Many people want to get into the $59 billion U.S. weight loss business. But how? And what kind of business to start? What product (a diet book, DVD, weight loss center, diet website, food delivery service, franchise, etc.)? How much will it cost, and which ventures are most likely to succeed? How can one avoid the mistakes others in this business have made? Do you have the qualities and background to make it in weight loss?
The typical American dieter makes FOUR dieting attempts per year. And, there are an estimated 75 million American dieters. They don’t use the same product or program all four times. If one plan doesn’t work, they try another, in an ongoing effort to find the “holy grail” of weight loss. They are fickle. They will jump on the latest trend or bestselling diet book by a celebrity, or program pitched via mail order or infomercials on TV.
This is a female-oriented market – Most diet programs are skewed to about 80-90% female customers.
Many people that enter the weight loss field have little or no experience in this area. They might buy a franchise and try to be an absentee owner, leaving the operation of a weight loss center to a manager they hire. This can be risky. Your chances of success will increase if you have experience in one of the following fields:
· Dietitian or nutritionist · Retail sales · Health club industry or personal trainer · Previous employment in the weight loss industry · Nurse/health care
Following are my estimates of the costs involved in getting into various weight loss ventures:
* Write a diet book and self-publish it: $2,000 (Note: You can do it for a lot less if producing an e-book – no printing costs or inventory. Sell it and get great exposure via Amazon.com or Barnes & Noble.com.)
* Purchase a commercial weight loss franchise: $32,000 – $349,000
* Purchase a license or become an “affiliate” for a turnkey medical weight loss program: $16,995 – $65,000
* Create a weight loss website with an e-commerce store: $600-1,000
Will you sell a weight loss product or service?
This is a key question to consider. Most dieters want a tangible “product” that delivers benefits, rather than an intangible service. These weight loss products may be a diet pill, diet foods (entrees, meal replacements like shakes and bars), a bestselling diet book, a scale, a diet cookbook, a multimedia weight loss program in the form of a CD/DVD and manuals, etc.
When talking about the “service” part of a weight loss program, dieters will pay for this only if they get something else concrete with it. Jenny Craig is one example. Yes, you get the one-on-one counseling in the center, but you HAVE to buy the Jenny Craig foods. It’s interesting to note that NutriSystem provides FREE phone counseling/support via health educators, as part of its program, but the company reports that only 20% of their customers use it.
Selling intangibles is tougher than selling real products (i.e. selling life insurance versus selling cars). People just have a hard time visualizing what benefits they will get out of a service.
Successful weight loss center franchisees say that to run a successful weight loss business one needs to be a visionary, be an effective leader, be a team player, and have good people skills. One should also be able to delegate work, be a good strategic planner, be able to set goals, and be able to communicate well with the parent franchisor. They believe that you also need a passion for what you are doing and you must believe in the product or service.
“Most doctors make terrible business owners, with no clue about marketing and advertising, or how to motivate employees. Yet many think they can make it in weight loss. Clients of a diet company that lose weight think they can run their own diet center. Think again. This is a complex business with fickle customers. It’s easy to lose your shirt.”, according to author John LaRosa.
People in this business for 20+ say that one has to be extremely adaptable and able to shift gears quickly to succeed the diet business. They also have a lot of say about competitors that are not so reputable and the fact that legitimate operators have to compete with them. It’s a very crowded market and unfortunately, many are still hucksters and scam artists.
Qualities needed
You’ve heard the saying in real estate, that the three most important factors in real estate are: LOCATION LOCATION LOCATION. Well, in the weight loss field, it’s: MANAGEMENT MANAGEMENT MANAGEMENT.
As a consultant to and analyst of the U.S. weight loss market for 20+ years, the one thing I’ve seen ruin more weight loss companies than anything else is bad management decisions. Not recessions. Not pricing. Not diet fads. Not new technology. No, it’s the way that weight loss companies treat their employees and their customers that matters most and that results in fines and legal actions by the FTC (Federal Trade Commission) or state Attorneys General offices, or class action lawsuits, or undercover investigations by TV stations and local news organizations.
Following are the things that Marketdata and John LaRosa believe ruin most weight loss companies:
– High pressure sales tactics by your weight loss staff
– Inadequate disclosure of true and total costs
– Fees that are not competitive
– Deceptive/false/bad advertising
– Negative public relations spread over the Internet
– Underestimating the competition
– Not sticking to your main focus
– Not monitoring quality control of your program
– Not listening to the concerns of your customers
– High Up-front fees and long-term contracts
This article just scratches the surface of what it takes to run a profitable weight loss business today. For more in-depth guidance, case histories and detailed descriptions of each type of diet business (center, website, book, etc.), see below.
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“How To Start & Run A Profitable Weight Loss Business” is a 199-page guide, published in Aug. 2010. It is sold in digital and print format. A Table of Contents may be found at the Marketdata website. John LaRosa is available for interviews. Call: 813-907-9090, or visit www.marketdataenterprises.com. Marketdata Enterprises is a leading independent market research publisher and consulting firm focusing on service markets since 1979.