As entrepreneurs mature, they pass through four distinct phases of business. These are the Founder Phase; the Farmer Phase; the Tinker Phase; and, if they’re very successful, the Thief Phase.
Each phase requires a different mindset, different habits, and different types of growth. But the goal is simple: to achieve wealth in terms of both finances and time. That’s why we’re all in this, right?
The most common phase of entrepreneurship is the Farmer Phase. This is where most entrepreneurs abide—not by choice but because it’s where they get stuck.
RECENT: The Founder Phase — How to Get out of It
In the Farmer Phase, the rush of the startup is gone, and all that’s left is the daily grind. Farmers realize that they’ve bought themselves jobs, and they settle in to grind harder, thinking that this is going to grow their businesses. This is what Michael Gerber called “The E-Myth”—the myth that simply doing the best job you can as a trainer will make your business successful.
The goals of the Farmer Phase are to:
- Reach a 33% profit margin.
- Work less than 40 hours per week.
- Increase your effective hourly rate to more than $50 for EVERY hour you spend working.
- Hire staff, and start mentoring them toward careers.
- Diversify your services and revenue streams.
- Increase your average revenue per member (ARM).
- Move your branding from “Joe’s Gym” to “Catalyst Fitness” (or your name).
- Pay yourself more (we use the “Profit First” model).
- Set up a retention plan for your clients.
- Master the sales process.
- Start affinity marketing.
- Set up a digital marketing plan.
Here’s how to move through the muddy fields of the Farmer Phase and finally achieve your perfect day:
- Build a staff playbook. You must replace yourself—at least virtually—in every role in your business. Record the gold standard of care for every role: cleaner, coach, trainer, nutrition expert, bookkeeper, sales…all of them. Pretend you’ll be hit by a bus in 10 days.
- Assign a value to each of the hats you’re currently wearing. Replace yourself in the lowest-value roles to start. Buy yourself time to work on high-value stuff that actually grows your business. Keep moving up the ladder until your time is worth at least $50 per hour minimum (that includes the time you’re not training clients).
- Mentor your staff. Show them how to get to their own perfect days. Map out the processes required to get them the money and time they want to earn.
- Start performing goal reviews with your clients. Find out how their goals have changed, and update their prescriptions to reach these goals. Offer them services like 1:1 training and nutrition coaching if that’s what they should be doing.
- Get their spouses, co-workers, and friends into the gym (we call this affinity marketing).
- Spend one hour every day making your clients famous. Use your email list, your social media, and a bullhorn at the gym. Make SURE there’s a clear path from your media to your signup process.
- Learn how to push your media through paid means, like Facebook marketing, Google AdWords, or billboards. Do this only after everything else has been done. Adding great marketing to a weak gym is like dating a supermodel when you’re 11 years old. You think you’re cool, your buddies think you’re cool…but you’re not going to experience the full depth of your opportunity in that relationship.
- Finally, pay yourself FIRST. Follow the Profit First book by Mike Michalowicz.
- Get a mentor and a small group of peers who are also in the Farmer Phase.
Your business exists to serve you, not the other way around.
The Farmer Phase is really the hard part: you’re working IN the business a lot and don’t always have time to work ON the business. This is where I found my first mentor, but I had to hit bottom before I did. The 420 gyms in the TwoBrain family were wiser than I was. Now, they’ll grow faster than I ever did.
Header image credit: Kostic Dusan © 123rf.com
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