The First Chapter of a New Business – Lessons Learned

It has been a few months now and the new business has surprised me pleasantly. Here I’ll briefly share what has been working well and some areas of improvement others may find helpful.

New Business Promises Hope

The finances on a new business are typically the first thing that draws attention, so I’ll start there. Since I acquired the assets from another individual, I understand the revenue they were able to generate. I’m pleased to announce revenues have nearly doubled and beaten expectations by 60%. Below I’ll share some of our initiatives that I have not yet written about.

Relationships are Key

It’s a cliche at this point, I know… but getting to know people in your industry and complementary domains. We have been working with local gyms, athletes, clinics, etc. This has opened doors to amazing B2B opportunities. Some things that we have done or are preparing to do with these businesses are below.

Referrals

We have developed a strong referral network that allows us to easily direct clients to ‘next step’ solutions and allows organizations to send business to us. This networks is essentially free advertising. We do offer referred clients a discount, but otherwise, others are working to get you leads. That is always nice. Additionally, this has a stacking effect. Every partner you land that regularly refers customers in leads to recurring customers, then more recurring customers, and more… Since our partners are so valuable to us, we have started 2 new programs.

Program 1: Service repackaging and resale (revenue driver)

We now allow businesses to package our services in with their own. They get access at a discounted rate, and provide a wider offering to their customers. We also offer white-labeled reports to further strengthen their business and brand name while driving us referrals. Below is an example of how a gym could package in our DEXA scans.

_{Made this in 1 minute with AI assistance!}

Now Jim’s Gym can generate some extra revenue without needing to perform any additional services.

Program 2: Referral Engine

Often our clients want to know ‘what should I do’ after receiving their test results. And while we can provide general guidance, that is not our area of expertise. So, I developed a referral widget for our site. This reads a csv file that lists businesses we work with and how close they are to a customer’s home. So a customer can generate a list of personalized follow-up recommendations and we can refer out to our valued partners. I’ll attach some non-functional code below as a visual in case this widget is moved from the site later.

The Referral Demo

Friendly Competition

I believe organizing friendly competitions will be a fantastic driver of exposure. We are planning both internal and external competition initiatives. For our customers, we are pushing them to compete against themselves and gamify the experience. For our partners, we are pushing them to compete against each other via our services. Imagine Gym A vs Gym B – Who’s fitness team achieves better results?

Need for Sponsorship

We have recently started working with a local shelter who is promoting a St. Patrick’s Day 5k. We’ve sponsored the race and will have our logo displayed on shirts, media, finish line, etc. I see this as a relatively inexpensive way to obtain exposure, but also to give back to the community that us supporting your business. Also… who doesn’t like animals?

Expense Reductions for a New Business

While acquiring the assets of the new business, there were a handful of thing I wondered “why do we have that” and for the most part… I found out the hard way. Luckily, I was also able to identify plenty of areas we could cut away without harming the business (and potentially helping it). Things like paid music services, unnecessary software, and un-utilized contracts played a large part in our expense reduction. Many free options existed that met our needs and better programs (especially maintenance contracts) saved us large sums on a recurring basis.

Systematic Optimizations

There were many processes that I came across that were the way there were because they had always been that way. Some of them were entirely meaningless (manually documenting automatic reports in Excel) and others were overcomplicated. There were also known customer pain points that were unaddressed that we were able to work on. Some (like our booking system) will require a large effort to fully resolve, but it is worth it. For that example specifically, we now offer a simple booking option and the old option. Eventually, some custom build will merge the systems.

New Business Areas of Development

While most of my experience has been rosy thus far, there are many areas we need to focus on for growth and sustainability.

Customer LTV

I quickly realized that customer volume was consistent, but customer retention was poor. This led me to a marginally successful “come back!” email campaign and eventually to larger changes. We quickly started offering memberships for our services and programs that can either be paid up-front or over time. These programs have immense value for the customer and ensure recurring visits for us. While it sounds ideal, the package prices/commitment seem to deter many of our customers. This is part of the reason we are trying new ‘returning customer’ campaigns via competitions.

Developmental Threats -(Awareness for every new business)

While this may be less of an immediate threat (and potentially me being overly worried), development trends are terrifying. Our business is built off having the top of the line medical equipment. AI is developing new products and replacement products quickly. In fact, we are helping a potential competitor make some of our main devices obsolete. This is a calculated risk. They are providing substantial funding for the research and we are using it to explore other less-risky areas of growth. The goal is that we can develop a new revenue generator before the new technology destroys the business. AI growth continues to be exponential with recent video models convincing me that this will be the year independent studios start to cause a stir. It won’t be long before we are utilizing AI as a primary technology in our daily lives.

See what else I’ve been cooking up here!