In this episode summary, Matt and Rick discuss fitness business ownership and the two types of fitness business owners: owner-operator or investor. Which is better? Neither ownership structure is right or wrong. We talk about the pros and cons of each and also the type of person who fits into each model. Listen in and decide for yourself.
Two Types of Fitness Business Ownership
An owner-operator is somebody who works in the business every day operating the business. An owner-operator can have higher profit margins because they can tightly control the operations and occupy the Director of Training position. They are usually a trainer or technician who decides to own a business. The cons of an owner-operator are that they are getting into a job. They might find trouble getting out of this job.
Investors are also known as an absentee owner. An investor is normally someone who has a higher business acumen, who wants to scale up to multiple locations by executing the systems of a franchise they have selected. They initially invest more capital because they need more people to run and staff the business, but their return on investment is much higher in the long run. This type of owner will need entrepreneurial and leadership skills to build a team to manage and run the business.
Also check out more information with this article Being a Single Unit vs. a Multiple Unit Franchise Investor.
- Which type of fitness business owner do you want to be? (02:20)
- Who is an owner-operator and what do they do? (04:13)
- Owner-operators can make more profits by tightly controlling the operations and managing the business. (06:14)
- Why owner-operators should work with a franchise. (08:49)
- The challenges of the owner-operator fitness business model. (11:51)
- Why do investors have a higher return on investment in the long run? (17:49)
- The challenges of the absentee owner fitness business model. (22:49)
- Why the Alloy Franchise benefits both types of fitness business owners. (27:46)
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