Are you diligently keeping track of your studio’s finances? If not, keeping your doors open could be harder than you think. There are yoga studios out there losing an average of $2,058 per month. This is almost double the average monthly payment for a 30-year mortgage in the U.S. (according to LendingTree). The money yoga studios are losing may not even be related to poor teaching or a lack of members, it’s likely because they don’t know their finances. But just like yoga, maintaining your business finances is a practice that you must continually work on.
Do you know your finances?
According to the 2017 Yoga Studio Benchmark Report, released by a thought leader in the industry and membership management software company, profitable studios bring in an average monthly profit of $13,493, compared to non-profitable studios who again, lose an average of $2,058 per month. This variance is too staggering to overlook.
As a studio owner, you have a busy life. Between running the studio, planning classes, managing your teachers’ schedules, building relationships with your students and growing your business, you don’t have a lot of extra time on your hands. One task that should never lose priority is properly tracking the money going in and out of your business. It’s recommended to use an effective business software to do the tracking for you. But heck, if you have expert level Excel skills and spare time, you can track and analyze this all on your own. It doesn’t matter how it gets done, just get it done.
You must find a way to manage the costs of your business, because this is what will allow you to continue sharing your love for yoga with your students. To do this, your tracking must be exact. Keep track of exactly how much you spend on everything, from retail to space to payroll and fancy furnishings. On the other side, you must accurately track how much money you’re bringing in from memberships, teachers training, workshops and events. And, don’t forget discounts. Discounts are probably the largest variance seen between expected and actual revenue.
How much do you discount?
The bottom line: your revenue always must be higher than your expenses. This is a known fact, but what is often missed is the accurate tracking to make this fact a reality for yoga studio owners. You have a talent and skill that should be shared. Don’t let a lack of visibility into the financial health of your business get in the way. Get the tools you need to make it easy to stay present. Utilize a software and know where your business stacks up against industry benchmarks.
By Zen Planner. For a full report highlighting what top performing studios around the world are doing to create financially successful businesses download the 2017 Yoga Studio Benchmark Report.