In this episode of the GSD Show, we interview Forrest Walden, the CEO and Founder of Iron Tribe Fitness. Forrest shares how he took his small garage gym and grew it into a franchise success.
How Iron Tribe Started
Iron Tribe Fitness is a group personal training model with four programs – a large group class called Power, a semi-private personal training class called Prime, and athlete training program called Perform and Peak which offers members nutrition, accountability and the ability to work out at home. The company has nine corporate gyms and an additional 22 franchises. Forrest’s background is in personal training, but he started Iron Tribe in 2010 after realizing the industry was moving towards group workouts.
“So my background is in personal training– it’s all I’ve ever done since 1998. I actually owned a brand called Fitness Together. I was a multi-unit franchisee and then a master franchisee over three states and it was all one-on-one personal training, but I saw the industry going more group. So I sold it and started with Iron Tribe in 2010 with our first location, but it actually started in my garage a couple years before that.”
Building the Right Team
According to Forrest, building the right team is crucial, especially when it comes to studio managers who are responsible for running the facility. He believes that if you get the right person to manage the facility, everything else falls into place. In fact, some of his employees have been with him for over ten years.
Forrest mentioned that previously the were struggling with coach turnover despite offering competitive salaries and benefits. To address this issue, they introduced a revenue-sharing model with their coaches using Prime. This resulted in two consecutive years of significant growth, which motivated coaches to stay and invest in the success of the business. This new model has allowed coaches to see the impact of their work on their income, leading to increased buy-in and the potential for a long-term career.
“I would still get people about a year or two in saying I need to go get a real job or I’m getting married, etc… So I thought, ‘how do I raise the average level of what I can pay that coach with Prime?’ We had enough margin to do more of a REV share with that coach and so these coaches have seen a massive opportunity. Their buy-in’s huge, they can put braces on their kids, they can make this a long-term career.”
Forrest spoke about the company’s growth and success in the fitness industry. He highlighted three main points that he had been focusing on for two years: opportunity in the market space, building the coaches’ future, and creating better margins for the business. Walden said that the company had scaled the brand to all locations and seen positive results in each area, including improved profits.
Iron Tribe has been successful even after the pandemic, with some of their franchisees having their best months ever. Walden attributes this to their focus on providing value to their members, constantly improving their programs, and building a strong community.
One opportunity that Walden emphasized was the ability to work with a higher-level Avatar. This was made possible by raising prices and attracting customers who are willing to pay more for a better experience. Iron Tribe Fitness launched a “fit over 50” campaign, which drew older clients into the semi-private model, resulting in lower attrition rates.
Lifetime Value (LTV) of Your Member
Forrest shared that Iron Tribe Fitness’s average price for group training is $219, semi-private is $599, and blended is in the high $300s. The company’s attrition rate hovers around 4-6%, with an average of 5%, and the average lifetime value of a member is $7,600. This is a stark contrast to the industry average of $150-$160 per month, with an attrition rate of 12%, retaining clients for only 10 months.
He stressed the importance of understanding the lifetime value of a member and how it affects the company’s ability to invest in areas such as employee compensation, marketing, and facility upgrades. He also discussed the “money math” of being able to spend more on customer acquisition than competitors, which leads to a significant difference in lifetime value.
Iron Tribe offers ancillary sales, and he talks about how they decide what to sell and how to sell it. He emphasizes the importance of providing value to members and not just selling them products. His team is so involved with selling because its products they actually use and support.
“The coaches, they’re invested in it because we have them taking the product too. One of our best sellers – the coach was saying we want to carry this brand and so there’s such a hard buy-in to that because they were customers [of the product]. So of course, you know, these clients look up to their coaches and they see them drinking that brand, so they want that brand.”
The President of Iron Tribe Fitness, Karen Broadwater, dives into this in another episode — Watch it here!
KPI’s for the Team
Forrest explains the key performance indicators (KPIs) for the company’s sales managers. The sales managers are responsible for acquisition, retention, and administration. On the acquisition side, they must respond quickly to leads, use follow-up systems, and perform sales and onboarding processes. On the administration side, they oversee the cleaning and staff, among other details. On the retention side, they are tasked with keeping the attrition rate at five percent or less.
Forrest emphasizes the importance of tracking gross revenue daily to ensure everyone, including coaches, understands the business. He shares how he has shown his team how losing one client can cost the business thousands of dollars and impact referrals. Attrition rates, even a difference of one percent, can have a massive impact on the business. Forrest highlights how an attrition rate of 10 percent means replacing the entire client base each year, which can be exhausting for business owners.
Forrest shares how his team is involved in a variety of programs, including Loud Rumor. The team attends events and participates in masterminds to continue learning and stay up-to-date on industry trends. Forrest believes that investing in oneself and the team is critical for success in the fitness industry.
In conclusion, Forrest’s success with Iron Tribe Fitness can be attributed to his focus on building the right team, providing value to members, understanding the lifetime value of a member, and investing in continued education. These strategies have helped Iron Tribe Fitness grow into a successful franchise with a loyal customer base and a strong community.
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