For the last couple of weeks we've been discussing dojo basics... you know, the nuts and bolts of starting, growing, and running a profitable small dojo.
Just to recap the steps we discussed, here they are in the order you should tackle them. People often ask me which of my products, books, and resources correlate with each step, so I've linked to relevant resources at the end of each step below*:
- Set your dojo up for success by keeping your overhead low and your profit margins high from the start. (Small Dojo Big Profits, Martial Arts Business U)
- Get really good at attracting new students and selling memberships. (Martial Arts Marketing Success System, Martial Arts Sales Success System, Martial Arts Business U)
- Master the art of keeping the students you have. (The Profit-Boosting Principles for Martial Art Schools, Martial Art School Business Growth Strategies, various other books and short reports)
- When the time is right, hire and train competent, reliable, qualified help to replace you. (Martial Art School Staff and Leadership Team Training)
- Optimize and maximize your profits. (The Profit-Boosting Principles for Martial Art Schools)
- Plan for the future. (Martial Arts Business U)
Now, let's discuss the final topic that I'd like to wrap this series up with... common mistakes.
Welcome to the "Don't Do This" Section...
It's cliche, but if I had a dime for every time someone ignored my advice and suffered for it, I'd at least have a piggy bank full of dimes.
To help you avoid suffering needlessly, I'm going to give you a laundry list of common mistakes that school owners and would-be school owners make. Ignore this advice at your own peril.
Mistake #1 - Jumping The Gun
Probably the most common mistake I see school owners make is jumping the gun. Meaning, they take on too much, too soon, or they do things out of order.
For new school owners, this usually means getting a full-time location before they are ready. There's a tried and true road map for opening a school in Small Dojo Big Profits, and it has been proven to work by hundreds of school owners over the last two decades.
Why martial arts instructors read my book and then insist on renting space before they're ready is beyond me, but it happens a lot. And then, nine times in ten they suffer for it.
Granted, sometimes it turns out alright, but in most cases it doesn't. Which is why I advise you to read the book and stick to the plan, so you can hedge your bets against failure.
Mistake #2 - Going Big, REAL BIG
Look, there's nothing wrong with wanting a big school. If your dream is to have a 10,000 square foot facility and 1,000 members, great, more power to you.
But, Rome was not built in a day. And you can't jump steps on the way to reaching your ultimate goal. Not only does it take a lot of cash flow to keep a big school open, it also takes managerial and business skills that you likely don't have yet.
Exhibit #1: I coached an old friend of mine through the process of starting a small school. He followed my advice, opened in a small footprint location, and did great with it. He worked hard and his school grew rapidly. Then, he decided to go big.
So, he leased a 7,500 square foot location with multiple classrooms. It was way bigger than he needed, but he figured the way he was growing, he'd fill it quick. Unfortunately, he hadn't yet developed the business acumen to go to the next level in his business, and he ended up losing his school.
Exhibit #2: A friend of mine had a black belt student who ran what might have been the ideal small dojo. He operated out of just 1,000 square feet, he limited his classes to 10 students per class, he had a continual waiting list for his classes, and he only taught a few hours a night, four nights a week. The guy pocketed about $40k a year profit, working less than 20 hours a week (in today's dollars that would be about $60k a year).
My friend told him he had it made in his small school. But, this guy wanted more. So, he moved into a 4,000 square foot location in order to expand his enrollment and classes. But again, he lacked the skills and business acumen necessary to take his business to the next level. Within a few months, he closed his doors because he didn't have the cash flow to keep the larger school open.
The moral of the story is that the bigger the school, the more moving parts it has, the higher the overhead and risk, and the greater the skills, knowledge, and business acumen necessary to keep it open.
So, start small and gradually work your way up, a little at a time. Read my book, Martial Art School Business Growth Strategies so you can know how to grow your martial art school and your skill-sets gradually and with stability.
Mistake #3 - Focusing on Profits Instead of People
Granted, if you're in business you need to turn a profit to survive. However, this is a relationship business -- we offer a service to people who pay us money to help them solve their problems.
Whether it's feeling safer, learning self-defense, building their child's confidence, helping them lose weight, or providing a fun social activity, we only get paid because we help people solve their problems.
When you take the focus off people and put it solely on profits, it's going to have a negative impact on your business. A "profits-first" attitude will cause you to make all kinds of stupid decisions in your business... decisions that will affect your quality of customer service, and drive your customers away.
Exhibit #3: Years ago we hired a martial arts billing company because other school owners we knew raved about them. We attended their seminars and drank their Koolaid, and ultimately implemented a lot of stupid ideas that our customers didn't like.
Our experience with this company wasn't all bad, as we did get a lot of good marketing ideas from them. But overall, their approach was very much "profits-first" and adopting some of their ideas made us look bad to our students. Eventually, we ditched them and went back to doing things the way we'd always done them, and our customer relations improved considerably.
The moral of the story is to keep the focus on serving your clients, always.
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I'll be back tomorrow to discuss a few more common mistakes -- being bedazzled by bullshit, building a school you don't really want to own, trying to keep too much for yourself, and unnecessary grinding. Stay tuned!
