Revenue Increased by 50% AND Profit Increased by 400% - All Inside 12 months!
The situation:
The client was a gym installation company making $10 million a year revenue, but their profitability was only $1 million annually.
So a $9 million problem.
The issue was they were doing everything right but still only making $1 million in profit.
They’d been referred to me by another client who had seen me find minute problems that were draining their profit margins.
They hired me to take care of the profit problem.
The issue, as I said, was that they were doing everything right.
But before letting them go and giving up on spending $20,000 on effectively being told “you’re doing a good job”, I started to look at their clients and the other problems my client could solve.
And that’s when we found our golden goose.
What I found was that most of these gyms actually stocked proteins, creatine, and more but it was all still branded.
Which is great - though I realized that I had the perfect connection for my clients.
I put them in touch with a supplement company my friend owned, and asked them to white label their high quality product.
After a little negotiating, the deal came through.
I’d already been working on the promotion I had in mind - have the gym owners understand they could make more with my clients’ new supplements while keeping a good price.
I put the promotions into action and the first two weeks, we heard crickets.
The client was annoyed as they spent $300,000 putting everything together.
But in week 3…
We started to sell and fast.
By the end of the month, we’d sold out our initial run of supplements.
How and why?
“The How” was simply down to positioning.
We positioned everything to benefit the gym owner and as a way for them to make their money back asap and to give them a conditional special price to buy from us.
As the client already had their gym colors and logo - we just made everything white label.
Why?
Having something similarly branded in the gym gives it the feeling of exclusivity.
It cost my client $1 million total to handle the supplements, the labels, and shipping - and a few admin fees along the way but making an extra $5 million in revenue and $4 million in profit was worth it.
The ad campaign was simple.
I made sure that I spoke to at least 10 of my clients best customers who had an amazing experience, and 10 who had a so-so/less than ideal experience to gauge the trust factor.
Thankfully even the “less than great” partnerships said they would be open to the idea of a supplement line with their images and colors.
Once I had all the data I needed - I built out a warm email sequence with an introduction and a 2 page sales letter to be physically sent out to their gyms.
The emails were to let them know something awesome is on its way to them and they needed to respond soon.
The letter included visual representations of the supplements with their brand.
This anchored the desire with the benefits.
As I said, the first two weeks were quiet - the mistake was that I had, unintentionally, added a few friction points.
This got in the way of people responding to the offer.
What I shifted was to tell them there was something in the mail without them needing to reply and just send the offer.
This drastically shifted response.
Over the course of the next 6 months, my client worked with his new customers for the supplements to make sure they were meeting the standards and gave them an advantage.
Now - what stopped any of the other gyms having their own supplements?
I connected my client to someone I know who wouldn’t charge the usual minimum but rather gave them a discount based on our pre-existing relationship.