Subject: How You + Your Dojo + Consumers = Setting Your Rates...

Friend,

Let's step back a minute and ask ourselves a question:

"Self, why go through all this rigmarole to set our tuition rates? Why not just set our prices in the same range that everyone else charges and be done with it?"

To which, yourself should reply:

"For the same reason you don't go to work at a job satisfied that you're being paid only and just what everyone else is paid. Just like any normal person with a healthy self-image, you'd much rather be paid what you're WORTH, instead of getting paid what the typical schmuck gets paid. Because you're worth a lot more than the going rate... aren't you?"

Well, aren't you? If not, then this is all moot. Go back to your regularly scheduled programming.

But, if you do value your own worth and believe that you deserve to be paid BETTER than the average schmuck, read on.

Going Deeper To Set Our Rates

So, now that you have a ballpark idea of the bare MINIMUM you have to charge to earn what you want to earn and keep your doors open, what other factors go into determining your tuition rates?

Most people will say "competition" at this point. 

Some will say "the economy."

And others will say "local demographics."

To a certain extent, these are all viable answers. But really, there's only one factor that determines how high or low you set your tuition rates in your dojo.

And that is, how much your customers are willing to pay!

"But Mike," you say, "how in the heck do I figure that out? It's not like I can read their minds!"

True. But you can do some research and get a working knowledge of what people are currently paying for similar services locally. And that's where your competition, the economy, and local demographics come into play.

Start with your competition, and do a price analysis on all your competitors within a ten-mile radius of your school. Call each one and find out what their rates are, and write them down (and if you feel awkward about this, simply have someone else do it for you).

Then, take a look at your local economy and demographics. What's the median income in your area? What's the cost of living? How much disposable income do families typically have?

Also, look at how people are living. What kind of cars do they drive? What kind of houses do they buy? What are their spending habits? All these bits of info will inform your decision on what your tuition rates MIGHT initially be.

Unfortunately, this is usually where most school owners stop. They gather all this information, consult their astrologer and have the local voodoo priest throw the bones, and then they set their rates accordingly.

And they leave out the most important step of all in price determination.

Which will be the subject of tomorrow's email. Stay tuned.

Until next time,

Mike Massie
MartialArtsBusinessDaily.com

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P.S. - Setting your tuition rates without the final, crucial bit of information is nothing more than guesswork. Tomorrow, I'm going to reveal how to get that last bit of info - which is really the only way to know if you've set your tuition at the ideal price point.
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