Episode #533: Building Extraordinary Brands-RJ Krone on Franchising Strategy and Community

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I am super excited to announce that we now have a formal partnership

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with the Prospect Wizard. And when I say wizard, I mean

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wizard. Obviously you have a website. This allows you to

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convert your website traffic visitors directly into

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leads. It's not just another chatbot and it's not AI but it

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allows a visitor to call, text or leave a voicemail

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immediately. Goes to you, your sales team or anyone else in the club

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instantly. MIT shows a study that if you contact the lead

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within 10 minutes, chance of them converting goes up nine

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times that of the average. We got the Atlanta clubs on

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it. Vita Fitness, Gold's Gym, Mountainside

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City Fitness, Philly, College Park. Become one

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of the next Halo companies to deploy the Wizard. It's

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easy to use. Go to the prospectwizard.com get

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a free 30 day trial. Talk to my boy Dave Gallen. He will get you

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all set up and let the leads flow based on the

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Wizard. Go get him.

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This is Pete Moore on Halo Talks nyc. I have the pleasure of

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bringing it to our audience. RJ Krohn,

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president, Extraordinary Brands, Extraordinary Studios,

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Extraordinary Wellness, Extraordinary Chicagoan. Welcome

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to the show. Thank you. The weather's about to change in

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Chicago, so get ready for winter. Well, I just attended my

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first Taylor Swift concert, so I am. I'm all heated up and ready

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for a day of Halo Talks. Well, we could use you in January. You can

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come here, it'd be great. Sounds good. So look, you've got

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an interesting platform that you built in a pretty short period of time.

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So give our audience a little background on yourself and what you're

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building and some of the acquisitions you've made. Yeah, quick summary. Is

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been in franchising almost 20 years. Started off in the service industry. Wore

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too many hats. From a business coach to director of

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operations in a small franchise system. You touch a lot of things.

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Learning management systems, operating manuals, call centers, company

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owned units. It's where I cut my teeth. However,

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I did transition. I got a phone call from a president of a company called

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Julie Cartwright. Her name is Julie Cartwright from PVolve.

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And she had an online on demand modality and that was

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in 2019. And she asked me if I was interested in bringing that to

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brick and mortar and franchising, to which I kind of

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half jokingly said, you know, you're talking to a service guy. She's like, yeah, but

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this is a great conversation. We should continue. So a couple months

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later we had continued to talk and we decided it was the right move for

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us. So I joined April 13th of 2020, right in the beginning of

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COVID no one knew what was going to happen, but for us, it was a

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good time. We needed to be fully baked as a franchisor, operating

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systems, operating manual, all those things. And so I spent the next

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three and a half years slowly awarding franchises, and

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we got to 40 franchises by the end of my tenure there

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in 2023, joined extraordinary

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brands. December of 2023. And we started

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out, we had a small cycling concept with

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Purvello. And then we really started looking for different acquisitions

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and the building the boutique fitness industry. In April, we acquired

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Eat the Frog. In May, we went and acquired Row

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House. And then in August, we acquired Neighborhood Bar.

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And the reality was to find a diversified strategy for

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our franchise owners, but also for Extraordinary brands. So you have a hit workout,

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cycling, rowing, and then a bar space.

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So, you know, we've been pretty aggressive in our acquisition, but the most

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important things to us is making sure that our franchisees are profitable.

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Nothing. We can't award another franchise unless our

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franchisees are doing well themselves. So our focus has really been on support and

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operational support. That's great. So I'm happy to say that Eat the

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Frog, Row House and Neighborhood Bar have all been on Halo talks.

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So I'm assuming that your next leg of this stool is going to be one

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of our legacy guests. So we will, we will help you go hunting through

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our archives for that. I'd appreciate that. So,

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look, you know, before COVID

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Hit Studios were definitely on a tear.

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You obviously had Class Pass and gympass and some of these other groups out

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there creating a little bit of noise in how the system

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works and being able to sell memberships versus giving people the ability

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to go to, you know, different types of modalities

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through a credit system. You know, what gave you the, you

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know, inertia and confidence that, you know, we're. We're kind of

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going back in the direction that we were prior to Covid.

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And, you know that the unit economics are something that, you know,

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as a franchisor, you like, hey, look, this is sustainable.

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Yeah, I think that those are different types of memberships. To be honest with you.

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There's a member that does fit into what ClassPass is looking

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for. They're looking for variety. They want to be able to taste a lot of

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different modalities. But I still think the boutique fitness

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space of, you know, the brands that we have are still being. People want to

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be specifically at that studio. And it's not necessarily just the modality. It's the community.

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Right. During COVID there Were so many different conversations

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I heard about are people coming back once

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Covid's over to the studios? And the answer was overwhelmingly yes. Ben. And it's

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overwhelming you. Yes now. And it's just something you have to have you build. You

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can't work out by yourself down in the basement forever. You need to be able

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to go to that 7:30 class and be with your for your friends to be

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there motivating. Get to know your coach, understand that the coach understands who

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you are and what your goals are trying to achieve. So I think it's

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an important thing is that once

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a member finds the modality and the space that

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feels very comfortable to them, then they have a long

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term commitment to that studio. So yes, there's always going to be class

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pass. Honestly, at the beginning of our

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franchise journey when the studios are out there, we're advocates, it's

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revenue. Right. Let's get the people into the studio and then work on

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converting them into, you know, members of our current studio. And we've been

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quite successful with that. But I think it's not a, it's not a bad thing

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in the industry. Allows for people to go ahead and taste a few different things,

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little smorgasbord. But once they find the space that they like, they

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stick. So you know, as you went to buy

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different franchisors and different brands, each one had

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their own, you know, DNA and evolution. So what are some of the

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things that you looked for in Eat the Frog which I met those

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guys, you know, a long time ago when they were just starting up and you

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know, just, just a ball of energy kind of like,

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like kind of shot out at you row house. We've known

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Deborah for years back in New York when that was, you know, the

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first dedicated row and then neighborhood bar has done really well

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in, in some of these sub markets. Were there certain, you know,

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traits to say like this fits because I know that the brand

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has, has been established now I can kind of fine

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tune the unit economics or I can fine tune the franchise or

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franchisee relationship. Yeah, I think they all have their unique

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niche and I think one of the things that extraordinary brand we like to look

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at is how is this available to everyone? Right. Just take Row House

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in particular. You could be 25, you could be 35, you could be

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55. And I believe there's a woman in California that won the regatta at 70

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years old that we did over the summer. And I think that's really important

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to where fitness is today is inclusive

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and there's a Gentleman that I used to work with at

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pvolve that was a large man, tall,

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and there was really like, he started going to row house in

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Cool Springs, and it changed his life. Right. He not only lost

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weight, his hips felt better, his knees felt better, and he lost a

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significant amount of weight. And he couldn't have done that without a unique

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modality that allowed for you to work out 70% of your body, but at the

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same time not putting stress on your knees and hips. So when I look at

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it from our perspective, what we're looking for is some of the uniqueness. What are

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the things that are strong and powerful. Hiit is a particular type of workout,

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but what makes it unique. And I think that inclusive nature, you'll see

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with all of our brands that doesn't.

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That allows for you to come in and feel comfortable from the very beginning,

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whereas it's not maybe a.

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A show that you don't want to be part of. It's making you feel

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comfortable and being inside your own zone to be able to be successful for

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your fitness journey. Yeah. One of the things that was music to my

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ears when you said we want to make sure all of our franchisees are

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profitable before we award and sell new ones. I feel

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like there's a number of franchising concepts that

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maybe haven't figured out the special sauce yet. Just start

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franchising as if they have an operating or offensive playbook

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that they share with people, yet it's still kind of, know, wet or, you

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know, in version one. So when you.

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When you see that in the market, you know, and you and

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someone's deciding between different types of franchises, how do you kind of

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articulate to them? Look like we've actually got a franchising

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support team. You know, we know what we're doing here. We've got a lot of

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experience. And, you know, you might be taking a flyer on something. But look

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at our. I haven't checked your, like, item 19 or, you know, FDD, but

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I always look at that and see, you know, how close are they to getting

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to, like, $2,000 a day is usually like a metric that I look at. And

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a lot of that's related to, like, number of classes that you have on. On

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the schedule. So what's your view on. On what's in

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the market? And you know, what maybe is causing some issues

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with franchisees and other brands? Well, some of the

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conversations I have with franchise candidates, we don't sell franchise

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units. We award franchise units. And I think there's a difference there

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And I think when you, when you have that type of a situation it

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changes the con. Right. And I always tell franchise candidates, I

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said make sure you're, if you're talking to other other types of franchise

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businesses, make sure you're a cultural fit. It's no different than you going to work

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for someone else. Make sure the people you talk to align with what you're thinking

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and how you feel and it makes sense because that's what's going to learn, lead

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to long term success, boutique fitness and

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franchising in general. You're really your top. It's a top of funnel

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leads and converting them into a membership. It's not, it's not rocket science.

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Your modalities, the thing that separates you from each each other. But

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really the, what we do on how we acquire members is not all that different

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between different brands. But I would say also

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be cautious of, you know, looking at, we

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look at it from I'm going to award you a studio that makes sense for

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you and your family. Is one unit the one what you need or is it

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something that you're trying to do income replacement and you need three studios. I

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don't believe that we need to be awarding multiple packs,

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huge packs. I think it's trying to identify what the franchisee is looking

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for and aligning with their goals and making sure that they,

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that makes sense. And I think those things kind of come across. So if they're

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wet behind the ear, whatever it might be, I think having those conversations shows the

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maturity of our system as well as the team that we have. When we

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bring into a Discovery Day, you're going to see, you know,

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director level and above individuals that are talking to that are experts in their space.

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I have no problems and it's a cliche thing to hire people that are smarter

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than yourself. My team is tremendously more smart than I

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am. I could provide the vision. But they're experts in what they

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do and I think that gets communicated to the franchise candidate. Well, so

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there's, if there's a weakness somewhere, franchise candidates here.

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This is Pete Moore. I want to let you in on a little secret. There's

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this company called Promotion Vault and what they do is they give out rewards

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from retailers that allow you to incentivize your

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members without having to do zero down and one month

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free or giving away shakes or giving away T shirts.

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What you want to do is build a rewards program that lasts,

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that people value and that doesn't discount your own products and

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services. So here's the deal. There's something called Rewards Vault.

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The Rewards Vault is going to allow a member to set up their own

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profile. They are going to answer questions, you are going to get those

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answers, going to be able to target those members and you're going to reward

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them inside your club, inside your spa and outside

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of the club and outside of the spa to get them to become

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loyal, to get them to pay their monthly dues and

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to be rewarded properly for the actions. A lot of companies are cutting back

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on rewards. You shouldn't be Promotion Vault, your answer, trust

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me, this is real.

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So from an operational standpoint and don't disclose

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things if you don't want to, but do you have a director or chief

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marketing officer for each one of the brands and a president of each one of

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the brands or do you basically say, hey, I got a chief marketing officer

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for extraordinary and we're basically managing these brands underneath.

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I've seen it in different

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ways, but I feel like there's definitely a

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benefit of providing that brand across, you

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know, touch points and also see somebody who like wants to

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wake up and dedicate and say, hey, I'll meet the frog every day. I'm not

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extraordinary. So how do you think about toggling between the two?

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Well, I think marketing and operations are kind of separate when it comes to

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that kind of a thought process. Marketing is a shared service that I

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think that in many of the boutique fitness spaces can be

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a shared service. A lot of the concepts are very similar. You

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need to have the flavor of each brand and make sure that it is specific

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to each one. But you're looking at right now Black Friday and soon

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to be New Year, new you. Those are very important times of the year for

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any type of marketing in the boutique fitness space. And I think a lot of

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those things are applicable now. When it comes down to the actual unique modalities

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of training and coaches, I think it becomes more specific to that. You want

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to make sure that your master coaches are training your team exactly how to

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do the modality that is the product. Right. If you are a

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chef in a restaurant, that's the product. So we need to look at

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our trainers and say, hey, you need to be working with this

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individual that knows this modality inside and out because that's what keeps people

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coming back. If you have a coach that's maybe not trained as well as they

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could be, it's going to be a bad first time experience for potentially a member

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and that doesn't lead to the membership sales. So our most important thing that we

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can do is be specific. Specific in how we train our coaches.

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Great. From a standpoint of

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exponential and what they had planned. I'm not really sure what the current

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Status is on XPass where they were going to try and basically sell membership or

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you go to different brands under their umbrella. Do

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you keep these separate? Do the people at Eat the Frog as a

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franchisee, are they potentially awarded a

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row house or neighborhood bar? Do you want them to only be in

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one brand? And is there any interest later on

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of trying to do some kind of collaborative like co op marketing?

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No, I definitely think that the brands complement each other and I would say that,

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you know, any type we have, anytime we have an owner that's successful, I'd like

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for them to be able to continue that success in another brand. And it's

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not something that I created necessarily. Other brands have done it, including premium

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service brands is our sister company. There are individuals that own

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different brands in that space and I think that it'd be, you know,

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our vision is that you could go to one of those, to a fitness row

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and those could be owned by a specific franchise owner and maybe that's

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in rowing and then one's in hiit. But then as we move

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forward into our aspirations for extraordinary brands is to get into

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the wellness space and provide that inclusive

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experience for the member that they might go do their

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workout but recovery is right next to it or stretching

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concepts next to it so it's convenient to that member. And ideally it'd be

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owned by the same individual. So gotcha. You know, for when you

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take a look at, take a step back. Sometimes, sometimes people come and

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pitch and say, hey, I'm going to get to 500 franchisees and you know, X

264
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number of years. The way you articulate your, your mission

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and your strategy is I'm going to award people when it's

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right for me to award a franchise. I'm not actually

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looking at a number or a goal. I'm looking at building out

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relationships and those relationships are going to be profitable relationships.

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So how do you think internally? And I know you've got

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private capital, so it's not necessarily like a venture capital firm or private

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equity firm that has like a certain Runway and they're trying to get a certain

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amount of locations to get to the next level. How do you think

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about. How do you manage and measure success? I guess is the, is

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the. Boil down the question. Well, franchise development is key to any

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franchise system. Right? You know, you need to be growing that franchise system. That's not

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only with new Candidates, sometimes that's also with resales. You know, individuals that

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came in from, for, you know, their 10 year term and wanted to move on

278
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to something else or retire wherever it might be, we should be involved in helping

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them achieve their goals that can bring in new

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livelihood. My approach to looking at

281
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franchisees, you definitely need to set a goal to decide where you want to

282
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be regarding awarding franchises. How you get there

283
00:17:13,994 --> 00:17:17,554
might be a little bit different than what you thought on January 1, right? Individuals

284
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come into your pipeline from many different angles. And

285
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you know, sometimes, you know, you set the goal of awarding say

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25 franchises in this, in, in, in a year.

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They come, they might be singles, they might be someone that needs two French,

288
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two studios, could be a three or four. So I think it's, to me it's,

289
00:17:36,842 --> 00:17:40,522
it's definitely setting a goal, but it's really making sure that

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you're talking to the right type of franchise candidate and having your pipeline full

291
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with those types of people coming in that are going to have that type of

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conversation. And I think that is really

293
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a way that you market the actual brands to bring those people into it. If

294
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we're really going after someone which we do not like, a master franchise

295
00:17:57,672 --> 00:18:00,984
licensing license, that's one way to market the business

296
00:18:01,152 --> 00:18:04,936
versus looking from an organic space where we're looking to find someone that's

297
00:18:04,968 --> 00:18:08,580
going to be involved and passionate about that business.

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In a lot of franchisors that we've worked with in the past,

299
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the first set of franchisees are usually either members or instructors that have

300
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moved to a new city and said, hey, I got to bring this with me.

301
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Do you find, and maybe it's too early to say

302
00:18:23,920 --> 00:18:27,512
or to have an opinion on, is it sometimes better to have people that are

303
00:18:27,536 --> 00:18:30,328
coming in here and say, look, I'm looking at this as a business opportunity, I'm

304
00:18:30,344 --> 00:18:34,152
not necessarily affiliated with the brand. Or do you like

305
00:18:34,176 --> 00:18:37,672
to have people that have some DNA attached to it and are kind of using

306
00:18:37,696 --> 00:18:41,544
that enthusiasm to put themselves into business? Passion for the

307
00:18:41,552 --> 00:18:45,240
business you're in is important. To be honest with you, I think that

308
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there are a mix of individuals that are looking from an investment side

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of things, but they typically, in my years in the

310
00:18:52,766 --> 00:18:56,470
fitness space, they might be the investor grade, but there's something that's drawing them

311
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to the fitness space, right? Either they're passionate about their fitness and their

312
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workout regimen. If they knew someone in the business, something, there's

313
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something that draws them in, but they might be just a different type of

314
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individual. I think that Doing it

315
00:19:10,606 --> 00:19:14,390
correctly. And the people I spoke to and speak to

316
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often, it's just that they, they want to be able to part of something

317
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and they want to be part of something that helps people. Right. And I think

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that's like. That still gives me tingles in my neck to think about what we

319
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can do to support our franchisees and members. I had a

320
00:19:28,512 --> 00:19:32,296
conversation in PVolve, I think it was our 100th member

321
00:19:32,448 --> 00:19:36,088
early on celebration and there was a woman there that

322
00:19:36,224 --> 00:19:40,020
just told me how important this method was to her

323
00:19:40,400 --> 00:19:44,136
living life. Right. And her knees felt better, her hips

324
00:19:44,168 --> 00:19:47,822
felt better. And those types of stories are just so

325
00:19:47,846 --> 00:19:51,358
unique to this space. I was in the service industry before

326
00:19:51,414 --> 00:19:54,890
and no one said that about their grass, I could tell you that. But they

327
00:19:56,070 --> 00:19:59,870
talk about how their life journey has taken them there. And yes, there

328
00:19:59,910 --> 00:20:03,550
are members that do come forward and want to put themselves

329
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into an ownership position for sure. And I find that those are

330
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sometimes the best owners because they understand the modality. Great. Their story goes

331
00:20:11,022 --> 00:20:14,622
right across finetley that first time client comes in they can

332
00:20:14,646 --> 00:20:18,062
pitch that story and they understand what this modality can do for

333
00:20:18,086 --> 00:20:21,790
them. You know, one thing that sticks out to me on

334
00:20:21,830 --> 00:20:25,326
the brands that you have right now is versus some of the

335
00:20:25,398 --> 00:20:29,038
players in the space, you have a relatively lower build

336
00:20:29,094 --> 00:20:32,798
out cost than some of the groups that,

337
00:20:32,854 --> 00:20:36,462
you know, whether it's like a soul cycle or Barry's boot Camp, you know, that

338
00:20:36,486 --> 00:20:40,040
are, you know, some of these are in the multimillion dollar build outs

339
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and I'm not sure what the return on investment on

340
00:20:43,856 --> 00:20:47,624
some of those are. So when you take a look at how you guys architect

341
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this and maybe talk a little bit about what you get

342
00:20:51,200 --> 00:20:54,792
besides just the brand and the operational support, not that that's,

343
00:20:54,936 --> 00:20:58,680
you know, minimized, but it's maximized. However, here's some of the things

344
00:20:58,720 --> 00:21:02,472
that maybe an entrepreneur might not be thinking about where you're like, look, I kind

345
00:21:02,496 --> 00:21:05,538
of nailed this for you don't have to worry about it. Well, I think the

346
00:21:05,594 --> 00:21:09,122
build out cost is probably one of the biggest things that you need to be

347
00:21:09,146 --> 00:21:10,790
watching as a franchisor.

348
00:21:12,650 --> 00:21:15,282
It's everything when it comes to someone's coming to the business if they have an

349
00:21:15,306 --> 00:21:18,962
SBA loan or whatever it might be, because we can minimize the SBA and we

350
00:21:18,986 --> 00:21:22,738
spent a considerable amount of time on value engineering the studios to take the cost

351
00:21:22,794 --> 00:21:26,530
out. Obviously everyone has experienced a lot of inflation over the last few

352
00:21:26,570 --> 00:21:30,274
years and construction hasn't necessarily

353
00:21:30,402 --> 00:21:34,154
come back to the ground. There was three, four years ago from Cost.

354
00:21:34,242 --> 00:21:37,642
So you have to think about things on how you're building it out. We had

355
00:21:37,666 --> 00:21:40,870
a bathroom in just one instance where there were

356
00:21:41,490 --> 00:21:45,178
four walls were tiled. It looked great to have the four walls tiled,

357
00:21:45,274 --> 00:21:48,842
but the reality is it was an extra three, $4,000 in

358
00:21:48,866 --> 00:21:52,586
tiling that we needed in the bathroom. So instead of doing all four walls,

359
00:21:52,698 --> 00:21:55,354
we did it on the wet wall. Right. Can we save some cost there? Is

360
00:21:55,362 --> 00:21:58,710
the member experience still good? Yeah, absolutely it is.

361
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And so you need to keep those costs down. And I think with from an

362
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extraordinary brand side of things, you know, we have build out costs, you know,

363
00:22:06,716 --> 00:22:10,372
that are, you know, range, but they're all reasonable.

364
00:22:10,436 --> 00:22:13,716
Right. The unit economics will work for it. You don't need to have a thousand

365
00:22:13,788 --> 00:22:17,396
members to make these concepts work. And that's really what Boutique Fitness

366
00:22:17,428 --> 00:22:21,172
is finding three to 400 members that come religiously to your studio

367
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that want to invest their time getting to know the

368
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modality, the members, the coaches, all those

369
00:22:28,508 --> 00:22:31,876
things. And our investment level allows for that to actually

370
00:22:32,028 --> 00:22:35,844
happen. And then two questions.

371
00:22:35,892 --> 00:22:39,172
One is, do you have a corporate studio for each one of the

372
00:22:39,196 --> 00:22:43,028
brands and are the founders still

373
00:22:43,084 --> 00:22:46,660
involved in each one of these brands or are they still, you know,

374
00:22:46,700 --> 00:22:50,548
consultants or if you want to share that just for future

375
00:22:50,604 --> 00:22:54,244
deals, are you looking to partner with them under your umbrella or is it,

376
00:22:54,332 --> 00:22:57,376
you know, they maybe have run the course and are for a

377
00:22:57,528 --> 00:23:01,264
graceful succession plan? We have both. To be

378
00:23:01,272 --> 00:23:04,896
honest with you, it's not the deciding

379
00:23:04,928 --> 00:23:08,304
factor for us in regards to if they have company owned or not. If they

380
00:23:08,312 --> 00:23:11,552
do have a company owned studio. I do think it's interesting to use that as

381
00:23:11,576 --> 00:23:15,264
an incubator of thought to test things out for the franchise system. If

382
00:23:15,272 --> 00:23:18,976
there's not a company owned franchise, you can partner with franchisees that are leaning forward

383
00:23:19,048 --> 00:23:22,816
and want to try new things. The businesses have to evolve, right?

384
00:23:22,968 --> 00:23:26,562
And to evolve the business, you have to do testing. In one of

385
00:23:26,586 --> 00:23:29,762
our row house locations, we're testing out a

386
00:23:29,786 --> 00:23:33,602
nutrition, not nutrition supplement, but nutrition

387
00:23:33,666 --> 00:23:37,138
counseling. Now after good research,

388
00:23:37,274 --> 00:23:40,402
enough research, we decided that that was going to be something that we felt like

389
00:23:40,426 --> 00:23:42,754
it was successful, it could be scaled, but we do have to test it out

390
00:23:42,762 --> 00:23:45,170
in the real world right now. Right? We have to make sure it is something

391
00:23:45,210 --> 00:23:49,042
that our members are looking for. And so

392
00:23:49,066 --> 00:23:52,674
I think going back to the original question about having ownership

393
00:23:52,722 --> 00:23:56,382
stay around Neighborhood Bar, the founder is still part

394
00:23:56,406 --> 00:23:59,950
of Neighborhood Bar. Katie Richardson, she's phenomenal

395
00:24:00,030 --> 00:24:03,566
and she spent the last 12 years building that business. And why would it be

396
00:24:03,638 --> 00:24:07,486
silly not to keep her on our team to help learn and

397
00:24:07,558 --> 00:24:11,230
take those experiences and share them with Anita Frog. A row house

398
00:24:11,270 --> 00:24:14,734
and a pure bellow, which she has a tremendous

399
00:24:14,782 --> 00:24:16,410
background in those types of things.

400
00:24:19,190 --> 00:24:22,350
This is Pete Moore. Here's the last tip for you of the

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409
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there before these workout recovery and spas end up saturating

410
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your market. Having your members walk out of the club and going into one of

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their locations for 200 bucks per month where they're paying

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and services to meet the demands of your members. And

417
00:25:19,820 --> 00:25:23,572
hey, let's get people happy, healthy and sweaty. And

418
00:25:23,596 --> 00:25:26,440
the recovery should be just as good as the workout.

419
00:25:29,740 --> 00:25:33,428
You know, I was at a couple of tech summits recently and I kind of

420
00:25:33,484 --> 00:25:37,284
came up with this quote that says you can't have artificial intelligence until you

421
00:25:37,292 --> 00:25:40,948
have intelligence. So, so what do you do to kind of

422
00:25:41,004 --> 00:25:44,686
tell these franchisees and maybe in the background of, you know,

423
00:25:44,758 --> 00:25:47,662
whatever software you guys are running to say, hey, we actually got to fill this

424
00:25:47,686 --> 00:25:51,262
up with like real information and then I can help you kind of sort it

425
00:25:51,366 --> 00:25:54,750
and use it. So I see you smirking, so I'm assuming you're on the same

426
00:25:54,790 --> 00:25:58,590
page as I am with that terminology. It's still

427
00:25:58,630 --> 00:26:02,238
a people business, right? You know, there's automations that can come in to help support

428
00:26:02,294 --> 00:26:05,806
you and speed to lead those types of things. But even you know, the reality

429
00:26:05,838 --> 00:26:08,702
is that you still have to be in touch with those individuals. I look at

430
00:26:08,726 --> 00:26:12,334
a quick short story is that if you call me after I submitted a

431
00:26:12,342 --> 00:26:16,160
lead, I'm not picking up the phone. However, my wife, if you call

432
00:26:16,200 --> 00:26:19,888
her, she's picking up every one of those calls. If you email

433
00:26:19,944 --> 00:26:23,344
me, I'm responding to you. So there's no replacement for

434
00:26:23,512 --> 00:26:26,780
those different types of engagement with a potential member.

435
00:26:27,480 --> 00:26:31,232
AI is going to be part of our lives, I think for the best. But

436
00:26:31,256 --> 00:26:34,660
at the same time, it does not replace the need for a personal touch

437
00:26:35,000 --> 00:26:38,608
to reach those people out and understanding they're truly understanding their goals of what they're

438
00:26:38,624 --> 00:26:42,304
trying to achieve in other fitness regime.

439
00:26:42,432 --> 00:26:45,580
Yeah. And I actually do have one last question on

440
00:26:45,960 --> 00:26:49,700
Ozempic and some of these other weight loss drugs.

441
00:26:50,120 --> 00:26:53,808
I've been in this industry 25 years and everyone always said back in the day,

442
00:26:53,864 --> 00:26:56,112
oh, it's going to be a pill where no one needs to work out. Now

443
00:26:56,136 --> 00:26:59,088
it's actually, you can take this pill, but you must work out or else you're

444
00:26:59,104 --> 00:27:02,940
going to be an assistant living at 35 and lose all your muscle mass.

445
00:27:03,880 --> 00:27:06,810
With that coupled with hsa, FSA

446
00:27:07,000 --> 00:27:10,550
reimbursements, are you seeing a wave yet of,

447
00:27:10,670 --> 00:27:14,422
you know, new people entering the space or maybe programming that's designed for

448
00:27:14,446 --> 00:27:18,130
like, hey, you're doing this, but you really need to do this also?

449
00:27:18,830 --> 00:27:22,646
Well, all those those types of medications do is they're a tool.

450
00:27:22,718 --> 00:27:25,862
They still, you still need to be a healthy, have a healthy lifestyle. Right. You

451
00:27:25,886 --> 00:27:29,334
still have to eat correctly and you still need to have a fitness

452
00:27:29,382 --> 00:27:33,142
regime of some sort that you're. You're maintaining. So if anything, it

453
00:27:33,166 --> 00:27:36,870
helps someone that maybe wouldn't be able to get into a studio because, you know,

454
00:27:36,910 --> 00:27:40,232
their shape or size at the. But it allows for them to get into a

455
00:27:40,256 --> 00:27:43,976
space where they can go ahead and be part of a fitness studio

456
00:27:44,008 --> 00:27:47,100
or feel more comfortable at a fitness studio, boutique fitness.

457
00:27:47,760 --> 00:27:51,304
But I think it's like anything, it needs to be used for the right reasons.

458
00:27:51,432 --> 00:27:55,096
I know we're Americans and we like to take a pill for everything, but there's

459
00:27:55,128 --> 00:27:58,968
no replacement for a healthy lifestyle. Right. And

460
00:27:59,024 --> 00:28:02,424
I think that using those types of medications as a tool

461
00:28:02,592 --> 00:28:05,780
works and it helps people get to where they need to be.

462
00:28:07,180 --> 00:28:10,320
Is there a need? We do offer

463
00:28:11,660 --> 00:28:15,240
FSA and we work with Optum and Ash

464
00:28:15,740 --> 00:28:19,380
and we do have members that utilize that programming to help

465
00:28:19,420 --> 00:28:22,852
offset some of the costs that they have with the studio. So I definitely think

466
00:28:23,036 --> 00:28:26,836
it needs to be not only talked about at the local level

467
00:28:26,908 --> 00:28:30,692
with our studios, but also working with those partners in that space that

468
00:28:30,716 --> 00:28:34,416
they make sure that people in the healthcare space, they do tell the benefits

469
00:28:34,448 --> 00:28:38,240
of what could be used if they chose to. And that

470
00:28:38,280 --> 00:28:41,632
comes from those insurance companies making that a little bit more vocal, a little bit

471
00:28:41,656 --> 00:28:44,860
more noticeable that they have those benefits already into their

472
00:28:45,720 --> 00:28:49,472
insurance. Great. Well, thanks for coming on the

473
00:28:49,496 --> 00:28:53,248
show here. We really appreciate it. I love what you're building. It seems like you're

474
00:28:53,264 --> 00:28:56,848
doing it very methodically and at the right pace.

475
00:28:56,944 --> 00:29:00,588
And I'm awarding franchises instead of selling franchises.

476
00:29:00,704 --> 00:29:04,400
These are the kind of buzzwords that I hope proliferate through the industry.

477
00:29:04,780 --> 00:29:08,084
So someone's going to listen to this podcast and start to use the word award

478
00:29:08,212 --> 00:29:11,860
and not hey, I sold. When you sell something, it's almost, you know,

479
00:29:11,900 --> 00:29:15,748
determine the history of the word. Sell is like to sell somebody

480
00:29:15,764 --> 00:29:19,280
down the river or to, you know, take get one over on them.

481
00:29:19,580 --> 00:29:23,300
I like looking at the derivation of words. So look

482
00:29:23,340 --> 00:29:27,120
forward to getting to know you, sending you some opportunities and,

483
00:29:27,580 --> 00:29:31,322
you know, seeing you at the shows and also, you know,

484
00:29:31,346 --> 00:29:34,890
visiting your locations as I'm traveling around. So congrats on what you built so far.

485
00:29:34,930 --> 00:29:38,650
It seems like a great work in progress to to get you on the

486
00:29:38,690 --> 00:29:41,962
show now. Well, thank you very much for the invitation. Appreciated the

487
00:29:41,986 --> 00:29:45,450
conversation and definitely want to see you at a show

488
00:29:45,490 --> 00:29:49,258
and share an adult beverage maybe. You got it. That's

489
00:29:49,274 --> 00:29:52,954
fine with me. Okay, sounds good. All right. Enjoy the, enjoy the cold weather pending

490
00:29:53,002 --> 00:29:56,064
and make sure everyone gets in the studio. Great to meet you,

491
00:29:56,202 --> 00:29:56,880
Sa.

492
00:30:21,670 --> 00:30:21,910
Sa.