As I said yesterday, the way you schedule your classes will have a major impact on how quickly your school grows.

Moreover, it will also influence how smoothly your school grows. A good schedule will pave the way for smooth, steady growth, while a poorly designed schedule will create problems for you that seemingly have only bad solutions to remedy them.

I also mentioned yesterday that many new school owners think "more space" is the only solution to a growing school. And, while having too many students is a good problem to have, getting more space is often the worst solution to this issue.

Scalability and the School Owner

If you want your business to grow, you have to set it up in a way that makes it scalable. But what does it mean to have a "scalable" business?

According to Investopedia:

Almost no business is infinitely scalable, and even those businesses who sell digital widgets online will eventually be limited by bandwidth and other technical considerations. And in our business model, we are typically faced with three factors that limit our ability to scale.

These three factors are:

In Small Dojo Big Profits, I go into great detail on the reasons why you want to start out in a smaller location when you make the transition to leasing your own space. Mostly, those reasons relate to overhead concerns as well as the time and effort it takes to maintain a larger facility.

Granted, I have known of school owners who stumble across low cost-per-square-foot locations where they are able to rent 5,000 to 10,000 square feet for a song. 

However, these locations are usually in rural areas and small towns where the local population and economy are not able to sustain the type of retail businesses that tend to rent large storefront retail locations. Or, they are in industrial warehouse complexes that offer poor visibility and limited parking. 

For these reasons, the majority of new school owners will be operating out of 1,200 to 2,500 square foot locations in sub-prime shopping and retail centers. This means that most new school owners will be limited on the amount of space they have available to them, and will be teaching all their classes in a single classroom.

Factor #3 -Staff

Let's say you do find a 7,500 square foot location with dirt cheap rent in a decent location. And let's say you divide that space up so you have three classrooms to teach in all at once.

Your next challenge (after developing marketing and sales systems to fill the place) is going to be hiring and training staff to teach those classes. While this may not seem like a major issue, I'm here to tell you that qualified martial arts instructors don't grow on trees.

Consider that it takes roughly three years to train a new student to a high enough level of technical proficiency to be a decent classroom assistant. Then, consider that it takes at least another year for that student to be proficient enough to run a class solo, and you'll soon see that this becomes a major limiting factor on your school's growth.

Sure, you can do what some martial art school chains have done, and hire people with zero martial arts experience off the street, and run them through a coaching crash course to teach your classes. Right. I don't know about you, but personally I don't want to be known as the Ray Kroc of martial arts. Yeah, those guys are laughing all the way to the bank, but nobody, and I mean nobody really respects them as martial arts instructors.*

And even if you have a well-trained staff, consider that four part-time instructors are going to cost you between $50,000 and $100,000 a year in wages, taxes, and benefits. Even on the low end, a part-time instructor making $15 an hour who works 12 hours a week is going to cost you about $12,000 a year after all is said and done.

It may not seem like a lot in the grand scheme of things, but it adds up. And if you bring on full-time staff, which many schools are forced to do to attract quality instructors, you can double or triple those numbers. Plan on paying a full-time instructor $40,000 a year in salary, plus another $10,000 in taxes and benefits.

As you can see, not only is it tough to find and train good instructors, they're also expensive to keep on staff.

So What's The Answer?

Well, if you have a lot of starting capital and excellent management skills, you can certainly rent a huge location, hire a lot of staff, and start a "big box gym" type school. And, if you handle your business right, you'll probably end up turning a profit.

But, you're also probably going to be working the same amount of time for the same amount of money (meaning net profit) that a small school owner makes in a school that follows the Small Dojo Big Profits business model.

Also, that's a lot of risk to take in a new business, especially if you're new to being a self-employed business owner. Which is why it makes more sense to run a small, efficiently-run dojo where you're taking less risk and turning greater profit margins.

To do this, you need to understand how to schedule and structure your classes efficiently. I'll talk more about those two topics as the week progresses. Stay tuned.