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Episode 69

Why your business model could be set to fail

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About this episode

Welcome to another exciting episode of “Treat Your Business” with me, Katie Bell! In today’s episode, we’re diving deep into the foundations of building a resilient and sustainable business model for clinic and studio owners.

In this episode, I address the common challenge of inconsistent income faced by many business owners in the healthcare industry. We explore the root causes of this issue, including inconsistent revenue, marketing strategies, sales approaches, and team performance.

I share insights into the importance of transitioning from a pay-as-you-go model to structured programs or packages, allowing for more predictable revenue streams and better client retention. By delivering exceptional results and creating a business model that aligns with both client needs and business sustainability, we can achieve long-term success.

Throughout the episode, I offer practical advice and examples of creative ways to work with clients, such as incorporating online elements and implementing subscription-based models. These strategies not only improve client satisfaction but also contribute to a more stable and thriving business.

In summary, mastering business resilience involves rethinking traditional approaches and adopting innovative strategies tailored to the needs of both clients and the business. By making these shifts, clinic and studio owners can create consistent income streams while delivering exceptional results.

Key Takeaways:

  1. Identify and address the root causes of inconsistent income, including revenue, marketing, sales, and team performance.
  2. Transition from a pay-as-you-go model to structured programs or packages for more predictable revenue streams.
  3. Embrace creative approaches like online services and subscription-based models to enhance client satisfaction and retention.
  4. Prioritise both client needs and business sustainability to build a thriving and resilient business.

Resources:

This podcast is sponsored by the team at HMDG

Highlights

  • 0:00-Understanding the Challenge: Inconsistent Income
  • 2:08-Root Causes: Addressing Revenue, Marketing, Sales, and Team Performance
  • 5:14-Transitioning to Structured Programs: Creating Predictable Revenue Streams
  • 10:51-Embracing Creativity: Incorporating Online Services and Subscriptions
  • 16:45-Prioritising Client Needs and Business Sustainability
  • 22:45-Taking Action: Building a Thriving and Resilient Business

Transcription

[00:00:00] Katie Bell: In today’s episode, we’re tackling the third key foundation that all clinic owners and studio owners need to have in place. If you haven’t already, listen to the last two episodes that have been released on our number one foundation and our number two foundation. Then take a pause now, go back and listen to those two episodes and then jump back into this one.

[00:00:23] Katie Bell: Get ready to discover in this episode, game changing strategies for delivering exceptional results. whilst building a resilient, sustainable business model. One of the biggest challenges that I always hear clinic owners and studio owners talk about is consistent income. They feel like they’re on this kind of roller coaster when it comes to drawing a salary, paying yourself some money out of your company or out of your business.

[00:00:52] Katie Bell: And this is often for a few different reasons. Inconsistent Income is often because your revenue and your sales are inconsistent. So that can be because your marketing strategy is inconsistent or maybe it’s absent. Your sales strategy, and yes, you have one, even though you think as physios sports therapists, we don’t sell, you definitely have a sales strategy or you should have one.

[00:01:21] Katie Bell: It’s all with integrity, but maybe that is inconsistent or maybe that is absent. And that includes how you work with your clients. What is your strategy? in terms of how you deliver the results that they’re wanting and they’re needing and they’re looking for. And maybe that it’s your team performance is inconsistent.

[00:01:41] Katie Bell: So if you’re a clinic owner or a studio owner listening to this with team, are your clinicians, your therapists your instructors, are they converting your initial assessments into follow up treatment? Are they retaining and are they retaining past a patient value average of 2. 7 or 3. 3? Which is frankly not going to make your business any money, and it’s also not going to get the clients the results that they’re looking for.

[00:02:06] Katie Bell: Let’s dive in to this episode.

[00:02:08] Katie Bell: Welcome to the Treat Your Business podcast with Katie Bell. I am Katie, and this is the place to learn the strategies, tactics, tools, and mindset needed. To build your clinic or studio into a business that gives you the time, money, energy and fulfillment you want and deserve. My team and I work every day with overwhelmed and exhausted clinic owners like you to shift them from a business that is a huge time and energy drain and is not giving them the income they want to confident clinic owners that are making money, saving money and getting time back in their lives.

[00:02:39] Katie Bell: So if this sounds like something you want, let’s dive in. This podcast is sponsored by HMDG, the leading digital marketing agency for the Clinic Owners in the U. K.

[00:02:49] Katie Bell: Can you solve someone’s problem in one session? If the answer is no, why do we as an industry, or why have we always relied on a pay as you go model in our business? Or maybe you’ve advanced from pay as you go, but now you have very short courses of treatment or classes. This creates really inconsistent income for you as the business owner.

[00:03:14] Katie Bell: And if you’re listening to this, you’re probably nodding and agreeing. You can have gaps in your diary, which which are a time waste and an opportunity to make money. You have cancellations, last minute cancellations. You can create mediocre client results. Now, I’m not suggesting that you are not great at what you do.

[00:03:33] Katie Bell: I think you’re all amazing at what you do, but we create a business model that doesn’t allow great conditions for delivery. And we are very focused on exchanging your time for money, which is going to mean that you constantly hit a ceiling, because Unless anybody has invented another set of arms, then you’re going to constantly be feeling like you can only make the business so much money because you can only see so many clients.

[00:04:00] Katie Bell: And for many of us, we don’t want to be seeing 50, 60, 70, 100 clients a week. So I need you to have a mindset shift here and think what is best for the clients and then for the business. So how can we facilitate The client’s treatment, their rehab, their recovery. How can we solve their problems in the best possible way?

[00:04:27] Katie Bell: So we create great results. We maintain a fabulous reputation, but we also create a business model that is going to support us rather than starve us of time, of energy, and of freedom. Most business owners that we start working with are running their business purely on a sort of single session model, because it’s just all that they know, and it’s all that they’ve ever done.

[00:04:50] Katie Bell: And most businesses in our industry, particularly in the UK and Ireland, are running that similar model. So we’ve just followed suit. Now what this means is that you all start the month at zero pounds. On the 1st of March, when we’re recording this podcast, the 1st of March, you literally, if you were to clear out all your bank account and you were to manage your money in a certain way, you would be back to zero pounds.

[00:05:14] Katie Bell: And that comes with a lot of anxiety, doesn’t it? That comes with a lot of feeling of having to chase the top line figure.

[00:05:21] Katie Bell: So we all then think as well that to move away from our pay as you go model, it’s going to make us look salesy. It’s going to make us feel like we’re trying to sell something to somebody that they don’t really need. And what I’m here to tell you is that you don’t ever sell anything to anybody if they don’t really need it.

[00:05:38] Katie Bell: We always lead from professionalism and from integrity. But what we need to be really passionate about is that if we if clients have pains and problems, that we know we can solve, or we can certainly support them in solving. We can create the environment for them to have a facilitate that recovery or that treatment or that we can give them that rehab to get the best possible results.

[00:06:05] Katie Bell: Then that’s our duty. And I want you to think about some of the roadblocks that often are in the way when patients go through their recovery. We hear it all the time. They’ll tell us they don’t have time to do their exercises or they started doing their exercises and after a few weeks they felt a bit better so they stopped doing their exercises.

[00:06:26] Katie Bell: Or that they have to cancel last minute because the kids have got something or the kids get ill, or they might haven’t got access to the gym to do the exercises that you’ve set them to do, or they can’t get to as many classes as they want to be getting to, to get the results that they’re looking for.

[00:06:42] Katie Bell: So there’s always these roadblocks that get in the way of our patient’s recovery. Our job is to figure those out and our job is to then create ways of supporting our client’s recovery without those roadblocks even being a problem. I am gonna give you an example actually here in, in I’ll give you one in, in Thrive and one in the studio.

[00:07:01] Katie Bell: So as a lot of you know, in December we announced that we were restructuring and relaunching our ways of working with our clients, and we have launched our Activate and Elevate programs. And the reason that we did that is because for many years. I’ve worked with clinicians like you guys and therapists and I’ve listened and I’ve figured out the roadblocks and I’ve seen what you need to get the results that you’re looking for in your business.

[00:07:31] Katie Bell: I. e. you want more time, you want more freedom, you want more flexibility, you want more income, you want more confidence and more clarity. And so by knowing what it is that you all want and what your biggest challenges are, And what roadblocks often get in the way for you, which is time is always the biggest factor that you often are distracted and lose focus and have shiny object syndrome.

[00:07:55] Katie Bell: Or we are chronic procrastinators, or we don’t feel that for lots of reasons, our mindset and our belief system gets in the way of how we run our business and our pricing and our leadership. From knowing all of that, it then allowed me to create the very, very best way of working with our clients so that I facilitate the best possible results.

[00:08:19] Katie Bell: Nobody joins our program and doesn’t get great results. And that’s not me blowing our own trumpet. That’s just me saying, we figured out what’s going on for you. We figured out what your biggest challenges are. We know what the roadblocks are. We know what things get in your way. And we’ve created a program that means they don’t, that doesn’t happen.

[00:08:37] Katie Bell: That you’ve got accountability, you’ve got focus, you’ve got clarity, you’ve got a way to ask questions. You’re never more than six days away from speaking to one of the coaches in a live format. So there is never a moment in your business where you now feel alone or you don’t know what you need to do.

[00:08:54] Katie Bell: The same in our studio. I believe and my company believes that you need to be doing Pilates consistently for a minimum of three months before you’re going to start to see the results of what you’ve been working on. So we have structured The way that our clients can work with us is that it’s a minimum of three months.

[00:09:15] Katie Bell: I will not allow anybody to work with us for any less than that when they join our programs because I don’t want our reputation to be affected. I don’t want our reputation to be damaged. I am really passionate about our clients. Feeling better, moving better and living better. So this comes down to like your QBR, your promise.

[00:09:35] Katie Bell: Now, if you haven’t listened to the QBR episode, it was a few episodes ago. I’ll link it in the show notes. Go back and listen to what I mean by the Queen Bee role. But your Queen Bee role is like your promise in your business. What are you promising? And Our QBR in my clinic is that we are here to deliver exceptional health and wellness services and solutions to our community.

[00:10:00] Katie Bell: So that they can move better, feel better and live better. That is our promise. So with that in mind, the way that we structure our business model has to be to protect and serve that QBR. So when we are educating our team and training our team and getting our team on board, it’s all down to what is our promise?

[00:10:21] Katie Bell: What do we believe? How can we serve our clients in the best possible way? And therefore, what does the business model need to look like?

[00:10:27] Katie Bell: So you can Stand out in your industry as a clinic, as a business, as a studio, so you can create programs of treatment, packages of treatment, ways of working with people that solve their problems in a really creative way. And this means it doesn’t always have to be delivered face to face. Who says? Who says that to solve people’s problems in the best way, we have to be hands on and we have to be face to face?

[00:10:51] Katie Bell: Your clinic might really believe in hands on therapy and rehabilitation. So you can create online elements to the way that you work, or the way that you want to work with clients. Again, it’s based on what you know your clients need. If they don’t need it, don’t sell it them. More is not always better.

[00:11:10] Katie Bell: Less is often better. People don’t buy things. They don’t buy 12 sessions of Pilates. They don’t buy five sessions of physio and a rehab program. They don’t buy, they don’t buy the stuff. They’re buying themselves away from the problem. They don’t know what it is that they need. It’s our job to tell them what it is that we think they need to get to where they want to be.

[00:11:33] Katie Bell: And when you’ve got these ways of working with clients, you’ve got clients with skin in the game. You’re going to have less cancellations. You’re going to have less changes in the diary. You’re going to have less people drop off their treatment. You’ve, I’m sure you’ve all got patients that you’ve been seeing for a few weeks, and then all of a sudden, a few weeks later, you go, Oh, where is whoever?

[00:11:55] Katie Bell: And you look into it and they’ve cancelled and they, you’ve never seen them again. And it’s often not because their pain or their problem has gone away. It’s just that life has taken over. Something else has got in their way. Something else has taken priority. We know what that feels like. Go back to some episodes that we released.

[00:12:13] Katie Bell: It was around February time, so it will have been about five or six episodes ago from where we are now. We talked about our retention. We talked about our re engagement strategies. We’ve got to make sure we’ve got a really slick funnel so that as our clients are passing through, we’re not losing them in holes in our funnel.

[00:12:31] Katie Bell: We’re making sure we’re plugging all of those gaps. So if you’re running a pay as you go model, you can’t predict day to day, week to week, month to month. You’ve got no idea what marketing you need to be doing because your churn will be will be high or could be high. Because if we don’t know how many slots we’re trying to fill because we haven’t worked out all of these numbers, it’s so unpredictable.

[00:12:57] Katie Bell: How can a marketing agency then really deliver on results if we’re not clear what it is that we want out of them? And because it’s so unpredictable, we’re just reliant then on whoever book rings that week and books in and turns up for their appointment. So this is what we call this big churn rate. It means you’re constantly having to fill the top of the bucket as people leave at the bottom.

[00:13:18] Katie Bell: Now don’t get me wrong, you’re always going to have clients that leave because you should be getting people better. That’s what we’re here to do. But some clients, some of your business models will be that you want to get them well and keep them well. Some clients have worked with me for years. And it’s not, I’m not going to get on my soapbox about reliance and dependence on physios.

[00:13:38] Katie Bell: I’m not, we’re not going to go down that road on this episode, but if my clients want to pay me for me to keep them well, who am I to say that’s not okay? Because that’s their priority.

[00:13:51] Katie Bell: We’ve got to create ways of working with people that then facilitates that. So we saw this opportunity in our business to think I’m going to do this. If people want to stay well, why don’t we create a way of doing that? Why don’t we create a subscription model so that we can predict our income weeks and months ahead?

[00:14:09] Katie Bell: As I said earlier, we have a kickstart Pilates program where you join us for three months and then it’s an auto renewal. So you have to opt out rather than opt in again into our yearly membership that is paid on a monthly basis on a direct debit. So we have that in place because we believe that to genuinely feel and see the difference, you need to be doing Pilates for a minimum of 12 weeks.

[00:14:33] Katie Bell: So that’s what we’ve created. We’ve then looked at adding online an online dimension to our program for those that want to do more than one session a week, but can’t get to class because they’re too busy with life. And we’ve made sure that they’re like 20, 15, 20 minute little sessions that they can access, because the biggest challenge that our clients have is that they’ve got no time and that they’re super busy.

[00:14:54] Katie Bell: And we also have a way of checking in with them in their first eight weeks. And we obviously check in with them after that, but our first eight weeks is our really like on boarding time. That’s when we have an on ramp, what we call, where we bring them in. And we really nurture them, we really look after them, and we bring the retention point a lot sooner in their journey, rather than waiting for them to get to 12 weeks and then decide that they’re going to stay.

[00:15:19] Katie Bell: We want them to be like, so in by week 4 and week 5 that the chances of them opting out are very slim.

[00:15:26] Katie Bell: But that also means that I can make predictions in our income stream for the next 12 months. We also have a diamond subscription program for our massage clients where they pay a direct debit for one or two sessions a month and it’s a 12 month program. So we get a diamond member join us. Guess what? We can predict for the next 12 months what our income is going to look like.

[00:15:50] Katie Bell: So when we are predicting our and planning our revenue for the year, We also have targets of reoccurring revenue. If you’re targeted to do 10k in a month because that gives you the profit that you need, that’s the most important thing, profit first, then how much of that 10k do you want to make from reoccurring revenue?

[00:16:11] Katie Bell: And for me, you all should know what your operational costs are of your business. Without you even opening the door, this is what it costs you to run your business. For me, that’s where you want to be. You want to get your reoccurring revenue up to that level.

[00:16:24] Katie Bell: So there is so many ways that you can think creatively and not just follow what everybody else has been doing in our industry, because that’s just how it’s always been. It doesn’t necessarily mean it’s right. This is about being able to show a client. This is where you are now. This is your state A. This is like pain.

[00:16:45] Katie Bell: This is what’s going on for you. Worries, anxieties. They’re going to tell you that in your subjective assessment. And state B is looking at what they want to achieve, what they want to be able to do, how they want to be, how they want to feel. Because people by themselves Out of a problem and into the solution.

[00:17:02] Katie Bell: They don’t buy the solution. People buy emotionally and they justify logically, which I said before is the exact reason why there are no bananas and apples near the counter at the petrol station. There is only, right now, bags of mini eggs because people buy emotionally.

[00:17:19] Katie Bell: They’re not looking for 12 Pilates classes. They’re not looking for three massages. They’re not looking for physio. They’re not looking for osteopathy They’re not looking for sports massage They’re looking to get away from the problem that they’ve got That they can’t play with their kids that they can’t jump up and down on a trampoline That they can’t run that 5k that they’ve not been able to Get this certain time in the marathon or they’ve not been able to play more than 12 holes of golf because their back goes Our job is to be able to say, this is where you are now, state A, this is where you want to be, state B, and there is a gap.

[00:17:51] Katie Bell: And we are here to bridge that gap. And this is what that looks like. Now, if you believe that pay as you go, one session at a time is what they need. Hey, keep it in your business. That’s fine. But you’ve got to be able to justify it from a business point of view, from a results, reputation, client need point of view.

[00:18:11] Katie Bell: It isn’t going to create a sustainable consistent revenue. It’s going to be very sporadic. It’s going to be very up and down. It’s going to be very seasonal. You’re going to tell me all the time that August and Christmas are your quietest times. And therefore it will be very difficult for you to take a consistent income stream out of your business when all your expenses have been paid.

[00:18:28] Katie Bell: Working on this, working on the how we work with our clients, this third key foundation influences your retention rate. It influences your ability to keep clients in your business in that bucket. It influences your conversion rate. It influences your ability to take somebody from an inquiry to working with you as a client and as an ongoing client.

[00:18:50] Katie Bell: It influences your revenue.

[00:18:52] Katie Bell: And I also think if we were to do the numbers, if you’ve got, let’s just say you’ve got a 12 week kickstart program and you charge 500 pounds for somebody working with you over those 12 weeks. Let’s just say that you want to work with you, you want to make, I don’t know, let’s say just for ease of numbers 10, 000 pounds in the month.

[00:19:14] Katie Bell: If you were to say, I I’ve got my 12 week program, three month program that’s 500 pounds. You only need 20 people, 20 people per month joining your 12 month program, and that makes you 10k revenue in that month. Whereas if we look at you all, most of you are an average session cost for a lot of you for a half an hour follow up with anywhere between 45 quid and 60 quid, 70 quid, something like that.

[00:19:43] Katie Bell: So let’s just say 50, bang on in the middle, just for ease of numbers. If you say I want to win 10k this month, Katie, but my average session cost is 50 quid, you need to do 200 sessions that month. 20 versus 200. I don’t know about you, but I want to do less and make more. It’s instantly harder for us when we’re running on that chase model, that pay as you go model.

[00:20:07] Katie Bell: And your conditions for delivery on a pay as you go model are poor. Because when we’re charging our client 30, 40, 50, whatever it is, 60 quid for that half an hour of your time, you’ve got to assess them, treat them, write an exercise plan, write your notes up afterwards, send them over an email, do whatever it is that you’ve promised.

[00:20:25] Katie Bell: And we over promise, because we’re all recovering people pleasers, and what ends up happening is that you write your exercise plan at night time, you write your notes at night time or, that half an hour for 60 actually gets stretched and pulled into an hour. So we’ve now just halved our hourly rate.

[00:20:45] Katie Bell: When we are working in a program of treatment and we’re not exchanging time for money, we wrap all of that into the cost, because your time is a cost. We can’t just quote for the 30 minutes that you see a client and then do another 30 minutes of work after that. Cause we’re not charging for it. So we, when you have programs of treatment, we can wrap up all of the things that you’re going to need to do to allow that client to get the results that they’re looking for, rather than just 12 times, 30 minute sessions.

[00:21:22] Katie Bell: So this is a really, really key foundation. Is it serving you right now in your business, the way that you, your business model is set up, or is it starving you, you might need to look at changing that. You might need to look at introducing new ways of working with your clients that deliver the best possible results, deliver better conditions for delivery.

[00:21:43] Katie Bell: You can treat them in a better way. You can optimize their results. You’re going to increase your reputation. You’re going to mean more people are going to want to work with you. I think it’s our duty as a health professional. We absolutely put the needs of the client first, but then we also think about how it’s going to work for us as a business.

[00:22:03] Katie Bell: So if you’re struggling with this up and down income stream, I encourage you to look at how your business model is currently set up, how you are working with your clients. And if you’re saying I’m already doing some short courses. Okay, great. But how can we leverage that? How can we work with clients on a premium level?

[00:22:23] Katie Bell: And the last thing I would encourage you to not do is to reduce your price to package your sessions up. That is not what you do. If you want to look at this in more detail, if you want to discuss how your business model is currently set up and where it needs to change, how your pricing model and your payment model needs to look, then this is just the start of the conversation.

[00:22:45] Katie Bell: This is just the start of that thought process. Grab a slot with me. You can grab a business and marketing audit call. The link is in the show notes and we can keep this conversation going. We can look at. Why your income is inconsistent and what you need to do right now in the next 30 days to change that and how you need to do it.

[00:23:05] Katie Bell: The links in the show notes. See you again next week where we have a very special guest joining us.

[00:23:11] Katie Bell: Thanks so much for listening to this show. Remember content consumption does not make changes, so commit to doing something from today’s episode. Maybe it’s taking action on what we talked about. Well, maybe it’s reaching out to me and learning more about our transformational coaching programs. Or if you have not yet, join our free Treat Your Business Facebook group, a free access to over 30 business masterclasses.

[00:23:32] Katie Bell: All of that is over at thrive businesscoaching. com or linked in the show notes. And the last favor I will ask, because social proof is endlessly important, is to leave a rating or review. I would love to know what you think of the show, how the show has been helpful for you. And I can’t wait to chat with you.

[00:23:50] Katie Bell: This is just the start of our conversation. Reach out so we can keep it going. Talk soon!

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