Derek Geiges, owner of Solid Rock Personal Training, discusses exploring the option of licensing his brand. Topics include choosing between franchising and licensing, operational roles and equipment in a gym licensing model, revenue projections and compensation, long-term goals, fees and licensing models in the gym industry, imitating brands and future-proofing in the fitness industry, and exploring licensing models and real estate opportunities for gyms.
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Quick takeaways
Building a strong customer base and creating demand are crucial for successful licensing.
A desirable business model with unique features is important for attracting potential licensees.
Acquiring real estate and offering favorable rental terms can increase profitability and support licensees' success.
Deep dives
The Licensing Process and Building a Customer Base
Before selling licenses, it is crucial to have a solid customer base. Building a brand and customer demand is key to successful licensing. The speaker highlights the importance of creating a demand for the product or service being licensed. They emphasize the need to let the world know about the brand and what it offers, through marketing strategies, paid advertising, and sharing content on relevant platforms. The speaker also mentions the significance of distinguishing the brand from competitors and having unique selling propositions. They stress the need to attract potential licensees by showcasing the attractive aspects of the business model.
Quality and Desirability in Licensing
To attract licensees, the speaker emphasizes the importance of ensuring that the business model being licensed is highly desirable. They advise that the business should offer unique features or solutions that stand out in the market. The speaker recommends focusing on quality over quantity, as having a limited number of quality licensees can be more beneficial in the long run than having many licensees who may not succeed. The speaker suggests evaluating potential licensees carefully, considering their fitness portfolio, financials, real estate, and commitment to the brand. They also mention the need for licensees to be willing to make necessary changes to align with the brand and create a successful business.
Considerations for Licensing and Real Estate
The speaker highlights the potential benefits of acquiring real estate for the licensing process. They suggest considering purchasing larger properties to accommodate multiple licensees or subtenants, which can generate rental income and increase profitability. The speaker encourages exploring options where licensees can operate in buildings owned by the licensor, offering favorable rental terms to support their success. They also mention the importance of proper trademarking and copyright protection to provide a complete and valuable licensing package. Finally, the speaker mentions that banks are generally more willing to lend to fitness businesses for real estate purchases compared to other expenses, making real estate ownership a viable strategy for gym owners looking to expand through licensing.
Licensing Model and Revenue Projection
The podcast episode discusses the possibility of implementing a licensing model in the fitness industry. The speaker talks about their own plans to license their brand and the financial projections for this venture. They express confidence in being able to sell 10 licenses, potentially generating $120,000 in revenue in the first year. The goal for the first year is to break even and not make personal profit. The focus is on compensating the licensees well and creating a profitable business in the long term by adding more licensees in subsequent years.
Franchising vs. Licensing and Future-Proofing
The conversation also touches upon the differences between franchising and licensing, with the speaker expressing a preference for licensing due to lower costs and greater flexibility. They emphasize the importance of future-proofing the licensing model by considering factors such as individual design components, remote coaching, and digital offerings. The speaker encourages the gym owner to think long term, predict future trends in the fitness industry, and consider their unique selling points and competitive advantages. The idea of creating business content, such as a podcast, is also suggested as a way to build brand awareness and prepare for potential licensing opportunities.
This episode is from a call I had recently with a gym owner who has built a very successful private training business - Derek Geiges, owner of Solid Rock Personal Training in Oklahoma. He's now exploring the options of creating a replication model via licensing, so he scheduled a call and we discussed some of the big vulnerabilities and opportunities I saw for him.
Derek was gracious enough to allow me to share this call (that he paid for), with you - in hopes that you too can benefit and learn from our discussion.
Go hit him up on IG and give him some props. That's a solid fucking guy right there.