Your front desk attendant with a schedule, W2 form, and agreed-upon wage are employees. They show up for their shift, and they’re there when you need them, but they’re not the only type of help you could have to help run your CrossFit gym. Independent contractors (also known as freelancers) are self-employed and work with you, not for you.
They have their own rates, contracts, conditions, and depending on how much it costs, it can be a headache. Independent contracts have more benefits than setbacks, but it all depends on how you want to run your business, and where you see their value. Let’s talk about what your workforce is going to look like for your CrossFit affiliate gym.
Independent Contractors
Independent contractors show up for money. They’re not obligated to (unless you sign a contract with them), and they’re certainly not employees. It’s an entirely different way that you deal with help. Professional freelancers (independent contractors) are self-starters, know their industry, and come with tons of benefits. You’re not going to hire them to man the front desk, but there are a few things you can do.
Pros
- You Don’t Have to Provide Benefits: Yes, you’re paying more for freelancers than you are for employees, but these independent contractors factor in their own expenses into the cost of doing business. You’re not paying for healthcare, adding to their 401(k), or anything like that. It’s a simple money-for-value transaction, so you don’t get left with additional administrative work on the back-end. You pay them, they do the job you need, and you’re good to go.
- They Bring Experience: Employment has limitations. Experience can only be earned for so long before it stagnates pending a promotion, or taking that experience to another company. Freelancers are able to expand their experience through every single client they pick up, and they bring that with them to the next client, and so on. The more experience, the more they cost, but they’re also bringing a lot of value to you in a small package. It’s worth the investment.
- Cheaper Than Employees: One freelancer could do the job of two employees, and not have to work a full 40 hours a week to achieve it. Plus, since you don’t have to provide benefits, uniforms, accommodations, or physical space for them to work, you could actually end up saving money. VAs can often replace employees without being overly expensive, and get work done in a fraction of the time.
- They Have Connections: Freelancers go from client to client, and their goal is to leave a positive experience behind. It keeps doors open for them in the future. That being said, it also comes with perks for your business. What if they work with a major fitness app, ad agencies that specialize in fitness, or other connections that you could benefit from? It’s more than cut-and-dry pay-per-hour work when you hire a freelancer.
Cons
- They Cost More Than Employees: Freelancers have carved out a niche skill (or several) and put in more time and effort to master those skills than most. This is amazing for your business growth potential, but because of their experience, they’re not going to accept the same payment as employees. This will all be outlined in their proposal to you when you hire them, but keep in mind that when those terms end, there’s a good chance that the experience they gained as your freelancer will force their costs to increase as well.
- Hard to Find: While freelancing has gone up over the last decade (and is expected to rise further), it’s important to note that many freelancers are given the advice to pick a niche. You’ll get more high-paying clients with niche skills than you will with generalist skills. Anyone can apply to work the front desk at your gym, but few have the skill set to perform the specific tasks you have in mind for your freelancer. Even then, that niche might be very narrow, and not have many freelancers who are currently available to work.
- No Obligation: If you’re difficult to work with, they aren’t obligated to continue to work with you. Some gym owners will have freelancers for years and they’ll become integral to the core of their business. Others who have extreme expectations without compensating accordingly will run into issues, which will absolutely carry over to their traditional employment as well. A freelancer works for themself; you’re a client, not an employer to them.
Employees
Employees need to show up to get paid, work in-house (at least most of them do, depending on how your gym is structured). There’s a specific relationship between an employer and employee that differentiates vastly from how you would talk to or interact with an independent contractor. This is what you need to know.
Pros
- They Cost Less Than Freelancers: You’re saving money. While the saying “You get what you pay for” is true even for employees, and you shouldn’t stick to minimum wage, you can even afford to pay employees well and still save money compared to freelancers. There’s a difference in expected schedule and value output, but you can absolutely have more employees than freelancers for the same cost.
- They Can Run the Show: Need a day off? Most company founders do. If you train your employees, they can run the show while you’re away. You can focus your time on tasks that bring in more money than simply running the gym, and with the right workforce, they’ll keep your clientele happy and taken care of during your absence. Freelancers are generally remote and do not come on-site, so you’re not going to get the same service with them.
- They Come to You: You don’t have to go and hunt down a freelancer, because employees will look for help wanted signs, posts on free forums that you can make, etc., and the effort required to attract prospective employees is minimal in comparison. This works for continuous hiring as well. If your gym has a few thousand passers-by in vehicular traffic each day, a simple sign will usually suffice.
- Structure: While freelancers can one day just decide to say “This isn’t worth it any more” and up their rates, or leave entirely, your employees have structure. Beyond annual pay raises or whatever else they want in their employment agreement, you don’t have to worry about too much. They generally don’t get too big for their britches. Take care of them, but rest assured that they’re not going to up and leave as often as freelancers can.
Cons
- Burnout is Real: Freelancers work for their own schedule and have more control over their expectations, and by result, your expectations. Employees have to work a schedule, and in gyms, most of them don’t have PTO. It’s very easy for employees to get burnt out. This negatively impacts their performance on the clock, as well as how they treat customers (even unintentionally). You have to balance your employees' mental health with their expectations for pay.
- Training Costs: You have a specific way you want to run your gym, as anyone would. You have to train an employee, which means you either need someone to train them (that’s two wages), or you spend your time training them (their wage plus your arguably more valuable time). Either way, it’s hard. Freelancers come with experience, so you don’t have to train them on much, other than getting them used to the way you want to run things.
- Downsizing is Hard: If you hit a hard snag and you need to downsize, well, it’s called firing your employees in this case. This is something that’s starkly different from freelancers. When you fire or lay off an employee, they go and find another job quickly. They’re usually out of the job hunt fast, and have a negative emotion about the experience. With freelancers, you can pause services, mention that your budget has shrunk, and talk to them again in a few months if things pick back up. They’re quite used to similar situations playing out, and won’t shut the deal on your working relationship as a result.
It’s Up to Your Preference
Contractors definitely have their downsides, but generally speaking, they help fill the holes in your business that you couldn’t otherwise afford. A monthly retainer for a portion of a lawyer’s time is much more reasonable than fully employing a lawyer that you wouldn’t actually need for 40 hours a week.
Weigh what you need in your CrossFit gym and how you could reasonably pay for it. You’ll need employees for sure, but what your workforce looks like will change depending on your needs. You’ll know more as you expand and become more and more profitable. You can always revisit your options if you want to switch things up.
