t consider it a “system” if no one else can follow the directions and reproduce the results. Systems are not secret recipes. It’s like nutrition – eating just one good meal won’t keep you healthy. The same is true for your business: it's great to really wow one client, but that doesn’t give you a gym full of satisfied, committed members.
Prepping for a recession doesn’t involve anything fancy or expensive. Doing the basics really well enhances your business to the very core AND it sets up success if/when the recession affects your members.
We have a practical way for you to help your members, which in turn will help your community and your business. The “Stress-Free Challenge” is designed to help your clients organize their lives, practice gratitude, and create simple, consistent habits. It’s a done-for-you tool that easily guides your members through stressful times. Bottom-line: Deliver so much value that your members would never cut their gym investment.
Fill out the form below if you're interested in running the “Stress-Free Challenge” at your gym.
