29: How To Know Where The Gaps Are In Your Business.

What Is This Episode About…

In this episode, John and Chris will seek to answer a question about the five core functions of a business. When they were starting out with their business, they didn’t know what those core functions were. Chris didn’t even pretend to know what they were while John would either lie that he knew them or make them up. That was until they heard about Alex Charfen’s Billionaire Code from some of their coaches, and the five core functions of business just so happened to be one of the core teachings of the code.

The five core functions include lead generation, lead nurturing, lead conversion, delivery/fulfillment, and resell/upsell or retention. For a yoga entrepreneur to successfully run their business consistently, they have to analyze the business based on the five functions by creating a scorecard of each function, and then focusing their future efforts more on the functions that they are failing in the most while still ensuring that they keep working on the rest of the functions, because a failure in any of them leads to the overall failure of a business.

John and Chris will talk about how they learned to implement the framework of the five core functions and advise us on how to efficiently implement them in our yoga businesses. Stay tuned and enjoy.

Key Points Discussed:

• The systems and processes for a business that helps you scale it and creates free time for you (00:48)
• Looking at our businesses through the framework of the five core functions and how that can change everything for the better (01:42)
• If one of those is not working, your business is not working (02:58)
• The importance of leading in the decision-making process (05:19)
• How to do your lead generation, nurturing, and conversation (07:29)
• Caring about students getting the quality of experience that they’re looking for (11:06)
• It’s all about balancing five swords on their tips (13:24)

Learn More About The Content Discussed…

Join The Facebook Group –> http://bit.ly/yogaentrepreneur

When Was It Released…

This episode was released January 8, 2020

Episode Transcript…

Disclaimer: The Transcript Is Auto-Generated And May Contain Spelling And Grammar Errors

00:00          Alright. Welcome to YES (Yoga Entrepreneur Secrets). And, the question for today is, do you know about the five core functions of a business? Because if you don’t, that is probably why you’re not as successful as you want to.

00:17          What’s up everyone? You are listening to Yoga Entrepreneur Secrets. I am Chris Yax, and I’m John Yax. We are part of a small group of yoga entrepreneurs who are committed to making a living, doing what we love, without feeling guilty about making money, or ashamed of being successful, because we know the real value of yoga and how the world needs it now more than ever. This podcast is here to teach the strategies and tactics so we can thrive financially as yoga entrepreneurs. We are the Yax brothers and welcome to Yoga Entrepreneur Secrets.

00:48          Alright, so Chris. Five core functions of a business. Five core functions of a business, John. I had no idea what this was in the beginning of… oh man, today is the last day… as we’re recording this. Today is the last day of 2019. At the beginning of 2019, if you asked me what the five core functions of the business was, I would say, “I don’t know what you’re talking about, and why are you talking to me about them?” I would make something up and… John would lie. I would be honest. Straight bald-faced lie, but I would try to make something sound good. It’d be a white lie. Which is still a lie, John. So, Chris and I are part of a mastermind, and in this mastermind, we heard of a gentleman, Alex Charfen and he is a basically a Ninja when it comes to businesses. His business is called The Billionaire Code, and it’s all about like, the systems and processes for a business that helps you scale it and creates free time for you.

01:42          Almost all of our coaches are working directly with him, and so, through some of our coaches, we heard not only of him but some of his core teachings and one of them are the five core functions of a business. You want to tell me what those are Chris? No, I want to keep the story going. So, we’re in this mastermind group and… and Steven Larsen who is the main coach in the group, talked about Alex Charfen. He talked about these five core functions of a business, and what was really interesting he said is, every quarter he looks at his business through the framework of those five core functions, and he analyzes it. He basically gives himself a scorecard for each one of these five core functions. And what that does is it then organizes what he focuses on for the next quarter, whichever one scores lowest is what he pays attention to most in the next quarter. And, what he said is, this has revolutionized his business. It has changed everything. So beginning of 2019 I had no idea what these were. Second-quarter of 2019, we were introduced to them, and then we started looking at our business through the framework of these five core functions. Are you ready to tell them what they are? Third-quarter. Yes. Five core functions. First one’s lead generation. The next one is lead nurture. The following one is lead conversion.

02:58          The next one is delivery or fulfillment. Or fulfillment. And then the final one is reselling/upsell or retention. Thank you Chris. Retention, resell, upsell. It is everything guys. Like this is… if one of those is not working, your business is not working. In order to create a successful business, all of these need to be worked on, and obviously, you focus on one and another one could start to deteriorate a little bit. That’s why every quarter we give ourselves a scorecard and say, “Okay, what out of those five… where are we in and what do we need to pay attention to the next quarter?”

03:33          Yeah, so you, I don’t know if we’ve talked about it a lot on the podcast, but you know we’ve been in business for over 15 years now owning yoga studios. We’ve been teaching yoga for longer than that. We were in martial arts world are much longer than that, but for the majority of that time, John and I, our main focus, if we’re looking at our business through the five core functions was on delivery and fulfillment. Because our main focus was what is going on in the yoga room, right? How are our teachers teaching? What are they teaching? How can we make the sequence better with this new information about like where we, the methodology we use is Mio Fashional methodology. Like we didn’t know that for a while and so we were doing our best teaching, but when we learned it, all of a sudden it was our job to implement this new methodology, this new framework of sequencing into our classes.

04:24          What I’m saying is all of that is related to the fulfillment of what people are getting when they came into hot house yoga because we didn’t have any idea what the rest of the five core functions were. We thought that if we could just fulfill if we could do the best on that side of it, that’s all we need to do, and so it would create the most excellent experience for people that we could possibly put together and our businesses still struggle to get to the point of where we actually wanted them to. Now it made a difference because people would, if you create something remarkable, people remark about it. It’s amazing. It’s nice when you put something amazing together, people will tell other people and people will be excited about it. But the people that don’t know anything about it, you have to generate [inaudible] this buzz about it, right? You have to create some type of buzz. Like in your business, you are the market or you have to put your, take a Bullhorn in, preach your message, let people know what you do and how you can help them. Right?

05:19          Yeah, totally. So in that fulfillment, what we realized was that consistency is most important. So we focused on that and part of that consistency was, okay, now we need a coaching program. So we developed a coaching program and then we’re like, man, we need teachers. And in the beginning, we were sending teachers to where we got certified and all of a sudden realized, man, it’s just not working like that. It’s not working for us anymore. So we develop our own teacher training program. And so, but you can see it’s all very, very focused on the fulfillment aspect of it and that was super important. But what we didn’t have control over of those beginning years was like, how are we generating those leads? Like we are part of the decision-making process, but we weren’t leading it. We weren’t like being the innovators of it. We weren’t creating the promotions.

06:00          We were like, do you guys like this or not? Yeah, we’re like, let’s go. Honestly, I didn’t care. I didn’t care to know about what was going on. I’m like, you guys run with that. I want to focus on the yoga and then come 2016 we were like, Oh, we actually need to care about this because it’s now up to us because that was when we separated the business. So 2016 we did a little bit better than we did in 2015 2017 we did better than we did in 2016 we have all these numbers. We’re not going to share them with you just yet. And then this last year, 2019 18 was better than 17 and 19 has just been huge. And it is not a coincidence that the year that we learned about the five core functions of the business and we started making decisions based on where our leaks were in these five core functions, lead generation, lead nurture, lead conversion primarily.

06:47          And we started focusing on plugging the leaks. We’ve had our best year ever in 2019 we still have today while we’re still today. See all today goes. Yeah, we’ll take everything down just today. And then once you generate leads, how do you nurture those leads? How do you stay top of mind, right? Cause that’s the other thing. Like you can put a message out, but how many times does somebody need to see a message? I know back in the day it was like seven times. And I think now because of everyone’s short attention spans, it’s like 16 times to be in front of their face before they actually realize or take action or know that you’re in the uh, their orbit. And then converting those people once they get interested. And once they move in, how do you get them to actually take the next step and convert them, move them into your process, right.

07:29          To be able to help them. So, and then once you’ve delivered and like people are moving in, they’re moving in with you. It’s so funny. I swear you were just picking up my brain. Right? Cause I’m like if you look at this, it actually, it kind of works in all and a lot of areas, I won’t say all areas of life cause I’m sure you’ll figure out one that doesn’t work. But like to think about dating. So funny, right? You were thinking about dating cause that’s, I picked up on what you’re putting out and so, so like you don’t go and meet someone and say Hey do you want to marry me? I love you. No cause they’d run away, Hey do you want to move in? Right. So you gotta like generate the lead and be like, Hey would you like to go have some coffee or tea or go have some lunch.

08:10          Right. You’re not even going to dinner before that. Cause that’s kind of lead conversion. I think even before that, it’s lead generation where you make eye contact, right? You see them and then you look away and you pretend like you didn’t see them. Right. You’ve generated, there’s an attraction, you start showing up at the same place, they show up. You kind of like you see them a few times and there’s the lead generation piece. Yeah, totally. But then the nurture is like, Hey, how are you doing? What do you do? You want it cause then you’ve got to ask, right? So you’re like the attraction happens and then when you ask the person out, then it’s like now the lead has been generated. Like they know you’re interested. Their nurture is now like what do you do? Do you go have lunch? Do you go have coffee? What do you like? What’s that process look like? And how many of those do you do? So you’re not like one coffee and you’re like let’s move. I love you.

08:58          You then say, Hey, let’s do this again. Hey, let’s do this again. When I first am I after the first lunch date with my wife, I got to like the side hug with the tap house. The hugs when like you’re not like squeezing holding. You’re like you got a little squeeze and then it’s like, okay, that’s enough. That’s what I got. I thought it was done. It could be a friend hug zone, but I was like, wait a second. I thought that went way better than she did I think and so I haven’t nurtured enough so I need to ask her out again and again and again, but you see at that point the conversion is like, okay, we’re dating. It’s official meaning it’s official. Can I say I’m in a relationship on Facebook, right? That’s the day that it’s official not change your status on Facebook.

09:39          Yeah, you got to change status, but if you look at that, it’s the same framework. Like when you ask somebody to come in, you’re giving them an introductory deal. Now that introductory deal like should help them in the process of however long that introductory deal is and however many touchpoints there are. How many classes are involved, like that is the nurturing process and then the conversion is how do you get them into a membership versus dating, which is, Hey, will you just be exclusively my girlfriend or my boyfriend? Yeah. Right. And then delivery is showing up. Right? And in the relationship world, not as your representative, but like now showing up as you like who you really are. Because in the generation and the nurturing process, in the conversion process, it’s not you really [inaudible] representatives. Totally representative. Like this is me I want you to believe is the best version of myself. Yeah.

10:30          And then retention is putting in the work, and this is, I think in, I always staring off into a relationship conversation, but this is where relationships fail is one person or both people stop trying the retention piece. It’s the resell upsell, right? So you stop trying, you stop putting the effort. It’s usually around the two two year Mark I think is what? Five love languages. Gary Chapman, the author of five love languages says that two years Mark is when we get comfortable, we get caught in this experience of. It’s the idea of familiarity. You’re so comfortable with a person that you stopped putting in the work.

11:06          Yeah, and so if you had like as far as your business is concerned, if you had someone stay with you for two years, that is huge. The lifetime value of that person. Like you have done a great job, but what we’re saying, not in relationships, this is almost like a relationship podcast now is that they’re ha you have to keep putting in the effort once they’ve converted, converted mean they’re a member now. Right? The high watermark for yoga studios to get leads from the generation to the nurture to the conversion is like now they are a member. They’re paying you every month to practice and how are you like again, how after they’ve signed up for the membership, the retention is how are you handling them? Meaning how are you taking care of them? What are the touchpoints? Are you still talking to them about it?

11:44          Like are you still caring about their experience? And then that’s for us, what we’ve really organized really well at this point is that fulfillment of it, knowing that the consistency that they get, the care, the love, like I, we know what our teachers are teaching, we know the methodology that they’re teaching, so we understand that the consistency is there so that they’re getting the quality of the experience that they’re looking for each and every time they come in to practice. Yeah, I think that’s as deep as I want to go into it right now what we’re going to do is we’re going to break down each segment of these five core functions. So next episode we’re going to talk about lead generation and what we’re doing right now, what we’ve implemented that has changed the game so and then we’ll talk the following episode on lead nurture and ways that you can do that better.

12:29          And then we’ll go through all five of them and tell you what we’ve done, right, what we’ve done wrong, how we failed, the mistakes we made and what we’ve done to shore up those mistakes. Now what’s important is for this episode is just starting to look at your business through the framework of these five core functions. Because what’s what ends up happening, and this is what happens for us is like for years we focused on fulfillment and that was our, our focus and we realized, man, that’s really good right now. And then 2016 happened. We’re like, Whoa, we didn’t know what it was. Then 2019 and we learned about the five core functions and we’re like, Whoa, okay. Now this lead generation nurture and conversion thing, we have to, that’s the biggest gap that we have in our business. So I’m not ever expecting that all five will be perfect because as I focus on one, I’m taking my attention away from the other and then when I come back to that next quarter and I look at it, the lead generation, conversion nurture, if that’s like what I’ve been focusing on, I imagine the fulfillment, the retention, the upsell, resell is what I then need to focus on, right?

13:24          How am I taking care of the members that are already there? What can I do better? And so I look at it like it’s this, uh, you know, the way in which I look at it as like, all right, I’m balancing these five swords on new tips. All right, on the very tip. And I’m trying to balance them and figure them all out. And as I focus on one, the other starts wobbling and losing their balance. And then I got to focus on them and the other start losing their balance. But each time I do that, each iteration, I’m leveling up each of those. But I think there’s this never-ending growth if it hasn’t been point. What we learned was every quarter, take the five core functions and grade yourself. One being the worst, five being the best, a one through five. And if whatever one of those hits the five, take your eyes off it for a little bit and focus on the ones that are at a one or two and get those up to three or four or five and you know, get some motive movement in those.

14:14          And then the next quarter, grade yourself again, one through five in each of those five core functions and see which one needs you need to pay attention to. And if you do that consistently, so every quarter you do that like Chris said, you’re balancing those plates and you’re making sure they all stay balanced and stay on the swords. So that’s what we would recommend for you to do like right away. Cause here we go. We’re starting the first quarter of 2020 yeah. Where are the gaps in the business viewed through these five core functions and then focus on one of them and start making it better. Yeah. Cool. Thank you so much for listening. Like always do the work, honor the struggle and make the world a better place.

14:52          But he’s our buddy. Yes, thanks so much for listening to Yoga Entrepreneur Secrets. Do you have a question that you’d like us to answer raw and uncut on the podcast? If you want your questions answered, all you need to do is head over to Apple Podcasts, and do three simple things. One; rate and review telling us what you think of the podcast. Two; in that review, ask anything you want related to yoga, and three; if you want to shout out, leave your Instagram handle or name and that’s it. Then listen in to hear your question answered Live, raw and uncut. Join us next time on Yoga Entrepreneur Secrets Podcast. Thanks