6 Ways To Improve The Financial Health Of Your Yoga Studio

Every day, multiple times a day, I talk with people who own yoga studios. And because the catalyst for these conversations is a piece of software that we make, I've learned a lot about the different ways in which studios run their businesses, what common challenges people face, and what kinds of things people have done that led to positive change for their businesses.

Below are a few things I've learned through these conversations that I thought would be worth sharing, and that might help your yoga business.

1. Believe that you deserve to be financially healthy.

If you don't learn this lesson, nothing that follows will be of much benefit. Yoga studio owners regularly share with me how they feel bad when their business makes money. Because of this, they shy away from doing things that they know might benefit their studio for fear of appearing greedy or too "businessy."

The problem, of course, is that in order for your studio to spread your love of yoga, to help people, and to create meaningful change in your community, your doors have to stay open.

You shouldn't feel bad about maintaining a financially healthy yoga studio. You and your community deserve it.

2. Give people fewer options.

Sometimes I'll speak with studios that have pricing plans that look something like this:

* Single Class: $14

* 3 Pack: $40

* 5 Pack: $65

* 10 Pack: $120

* 20 Pack: $200

* Unlimited month: $100

* 60 Days Unlimited: $190

* Unlimited month - auto renew: $90/mo

Look at how hard this buying decision is! Your students just wanted to buy a yoga class, and now, not only do they have to do a bunch of math, they're probably going to feel bad about what they buy because they're definitely not going to be sure they actually bought the best deal for themselves.

Consider what passes are best for your studio, and pare down your options to just a few. Compare the above to the list below:

* Single Class: $14

* 10 Pack: $130

* Unlimited month: $100 - auto renew

An easier buying decision is only one of many benefits of having only three options.

3. Understand that pricing matters.

When someone is buying something from you, they're making a number of decisions in a very quick period of time. What's the best deal? How often do I come to class? Am I going out of town any time soon? When will the monthly thing renew? When do I get paid? And on and on and on.

The way you price your services will have an effect on what people buy.

Let's look at the list above again, but with one small change:

* Single Class: $14

* 5 Pack: $65

* 10 Pack: $130

* Unlimited month: $100 - auto renew

We just broke an optimal pricing structure. Why? Let's look what's just happened here:

In our three-option structure, if I wanted any more than a single class, I had to choose between a membership and a ten pack. Of critical importance, the membership was the second least expensive item. When the buying decision is being made, paying $100 sounds a lot better than paying $130. And I just ask myself, do I come to yoga 10 times a month? If yes, the membership is clearly my best option. If not, then I should go with a ten pack. Easy.

With our new list the 5 pack is cheaper than a membership, gives a better deal than a single, doesn't require a commitment, and still saves me some money.

Suddenly it's not clear to me which is a better deal. Maybe I should just get a 5 pack.

This matters. A lot.

4. Establish recurring revenue.

Establishing a regular, predictable, recurring revenue stream can mean the difference between surviving when times are slow and running out of cash.

Keep in mind, revenue and cash flow are two different things, and recurring revenue gives you more regular and predictable cash flow.

When you know you're going to have a certain amount of money coming in each month, it can give you the confidence to invest in new ideas, remove some of the stress of making rent and payroll each month, and helps build an environment that values loyalty in a way that a daily deals site could never do.

5. Build and connect your own systems.

Occasionally I'll speak with people who are looking for a single system to do everything they need for their entire business in one neat little package.

I'm sorry to tell you, this is a flawed strategy.

Running a business requires work, effort, insight and experimentation, and no single piece of software could possibly do everything you'll need to do to run your business.

Think of all the things you need to do to run your own business and use inexpensive tools to build your own systems that work best for your business.

These are things like email marketing programs, accounting software, building a social media presence, creating a website, using a point of sale system, taking care of member management and having an online store.

No single piece of software could ever do everything you need to do to run your business. Those that try are mediocre in everything and excellent at nothing and can't come close to creating something as good as you can by connecting a variety of different tools.

6. Trust your instincts.

If you think your pricing is too low, it probably is. If you don't think a donation-based studio is going to work in your small town the way it might work in L.A., it probably won't.

If you think you should have a free class every week to spread the love of yoga, you probably should.

Everything I've written here has come out of conversations with owners of independent yoga studios. Most of the time I'm not sharing any new information with these business owners, I'm simply validating what they already know because I'm able to tell them that others have told me the same thing.

If you run a yoga studio, trust your instincts.

You know you deserve to be financially healthy — and I hope these tips might help in some small way.

Ready to learn more about how to unlock the power of food to heal your body, prevent disease & achieve optimal health? Register now for our FREE Functional Nutrition Webinar with Kelly LeVeque.

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