We’re excited for hosting guest author, Christa Gurka, MSPT, PMA®-CPT, of Bikram yoga within the Grove in Coconut Grove, FL with this publish!
You probably know this, the majority of us opened up our studios because i was enthusiastic about fitness, not figures. So basically we might want to share our passion for the technique, embracing an appreciation of spreadsheets may be more difficult. As being a great instructor and as being a great businessperson requires two entirely different skills.
Within my ten years in the industry, I have seen many studio proprietors are unsuccessful in understanding that an exercise studio continues to be a company. Actually, I’d bet many small studio proprietors do not have much experience developing P&L (profits and losses) statements or balance sheets, and that’s why I wish to stress the significance of understanding your main point here. I’ve learned through the years (now getting opened up my third location) that it is important to have objective data to determine failure or success and that will help you set your monthly, quarterly and yearly goals. Only after you have individuals metrics in position is it possible to correctly allocate your financial allowance for achieving individuals goals.
The right place to begin would be to create your year-finish goal. Never be afraid to consider big. Where would you realistically wish to be in the finish of 2016 in revenue? Are you currently searching at $100,000, $350,000…more than $500,000? Have something to achieve for. I love to aim for a 20-30% rise in revenue from the year before. It provides me something big to aim for yet still be attainable.
Here is a sample graph that shows a terrific way to break lower your figures and provide you with an overview of the items your company appears like:
|10 Class Package||$15,000||$18,000||$10,000||$15,000||$58,000|
|Single Private Session||$5,000||$6,000||$5,000||$8,000||$24,000|
|10 Private Sessions||$4,000||$6,000||$5,000||$10,000||$25,000|
|Other (Merchandise, rentals, workshops)||$1,000||$750||$750||$1,000||$3,500|
Based on the above sample, the total revenue for 2015 was $165,250. We can also see that the first quarter was the highest revenue generator. Based on these numbers, we can then decide that a good target for 2016 revenue is $215,000. Looking at your numbers in an organized format like in the above chart will help you set realistic and achievable goals. Past numbers can show you which quarter generated the most revenue; which product or service generated the most revenue; and if a specific marketing campaign spurred an increase or decrease in revenue during that period.
Now that you have a realistic revenue goal to strive for, you have to know how to reach that goal. Translate what your sales numbers are telling you into meaningful action items to help you achieve those goals.
You can do this by figuring out what is called the Bridge to Gap number; that is, your goal number minus your dollar amount for business as usual. If you know that each month you can bring in $20,000 without doing any additional work or marketing, that would be considered “business as usual.” Say your goal is $350,000, minus a business as usual amount of $240,000, your Bridge to Gap would be $110,000 – the amount you need to bring in to achieve your 2016 revenue goal.
Now we ask ourselves, “How am I going to bring in an additional $110,000 this year?” Simple. Break it down into quarterly goals. If you want to bring in an additional $27,000 per quarter ($9,000 per month) you’ve now given yourself a manageable goal to work towards. If you know your 10-session card is your biggest revenue generator and costs $300, you would need to sell an additional thirty 10-class cards that month – that means bringing in 30 new clients or inspiring current clients to come in more and purchase more packages. To do that, you’ll now need to develop a specific marketing strategy or campaign. Again, look to the numbers. See what campaigns have been most successful for you and when to plan accordingly.
In the end, your data is the core of growing your business. And though it may not be your first love, it’s truly the key to turning your passion into success.