As a studio owner, you strive to provide the best you can for your students and clients. Yoga is a sacred experience for you, and you want to share its essence with as many people as possible.
At the same time, you need to earn enough to pay the bills and hopefully make a reasonable living, because if you do not, you will not be able to stay in business. And if you can not keep your business open, then how many people will you serve?
A critical part of the business of yoga is about doing what we do in a way that people are glad to pay for what they receive – no tricks or deception. Just honestly providing something that give people real value.
This month, we'll focus on making passive income from your studio. How would you like to increase your studio's revenue by $ 2,000 or more each month while helping people at the same time?
Passive income is money that you earn by essentially not directly working for it yourself, but instead using some other resource you have, like your studio space, that people will pay for. The people you serve will be grateful for your assistance, and you will earn extra income – it's totally a win-win arrangement.
If this sounds good to you, read on …
Improving Your Studio's Business Through Serving Your Community
Running a studio is hard work. Lots of it. For most studio owners and directors, it's very much a labor of love – or at the very least, that's why they started doing what they do. For some studio owners, cash flow can be an ongoing problem, (although for others, it's just nice to have an additional stream of revenue). Can you relate to this?
Whether you rent the space for your studio, or pay a mortgage, the space is yours 24 hours a day. Even if you only use it for 6 of them, you still pay for the remaining 18 hours. An excellent way for studios to earn reliable passive income is to rent out as much of the space as possible when you're not using it.
Consider a studio that has two spaces that can rent out, a smaller one for $ 10 per hour and a larger one for $ 15 per hour ($ 25 / hr. Total). If they find people to rent these spaces for just 3 hours each day, 6 days a week (72 hours / month) that's an extra $ 1800 per month of income for virtually no extra work.
What's more, this is usually dependent income that does not change month to month (if you pick the right kind of renters). Now consider that it's often possible to rent for far more than just 3 hours per day, and many studios have spaces that will rent for more than $ 25 / hr. It's quite reasonable for a studio to earn an extra $ 3,000 to $ 5,000 per month in passive income this way. So, how do you do it?
The key is to pick the right renters (see "Do's and Don'ts" list below). Some studio owners have horror stories about how they rented their space out to someone who never paid their rent, or who had a rock band practice there and the neighbors called the police about noise … get you good renters. There are usually two types of space a studio has available. One is the yoga class area, and the other may be smaller rooms used for private sessions. Different tenants naturally will be interested in different types of space. Here are some common types of renters.
Possibilities for larger spaces: T'ai Chi classes, some martial arts (they provide their own mats – charge extra if you store stuff for them), meditation groups, community groups (Addiction management groups like AA, weight-loss groups, women's groups , men's groups, some community clubs like investment clubs or Toastmasters), educational lecture series, musical groups (as long as they will not disturb anyone), adult education classes, religious groups (that do not have their own space), etc .
Possibilities for smaller spaces: Massage therapists, Rolfers, acupuncturists, facial and skin therapists, Ayurvedic practitioners, chiropractors, yoga privates (even from teachers who teach at a gym or YMCA), students (of all types), etc.
Coach Al's list of Do's and Don'ts for renters:
- Do Aim for renters who will come in, use the space, leave it as they found it (if not better) and pay rent on time.
- Do have them pay in advance each month. Or if it's a one-time event, they must pre-pay (and possibly leave a cleaning deposit).
- Do reserve the right to terminate the agreement for good cause at any time (including not paying rent, damaging your space, disturbing others, etc.)
- Do seek out renters who may feed clients to you. That is, the people who they serve are likely to also be interested in yoga. At the very least, give some free class coupons to the renter as a gift for their students, clients or group members.
- Do put all terms on a simple document that you both sign and date.
- Do be cautious when renting to friends. I'm not saying do not do it, but consider if this is someone you know always pays their bills on time. You do not want to get stuck having to choose between friendship and getting paid your rent.
- Do not get involved in their business – your rent should not depend on how many people show up for them. Charge a flat, hourly rate. They are responsible for paying it even if they do not show up.
- Do not start with long-term agreements until you've first rented on a monthly basis for a few months to see what the renter is like.
- Do not feel like you "have to" take a questionable renter because you do not have other options. Just let them go. Something else will come along and you'll be glad you waited.
Sometimes having some basic "equipment" like a couple of dozen folding chairs or a blackboard on wheels available can allow you to rent you space out for many extra hours per month. Even if you have a couple of renters now, think about how you could fill unused studio time with even more.
Usually renters will not seek you out. It's a matter of identifying them (through brainstorming ideas, the yellow pages, internet, community services directory, or whatever means you can think of) and writing down a list with contact numbers. Then go down the list and call them, simply asking if they might be interested in using your space for a small fee.
Think in terms of how the space will serve them and their needs (which may be very different from what your are). If you're not totally comfortable with this type of thing, it can really help to write up a script before making the calls.
By the way, if you're thinking that you'll sound like a telemarketer, do not worry, you will not. You are in a position to really help these people out. Imagine you needed a place to work and someone called you and offered to rent a perfect space to you. Would you be glad they called?
So put some time in this week and get some passive income flowing. Whether you're already doing well financially or really need to generate some more money, this is a great way that you can serve your studio and help others at the same time.