Knocking out inflation: How this entrepreneur has been dealing with rising costs

A boxing studio went head-to-head against rising rent costs, scarce labour and changing employee expectations—and emerged a winner.

12-minute read

Published October 21, 2024

Plenty of people enjoy working in Alberta’s lucrative energy sector. But Cissy Chen, who held a corporate role for many years, wasn’t one of them.

“I found that the nine to five—or actually, eight to six—office job was kind of boring,” she says. “I wanted something more challenging. Something entrepreneurial.”

At the time, her personal fitness routine included spin classes, which feature upbeat music to set the pace and motivate riders. But boxing was also becoming trendy. One day, she got an idea: Why not box to a beat?

She left her office job and founded Rumble Boxing, opening the first studio in Calgary in 2016. Rumble brings together high-intensity boxing workouts with group fitness, offering what it calls a “fight club meets nightclub vibe” and welcoming all experience levels.

Today, there are close to 10 studios across Canada—in Calgary, Toronto and Vancouver. Most locations are corporately owned, but Chen has plans for franchises too. The business employs 300 full-time, part-time and contract staff.

Although her business is doing well, Chen has spent the last eight years conquering a range of issues—the same ones that continue to create headwinds for business owners across Canada, like rising costs, labour shortages and shifting consumer and employee demands.

We could have grown much faster, but we are very disciplined about sticking to our economic model: We do not go above a predetermined threshold when it comes to how much we will pay for rent.”

A one-two punch from rental costs

Rental costs for commercial real estate began to skyrocket just as Chen was trying to grow Rumble. Like other business owners, Chen has had to get creative to keep her finances on track.

She takes a three-pronged approach to keep her rental costs down. The first part involves playing a good waiting game.

“We’re very patient and specific when it comes to location selection,” she says. “We could have grown much faster, but we are very disciplined about sticking to our economic model: We do not go above a predetermined threshold when it comes to how much we will pay for rent. We decide in advance how much we can afford, considering costs and projected revenues, and we do not make overly optimistic projections.”

Secondly, Chen realized that by strategically building up her brand, she could expect to secure prime locations for a good price. “Landlords want our brand in their premium buildings,” she says. Through a focus on quality, the company’s reputation has spread by word of mouth. They’ve also been fortunate enough to count some landlords among their existing clientele.

Finally, Rumble strongly emphasizes sales to cover costs and keep growing. But that’s a constant battle, says Chen, because of the rising cost of living.

“Consumers are struggling with costs too,” she says. “We need to absorb some of these increases as a business while maintaining our product quality, which can be difficult.”

We break down the roles and responsibilities to adapt to employees’ needs instead of asking them to conform to what we want as a company.

Avoiding a body blow from high turnover

Along with rent, labour is a key cost struggle for Rumble. For example, in Ontario, minimum wage has gone up more than 40% in the eight years since the business launched.

Chen has also found it harder to attract employees since the pandemic. “We lost some talent to COVID-related trends, like remote work, career change and other disruptions,” she says.

Keeping people is also challenging because of the nature of the work. Rumble tends to employ a young (naturally more mobile) demographic. Chen has noticed that employees in their mid-twenties and thirties—who make up about 70% of her staff— have different priorities than those in previous generations.

“I would say they’re much more focused on ‘YOLO’ [you only live once], balance and joy in life over working. They want the flexibility to work the number of hours they want, when they want.”

The average employee only sticks around for about 18 months, says Chen, and replacing people is expensive. She pegs the cost of onboarding each new employee—including training and development—at about $2,000. With a staff of 300, that can add up.

In the past, Rumble expected employees to work full-time, with career trajectories and plans, says Chen. “But these days, some want to work only 15 or 20 hours a week. Some are students, while others are holding down two or three jobs because of the rising cost of living, and some just want to expose themselves to different things.” Rumble has broken down roles and responsibilities to adapt to employees’ needs and create a culture they appreciate.

Rumble’s office employees tend to be somewhat older, but Chen says they still want maximum flexibility. She tries to offer that flexibility in addition to a competitive salary, benefits package and a sense of purpose.

Knocking down high costs with technology investments

Rumble has embraced various types of technologies to cut costs and add efficiencies. These investments have helped the business thrive and grow despite the economic and labour pressures it faces:

Customer relationship management (CRM) software and a booking platform help to streamline and automate client communications.
Chatbots powered by artificial intelligence (AI) answer entry-level inquiries efficiently.
Website analytics, like Google Analytics, inform the business’s strategy. Chen says the analytics have improved, helping the business target specific demographics.
Logistics software for warehouse management and procurement on the retail side reduce manual work and administration. Rumble also sells products directly to clients at its locations, such as boxing gloves, hand wraps, branded merchandise and more.
An internally developed key performance indicator (KPI) system helps with company performance management by yielding data to inform quick business decisions.

Chen says that website analytics have increased Rumble’s marketing efficiency by about 20%, while logistics software has led to a 25% to 30% increase in shipping accuracy and timeliness.

Just keep moving, and remember that the dark days will pass.

Looking ahead: The TKO

Despite the challenges she has faced, Chen is continuing her expansion, not just in Canada, but in several Asian markets as well. She envisions opening five to 10 more locations in Canada, if the real estate markets cooperate, and three to five locations in places like China, Singapore or Thailand.

“There is a lot of interest from the younger generations in those countries, and their standards of living are rising,” she says. “So we want to tap into those markets.”

Mindset tips for worried owners

Chen has some suggestions for other business owners concerned about economic challenges:

Cash is king for survival. No matter what, “make sure you are financially sound,” she says. This might mean, for example, patiently waiting for the right rental deal instead of leaping in and growing at too great a cost.
Mind your business and stay in your lane. Don’t get discouraged or distracted by comparing yourself with other businesses that may be failing. Stay focused on what you are trying to do.
No one has all the answers, or even the best answers. “Not even you,” she adds. “It never hurts to seek expert advice when you’re uncertain, but ultimately, you’re the owner and you need to learn to trust your gut and just keep moving.”