Forum / Let's Discuss! / opening your own studio and getting started

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Valerie_347
On: October 16, 2013 11:59 AM
Dearest Jennifer, Hello I am dreaming of opening my studio soon and I am currently looking for a space. Money is tight and Miami expensive. What do you think is the minimum size for a studio? I want to give group and private lessons, mat and equipment ( reformer to start with (and then barrel, chair and cadillac later when I have enough $$$). What are you top 5 tips for a beginner like me to open a place and be successful? What is a good ratio between your lease and your revenues? what is viable? If I hire some instructors, what is the standard ratio to pay instructor? In Japan ( where we met), it was a 50% ratio or 60% for the studio/40% for the instructor. What is custom here in the US? what are the keys things to do before you open to advertise your studio? Do you think it matters or not to be in a very visible location or that this is not the most critical aspect of the location? I would like to also teach reformer group class: what is a good number of students to ensure quality class for students? I have plenty of other questions and I apologize if I bombarded you with so many at a time. I send hugs and lots of love, Valerie
AngeloG
On: October 17, 2013 07:21 AM
Hi Valerie, I can take most of the business questions. But please keep in mind- we are not business experts and we advise you to talk to their own attorney's and financial advisers to get professional opinions on any plans you might have. We're happy to give our opinion - just remember - it's just an opinion! There are many small business resources online that you should definately take advantage of as well. • Studio Size / Location: We started Jennifer's first studio in 1999 in a 300 square foot converted garage behind our tiny house in Venice, California. I think there was a Cadillac and a Reformer and that's about it. Was it ideal? No! It was a dump. But it was what we could afford at the time. And guess what? Word spread - and soon enough - there were clients like Hillary Swank doing Pilates with Jennifer in our garage! Everyone loves walking into a big beautiful spa-like studio, and we definately missed out on those types of clients back then. But if the work is good - clients will come and you can build up some cash, and expand when it feels right. We moved to larger and larger locations three times in the following 8 years. What we didn't want to do was to bite off more than we could chew. It's stressful enough starting a new business no matter what the circumstances - but when you're in debt to the hilt on top of that - it's much worse. We've always owned our studio spaces so I don't think I can give you good advice on lease to revenue ratios. But there are lots of great small biz sites out there for research on this. As far as location/visibility - sure - it matters. We know of one studio that is located next door to a Starbucks and there is no doubt that they get lots of clients just because of that. But you can imagine that rent in a space right next door to a Starbucks might be pretty expensive. So - you just have to balance to pros and cons. Starting out in a space that you know you can cover is your best bet. Worry about location and expansion once you have the clients to support it. I know - it's a bit of a chicken or the egg situation - but relying on the quality of the work instead of a great location seems like a better and safer bet if money is an issue. • Instructors Pay: Like everything - there are no hard and fast rules on this. I've heard of teachers starting out at a flat fee per session, or a percentage ranging anywhere from 25-60% to the instructor. This really depends on the local market and what other studios are paying. The magic number will be - whatever it takes to keep the very best instructors teaching at your studio. But other things play into this as well, like providing a great working atmosphere and other perks. You just have to be competitive with other studios in your market. And honestly - there's no reason you need a staff of 4 if you're just starting out. There are plenty of successful studios out there with 1 or 2 instructors. • Marketing: In our experience, the only marketing that's worth anything is word of mouth. And we've tried them all. We no longer do any marketing other than word of mouth and some occasional online advertising for our teacher training programs. Print in our market doesn't work. The exception is when we first opened. I would say that it's a good idea to put as many resources as you can into a launch campaign that includes print advertising. People have to know you're there. But also - try to get free PR with articles about the new studio. Newspapers and local weekly's are usually interested in new businesses that will serve their readers. Do a great press release and follow up with it. Offer some free classes to the writer so they can see what it's all about first hand. • Reformer Class Size: This just depends on the instructor. Some instructors can teach a class of 12 with no problem - some have trouble with 4. But again - our advice is to start small. It takes a bunch of reformer classes to pay for 1 reformer.... As far as tips- Whatever you're projecting as an estimate for income - cut it in half. Whatever you're estimating as start up costs - add another half of that. There will be expenses that pop up that you could never anticipate. Start small and start slowly. The biggest mistake we see is when folks borrow too much money to start a massive studio with tons of equipment right from the start. It's too much too soon 9 times out of 10. The amount of debt you take on really also has to do with your comfort level. For us - we despise debt of any kind. But you have to balance that with the old cliche "you have to spend money to make money." Starting at a size that feels comfortable will save you lots of stress - and then you can let your business and clientele guide you to what happens next. Hope this helps - and maybe some other studio owners will chime in here! Best, Angelo
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