One of my favorite shows on TV is “The Profit” w/ Marcus Lemonis. If you haven’t seen it, it’s kind-of like “Shark Tank” but he only deals with one business per episode and it shows the different stages of the transaction (if there is one). Marcus has a simple way to evaluate each business. He uses the 3 P’s: People, Process, and Products.
A process is a systemized way of dealing with all aspects of your business. For gym owners, do you have a system for generating new leads, sales, programming, training, selling products, cleaning, hiring and training staff, processing membership payments, accounting, analyzing your numbers? Processes allow your business to grow and allow you to work on bigger picture tasks (and occasionally take a vacation).
Marcus only buys companies that he can scale up or grow (a lot). If you don’t have systems/processes in place, your business don’t have the ability to grow. Now, if the systems were perfect, then the business might not need Marcus so it’s rare that you see perfect systems on the show. That’s actually where he makes a lot of his money. He comes into a business with good people and a good product but not great systems and he sets up great systems that change the profit of the business.
Your processes should always be evaluated and improved upon so don’t think it has to be perfect from the start – just think, “What would Marcus do?”
Products are what businesses sell. For gyms and trainers, this is your training and nutrition services, apparel, equipment, supplements, etc. Ideally you deliver a good, if not great core product. You won’t keep customers very long and Marcus won’t invest in your business if you have a crappy product. Now, that doesn’t mean that there can’t be improvements to your product or to your product line…but it always starts with have a great core product.
People include the ownership and employees in your company. Everybody is important but the owners are the most important in this context. They started the company – they had the initial vision – they should be the one’s steering the ship forward towards prosperity. And ultimately, they own the company so they call the shots. Employees are very important as well, but it’s easier to get rid of a bad employee than it is to get rid of a bad owner (by the way, being a bad owner doesn’t make them a bad person – they just may not have the right skill set to run a company).
According to Marcus, this is the most important of the 3 P’s. You can’t fix a bad owner that is not willing to change. You – the owner – are the leader of your business. You will either move it forward or be what’s holding it back.
So, analyze your 3 P’s today. Can you improve your 3 P’s?
If you need help improving your 3 P’s, shoot me an email and we can chat.