1. health and fitness

ACE Personal Trainer
Manual, 4th edition
Chapter 18:
Personal-trainer Business
Fundamentals
1
Learning Objectives
 Based on Chapter 18 of the ACE Personal Trainer Manual, 4th
ed., this session provides the basics of running a personaltraining business, including business planning, marketing,
and financial planning.
 It also explains the advantages and disadvantages of working
as an independent contractor or direct employee.
 After completing this session, you will have a better
understanding of:
– How to develop a sound business plan
– How to create a brand and communicate the benefits of a business
– Marketing to acquire new clients and retain existing ones
– The professional services needed to run a successful business,
including an attorney, accountant, and web developer
– How to sell personal-training services
Introduction
 Whether working with clients in their homes or for a
major health club, a personal trainer needs to know how
to properly manage and operate a business.
 The fundamental purpose of a business is to generate
profit by delivering a product or service to customers.
 Operating a successful personal-training business
involves:
– Creating a budget
– Developing a marketing plan
– Having the ability to sell training sessions
– Delivering a quality product that meets client expectations and
drives retention and referrals.
Personal Training Is a Service Business
 Service businesses offer knowledge, skill, and expertise.
 Service companies build their businesses through
interpersonal relationships.
 A personal trainer needs to match
the desire for helping clients with
the ability to quickly establish
rapport with them.
– This combination will provide a
strong foundation for a
personal-training business.
The Direct-employee Model
 In the direct-employee model, a trainer is usually paid:
– A lower rate when working a scheduled shift on the fitness floor
– A higher fee when working with a client as a personal trainer
– The pay rate for delivering a personal-training session can range anywhere from
40 to 70% of what the client pays the club or training studio.
 Many companies reward trainers with bonuses if they meet certain
performance objectives.
 A personal trainer must also decide in which environment to work.
– Large health-club chain
– Non-profit center
– Community or university recreation center
– Corporate fitness facility
– Independent health club
– Personal-training studio
Considerations for Direct Employment

Determine whether the facility attracts the type of clientele the trainer is
interested in working with and if those potential clients have the disposable
income to pay for personal-training services.

The facility should be conveniently located for
commuting.

The facility should be located in an area that
gets steady traffic throughout the day.

Determine the reputation of a company.

Determine the requirements for employment.
Advantages of the Direct-employee Model

The employer pays the cost of marketing to new facility members.

The employer pays for equipment and all expenses related to the maintenance of the
facility.

Many employers provide benefits.

Some employers provide uniforms and offer continuing education opportunities.

The employer is required to submit taxes on behalf of the trainer and issue an annual
W-2.

Employers often let trainers take part in the decision-making process before ordering
equipment or changing the layout of a fitness floor.

Employers offer opportunities for promotion.

Staying at the same location throughout the day eliminates the cost of travel
additional commuting time.

Many facilities offer group exercise classes for members.

Many health clubs provide opportunities for trainers to deliver small-group training
sessions.
Disadvantages of the Direct-employee Model
 A trainer has to conform to the uniform and professional
grooming standards of the employer.
 Per-session training fees are often lower than what the
trainer could make working independently.
 Many employers have requirements for the minimum
number of hours to work.
 Many employers establish sales goals for their personal
trainers, which can create a high-pressure sales
environment.
The Independent-contractor Model

In the independent-contractor model, the personal trainer contracts his or
her services to a health club or training studio.
– A trainer will pay either a per-client or monthly fee in return for being able to use
that location with clients.
– The trainer is responsible for paying all of his or her own operational costs.
– Requires the trainer to make a decision about how much money to charge for
services

When starting out, personal trainers will probably want to price themselves
slightly lower than some of the competition (only 5% or so).

When setting their fees, trainers must remember that taxes are paid on any
earned income.
– A personal trainer should not simply set a rate that sounds inexpensive.
– A trainer must do the research to determine if the rate can cover all of the
required expenses of being in business for one’s self.
Considerations for Working as an Independent Contractor
 What facility will be used and what arrangements will be
made to use the facility?
 If the plan is to work in clients’ homes, the trainer should
research on the local market to see if it has the
demographic to support the fees for a private trainer.
 What type of marketing expenses will be required to
advertise for new clients?
 What health-screening forms and liability waivers will be
used to protect financial assets against litigation?
 What assistance will the trainer need from an accountant
or lawyer?
Training “Under the Table”
 Some fitness facilities will prosecute trainers for
shoplifting or trespassing if they are caught training
“under the table.”
– Taking money directly from a client without properly paying the
facility operator for using the space
 Because this practice is illegal and unethical, it violates
the ACE Code of Ethics.
 Training under the table might seem like a tempting
option for a struggling trainer, but there are serious
potential consequences.
Advantages of the Independent-contractor Model
 The personal trainer is able to establish the fees based
on experience and what the market will pay.
 Many personal trainers appreciate the opportunity to
move around and work out of different facilities.
 The personal trainer is able
to develop his or her own
financial goals.
Disadvantages of the Independent-contractor Model
 The personal trainer has to maintain business records
and pay quarterly taxes.
 The trainer is responsible for all of his or her own
marketing costs.
 If renting space, the trainer does not have control over
the operations of the facility.
 If training clients in their homes, the personal trainer will
have to travel between different locations throughout the
day.
Starting a Career
 The best way to get started as a personal trainer without taking any
financial risks is to work for an employer.
 Facilities provide:
– A steady stream of potential clients
– Some of the experience needed to operate a fitness business without investing
the time and money to start one
 A good employer will train its personal trainers to market their skills
and make sales.
 Another benefit to working for health clubs is that they are often
involved in community projects that can provide experience working
with the public.
 Beginning as a personal trainer working in the direct-employee
model can establish the foundation for a long and rewarding career
in the fitness industry.
Business Planning
 To have a successful career, a personal trainer should develop a
business plan.
 No one starting a business plans to fail.
– They simply fail to develop a systematic plan for running a business.
 A personal trainer should create a detailed business plan that
establishes definitive goals and a structure for achieving them.
 The components of a business plan include:
– Executive summary
– Business description
– Marketing plan
– Operational plan
– Risk analysis
– Decision-making
Executive Summary
 The executive summary is a brief outline of the business
and an overview of how the business fills a need within
the marketplace.
 A well-written executive summary is one page and
includes the following information:
– Business concept
– Financial information [with an emphasis on the expected return
on investment (ROI)]
– Current business position
– Major achievements
Business Description
 This section provides the details for the business as outlined in the
executive summary.
 A succinct mission statement should be developed that describes
the benefit of using this particular personal-training service.
 When describing the business, the personal trainer should:
– 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
– 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
 Potential lenders or investors need to see this information before
making a decision about providing capital.
Marketing Plan
 This section of the business plan specifies how prospective clients
become paying clients.
 Marketing is the process of promoting a service by communicating
the features, advantages, and benefits to potential clients.
 Marketing tools should tell a story about how the service can
enhance a person’s life.
– All marketing pieces should communicate the benefits of working with an ACEcertified Personal Trainer.
 The marketing plan should list the:
– Details on the demographics for the area around the training business
– Demand for personal-training services
– Specific type or brand of training services being offered
– Plan for communicating the benefits of personal training to potential customers
Operational Plan
 This portion describes the structure for how a business will
operate.
– Includes an organizational chart that identifies key decision makers and
the employees responsible for executing those decisions
 A business plan for a personal trainer will not need a lengthy
operational plan if the trainer is working directly for an employer.
 If a personal trainer decides to follow the independentcontractor model, a decision should be made about which
operational model to use.
– Sole proprietorship
– Partnership
– Corporation
– Franchisee
Risk Analysis
 There are a number of risks involved in owning and operating a
business.
 Risks can be categorized into one of the following general areas:
– Barriers to entry
– Financial
– Competitive
– Staffing
 For personal trainers who work as direct employees, most of the
financial risks are covered by the employer.
 Independent personal trainers will need to conduct an analysis to:
– Identify competitors
– Categorize the risks of competing in a specific marketplace
SWOT Analysis
 A simple tool for conducting a risk assessment is the SWOT
analysis, which is illustrated on the following slide.
– Stands for strengths, weaknesses, opportunities, and threats.
 A basic SWOT analysis is easy to perform by dividing a piece of
paper into four squares.
– The upper-left square should be labeled “strengths.”
– The upper-right square should be labeled “weaknesses.”
– The lower-left square should be labeled “opportunities.”
– The lower-right square should be labeled “threats.”
Sample SWOT Analysis
Decision-making Criteria
 This component includes a detailed cost-benefit analysis.
– Demonstrates that the expenses for operating the business are worth
the financial risks involved with establishing operations
– The specifics about the business plan that prove that it will be a
successful business venture should be highlighted.
 This final section is simply a conclusion summarizing how the
business will be a profitable venture.
 More time spent in the early planning stages allows a
business owner to focus his or her efforts on:
– Implementing the plan
– Attracting the clients
– Providing the service once the business starts operating
Creating a Brand
 A brand represents what a service or product stands for.
– An easy way to communicate its value to potential customers
and clients
– An important step in establishing an almost immediate emotional
connection with a client
– Helps prepare the client for what to expect during the personaltraining experience
 A brand establishes an instantly recognizable value for
the product or service being sold.
 The benefit of developing a distinct brand of personaltraining services is the establishment of a unique
identity.
Building a Brand
 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?
Communicating the Benefits

There are a number of different ways to market to prospective clients.

Every new-member fitness assessment is an opportunity to demonstrate the benefits of working
with a personal trainer.

Personal trainers should use the time working on the fitness floor to build as many relationships
as possible.

It is a good idea to make business cards and distribute them to as many people as possible.

Personal trainers can create a testimonial book or have testimonials from current and former
clients on a web page.

Trainers should make an effort to work with clients in a visible area of the facility so that other
members can see the personal-training experience.

Independent contractors can create signage for their cars and make T-shirts for clients with the
trainer’s name and logo.

Trainers can use the Internet as a powerful and efficient tool for promoting personal-training
services.

Personal trainers can also expand their reach by becoming ACE-certified Group Fitness
Instructors.

Trainers can create adherence, orientation, and/or education programs to attract new clients.
Small-group Training

Small-group training involves a trainer servicing two or more clients during
the same session.

From the trainer’s perspective, semiprivate training provides advantages in
the areas of:
– Finance
– Time management
– Referrals

For the client, benefits include:
– A lower cost per session
– Enhanced camaraderie among workout partners
– Opportunity to receive instruction in a small-group
setting from a fitness professional

Information on how to create effective small-group programs can be found
in ACE’s Small-group Training Online Education Program.
– www.acefitness.org/continuingeducation
Marketing for Client Retention
 Once a prospective client becomes a paying client, it is important to
have a retention plan.
 To retain a client for the long-term, a personal trainer should
develop a long-term exercise plan based on the concept of
periodization.
 The ACE IFT Model uses periodization as a long-term, sciencebased plan for exercise program design that is aimed at meeting
individual client needs, while also providing the personal trainer with
a marketing strategy for client retention.
Marketing Through General Communication
 The most common form of communication with potential clients on
the gym floor occurs through visual means.
 For personal trainers, communication begins with a professional
appearance.
 Every interaction should leave a positive impression.
 A trainer should focus his or her communication efforts on helping
prospective clients maximize their return on training time to achieve
specific fitness results.
 New trainers should realize that it will take approximately three to
six months of work to develop a full client schedule.
Considerations for Starting a Business
 Considerations for starting a business include:
– How to structure the business
– Whether to work with partners
– Whether to establish a corporate structure to create an additional layer of liability
protection
 Factors to consider when starting a personal-training business
include:
– The level of experience that the potential business owner has in the fitness
industry
– The level of self-motivation
– 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
Professional Services for Starting a Business

Attorney
–

Accountant
–

Provides the most effective way to develop and structure a portfolio that provides the
necessary levels of protection
Real Estate Broker
–

Helps with creating a brand and establishing a unique brand identity
Insurance Broker
–

Helpful for structuring the best cash-flow and financial-management system for the needs of
a business
Web Developer/Graphic Designer
–

Critical for structuring the necessary articles of incorporation or partnership
Helps in finding the optimal location for a successful personal-training studio or fitness
center and negotiating the most favorable lease terms
Contractors
–
Helpful in dealing with ongoing repair and maintenance issues of any facility
Financial Plan
 To be successful, trainers should establish budget and
revenue goals for themselves.
– The first step when establishing a personal budget is to list monthly
expenses.
– The next step is to determine the number of training sessions required
to achieve the revenue to cover expenses.
– Next, a trainer can determine how many prospective clients he or she
needs to communicate with to successfully market the services.
 A personal trainer must establish realistic goals for income
and the number of sessions to deliver to achieve that income.
 The financial plan provides the specific details for how a
business will generate cash flow and produce a profit.
Time Management
 As a personal trainer takes on more clients, there will be many
demands for his or her time.
– Trainers should develop a schedule that accommodates all of their needs.
– It is important to set strict guidelines for hours of availability and adhere to them.
 A trainer who carefully manages his or her time and makes specific
hours available to clients:
– Creates demand by giving the perception that this limited time is indeed valuable
– Helps clients appreciate their timeslots and be more likely to show up for
appointments
 If a prospective client is not able to adjust his or her schedule to fit
into the time that a trainer has available, that client should be
referred to another trainer.
Creating a Realistic Schedule
 The schedule for a personal trainer should include time
for all of the following activities:
– Working with clients
– Client management
– Prospecting for new clients
– Developing marketing or
advertising materials
– Other job duties
– Exercise
– Personal time/home life
How to Sell Personal Training
 Personal trainers must be able to ask potential clients to spend
money on the purchase of training sessions.
 ACE-certified Personal Trainers must provide a high level of
customer service to make the transition to sales professional.
 Sales professionals are also leaders who help clients make the best
decisions for their needs.
 Two basic components to being a successful sales professional:
– Marketing the personal-training service to potential clients
– Asking for the sale
 Selling is a win-win process, especially when it relates to personal
training.
– When a trainer sells training sessions, the client “wins” because he or she is
purchasing a needed and valuable service.
– The trainer “wins” because he or she has gained a new client and a new source of
revenue.
Establishing a Successful Client−trainer Relationship

Buying decisions are emotionally driven.

The selling of a fitness service requires a personal trainer to make an
emotional connection with a prospective client and have empathy for him or
her.

Other important traits for establishing a successful relationship with a
prospective client are honesty and integrity.

A trainer should identify the emotional needs behind the client’s decision to
start an exercise program, and work to accommodate those needs.

When a personal trainer meets with a potential
client, no matter what, a sale will happen.
– The prospective client will be sold on the fact
that working with the trainer will be worth the
investment of time and money.
– Or the client will sell the trainer on the fact
that he or she is not actually committed
o achieving results.
Transitioning From Presenting Information to Closing a Sale
 There are four basic questions required to move from
presenting information to closing the sale.
 These questions should be asked once the prospective
client has experienced the first full workout session with
a trainer.
– Did you enjoy the workout?
– Would you like to continue to experience the benefits of working
with a trainer?
– Do you have the ability to invest in yourself by purchasing a
package of training sessions?
– When would you like to schedule our next appointment?
Closing the Sale
 An effective method to close a sale and earn a new client
is to ask a series of questions that relate back to the
client’s goals.
 The following questions focus on the needs of the client:
– You have told me your goals. How long have you had these goals?
– Why is it so important that you achieve these goals?
– What has kept you from achieving these goals in the past?
– From what you have told me, I think I can help you work toward
meeting these goals. Would you like that?
 By asking a series of directive questions, the trainer can
direct the conversation so that the client continues to say
“yes.”
Selling Training Programs
 Training programs clearly communicate a defined outcome so
that the client knows what he or she is investing in.
 A training program is different than a series or package of
sessions because it progresses each workout toward a
predetermined goal.
 A series of training sessions marketed as a program should
begin and end with the same specific assessments.
 The types of programs to offer might include:
– Performance enhancement
– Weight loss
– Event preparation
– Post-rehabilitation
Summary

A successful career as a personal trainer requires forethought on the part of the
trainer to develop a plan to attract clients and operate the business.

This session covered:
–
The direct-employee model
–
The independent-contractor model
–
Starting a career
–
Business planning
–
Creating a brand
–
Communicating the benefits
–
Marketing for client retention
–
Marketing through general communication
–
Choosing a business structure
–
Professional services for starting a business
–
Financial plan
–
Time management
–
How to sell personal training