352. Test out for the 10 week challenge, interim GM and outgoing GM

How do you keep afloat when the financial tide is pulling you under? This episode delves into the raw realities and intense pressures of owning a boutique fitness studio, especially when you’re an absentee owner. Join me and a fellow franchisee, as we candidly share the ups and downs of our entrepreneurial journeys. We discuss the mounting financial struggles and the intense competition from both high-end health clubs and budget-friendly gym chains that squeeze the middle market. Discover the shared experiences that unite us, and the profound insights gained from moments of vulnerability and openness.

Tune in to hear how we are navigating these challenging times, exploring strategies to manage stress and expectations amidst financial turmoil. We explore the importance of community and the essential counsel we rely on when contemplating tough decisions like bankruptcy. This conversation is a testament to the strength found in camaraderie and mutual support, a reminder that no one should endure the journey alone. Listen to learn from our experiences and discover why seeking support is crucial in times of adversity.

Transcript

Speaker 1: 0:32

Happy Saturday. So today is the test out day, tonight is the 10 week party and it was crazy. Got in the car driving to the gym Whoa, excuse me and I get a text from a fellow franchisee. He's like hey, nathan, how's things going over at your studio? Things have been pretty rocky since we last talked. It's been tough Feel like catching up at all. And it's a franchisee I've talked to before. So yeah, man, totally.

Speaker 1: 0:58

So I get it while I'm driving. I instantly like start typing out a response. I know I shouldn't, but I'm starting to type a response. But I'm gonna call this guy. So I call the guy. I'm like hey, man, what's going on? Like, yeah, we have, straight up, here's how we've been doing. We've lost money every single month since the purchase.

Speaker 1: 1:14

I don't know what corporate says about us, but if they're saying like anything positive, it's not true, because this has been a struggle since day one and that's the straight up truth. So how can I help? What have you been seeing at your club? And so he was like oh, man, like I'm glad you said that, because ever since this time period they've been going through so much and we had a good heart-to-heart 30, 40 minutes. And I'm starting to realize, like it's, that everyone is going through the same struggle and everyone puts on the same mask. It's crazy. And so I would say like, hey, here's how I'm handling stress, here's what we're currently doing, here's what I've tried. Here's how it went. Here's how it went. Here's how I other thing I tried to work. He's like I know we tried this. I was told we'll get this result. I did not get that result, and now I'm at this spot. I'm like, bro, I'm so sorry, and so we're kind of commiserating together, but, like, thinking out loud, strategizing, realizing like we're in trouble, like not saying anything about the brand or corporate, but us two individual owners, we're in trouble. So I told him hey, I'm not going to say too much, so you can. You can consciously say you did not know what was going on, but, like I'm, I don't know how my club can stay open for for like another year given the current circumstances. Like man, I'm thinking I'm right there with you and so I said, all right, well, here's what I've been talking to, here's the counsel I've been getting advice from. It's like, oh man, could you connect me to that counsel as well? Dude, absolutely Based on what you're telling me, based on what I'm telling you, we both need good counsel and alluding to certain things.

Speaker 1: 2:53

And so the group fitness space is getting pinched. The big dogs, like the Lifetime, the Equinox, the YMCAs, are able to offer big box offerings. The little studios, like Planet Fitness, are able to offer certain things. It's the middle space that's getting pinched and it's the boutique, small business owner space Because, for better or worse, the margins are just too thin and neither of us are owner operators, we're absentee owners, and we can't afford to pay someone 60 grand a year for a business to lose $10,000 a month.

Speaker 1: 3:29

And this guy is losing more than me. I'm losing a lot, he's losing more than me, and I thought they were doing a lot better, and so I said, all right, well, it's looking like I'm going to have to go bankruptcy. He's like, hey, I'm entertaining the thought. I couldn't sleep last night. You know who's your go-to for that. I said, well, I'll connect you guys up this afternoon. All this to say, um, do not internalize stress or think you're a lone wolf, especially if you're in. Do not internalize stress or think you're a lone wolf, especially if you're in. If you're needing help, reach out for help pretty quickly, um, and so it sounds bad, but like I can now refer him over to counsel to give him a strategic options so that he doesn't fall victim to being a victim, but he can choose how to end things well for his business. And I may do it the right way. I may not, but at least he'll be one step smarter than me.

Speaker 1: 4:21

And so we were talking like what's this exemption, what's this amount and whatever? And so what should we tell the corporate, our landlord, the sellers that we've made promises to, like all these, all these other curve balls? And I told him like, hey, I'm not a lawyer, I'm not an attorney Based on the counsel I've received. Here are the decisions I am making. And like, hey, that's just like my scenario, that's just like my scenario, this seems like my scenario. And I said, hey, definitely seek counsel first, but here's the decisions that I'm concluding. At the end he's like, okay, sounds good, that's your, and it's rock and roll. So that's the summary of the conversation. We'll see how this all rolls out. And so I'm like, hey, here's kind of the timeline. I'm thinking, if you're thinking the same timeline, let's have like a big bash and let's go down in a blaze of glory. Together, we'll combine forces. The last check will balance paying for a big party for the members and we'll go from there Say, hey, I don't know, but that sounds like fun, I think we can do that. So you and I we're going to catch up, grab coffee or steaks or whatever guys do these days, and tonight we're going to have a good party.

Speaker 1: 5:28

Went through the challenge we call it a 10-week challenge so we're going to do a test out today. It was kind of funny too. It's the last day of my full-time GM and my interim GM is stepping in and it was funny just to read the energy levels. My outgoing GM is like carefree, he's like having a blast, and he was actually really good at his role. And then the incoming interim GM. I could tell he's a little bit more uptight, a little bit more unsure, a little bit rocky, not quite asking for help, though he could have needed help in some areas. Just see how it plays out. It's just been interesting.

Speaker 1: 6:05

And so, reading between the lines, I think my outgoing GM we talked a little bit he said, hey, man, like I'm grateful for the opportunity. It wouldn't change a thing, but now I get to go home and have peace. I couldn't turn off the gym, I couldn't stop people from texting me, facebook messaging me, instagram DMing me, spreading rumors about me, like asking me about their membership contracts, that they're texting me and like I'm trying to hang out with my family on a Sunday. I'm like, yeah, it's wild. And he's like I get peace again, that's not going to be happening anymore. Like I can leave work at work. And I'm like, yeah, that's right, we're there with you, man. And so he was more upbeat and like optimistic about it, no-transcript.

Speaker 1: 7:04

And this interim GM is like, no, no, not true, I'll step in, I'll make a post about it. So now he's getting dragged into the drama because he's having to squash that stuff just alongside me. And so I think the interim GM is realizing, oh crap, what did I sign up for? So it's just interesting to see this will be the second time someone coming in and is overly confident, like, hey, I've got this, I know what I'm doing, I can run the ship, I can crack the whip and see the cracks and to realize like, oh man, I'm in over my head. That may be the case, I don't know. We'll, we'll see how it all plays out. But just interesting, um, just funny, I guess. Um, funny in the sense that it's a repeat human, a human condition, sort of thing.

Speaker 1: 7:54

So, heading home, going to hang out at home for a good five hours, five and a half hours. We're going to rest with the fam. Got a final bit of prep work for the party tonight. Bring the company card, we're going to have a blast. We're going to I can't remember what it's called. We're going to a tavern when they have like a party room. We're going to do that Wish. So wish off the GM. Well, he's done a good tenure. A lot of people have thrown shit at him. Shame on them, but he's going to go out in a bang of glory. So we'll have fun, it'll be good and we're going to enjoy ourselves. So that's where we're at, that's where we're going. Let's rock and roll.