What is recurring revenue? This is simply automatic payments or membership contracts that you can count on every single month. They create a stable cash flow for your gym, and at the end of the day strengthen your bottom line. Regardless of the type of gym you own, you should always be trying to increase your recurring revenue.
Change “Drop-In’s” Into Members
Many CrossFit or class-based gym’s have drop-ins where non-members can attend a class for a fixed fee. People who attend these have a low commitment level and can be turned into committed paying members. A great way to turn these individuals into members is to offer low barrier-to-entry class passes at a cheaper price compared to drop-in rates. For example, if you run a Yoga Studio and charge $15 for a drop-in rate, you could offer 5 classes for $70/month membership. This kind of savings gets people in the door and establishes recurring revenue for your business.
Make Sure to Price Memberships Right
When you offer your membership options, you must consider how fair the pricing is. You must look at local competitors and what others are charging. You also must consider how often people will attend your gym and its classes. There are three tiers in which your member’s attendance will fall into, low users (less than 2 times), medium users (3-7 times), and high users (8-12+). This will affect the price you offer your membership rates by knowing how often people attend. For example, you wouldn’t offer an unlimited classes membership at $200/month knowing people don’t go more than 12 times per month when your drop-in rate is $10. When considering recurring revenue, you must find a medium price-point that will make your business money and still have value for customers.
Get to Work Growing Memberships!
With the right membership strategy in place, you’ll be able to turn drop-ins into loyal members. Gym’s that can implement recurring revenue strategies are better off in the long run. Implementing the right kind of strategy can keep more people inside your gym!
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