How To Fix A Broken Business Model- Admit There Is A Problem

How To Fix A Broken Business Model- Admit There Is A Problem

Posted on 26. Mar, 2012 by in Marketing Fitness



[spoiler]Hey, everybody. Rocco Castellano here and today I’m going to be talking to you in my new studio. Yes. I got my brand new whiteboard and I will even turn this way for you.

I’m going to talk to you about a couple of different things because I just did a blog post about a bad boot camp model. Now, everybody thinks that I have something against Bedros and like Steve Hochman and I have to tell you I really don’t.

I don’t have anything against them personally. I have no beef whatsoever with them but the big challenge that I have with the actual business model of Fit Body Boot Camp is that it’s broken and anytime that I see something that’s broken – and part of what I do as a coach, askROCCO Media as a coach and me personally as your coach, has to help you, has to liberate you, has to be involved with making things better for you.

So with that being said, when I see something broken, I want to help fix it. Now, sometimes, the biggest problem is that the people that I want to listen don’t and when somebody doesn’t listen, sometimes you got to slap them in the fucking head and if they don’t want to keep listening, I don’t know what to do except help the people that are suffering from their bad judgment or from their broken business model.

So this is basically what I’m going to do. What I’m going to do is I’m going to present a series of videos specifically helping to fix that broken business model. Maybe they’ll learn. Maybe they won’t. I really don’t give a shit. I just really don’t but if you are a Fit Body business owner or a former business owner, I’m going to do you – and I’m going to do the founders a world of good by helping you out.

I’m not getting paid any money. My job, and I take it very fucking seriously, very seriously is to be – to show my passion, to liberate people and to do it in an entertaining style and I’m going to confront your troops the truth about Fit Body Boot Camp in the business model that is fucking broken. That’s all. Broken.

So why don’t we try to fix it? Now, do I have to be spending this time fixing somebody else’s fucking problem? No. I don’t. But I wrote that blog post A Bad Boot Camp Business Model specifically because I had 15 people come to me to ask me how to break or get them out of that contract. Now I can easily tell you how to do it but I would rather actually fix the problem.

I would actually want to help because the fitness world is a fucked up place. It’s an absolutely fucked up place because nobody can actually get a real grasp of anything. It’s literally retards teaching retards. There are blue collar mindsets teaching blue collar mindsets. You know, people are consistently afraid in this business and they’re trying to steal from everyone else every other industry and try to make it whole but they’re making decisions based on emotion, fear, guilt and shame. And if you tell me that you’re not, you’re fucking lying.

So what I want to do is I want to try to help fix this business model. That’s what I am going to do because if I don’t do this and I take a responsibility, for some reason, I don’t know, nobody else will.

So, here’s the first thing that I want everyone who has really a broken business model to do. The number one thing is I want you to admit. Number one thing, admit a problem. Number one thing, admit the problem.

And then understand the problem. Once you admit it – it’s like the person that says, “Oh, I don’t want to go to that doctor. Because you know what? He’s going to probably tell me I’m sick.” Well, if you’re sick and you can take antibiotics or you have cancer and you can take chemotherapy, guess what. You can get better! There’s a fucking cure and there is a cure for this! But you got to admit the fucking problem! Admit it! Understand it! Know it! It’s good!

Feel good about it. You know, people can make mistakes. Not everyone knows fucking everything. Why does everybody have to know everything? Why? Because you would have to be the smartest motherfucker in the world? Hochman, are you the smartest motherfucker in the world? You’re probably not.

I know I’m not. But I know that I know that there’s a fucking problem here and that’s the fucking truth. So admit that there’s a problem. Realize that there’s a problem. If there are people leaving your boot camp model, if they’re leaving your business in droves, if there are people complaining and they don’t want to pay you money and they don’t feel that you have a value to them anymore, if you’re not making a worthwhile contribution to their life, you have a broken business model. Admit the fucking problem. Admit it.

When you do, the healing can begin and we all want to fix. We all want to heal. If you don’t believe that somebody shot you in the arm and you don’t get it fixed, guess what! They’re going to chop off your fucking arm.

The second thing I want you to do is when you admit the problem, understand that problem and listen. Listen to the people that you may have hurt. Listen to the people that don’t believe that you’re a worthwhile contribution to their lives. There are probably some pearls there. There are probably some easy fixes. All you have to do is listen. Take these two ears right here and listen.

And when you listen and you actually take people’s phone calls, you may find the answers to what the problem is. OK? So admit the problem. Understand and then listen to where people are having a hard time with your brand, with your boot camp, with your service, with your product or whatever it is.

Now one of the biggest problems here is that you have to pay $10,000. Now, when you’re promising somebody that they’re going to make $120,000 to $250,000, $10,000 doesn’t seem like a lot. It doesn’t because you can tell – you can sell people on the idea. I could sell anybody on the idea, if they spend $10,000 with me, that they’re absolutely going to make a quarter million dollars. You know why? Because I’ve already done it. I have a blueprint and so do you.

So you can sell this easily and then if you’re telling somebody that they can make $120,000 a year minimum, obviously that’s $10,000 a month, $10,000 a month.

So in the first month, you make your money back. But the problem is that’s not happening. You see, in the beginning of any small business, any business, there’s going to be a transition. There’s going to be a learning curve. There’s going to be things that come up that you’re not going to automatically make $10,000 a month. But if you hype it and you keep pushing and you keep telling and you keep saying, “Oh yes, you’re going to do it. You’re going to do it,” people believe that. And then all of a sudden, the first month, the second month, the third month, they’re going, “Oh, first month, I only made 2500 bucks. What the fuck?” Second month, you’re doing human billboards. So you got 20 people coming in for free. That may not even be – we’re talking about $6000 right off the bat. I have never seen that. I’ve never seen it. Maybe I’m fucking blind. Maybe that’s my problem. Maybe I got fucking blind. But that is reality. These numbers are reality.

The second month, you might do $2500 and the third month, you might actually break $3500. These are normal and average numbers for any startup boot camp. If somebody is telling you that they’re doing more, well, that’s great. But that’s not the average. That’s not reality. You won’t see $10,000 in a boot camp until month eight.

So now, you spent $10,000 and you’re making $2500 – well, it’s probably $1500, $2500, $3500, maybe $3500. So when and where is this ROI going to take place? And then on top of that, you’re spending $400 a month and I have no idea why. Not one spec of why.

I would want a million little elves, a million little gremlins fucking working for me since I just paid you 10 grand and now I’m paying you another $4800 a year so now in the first year, $14,000. And you know what? Let’s just do the math. Let me take out my trusty, fucking calculator. OK? Because you know what? Let’s just see this.

Let’s just say an average – right? An average, you’re making $2500 and that’s on the high side. OK? So let’s go $2500 times 12 equals $30,000. Let me put this up to the thing for you. Thirty thousand dollars, just so that you don’t think I’m fucking lying. OK?

Thirty thousand dollars. Now, minus $14,800, right? Fourteen thousand eight hundred dollars. Equals – look at that. Fifteen thousand two hundred dollars. Now the average first year boot camp, I don’t give a shit what anybody says, what anybody wants to tell, what anybody wants to fucking believe is going to happen. It’s not going to happen. You’re not going to make $120,000. There’s no way that you’re going to make $120,000 first time out especially if you’re – and now I want the founders to understand this because you’re selling a whole bunch of horseshit to people.

You’re selling at most a $30,000 to $60,000 business model for $120,000. What the fuck! So, you know what? I mean when I was doing boot camps, I had 150 people in one class. A hundred and fifty people in one class and I was selling it for $99. Do the math. So, I had to get a lot of numbers, a lot of people in that door but I was already a celebrity. I was on the radio. I was on TV. I had a syndicated column. Most of the people that are coming to Fit Body Boot Camp don’t have all that.

So, the problem here is that the franchise or the license or whatever the fuck you want to call it has got to do the work for you. If you’re paying $10,000 and then $400 a month, the the franchise has to be doing the work or you don’t pay. When you go to Subway or you buy a Subway franchise, I would recommend you buy a Subway franchise. You’re guaranteed to make a half a million dollars from one little fucking outlet. In revenue, $500,000 and then a guarantee or they give you your money back.

Thirty thousand dollars to sixty thousand dollars, that’s the problem. Admit that problem. Tell people that that’s what they’re going to make because when you’re telling people that they’re going to make a hundred – well, basically six figures. You keep saying six figures, six figures, six fucking figures. It doesn’t work. The model doesn’t work. Giving away 20 free boot camps doesn’t make you $6000. I don’t give a shit what anybody says.

Number one thing, admit the fucking problem and then understand the problem. Understand the problem and then listen. If somebody calls you, somebody tells you, “I’m not doing this. It’s not working for me,” don’t just spend 15 minutes trying to get them to pay you more fucking money. Sit down. Have a conversation. If you don’t know the answer, get the fucking answer.

Number one, admit the problem. Number two, understand the problem. Number three, listen to the complaints. Listen to the criticism. Understand what is going on, what is broke. Why is it broke?

This is Rocco Castellano reminding you the least you can do is live up to your potential.[/spoiler]

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10 Comments

Kaiser Serajuddin

26. Mar, 2012

Yeah trying to make sense of it is a wasted effort Rocco – there’s no sense to it – it’s just two guys trying to get rich by screwing a lot of people over. I think it was a real cool idea when it was $100 a month club for trainers to get some coaching and interact with each other. There’s some real value in that. But now it’s essentially the same product at more than 10x the price.

Eirith

30. Mar, 2012

Like the post. Now I have to fight against litigation from them because I didn’t pay them (didn’t have money and didn’t have any means of paying them). Their collection lady called me and threatened me and said I need to man up and pay or else they are going to come after me.

Eirith

30. Mar, 2012

If anyone knows anyone that got out of this model, let me hit them up. so basically the director of operations (or whatever) lied to the collections person and said I was given the option to buy out. I never was. Now I’m being extorted. Their model didn’t make me money and now THEY have to be paid. What a shit world we live in.

Neil

05. Apr, 2012

i like the business attire :)

James Cipriani

05. Apr, 2012

How have I never run across you before, Rocco?!?! You may be my new favorite voice in the fitness industry. Way to keep it real!

Linda

05. Apr, 2012

As always and true to form, Rocco tells it like it is. That’s for being real and calling a spade a spade. We need more of this in our industry.

7Figure Sam

05. Apr, 2012

@James: Rocco has forgotten more that most trainers know. He is truly a legend and a wealth of knowledge. He is a No B.S not working til noon, working on the garden, turtle feeding mofo.

I highly advise (if he has the time) to connect with him if he has the time. Believe me I consult with him myself from time to time.

He has no choice to consult with me because he made a mistake and invited me to his house. So now I just show up like Kramer in Seinfeld ;)

There are things that only years of experience can teach and Rocco is an experienced OLD mofo ;)

PS – My blue collar mindset is about to set in oh nooooo

here it goes I can’t stop it

How dare you Rocco come to my blog and steal my show. This is my blog and only what I say is GOLD. Everything is about how great I am and how great my coaching clients do.
No one can be successful in the fitness business unless they go thru me, my coaching and my boot camp franchise. You have to agree with me on everything and any opposing comment will be erased immediately.

OK, I’m coming back again…

Seriously I am very, very glad to have Rocco as close friend and he is like family. What you see is what you get

Georgette Pann

05. Apr, 2012

Omg you kill me ! Really it’s like “everything you ever wanted to say but were afraid to !
Oh hahaha I’m on the floor seriously I can’t stop laughing. It’s your italian style and i can relate:) to it so much @sam will vouch for that!
but seriously speaking this is soooo true it HURTS!
I’m not sure I’ll watch the rest of the series on how to fix fit body bootcamp cuz frankly I don’t care :) I don’t need it but then again I just might watch and apply your knowledge to some other aspect of my business
Georgette Pann
Start your own dam bootcamp
http://thefitnessbootcamp.com

Brien Shamp

05. Apr, 2012

Brutal. I am a Fit Body Boot Camp owner and I did not pay $10k but I did pay $2k and still pay $397/month. I agree the $10k is very steep, but for me I have done very well with their boot camp marketing strategies. I feel fine paying $397/month for scripts that bring me 30-120 sales per month. Also, the $2k investment would have been the same as I would have spent on a new website so it was a wash. I have done well given I have allso done my own seo and website and not relied on them for leads.
You can either pay them or someone else. I have done both and do well over 6 figures. And that doesn’t even matter because the key is not how much you re making, but how much you are spending and really netting. I am constantly working on systems to automate everything and have a great team above and beyond Fit Body Boot Camp. I have not received any benefit from the brand “Fit Body Boot Camp, but a good investment from a systems perspective.

Lee Abrahams

09. Apr, 2012

Hmmmmmm… Interesting comments there Rocco, I did almost contemplate securing a territory with Fit Body having been charmed by Stevie n Bedros – But when they price hiked and became a “Franchise” rather than a licence –

Felt there was a RAT somewhere and the numbers didnt add up.

I have continued to do my own PT and are in process of doin my own shit – and guess what…. the income is good and consistant – NOT SIX FIGURES yet :-( but its ALL mine, no licence fee, no franchise or royalties either…

Will look out for further Roccos ramblings with anticipation

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