How to Build a Profitable Business in 2023 | The Bedros Keuilian Show E034

Introduction

In this section, Bedros Keuilian introduces the topic of the episode and talks about the importance of making a profit in business.

Building a Profitable Business

• Making revenue is not enough; businesses need to make a profit.

• Profit feeds the family while revenue feeds the ego.

Types of Businesses for Financial Freedom

In this section, Bedros Keuilian discusses different types of businesses that can help individuals achieve financial freedom.

Entrepreneurship and Money-Making

• Bedros Keuilian's Zone of Genius is his ability to create money across many different industries.

• He shares his favorite types of businesses that have helped him achieve success.

• He emphasizes the importance of creating value in exchange for money.

Importance of Leadership in Business

In this section, Bedros Keuilian talks about how leadership plays an important role in business success.

The Downfall as a Leader

• Bedros Keuilian admits that he wasn't always good at leadership.

• He almost lost his franchise Fit Body Boot Camp due to his poor leadership skills.

• This experience led him to become a better version of himself and improve his leadership abilities.

Lessons Learned from Mentor Jim Franco

In this section, Bedros Keuilian shares lessons he learned from his mentor Jim Franco regarding entrepreneurship and financial freedom.

Borrowing Money from Jim Franco

• Bedros borrowed $126,000 from Jim Franco, who was like a Rich Dad to him.

• His real dad was his "poor dad" who didn't understand how money worked or anything beyond trading time for dollars.

Becoming an Entrepreneur

• Jim Franco owned a company called Autolog that created software for auto parts stores.

• Bedros became a personal trainer and one of his first clients was Jim Franco.

• This experience helped him realize the potential of entrepreneurship and inspired him to start his own businesses.

Owning a Job vs. Entrepreneurship

In this section, Bedros Keuilian talks about the difference between owning a job and being an entrepreneur.

The Freedom of Entrepreneurship

• Bedros emphasizes that there's nothing wrong with owning a job if it provides the lifestyle you want.

• However, entrepreneurship offers more freedom and opportunities for financial success.

• He shares ideas for businesses that allow individuals to own a job while still having the freedom to travel and experience the world.

Starting a Business and Creating High-Tech Trainer

In this section, the speaker talks about how he started his own gym and created a software called high-tech trainer. He explains that the software was meant to be used on Palm Pilots in gyms all over the country.

Starting a Business

• The speaker's personal training client mentored him to become an entrepreneur.

• He started his own gym and personal training studio with his mentor's help.

• This led to him creating high-tech trainer, which was meant to be a software used on Palm Pilots in gyms across the country.

High-Tech Trainer

• High-tech trainer was designed for use on Palm Pilots before smartphones became popular.

• Users would pay an extra fee to check out their Palm Pilot at the gym and have their workout program on it.

• The speaker borrowed $126,000 over three years to create high-tech trainer but had yet to launch it.

• Jim Franco, who loaned him money, told him he needed to start selling and producing money instead of just creating.

• The iPhone launch in 2007 destroyed the business model of workouts on a PDA or Palm Pilot.

• High-tech trainer turned into an online personal training software where users could email themselves workouts or watch downloadable workout videos.

Lessons Learned from Starting a Business

In this section, the speaker shares his experience of starting a business and provides insights on how to sell your product early on or incentivize programmers to work for free in exchange for backend money.

Selling Your Product Early On

• Find a way to sell your product early on.

• If you can't sell your product, incentivize your programmers to take equity and work for free in exchange for backend money.

• The Product Industry requires constantly creating new designs and products to get customers to buy again.

• The Product Industry means putting money out first by purchasing products and then selling them for profit.

Types of Businesses

Product Industry

• In the Product Industry, you have to produce or purchase stuff first before selling it for profit.

• The Product Industry requires a lot of capital because you're parking a lot of money on shelves before selling the product.

Manufacturing Industry

• Manufacturing means building things out through an assembly line process.

• Manufacturing requires big warehouse floor space and equipment.

Service Industry

• No bullet points with timestamps available.

Conclusion

Starting a business requires finding ways to sell your product early on or incentivizing programmers. There are three types of businesses: Product, Manufacturing, and Service Industries. Each industry has its own requirements and challenges that need to be considered when starting a business.

Understanding the Service Industry

In this section, the speaker discusses the benefits and drawbacks of being in the service industry compared to the product industry.

Benefits of Product Industry

• Private equity and buyouts are possible for companies that sell products.

• Companies can sell their products for a multiple of their profits (5x, 7x, 10x).

Drawbacks of Service Industry

• Services are not always sellable or scalable.

• Coaching businesses are often personality-dependent and cannot be sold.

• Clients may feel cheated if they pay a high price to work with a coach but end up working with someone else.

Scalability of Coaching Businesses

• Coaching businesses can be scaled by hiring more coaches under the leadership position.

• A coaching business can become scalable when it has other coaches under its face.

Scaling Rachel Shear's Business

In this section, the speaker talks about how he helped Rachel Shear scale her coaching business from trading time for dollars to making multiple six figures a month in revenue.

Scaling Rachel Shear's Business

• Rachel Shear's business was initially trading time for dollars at $9k/month.

• The speaker helped Rachel Shear scale her business by adding five other coaches, two salespeople, and a director of operations.

• The director of operations oversees the operations allowing Rachel to be the face of the business.

Fit Body Boot Camp Franchise Overview

Bedros Keuilian, the founder of Fit Body Boot Camp, explains how the franchise works and what services they offer.

How the Franchise Works

• The franchise sells a proven concept to independent owners who pay a monthly royalty fee.

• The franchisor coaches new owners on finding a location, signing a lease, building out their location, hiring staff, pricing, and marketing.

• Each location is independently owned and operated but pays the franchisor for support and processes.

Benefits of a Franchise

• Franchises provide systems and support that eliminate guesswork for new owners.

• Fit Body Boot Camp has sales reps and coaches to help new owners find locations, build them out, open up, sign leases, hire trainers - everything needed to be successful.

Building a Sellable Business

Bedros Keuilian discusses how to build a business that can be sold in the future.

Sellability of Businesses

• When building a business, consider whether it will be sellable in the future.

• If not sellable, ensure it is high profiting so you can step away from it without feeling any loss.

Examples of Sellable vs. Non-Sellable Businesses

• Rachel Shear's coaching business may not be sellable because it is dependent on her personality as the face of the brand.

• Ashley Lucas' weight loss service with five locations is more sellable because she has created an online platform that can help people all over the world.

Marketing Strategies for Different Business Types

In this section, the speaker discusses different marketing strategies for various types of businesses.

Service-Based Businesses

• Marketing service-based businesses through radio and TV personalities is a common strategy.

• Personal branding can be an effective marketing tool, but it may not be scalable or sellable.

• Delegation is a key factor in scaling service-based businesses.

Product-Based Businesses

• Automating processes is crucial to scaling product-based businesses.

• Delegation is also important in scaling product-based businesses.

Manufacturing-Based Businesses

• No specific information provided in this section.

Narrow vs. Wide Markets

In this section, the speaker discusses the importance of identifying your target market and how to scale from a narrow market to a wider one.

Identifying Your Target Market

• Identifying your target market is crucial for success.

• Narrow markets can be scaled up by changing messaging to appeal to a wider audience.

Scaling Factors

• Automation and delegation are key factors in scaling any business.

Scaling Your Business

In this section, the speaker discusses how to scale a business by going wide in terms of reach and delivery, using group environments, and selling through affiliates.

Ways to Go Wide

• Can you sell to different age groups?

• Can you market your product in different ways?

• Can you go wide in terms of your reach?

Group Environment

• Can the product be delivered in a group environment instead of one-on-one?

• A gym that does one-on-one personal training is not scalable due to high overhead costs.

• Fit Body Bootcamp is scalable because it's one on many.

Selling Through Affiliates

• Can the product be sold through affiliates or referral marketing?

• Multi-level marketing is a true scalable business model but may not be suitable for everyone.

Profit Maximizers

In this section, the speaker emphasizes the importance of profitability and provides profit maximizers for entrepreneurs.

Importance of Profitability

• Revenue feeds the ego, profits feed the family.

• A business can make a lot of revenue but if there are no profits, it's like working for free.

• The reason we become entrepreneurs is to control our income and live off it.

Profit Maximizers

• Can the product have levels to it? (e.g., level 1 certification vs. level 2 certification)

• Adding more value justifies charging customers more.

• Levels should make customers better at what they do or provide better results.

• Level two may have better status or limited quantities.

Profit Maximizers

In this section, the speaker discusses profit maximizers and how they can be used to increase revenue.

Subscription Services

• The speaker explains that subscription services are a great way to create recurring monthly fees.

• He gives examples of companies like Amazon and Netflix that use subscription services.

• The speaker suggests exploring the idea of creating a box-of-the-month club for apparel or other products.

• He shares an example of his supplement company bundling their best products into a subscription service, which increased their profit margins.

Selling Experiences

• The speaker talks about building personal brands and becoming a celebrity in an industry to sell experiences.

• He gives an example of how BMW sells the Rolls-Royce Ghost for $500,000 even though it shares 70% of its parts with the $160,000 BMW 7 Series. People buy the Rolls-Royce for the status and brand.

• The speaker emphasizes that anyone can manufacture celebrity using social media platforms to share knowledge, content, and add value.

This section is focused on two main profit maximizers - subscription services and selling experiences. The speaker provides examples from different industries to illustrate how these strategies can be implemented.

The Pyramid of Hierarchy in Entrepreneurship

In this section, the speaker discusses how knowledge and expertise can help entrepreneurs elevate themselves on the pyramid of hierarchy from being a generalist to an expert to a celebrity.

Elevating Yourself on the Pyramid of Hierarchy

• Knowledge, expertise, and wisdom can help entrepreneurs move up the pyramid of hierarchy.

• Being an industry celebrity allows you to charge more for your product or service and increase your profit margins.

Understanding Scalability in Business

In this section, the speaker talks about how his father traded time for dollars in a tailor shop for 30 years without understanding scalability. He emphasizes that understanding scalability is crucial for entrepreneurs to be successful.

Importance of Scalability

• Trading time for dollars is not scalable.

• Understanding scalability helps entrepreneurs scale, automate, delegate, leverage and become better leaders.

• Entrepreneurs who understand scalability can lead amazing humans who work with them to scale their vision together.

Types of Businesses and Opportunities in Entrepreneurship

In this section, the speaker discusses different types of businesses that exist and opportunities they provide. He emphasizes that entrepreneurship allows individuals to do things on their terms.

Types of Businesses and Opportunities

• Individuals can be copywriters or phone salespeople selling for other people and make commission from anywhere in the world.

• Entrepreneurs need to understand what types of businesses exist out there and how they should leverage those opportunities to increase scalability and profitability.

Final Thoughts on Entrepreneurship

In this section, the speaker concludes by thanking his audience and emphasizing that averages are the enemy, success is their responsibility, and change can take place in an instant.

Final Thoughts

• Averages are the enemy and success is an individual's responsibility.

• Change can take place in an instant when individuals are ready to flip the switch.