Quick question...

What's the most efficient way to improve your dojo's financial performance?

Any guesses?

Well, I'll save you the suspense... it's to track your numbers (more on this in a minute).

That brings me to the topic of today's email, which is the 7th Immutable Law of Running a Dojo:

Back in 2003 when I wrote and published Small Dojo Big Profits, I started talking about the 80/20 principle (Pareto's Principle) and how to apply it to running a martial art school.

Three years later in 2007, Tim Ferriss released The Four-Hour Work Week (a pipe dream if there ever was one*), and suddenly the 80/20 principle was on everyone's radar.

So what is it?

For anyone who has been living under a rock for the past 15 years, the 80/20 principle simply states that 80 percent of your outputs will come from just 20 percent of your inputs.

Meaning, 80 percent of your results will come from just 20 percent of the work you do.

Your job as a school owner is to figure out which 20% of your efforts yield 80% of your results. Then, your job is to focus on doing those things first.

That's how you run an efficient school... one in which you can work fewer hours and take home more profit at the end of the month.

I figured out the 80/20 stuff a long time ago, and that's what I based my entire martial art school business system on--the 20% of tasks and activities that yield 80% of the profits for school owners.

That's why I teach a lot of what my detractors call "basic stuff." Well, duh... the basics are the 80/20 essentials for running a small, highly efficient and profitable school!

And that "basic stuff" allowed me to work 25 hours a week and have a six figure martial art school.

Are there school owners out there who earned more on a monthly or yearly basis? 

Of course. But there are few who could match my profit margins, and fewer still who could match my "profit per hour worked" ratio.

Granted, you could work 60-80 hours a week and have a million-dollar studio. There's nothing wrong with that.

But first, you'd better figure out the barebones basics, the 80/20 stuff that allows you to make that first six-figures of profit... because that's the financial foundation that all 7-figure schools are built upon.

So, if you're still struggling along with 30, 40, 50 or less than 100 students, you need to STOP trying to copy the 7-figure school owners.

Why?

Because what they're doing doesn't apply to your situation. Right now, you need to be copying the stuff that will get you to your first six-figures. Then, and only then, can you move on to the 7-figure stuff (if that's your goal).

And it all starts with discovering and implementing the most efficient ways to do everything in your school, from getting leads to enrolling students to keeping them coming back to class week after week.

Now, here's the golden nugget of martial arts business information from this week's email message...

Remember how I said that the most efficient way to improve your school's performance is simply to track your numbers?

It's true, and here's why:

"What gets measured, gets improved." - Peter Drucker

The simple fact is that when you are aware of your performance as represented by a numerical metric, you will subconsciously try to beat your past performance and numbers on a daily basis.

Try it and see....

Start tracking your stats today ("stats" = the metrics that matter in a martial art school, including but not limited to leads, appointments, enrollments, attrition, gross profit, net profit, and profit per student).

Then, in 90 days, compare your current numbers to the numbers from the same period the year prior. What you'll find is that your current numbers are better than those from past years when you were not tracking your stats daily, weekly, and monthly.

Then, maintain the habit! This is the first step to running an 80/20 dojo.