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  1. #1
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    What would keep you around? [Keeping employees]

    For those currently working at a gym, or those who have employees, what works for you? What keeps you at your place of employment, or keeps your employees with you? I'm starting up a business shortly and I want to have the best staff in the area. I know this means that they have to be happy. If not they will go off and do what I am doing.

    My ideas:

    Workplace

    Freedom/Autonomy - Allowing employees to come to you with ideas, don't micromanage, and don't be a control freak.

    Respect - Don't treat employees poorly, especially in front of clients. I've seen this in the past and it really makes employees hate you.

    Burnout - Don't always ask your employees to stay late, work weekends, do work at your house, etc. A number of people have trouble saying "no". You will lose these people as they will eventually burnout.

    Fun - I think it has been to fun at work, at least sometimes. This includes socials outside of work. Maybe a barbeque for your employees and their families?

    Relaxation - This field tends to be one that doesn't lend itself to regular vacations. You can't exactly have people covering your clients for you.

    Benefits

    Health Insurance - I was thinking in a generally healthy workplace, a high-deductible plan might work best with employer contributions to FSA/HSA. This would be considerably more affordable than other options. ** Tax deductible

    401k Retirement plan - Probably wouldn't offer matching, but I don't know many fitness facilities that even offer a 401k plan.

    Paid time off - I was thinking of close my facility officially for 3 weeks out of the year. Employees would be expected to take this time off and would be paid a standard rate during this week. This would force people to take some time off and would limit problems with scheduling around peoples' vacations.

    Profit sharing - This would keep employees interested in the long-term productivity of the business. I don't know what I would do exactly, but say owners kept 40% of the net profits and the other 60% would be distributed to employees once per year. The share that each employee would receive would be based on years of service, productivity (% of gross that the employee is responsible for), and other projects that they have worked on that might not be as easily quantifiable.

    Free classes for immediate family - pretty self explanatory.

    Legal

    Non-compete - I don't hope to control employees, but I think a fair non-compete could help you avoid people coming in to try to steal your ideas/systems. I'd probably look at something to the effect of 1.5 years and 8 mile radius. I'd also look at what would be a fair agreement to prevent employees from soliciting clients if they are fired or leave. Something like 2-3 years. I would need to research this further. All of the things I listed above are what keep GOOD employees around. However, those who have malicious intents need to be kept at bay as well.

    My thoughts have always been that you don't sign the non-compete unless the money and benefits are there. If I'm paying a trainer $35,000 a year (with potential for more $ with profit sharing) with benefits, I would expect them to sign a non-compete.
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  2. #2
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    Originally Posted by SFT View Post
    For those currently working at a gym, or those who have employees, what works for you? What keeps you at your place of employment, or keeps your employees with you? I'm starting up a business shortly and I want to have the best staff in the area. I know this means that they have to be happy. If not they will go off and do what I am doing.

    My ideas:

    Workplace

    Freedom/Autonomy - Allowing employees to come to you with ideas, don't micromanage, and don't be a control freak.

    Respect - Don't treat employees poorly, especially in front of clients. I've seen this in the past and it really makes employees hate you.

    Burnout - Don't always ask your employees to stay late, work weekends, do work at your house, etc. A number of people have trouble saying "no". You will lose these people as they will eventually burnout.

    Fun - I think it has been to fun at work, at least sometimes. This includes socials outside of work. Maybe a barbeque for your employees and their families?

    Relaxation - This field tends to be one that doesn't lend itself to regular vacations. You can't exactly have people covering your clients for you.

    Benefits

    Health Insurance - I was thinking in a generally healthy workplace, a high-deductible plan might work best with employer contributions to FSA/HSA. This would be considerably more affordable than other options. ** Tax deductible

    401k Retirement plan - Probably wouldn't offer matching, but I don't know many fitness facilities that even offer a 401k plan.

    Paid time off - I was thinking of close my facility officially for 3 weeks out of the year. Employees would be expected to take this time off and would be paid a standard rate during this week. This would force people to take some time off and would limit problems with scheduling around peoples' vacations.

    Profit sharing - This would keep employees interested in the long-term productivity of the business. I don't know what I would do exactly, but say owners kept 40% of the net profits and the other 60% would be distributed to employees once per year. The share that each employee would receive would be based on years of service, productivity (% of gross that the employee is responsible for), and other projects that they have worked on that might not be as easily quantifiable.

    Free classes for immediate family - pretty self explanatory.

    Legal

    Non-compete - I don't hope to control employees, but I think a fair non-compete could help you avoid people coming in to try to steal your ideas/systems. I'd probably look at something to the effect of 1.5 years and 8 mile radius. I'd also look at what would be a fair agreement to prevent employees from soliciting clients if they are fired or leave. Something like 2-3 years. I would need to research this further. All of the things I listed above are what keep GOOD employees around. However, those who have malicious intents need to be kept at bay as well.

    My thoughts have always been that you don't sign the non-compete unless the money and benefits are there. If I'm paying a trainer $35,000 a year (with potential for more $ with profit sharing) with benefits, I would expect them to sign a non-compete.

    Profit sharing - This would keep employees interested in the long-term productivity of the business. I don't know what I would do exactly, but say owners kept 40% of the net profits and the other 60% would be distributed to employees once per year. The share that each employee would receive would be based on years of service, productivity (% of gross that the employee is responsible for), and other projects that they have worked on that might not be as easily quantifiable. --- Bad idea. Giving up 60% of your profit will put you under. What is profit based on? GAAP, Tax, OCBOA? Depending on which method of accounting, you could run into a lot of issues with "paper profit" and having to distribute money you don't have.


    Non-compete -- It would be hard to enforce. Lawyers win on this.


    Paid time off - Are you adding in the 3 weeks in addition to normal vacation time and other holidays? I assume it is split up too. You are looking at 6 weeks of paid time off per employee if you give them a normal vacation. If you don't and just use the 3 weeks that you pick, you won't keep many around for long. I don't want to have my employer pick when I take my vacation. Also, it sucks when my gym shuts down for one day. If they shut down for 21 days a year I'd go somewhere else.


    There are many reasons gyms don't really pay that well. For the most part, personal trainers don't add much value to the business if they aren't training people. It takes a lot of money to start and run a gym. Think about how much it would cost you to have X trainers at $35k/yr plus payroll tax plus benefits etc. That is a ton of money right there.
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    Great thread
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    Originally Posted by Trollin4Tuna View Post
    Profit sharing - This would keep employees interested in the long-term productivity of the business. I don't know what I would do exactly, but say owners kept 40% of the net profits and the other 60% would be distributed to employees once per year. The share that each employee would receive would be based on years of service, productivity (% of gross that the employee is responsible for), and other projects that they have worked on that might not be as easily quantifiable. --- Bad idea. Giving up 60% of your profit will put you under. What is profit based on? GAAP, Tax, OCBOA? Depending on which method of accounting, you could run into a lot of issues with "paper profit" and having to distribute money you don't have.


    Non-compete -- It would be hard to enforce. Lawyers win on this.


    Paid time off - Are you adding in the 3 weeks in addition to normal vacation time and other holidays? I assume it is split up too. You are looking at 6 weeks of paid time off per employee if you give them a normal vacation. If you don't and just use the 3 weeks that you pick, you won't keep many around for long. I don't want to have my employer pick when I take my vacation. Also, it sucks when my gym shuts down for one day. If they shut down for 21 days a year I'd go somewhere else.


    There are many reasons gyms don't really pay that well. For the most part, personal trainers don't add much value to the business if they aren't training people. It takes a lot of money to start and run a gym. Think about how much it would cost you to have X trainers at $35k/yr plus payroll tax plus benefits etc. That is a ton of money right there.
    Keep in mind that these are all ideas that will not necessarily be implemented together. The profit numbers were basically a number thrown out there. When I say profit, I mean that the following has been covered: All salaries - owners and employees, all benefits, normal business expenses, and taxes. I'm not talking about gross income, that would just be stupid. This also depends on how many employees. With 2 others employees, I wouldn't give them a near owner share. At 10 employees, that is really only a 6% share of profits per employee.

    In regards to the non-compete - I hear this all this time, but some do hold up. If you become my employee for 3 month, take all my materials and go open up a mile down the street, that non-compete is likely going to hold up. This isn't my area of expertise, but it is my understand that most cases are lost because it restricted the ability of the employee to make a living. For instance, 2 years and 50 miles would restrict them from living in their current residence and finding work.

    My ideas was to set the 3 weeks of vacation so all programs would be off for that time period. To clarify, my business is going to be mostly small facilities with a low cost of operation, mostly focusing on personal training and group fitness. My clients will be okay with 3 weeks off from formal training per year and will be provided with workouts to do on their own if they choose. I can see some people not liking this. Rescheduling PT clients is easy, but getting people to cover group classes can be harder with schedule conflicts. Perhaps I will allow people to pick their 3 weeks within reason and schedule their programs around it. Keep in mind that 99% of gyms don't offer PTO.

    I'm not planning on starting a commercial gym atmosphere. 90% of my income will be from training sessions - group and personal. I believe it is very possible for a trainer to gross $100,000/year, which would allow me sufficient money to offer the types of benefits that I am thinking about. The key to this model is keeping income per hour high and the cost of doing business (aside from employee benefits) low.

    What I am trying to do is essentially give people 80% of the benefits they would reap owning their business without nearly as much risk. I want every employee to feel like they are an owner in the business. This of course is a trade off by which I would receive less compensation in the short-term, unless the business expanded significantly. A small percentage of the income of many trainers is potentially worth more than a large percentage of 2-3 unhappy employees.

    Any other thoughts?
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  5. #5
    Registered User EdgarAllanPoe's Avatar
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    i had a thread like this a month or so ago and people had so many negative things to say towards me....

    Ever since I opened up my own place I haven't had any trainer leave and I have a masseuse, all seemingly very happy. All of them are independent contractors and basically do what they want. Although they all have restricted access to the studio.

    I have 3 trainers, 2 pay a rent (experienced with existing clientele) and 1 pays a 50/50 split (degree/nasm cert but minimal experience and only one client atm)....the masseuse has her clientele and pays a rent.

    They charge what they want, have their own policies, maintain their own insurance, find their own clientele. I don't provide clientele for them except in the event I can't accomodate. They're basically their own boss.

    I don't pay them vacation or sick time or anything else. If you have independent contractors, they keep 100% of their money and just pay a flat rent. I paid about $300 to have a lawyer draw up an agreement with everything I wanted in it and that was that, plus an extra document for their clients to sign waiving me and other contractors from any liability.. This keeps my overhead low, I can spend more money advertising, buying equipment, etc...When starting a business keep the overhead low.

    These people are working for themselves like they want to do and I'm getting paid to share my studio with them.

    As for non-compete, since they're getting their own clientele I don't have a non-compete. At this point I would never join any facility with a non-compete of any kind even if it was one week and 1 mile. If you're going to be giving them clients then yeah, maybe you'd want a non-compete but unless they were in a bind I wouldn't anticipate too many experienced trainers with existing clientele signing one.

    I'd suggest starting with a small place, get 2 or 3 trainers....if its big enough maybe try to get a couple of speciality instructors to do some classes and then learn the ropes what works and doesn't then upgrade to a bigger, larger staffed spot.
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  6. #6
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    I'm definitely starting off small and it might stay small. I need to assess what will be most profitable - a large facility, or smaller facilities with not too much excess.

    In any case, I think we are talking about two very different things here. By growing with employees, you are growing your business name. In your case, the clients are probably more attached to the trainer. The trainer is only working in your facility because they find it to be a good deal. If a better opportunity arises, they will leave.

    By having employees and growing the business name, you have a greater potential to expand the business. Your plan works great for one facility, but what about opening a second? You need to have an employee that you can train over time to become a manager. This person needs to be treated fairly or they will leave for other opportunities.

    Thanks for the feedback. The independent contractors would work for now, but down the road I am looking for something more.
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  7. #7
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    employee or independent contractor...there is a strong chance in this day and age they'll be leaving at some point in either scenario....the ceo of bank of america will turn and be the ceo of google next year. Thats an extreme obviously but stuff like that happens all the time.

    My studio has all my information everywhere, the studio has my logo/my name on the entrance....people check in on facebook/google they're checking into my studio even if they're training with the other trainer. People will always say I train with "John Doe" but they'll ask where it is and then they'll say the name of my place. Employee or contractor that info will get out....plus I simply use my name so its easy to remember and my name is out there more instead of "competitive fitness" etc...


    you may consider putting together a company to take over the personal training exclusively in multiple large chain gyms

    i personally wouldn't want a 2nd location. If anything, I would move to a larger facility within about 2-3 miles of my current place.

    I just don't see the benefit of having employees as a small business owner when you can use independent contractors long term. Maybe its because if I were on the other side and looking for a job I would not consider being someones employee anymore.
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    The pay. That's all any trainer cares about. If the session is $60, then $45 of that needs to go to the person doing the work. Period. Don't try to get rich off of my sweat and time. Those days are over.
    'Real beauty is what's inside.' You know you are ugly if someone tells you this.
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    I wasn't going to respond to your post, but what makes you think that a business owner is some guy stealing your money? A good owner-manager is going to be marketing, dealing with the facility/equipment side of things, and generally making sure everything goes smoothly. They are the ones waking up at 2am if something goes wrong. The idea is that my trainers could be trainers. No keeping books, no bull****. This position would be ideal for someone who wanted a steady income and the ability to leave at night without any stress.

    I'm sorry, but after all that equity put into the business, I'm going to be rewarded for it. I will be fair more generous than most out there, but business owners take all the risks and should have some reward. If it doesn't make sense, then everyone will go off on their own and be successful. This simply doesn't happen.
    Last edited by SFT; 02-08-2013 at 03:01 PM.
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    Originally Posted by EdgarAllanPoe View Post
    employee or independent contractor...there is a strong chance in this day and age they'll be leaving at some point in either scenario....the ceo of bank of america will turn and be the ceo of google next year. Thats an extreme obviously but stuff like that happens all the time.

    My studio has all my information everywhere, the studio has my logo/my name on the entrance....people check in on facebook/google they're checking into my studio even if they're training with the other trainer. People will always say I train with "John Doe" but they'll ask where it is and then they'll say the name of my place. Employee or contractor that info will get out....plus I simply use my name so its easy to remember and my name is out there more instead of "competitive fitness" etc...


    you may consider putting together a company to take over the personal training exclusively in multiple large chain gyms

    i personally wouldn't want a 2nd location. If anything, I would move to a larger facility within about 2-3 miles of my current place.

    I just don't see the benefit of having employees as a small business owner when you can use independent contractors long term. Maybe its because if I were on the other side and looking for a job I would not consider being someones employee anymore.
    We just have different business models. However, I do think people will stick around if you treat them fairly. The idea is that 5 minds are better than 1. With 5 good trainers, I am fairly confident that we would make more money collectively than we would individually. Some people would prefer to be employees as well because they have no interest in the business side of things.

    The only other thing I was consider was giving a higher rate of pay to employees that weren't interested in benefits. This might be people that have a spouse that has benefits.
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    Originally Posted by SFT View Post
    I wasn't going to respond to your post, but what makes you think that a business owner is some guy stealing your money? A good owner-manager is going to be marketing, dealing with the facility/equipment side of things, and generally making sure everything goes smoothly. They are the ones waking up at 2am if something goes wrong. The idea is that my trainers could be trainers. No keeping books, no bull****. This position would be ideal for someone who wanted a steady income and the ability to leave at night without any stress.

    I'm sorry, but after all that equity put into the business, I'm going to be rewarded for it. I will be fair more generous than most out there, but business owners take all the risks and should have some reward. If it doesn't make sense, then everyone will go off on their own and be successful. This simply doesn't happen.
    This is all crap. Without the trainers you would not have a business. Without the front desk person, the salespeople.. whatever. You need the trainer more than the trainer needs you. Gym training is dead and everyone knows it. Why do you think you need to seek assistance online? Your trainers will continue to leave if you think you can pay them 20 bucks an hour. Everyone who has tried that has failed.
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    Originally Posted by Ronin4help View Post
    This is all crap. Without the trainers you would not have a business. Without the front desk person, the salespeople.. whatever. You need the trainer more than the trainer needs you. Gym training is dead and everyone knows it. Why do you think you need to seek assistance online? Your trainers will continue to leave if you think you can pay them 20 bucks an hour. Everyone who has tried that has failed.
    You're free to think what you want. Like I said, any trainer that feels that way can move on and run their own business. Most of them will fail in time. I do not need trainers more than they need me. Simply put, I will get to the point where I am making a very comfortable wage, without them. There are many underpaid and poorly treated fitness trainers out there. I think most would sign up in a second for the chance at a livable wage, with benefits, and the opportunity to grow.

    In any case, I'm planning on starting a small studio that is only my personal training and group fitness clients. After I develop a strong client base, I will be bringing in someone to take over some of the classes/clients as I plan to expand. If by "gym training" you mean commercial gym, that is not what I intend to own. I don't NEED your opinion, but it doesn't hurt to know the experiences of others.

    $20/hour with profit sharing and other benefits is different than $20/hr. Like I said, maybe I could offer a higher rate of pay for those who don't want benefits.

    I am considering the negative statements in here, but I put little weight on them because I don't know the background of those making them. Are you successful business owners, underpaid trainers, or are you a solo operation being put out by larger operations? Perhaps none of the above?

    I don't know where I said anything about $20/hr either. I said perhaps I would offer $35,000 with benefits for a newer trainer. As someone progressed and made me more money, they would make more money as a result of profit sharing. This could lead beyond $20/yr. The idea is that the business is going to retain some of the earnings for future expansions and down times. If an employee doesn't like that, again, they are free to move on.
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    Originally Posted by SFT View Post
    You're free to think what you want. Like I said, any trainer that feels that way can move on and run their own business. Most of them will fail in time. I do not need trainers more than they need me. Simply put, I will get to the point where I am making a very comfortable wage, without them. There are many underpaid and poorly treated fitness trainers out there. I think most would sign up in a second for the chance at a livable wage, with benefits, and the opportunity to grow.

    In any case, I'm planning on starting a small studio that is only my personal training and group fitness clients. After I develop a strong client base, I will be bringing in someone to take over some of the classes/clients as I plan to expand. If by "gym training" you mean commercial gym, that is not what I intend to own. I don't NEED your opinion, but it doesn't hurt to know the experiences of others.

    $20/hour with profit sharing and other benefits is different than $20/hr. Like I said, maybe I could offer a higher rate of pay for those who don't want benefits.

    I am considering the negative statements in here, but I put little weight on them because I don't know the background of those making them. Are you successful business owners, underpaid trainers, or are you a solo operation being put out by larger operations? Perhaps none of the above?

    I don't know where I said anything about $20/hr either. I said perhaps I would offer $35,000 with benefits for a newer trainer. As someone progressed and made me more money, they would make more money as a result of profit sharing. This could lead beyond $20/yr. The idea is that the business is going to retain some of the earnings for future expansions and down times. If an employee doesn't like that, again, they are free to move on.
    It's your time and dime, but I can assure you they will move on and they will take your members with them. Here's how it works: A member pays your club $60 per training session. After a while, she and the trainer develop a friendship. She learns that he is only earning $20 even though she pays $60. She hates that idea. She doesn't want to pay you on top of the membership fee you already charge her. The trainer also hates it. He knows he could get her in shape without the use of your equipment. They talk about it and she agrees to pay him $30 an hour to do boot camp, PX90 type routines, to run with her and other things that he can do at her house. You lose the trainer and the member. This will happen to you time and time again. I can assure you. People do not like being used when they know they are the meat of the operation.
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    Originally Posted by Ronin4help View Post
    It's your time and dime, but I can assure you they will move on and they will take your members with them. Here's how it works: A member pays your club $60 per training session. After a while, she and the trainer develop a friendship. She learns that he is only earning $20 even though she pays $60. She hates that idea. She doesn't want to pay you on top of the membership fee you already charge her. The trainer also hates it. He knows he could get her in shape without the use of your equipment. They talk about it and she agrees to pay him $30 an hour to do boot camp, PX90 type routines, to run with her and other things that he can do at her house. You lose the trainer and the member. This will happen to you time and time again. I can assure you. People do not like being used when they know they are the meat of the operation.
    But they aren't the meat of the operation. They are an important part of the operation, but they aren't THE operation. What about the marketing, the risk taking, the convenience of the facility, the planning of classes/the facility, etc. I'm not just talking about personal training either.

    Even if you made $30+/hr at her house, there is travel involved, you have to buy equipment, you will have to pay self-employment taxes, and you will need to find your own clients. Sounds like a sweet deal...

    I will repeat again, I'm not trying to start a commercial gym. There won't be tons of machines and cardio equipment. I've been part of a successful business with this model, so I'm not concerned.

    Thanks for the input.
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    Sounds like you're goal is beginning with an extremely high overhead. Trainers will come and go, I've never seen a gym with a whole staff sticking around long term,new faces all the time.

    Other guy is talking about members and front desk people, that's irrelevant in a studio which sounds like is this guys plan.

    Paying benefits is a bad idea unless you're really raking or you offer horrible benefits.

    I also think you're assuming you will fine 5 great amazing trainers/PEOPLE. They are few and far between. Part of the reason I started my biz and got my own studio was because the gyms and trainers are so irresponsible, cut throat, selfish, lazy and unreliable. I knew I work hard and would be successful and quite honestly the people I worked with for were holding me back.

    If you want to be the boss, your brain needs to be better than five brains.

    In my experience unfortunately there aren't very many people you can trust and the majority are out for themselves. Have low expectations. I do enough training on my own to cover my overhead and profit. The money I get from contractors is bonus and I feel no pressure about meeting my bills.

    I just think the whole employee thing is a setup for failure in most cases and as . Experienced
    studio owner myself would highly recommend against it
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    Originally Posted by EdgarAllanPoe View Post
    Sounds like you're goal is beginning with an extremely high overhead. Trainers will come and go, I've never seen a gym with a whole staff sticking around long term,new faces all the time.

    Other guy is talking about members and front desk people, that's irrelevant in a studio which sounds like is this guys plan.

    Paying benefits is a bad idea unless you're really raking or you offer horrible benefits.

    I also think you're assuming you will fine 5 great amazing trainers/PEOPLE. They are few and far between. Part of the reason I started my biz and got my own studio was because the gyms and trainers are so irresponsible, cut throat, selfish, lazy and unreliable. I knew I work hard and would be successful and quite honestly the people I worked with for were holding me back.

    If you want to be the boss, your brain needs to be better than five brains.

    In my experience unfortunately there aren't very many people you can trust and the majority are out for themselves. Have low expectations. I do enough training on my own to cover my overhead and profit. The money I get from contractors is bonus and I feel no pressure about meeting my bills.

    I just think the whole employee thing is a setup for failure in most cases and as . Experienced
    studio owner myself would highly recommend against it
    I definitely appreciate your opinion as it stems from experience. The reason I made this post is because this seems to be the general consensus in the field. My goal isn't to start off with any trainers. I plan to be on my own for at least 1.5-2 years. Even when I start with my first employee, I don't intend to start them off full-time, nor do I plan on providing benefits initially. The point of my post is to find a way to keep trainers around. This would by achieved by providing incentives to stick around such as profit sharing and benefits. The idea is that the business does need to be raking in money, or benefits aren't possible. This is all about the business model and maximizing income.

    I don't want to find 5 amazing trainers. My goal is to develop them. I would need people with strong character. I will agree that this might be hard to find, but I think they are out there. Even if people leave, if you become known as a great place to learn, you will keep trainers around for at least a few years. In addition, I don't think my brain has to be better than my five employees. I think I need to be a good leader who can bring those five people together and make them feel like they are part of a team.

    My goal is to build a team and make everyone feel like they are an important part of that team. Instead of being the big boss who exploits his workers, I want to make a smaller cut out of their productivity so that they won't want to go out on their own.

    I don't doubt that hiring employees doesn't turn out well for quite a few facilities, but that is the point of this thread. What would keep people around, short of ruining your business by giving them 75% of gross as was suggested above...
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