There are several ways in which to bill personal training services. Most personal training programs prefer a paid-in-full (PIF) billing method. A PIF billing method is one where clients pay for training in advance of receiving the service. However, in recent years, some health club organizations have tried billing for personal training services through electronic funds transfer (EFT) basis. Under this system, clients are typically charged a set, recurring monthly fee for a given number of training sessions each month. Although on the surface this may seem like an efficient billing method that encourages long-term re-signs, in reality it can work to be a disincentive for trainers, discourage sales and add unnecessary administrative costs to an organization.
In order to better understand the fundamental differences of each system, a comparative analysis is given below for PIF and EFT billing methods:
FEAR OF COMMITMENT
PIF: First-time clients are more likely to purchase a given number of training sessions if they feel that they are not making a long-term commitment initially.
EFT: First-time clients are often leery of committing to ongoing monthly EFT charges for training services having never experienced a personal trainer before.
SELL LARGE TRAINING PACKAGES
PIF: Clients are more willing to purchase larger training packages because they feel they are in control of the payment process.
EFT: Clients are less willing to purchase larger training packages because they feel that they have less control over automatic and ongoing EFT payments.
PAY SALES COMMISSIONS
PIF: It is a simple matter of paying trainers a commission on sales using a PIF billing method. Furthermore, trainers are motivated to re-sell clients additional training packages due to commission incentives.
EFT: Often, commissions are not paid to trainers after the initial sale for on going monthly training. This is a disincentive. If trainers are paid an ongoing commission after the initial sale, there is an unnecessary added administrative cost to track and verify such commissions.
SCHEDULE
PIF: When clients go on vacation, or have to reschedule their training appointments for any reason, they can complete their remaining sessions upon return.
EFT: Clients are typically charged a set fee for a given number of training sessions each month. This can create problems when make-up sessions are owed to members and/or sessions have to be brought forward into the next month.
REFUNDS
PIF: There are relatively few misunderstandings or complaints when clients pay for training in advance. Clients understand the cost and know exactly how many sessions they are paying for.
EFT: Overbilling problems, refund requests and member complaints with EFT billing are much more common. This occurs for a number of reasons, mainly due to client misunderstandings at the point-of-sale. Dealing with overcharges and processing refunds is time consuming and places undue administrative costs on the program.
PIF billing methods can lead to greater sales, handle various scheduling problems with more ease, lead to less overcharges, fewer requests for refunds, fewer member complaints, and greater overall organizational efficiency and profit. Although EFT billing systems can be made to work, the added complexity and added administrative cost may not be worth the time.
Don Walker, exercise physiologist, MBA, is the owner of Health clubs in Laguna Beach, CA, and Bullhead City, AZ. As a former vice president and district manager of personal training for two major health club chains, he has developed and overseen all operations and sales training material for personal training.