At some point every fitness entrepreneur will have to decide whether to build from scratch or buy a pre-packaged solution.

Usually the decision is easy. Few trainers have the background or resources to buildclient relationship management softwarelike Mindbody Online or Zen Planner. And unless you have a lot of experience as a welder, it's much easier to buy a cage and squat stands fromRogueor Again Faster.

But software and equipment are just the accoutrements of a fitness business. A gym, dojo, or any other type of fitness venture needs a business model with defined systems for attracting the right client, a pipeline for managing sales, and tools for servicing clients and retaining business. Without a fully baked business model you will be swimming with the sharks.

Not too long ago if you wanted to get into the fitness game you had no choice but to "roll your own" solution because pre-packaged business systems didn't exist. Nowadays, there are quite a few to choose from, including Results Fitness Universityfrom Alwyn Cosgrove, Net Profit Explosion from Sean Greeley, and John Burch's The Biz, to name a few.

All of these players offer the same core value proposition to the same audience, i.e. a pre-baked system for turning your passion for fitness into money. Sounds great, right? But with so many options, the build-or-buy decision can feel overwhelming. Let's take two steps back and look at the big picture.

The Case for "Buy"

Know Thyself

The world is full of great trainers and great business people, but rarely do the two populations overlap. The skill sets are entirely different and generally not complementary. This can cause massive dissonance and frustration.

Every hour that you spend learning how to run your business is an hour that you take away from clients. Unless you are deeply curious about business, you can avoid a lot of stress by purchasing a business plan that you can execute like a paint-by-numbers set. Minimizing stress is important because if you are frustrated with your business your clients will know it and eventually your frustration will repel them.

Training Day

Eventually your business will grow and you will need help. Having help is good. Having helpful help is awesome. Unfortunately, your team will only be helpful if they have training.

Training new people is difficultif your business is ad-hoc and reactive. Doyou have defined processes? Do you have manuals? Checklists? Phone scripts? Org charts? Packaged business systems give you all this and more. When you are making a build-or-buy decision take care to factor in the value of consistent training materials for your team.

Can You Afford R&D?

Research and development is when your pour a bunch of money into speculative business processes or products with the hope that your great idea will withstand the withering scrutiny of the market. But wait! Isn't that just gambling?

Yes, and I'm going to go out on a limb and suggest that you cannot afford to gamble on a dicey proposition like "build it and they will come." Rather than blow through your savings trying to develop a business model through trial and error, why not just buy a proven system that has already survived market pressure.

The Case for "Build"

It Pays to Be Different

One of the biggest shortcomings of packaged business system is that they lower your competitive IQ. When you are working within a system, you tend to prioritize compliance rather than creativity. That's not a problem if you are the only game in town, but what happens when the gym down the block buys the same playbook?

The essence of competition is differentiation, and if you and your competition are runningessentiallythe same business, customers won't have a reason to choose you. If you are in an extremely competitive market, you might be better off building a differentiated solution.

Beware the Up-Sell

Many business systems consist of multiple product tiers, requiring a progressively greater investment the further up you go. This model works for entrepreneurs because it makes the entry-level system accessible with minimal investment and commitment.

On the other hand, if you want the "good stuff," you might have to make a larger investment than you had planned. For many entrepreneurs starting off on a shoestring budget, a premium business product might not be affordable. If this is you, consider finding a business mentor who is willing to share knowledge with you out of the goodness of her heart.

When All You Have Is A Hammer…

The U.S. is made up of red states, blue states, purple states, and everything in between. New York and Los Angeles have vast cultural differences and neither shares much in common with the Midwest. Unfortunately, packaged business systems are usually rationalized within a single market, which means they frequently do not translate well in other markets. The people who develop business systems are smart, but nobody knows your market like you do. If you can't achieve product/market fit with a package solution, then you are better off building your own.

So What Should I Do?

I recommend that you make the build-buy decision based on two axes. First, what is your appetite for risk? Second, how innovative is your product?

If you have high appetite for risk and an innovative product, then you should build. Packaged systems are inherently non-innovative and you will find it difficult to force-fit a groundbreaking idea into a packaged system. Zumbais a great example of a highly disruptive product that could not have succeeded with a one-size-fits-all business model.

If your appetite for risk is low, and your product isn't extremely disruptive or innovative, then you should probably buy. You will be able to focus on execution, rather than innovation and it will be easy to find a system that fits. Yoga and CrossFit are two examples that come to mind.

Whatever you decide, the most important thing is to balance your passion for fitness with a healthy business plan. Build something or buy something, but never trivialize your business.

Photo 1 courtesy ofCrossFit Impulse.

Photo 2 courtesy ofShutterstock.

The post Fitness Business Systems: To Buy or to Build? appeared first on Breaking Muscle.

This month CrossFit HQ unveiled a new structure for trainer certification. Here is an outline of how the new certs work.

• CF-L1 – “The Level 1 is the first step on the path to becoming a competent trainer. CF-L1 trainers have the fundamentals required to responsibly train others through firsthand exposure, and they continue to learn via experience. “
• CF-L2 – “The Level 2 Certificate Course is an intermediate-level training course meant to provide students with improved skills, a strong sense of their strengths and weaknesses, and actionable ways to improve.”
• Certified CrossFit Trainer (CF-L3) – “Trainers holding the CCFT credential have demonstrated competency across the breadth and depth of CrossFit coaching concepts and skills.”
• Certified CrossFit Coach (CF-L4) – “The Level 4 Certification is a performance-based evaluation. It is designed to identify and acknowledge coaches who have mastered their craft.”

The New World for Level 1 Trainers

If you are a Level 1 trainer, the new certification structure is a mixed bag. In the old world, L1’s were co-equal with other CrossFit trainers in a very flat topology. In order to differentiate yourself, you had to hustle, market yourself, and delight clients with spectacular results.

In the new world, you are part of a caste system wherein CrossFit HQ has just branded you as a beginner. Worst of all, by creating specific “Trainer” and “Coach” designations, HQ has made it borderline unethical for you to advertise yourself as a trainer. Even if you have a decade of experience working with clients, if you only hold an L1, you are not, by definition, a CrossFit Trainer or CrossFit Coach. 

Click To Tweet: What just happened to your CrossFit L1 Certification?

What is most remarkable about this change is how HQ created scarcity through a semantical sleight-of-hand. Overnight we went from a world where everybody could claim to be a CrossFit coach to a world where nobody can. Put that in your pipe and smoke it.

No doubt, many L1’s are feeling pretty bummed right now. The value of their certification was just eviscerated by HQ, and in order to gain credibility in the market, L1’s will have to invest thousands of dollars to achieve an L3 designation. Remember that as an L3, you will still only be “competent” according to HQ’s rubric.

But there is another way to look at this. CrossFit’s brand equity is low, and creeping ever lower, because HQ can’t protect itself from the legions of bonehead trainers out there who devalue the brand with crummy programming and coaching. By creating the new cert structure, HQ is insulating itself from rank-and-file trainers while providing a clear path for professional development. The new certs will have a more profound and lasting impact on CrossFit’s brand equity because trainers do more to impact public opinion than Reebok or Games athletes.

If you are an L1, remember that the money you spend on a cert is essentially an investment in a brand, and I would make the case that no reasonable person wants to invest in an off-brand cert.

The Landscape for Affiliate Owners

On net, affiliate owners should be pretty pleased with the new cert structure. Like the L1 cert fees, your affiliate fees are an investment in a brand. When a company manages its brand poorly, smart people withdraw their investment by leaving the company.

Unfortunately the people who leave CrossFit tend to be thought-leaders and innovators. Robb Wolf, for example, is making his own party; he does not need CrossFit. Why would a thought-leader want to be associated with a down-market brand? I am hopeful that the new cert structure will enhance CrossFit’s brand and end the brain drain.

The downside of the new cert structure for affiliate owners is that gyms will start to trumpet cert levels in their marketing messages. Eventually a gym in your town will begin to advertise their L3 and L4 trainers. In the ensuing “arms race” you will face enormous pressure to keep up. Unless you have a healthy referral network and a sophisticated marketing apparatus, you’re going to have to shell out thousands of dollars just to maintain your market footing.

It’s not all bad, though. Many affiliate owners wish that HQ imposed a higher barrier to entry for new gyms. If you’re in this camp, then you were surely disappointed to find that L1’s can still affiliate. Sadly, a two-day cert still entitles you to open a gym and train others. “The Level 1 alone is required for affiliation,” as HQ would have it.

However, while there is no structural impediment, the new cert structure does discourage L1’s from affiliating. You don’t need an MBA to grasp the difference between legitimacy and credibility. In the old world, you could be a legitimate affiliate with little effort or investment. In the new world, affiliates will need to demonstrate credibility, over the course of years, by achieving the L3 or L4. This alone will deter many casual and lazy trainers.

The Bad News for Other Trainers and Gyms

Trainers and gyms not associated with CrossFit have had a field day over the past few years taking whacks at CrossFit. Many have found that a cheap and easy marketing tactic is to position their business as “not CrossFit.” CrossFit HQ has played along by saturating the market with countless crummy affiliates and inexperienced trainers. What we have today is a target-rich environment where CrossFit haters will run out of stones long before they run out of targets.

The “not CrossFits” should be given pause by this new cert structure, because it shows that HQ is willing to eat its young. The new cert structure by specific design rewards the most committed, most skilled trainers, with the deepest war chests and best business practices. The minnow affiliates will be cannibalized, and when they are gone, only the sharks will remain. If your business is “not CrossFit” you won’t be able to clown a bunch of beginners anymore. Prepare yourself for a new level of competition.

Photos courtesy of Shutterstock.

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