The Business of Pilates

Chapter 1

Introduction

Today. I'm here with Risa a little over a year ago. I was lucky enough to interview Kara when she was attending the PMA conference in San Diego in 2014 and we did a Q and a around business issues in the polarities industry. How that particular video is being a very popular, there's a lot of comments on it and today what we're doing is we're following up and exploring the questions that were asked in the comments. In addition to that, we are exploring some new questions that are we think have become relevant for the plotters industry over the last year. Um, please check out the first video it's linked to in the description below and a watch that is broken up into small sections and then kind of watched this video. And I think that you'll find that the, uh, the content here builds on that. Um, you're welcome to watch this on your own, but it's would be great to watch it in conjunction with the original video.

Chapter 2

Who "Owns" the Client

One of the questions that we explored a year ago was who owns the client?

Is it owned by the studio or is it owned by the instructor that is teaching them? And there was quite a dialogue within the questions of the prior video about that subject. And uh, the question that was asked that I would, would welcome your comments on was if a client leaves of her own will to follow that individual. Maybe they had a very close personal relationship and the client, ah, there, there's no solicitation by the teacher when she leaves that studio. How do you feel about that? Do you feel that that is acceptable? I mean the client gets to choose what they want to do. Always.

You know, the client is, can move to a different studio. The client can come and go as they please and we should want that for our clients. We have to have a certain, um, attitude of openness. Um, so yes, I think absolutely it's reasonable if, if a staff member or teacher leaves the studio and the client has a personal relationship with that individual for them to follow them, if they haven't been solicited, um, it's completely reasonable. People are going to come and go. I think one of the things we want to remember is that we don't want to hold on to our clients with a death grip. We want to let people come, let people go. I've had clients who've left my studio and gone with a, a teacher who's left me and then they've come back a few years later. Um, what we want to be doing is make sure we're constantly creating new business, having strong relationships with um, who's already coming.

Um, the question of who owns the client, um, is, is, is an interesting problem because clients, successful studios, the teachers build relationships with the clients. That's how you get retention. So you can't expect the client just to suddenly be in love with a new teacher because it's your studio. Um, I think if you do want to be a more grounded towards the studio, then an individual teacher, you want to make sure your clients are seeing more than one instructor at your studio. If that's your goal in retention. Um, and that means that people are subbing to other staff members. That means that classes are subbed out by other staff members. That means that per private clients are also taking classes and willing to move around your studio. Um, that might be one good strategy to not have your studio get wiped out of clients. If everybody decided to move on.

Chapter 3

Apprentice Teacher Compensation

Karen, what do you feel is the appropriate compensation for an apprentice teacher? Somebody who is learning the art of plazas? Hmm, that's an interesting question. I don't use apprentice teachers necessarily at my studio. Um, but I, I certainly think they should get paid less than a teacher who's certified and has gone through and completed their training. Um, I, I guess a value would be hard for me to give because I don't know what the, you know, pricing across the board is different, but I would say my instinct would go be to go 50% less than what a regular certified instructor would get paid. What are the different ways that an instructor could be compensated in a

Chapter 4

Teacher Compensation Models

polarity studio? Okay. So the, the ways that they get compensated are going to depend on the way that they are, are hired, um, how they, how they relate to the business itself.

So I'll talk about three different models that I think are out there. Currently. There's the model of a collective where you would be, or booth rental. I often refer that to where you'd be renting your time with the studio, in which case the studio owner would be picking the amount of rent and you would either be as a teacher, you would either be choosing how much you want to charge or the studio owner may have sort of a, a fixed price. Um, and that model, I think oftentimes in many states in the u s at least is a model where the teacher can be paid quite high. Um, because I know that rents tend to be on the lower end, but in that case that teacher has no, you know, isn't getting any marketing, isn't getting necessarily referrals, uh, network to build a business. Um, so that person needs to be thinking about how much money, which is always time. Time is always money they put into building a business on their own as a renter. So, um, in terms of what really they end up making, um, the second model would be to have your people who are working at the studio as independent contractors or contract labor workers.

And in order to do that, you have to look at your state regulations and make sure that you can abide by those completely or you can end up in a lot of trouble paying back taxes. But if you can hold that model in integrity with the laws of your state, um, I think what a lot of people do in the contractor position is they pay a percentage. So as the owner, you're looking at your overhead, what it costs to run your websites, what it costs, and then your, because you're looking at a reasonable, um, revenue share that you can give for the hour to a contractor, um, who's contracting out of your space. And, um, I think, I don't know for sure, but my guess would be that somewhere around 50%, um, would be about typical, maybe a little higher or lower depending on the area of the country. Um, and I think most studios offer some sort of perk on that revenue share. If there's the teacher are selling out their group classes. So for one on ones and duos and trios, I think it's usually a, a straight revenue share in a certain way. And then, you know, as the classes get bigger and more money is taken in, then the, the, the teacher, uh, can earn more on the hour.

The third is to have an employee. Um, and I'm not sure what the going rate, I think it's so depends on what you can charge. Um, and you can see that the pricing across the board in the u s for polities and abroad, uh, very, very different. Um, I think most of those markets are driven by within their own communities. Um, and so those are hourly. Um, those, those people are compensated hourly. But you know, generally I think you should see that that would be lower than the contractor because of course then as an employee, the owner of the businesses paying, um, a lot of extras with their taxes and their insurance and their compensation and whatnot. So, um, that's sort of the best way I can describe the three models that I see out there. Um, and the way you might look at paying. And I'm, I'm happy to answer those questions more directly. If somebody has a circumstance they want to ask me about if I'm offered the

Chapter 5

Contractor Versus Employee Pay

opportunity as a newly qualified polarities instructor that I'm optimistic that I'm gonna get two job offers. One of them is going to be with one studio that wants to pay me as a contractor and one of them is going to be at a different studio that wants to pay me as an employee. Both of them are paying me hourly for the work I do. Um, but one's employee and one's contractor. Um, what are the, you know, how do I compare those numbers because the employee one is a little bit lower than the contractor one, but am I going to actually have more money at the end of the day? It's a good question, John. Um, so you can look at it this way. When, when you're employed by somebody, your employer is paying about a 20% increase to take care of your taxes and your insurance. And so you should expect as as a, if you're an employee to make about 20% less than you would as a contractor.

So an example would be, let's say $30 an hour is sort of the rate in your state. Um, as a contractor you would, if you're making 30 as an employee, you would expect to make about 20% more as a contractor, like 36. So the idea that you would slide from a contracting position into an employee position making the same rate is really an unrealistic expectation that can cause a lot of trouble too. Plotty studios and staying, um, you know, staying viable at this point. And I do think that we see that as, as there's the dance between contractors and employees coming into the scene with, with owning plotty studios. So it's an important thing for people to remember that there's, there's quite a burden when you're paying somebody, you know, taxes and insurance. As a studio owner,

Chapter 6

Franchise Studios

uh, here in southern California, we're seeing the rollout of a lot of franchise, um, based Palati studios and uh, the people that are really pushing that right now here at the beginning of 2016, a club parties and pollster has a similar franchise model. If you're thinking of opening a studio, do you have any thoughts on whether or not you should go with a franchise opportunity or whether you're better off, um, creating your own brand and developing your own studio?

I think the most important thing with that question, John, is that those are two totally different experiences I'm having. Building up your own business from ground up, um, within a community and buying a franchise couldn't really be more different. So I think as the person who's wanting to grow up into owning a studio, you need to really ask yourself what kind of experience you want to have and what kind of experience you want to offer. And the only way you're going to know that is by really, you know, take yourself on a field trip and go in to a couple of franchised, um, organizations and see if that's the product you want to be delivering. See if that's the brand you really want to represent.

Cause that's what going into a franchise means. And if you have another vision, if you go to, you know, somebody's studio down the street and, and, and that's what you want to be delivering to your, to your community, then my advice is going to be take the risk and build a mom and pop shop. Um, there are different experiences and they deliver a completely different product and they, um, you know, I mean, franchises can't build a real custom relationship with the community in the same way that a homemade studio can. Um, it's, it's different, you know, so you have to figure out what it is, what your values are. And, um, if you're gonna spend your life running a business, they should meet your values every day, not be against them.

Chapter 7

Class Pass and Other Promotions

Yeah. Over the years we've had Groupon, we've had living social. Um, today we have ClassPass. There's been various sort of packages, marketing things that had been sold into [inaudible] studios. Um, what, what do you think about them? Do you, where do they fit into your marketing tools when it comes to growing your business? That's a great question. Um, I, I'm going to say in general, um, I have used some of those products.

Um, I don't see a lot of attention coming out of those products, but there are moments in my business where, uh, let's say class class sizes are a little, um, flimsy in a particular department. Let's say the Mat classes are a little flimsy. Um, I, I'll do a Groupon or some campaign like that for a short period of time just to get more bodies in that studio and keep the liveliness of the studio. Not, not necessarily with the idea that I'm actually gonna retain much because most of those people are going to go onto the next group on the next, you know, they're, they're, that's, that's what that group does. But there are times where I've done it just to kind of refuel the energy, even for my instructors, that they start to feel like people are, you know, because business ebbs and flows. Um, so I've sometimes used it for that. Uh, we've tracked retention on Groupon and other products like Groupon. Um, and it's, it's not an overwhelming, uh, um, response. Um, it's also kind of a little bit tricky to manage, so you have to decide, you want to do that, you know, manage the people coming in and out and they have their coupon and they have their number and um, you know, so there's a little bit of administrative hassle with those products as well. Um, you know, in general, I feel like discounting is something a business owner should use very sparingly.

Um, it's not how we need to get customers. We need to get customers by offering a really awesome product that changes people's lives and they don't need a discount for that.

Chapter 8

Impact of Discounts

Do you think that if you, on the Times that you have run Groupon, living social class past these types of things, has it had any impact on your existing customer base? Yeah, I think, I think if you run it for a long time, I think you can receive resentment from your regular customer base who aren't getting that discount. Um, most of the time you don't want to make a Groupon or a ClassPass available to your existing customers. Right. That's, that's a no brainer. So, you know, my first loyalty is the people who are paying their good money to come on a regular basis. I don't want to alien and alienate them by like flooding their classes with, with people who are coming on, on a discount train and get to leave again. So again, you know, what makes my company tick and run and sustain itself is the loyal customers who have been paying all along. And that's who I really want to pay attention to.

Chapter 9

Designing the Studio

If I've been running a plotty studio out of my home and I have, you know, two or three pieces of equipment and it's kind of grown to the point where I really need to move it out and I need to get my first studio. What was your advice on the process of thinking about what that studio should be like? [inaudible] I mean I just want to Holler out cause I have a lot of uh, clients in the situation right now, teacher clients. Um, and I learned a lot from watching them in this process. I think first and foremost, um, you know, like we talked about the first conversation, John, you have to keep your overhead really low. You don't need any fancy anything to get started.

You need your clients and you need a building. You need probably a restroom and the equipment that you have and make the best use of it. Um, I think one of the difficult things as launching into having is to teach in classes. Um, because usually in a home studio you're not doing that yet. And making that shift can be very confusing at first. What are classes you want to look at, what's around in your area, how people are charging them, how many people they have in them. Again, you want to stay in market as best you can and then you need to really try to train your clientele to be interested in trying classes. Um, they're not gonna want to, they're gonna want to do what they've been doing.

Um, so could you, now you have to change the culture of your business. Um, creating things, community events where you invite people in for classes, you do some free trials, um, and getting new, getting other teachers in that space right away. Um, I think waiting until you're so saturated is, is, is really hard because your are not going to want to go take with the new guy. So get new blood in there right away. Get, you know, get people taking classes, get your clientele to try different things. So they'll be telling their friends. Word of mouth again is, is key in these startups like this. Um, so that's really where I would focus is getting some new staff in there who want to build business. And, um, and getting classes going.

Um, and maybe if you want equipment clauses, you might have to purchase a little bit of equipment, but all you need is a floor and some mats to do mat classes.

Chapter 10

Teaching Instructors to Sell

You've just hired a new employee and this, this employee is, you know, a great parties teacher. She's really talented. However, you notice that every time that she gets a referral and a new client, she never manages to close the sale and have that person sign up for the next class. Um, your suspicion is that she's not really very good at the sales part of the job. Um, do you have any advice if you're coaching somebody like that about how to help that person develop the skills to, you know, retain that client, that potential client? I do. I mean, I, you know, some, some bloody studios, some of you have front desk people, um, and often it's capped to the front desk person to kind of help the client sign up for their next session. I say it's much stronger coming from the teacher herself or himself.

Um, and I would, I would say before that session ends, you're already in conversation with, hey, during our next session I really want to work on x, Y, and z with you. I see us going here. What are your longterm goals in your polities? I think twice a week actually would meet those longterm pros. I mean, don't sell something, it's not true, be honest, but you have to help people see themselves in the future coming back, getting more fit, getting out of pain. Um, and you have to guide them. And I think sending them to the front desk to reschedule is you're losing, I mean that one and a half minutes it takes to get to the desk. Something's already happened to that person's mind that's taken them out of the potty studio. I think, um, you know, I encourage everybody who I talked to about this, you know, to set a goal system for their client.

Get them to visualize their next session with you, start making plans and then book them. Hey, I have an opening on Wednesday, I think twice a week. This week would be great for you. Let me, let me offer you that opening. You know, you have to be aggressive. Um, people don't know that what they want until you give it to them. And our retention level is stunning at aligned and everybody on the floor is working at that level with their clients. Um, even if passing them on to other teachers, um, which in in, in I hope most studios are willing to do as well. You apply these teachers that are early in their careers or trying to build up

Chapter 11

Building a Teaching Schedule

that client base to have a high quality life.

But when you first graduate you have this challenge of, oh my goodness, I have this opportunity. I got my first client. And then, um, you might be working in more than one location and you get your second client and you can end up with this schedule that involves driving from one part of town to another. And you can also end up with a schedule where you have this big kind of gap in part of the day where you have no nobody there. So, you know, it can be that you're working a really long day, but only some of it is being compensated for. Do you have advice on how to build that schedule when you first begin to work as a polarities teacher? I mean, it's a good question and it's, it's rough. You know, it starting starting your own business basically is what you're doing as a contractor. Employees working in multiple studios, uh, it's gonna take time. Um, I think one strategy might be to not divide yourself between studios in the same day. You know, if you're working multiple studios, give Monday to one studio, give Tuesday, you're probably going to have to say no every once in awhile, even if it doesn't feel right to just keep a sort of sanity around it.

Um, but, and then I think it's about sort of zero really zeroing in on your goals eventually. So if you find yourself starting to create traction at one studio more than the other, start to really focus up on how you're marketing in that area, how you're accessing more people in your community there, how you're accessing your current clients to refer to you. Um, I think all ultimately getting yourself into a schedule where you're at the same place or between a couple places but not on the same day is, um, is, is smart. But, you know, being eager and saying yes to everything, you know, that's something we all do when we're starting. And I don't know, books on tape during the commute. That could be fun. I mean, it's not easy to start. Um, but if you stick with it and you take yourself seriously and you, you, you remain a student of the work and good at what you do, it, it will level out. Um, and I think a great profession is waiting for all of those teachers that you're referring to. Um, but it does take time and, and uh, I think patience is probably part of that too. Okay. Yeah.

Chapter 12

Creating a Professional Culture

Sometimes I walk into a [inaudible] studio and my kind of sense is that the people, the teachers in that room, in that studio really aren't fe engaged with what they're doing.

And other times I'll walk into a studio and it's like, wow, these people love it. They're into it, they really care. And you can kind of sense that it's just a very, very different vibe that's going on. You know? Do you have any advice on how do you create that culture of really being professional about what you're doing? Really going that extra, extra little piece, that extra mile? Yeah. How do you get, you know, how do you create that culture as opposed to the kind of casual nodded not at not even acknowledging that the customer has walked in the door? That's a great question. And it's a question I care a lot about because I care a lot about, um, the professionalism of [inaudible] teachers. Um, so I'm going to give you a few, a few thoughts here. Number one, you're the owner of the studio. It's your brand and you're at the helm.

And what you need to do is model that professionalism all the time. You need to inspire it. So an example of how one might inspire that kind of professionalism, that interest and that hunger, that ongoing desire to be better at your job is to host events for your staff, where you're, you're reading something together, you're studying an article by lunch for them and invite them to sit down and examine something you learned at a conference. You went to inservice each other. Invite people to teach workshops at your studio and let your staff take them at a discounted rate and discuss what you learned.

Have them become part of what you do, whether you're a presenter at the PMA or something like this. Um, so you want, you have to model that and you have to, you have to, um, I don't say you have to be a mentor, but you have to through example and creating moments to be shared educational moments. You have to create those. And I think there are also ways within the programming of your studio to inspire that. So, you know, for instance, at aligned, one of the things I do is I ask them, what do you, what are you interested in? And somebody will say to me, why I really want to work with elderly? And I'm like, okay, let's look at that. What would it be if we had an elderly bodies class?

I'm going to create a class just for you on elderly [inaudible]. Next thing you know, they're on the Internet looking at Belvoir. Lee, they're going to visit some elderly people. They want to know about what silver sneakers is doing. They're contacting silver sneakers. I gave them an in and now they have a platform.

You know, I give them something to teach a specialty. Um, and they, and so you have to create, you know, you have to build some structure for them to bloom. Um, so you could have specialty programming you could do, um, in services we have something out of line that's called brainy body talks that one of my staff created. And it's, it's, it's a donation base. So if you want to come to it, you just pay anything you want. And you read an article together and you come and you just discuss it and people come from all over. It's amazing. She made the whole thing up.

She posted on the Internet and it's her, you know, I go every once in a while, but it's her baby. Um, and she, and, and it's what she's interested. So you gotta be cultivating that. Um, and also I think you want to be challenging your staff. You know, when a staff member comes up to me and says, I don't know if I want to work with, with so-and-so, you know, I know she had a herniation and a hip replacement. I go, oh, yes, you can. Let's, let's take an hour next week and let's talk about how you might work with that. I want you to watch John Cloud's west a workshop and plugs anytime on the public clock and see how you might help somebody with a herniation. I mean, come on, there's resources. Um, so I should not just be sitting in my office like faxing and drinking coffee.

Chapter 13

Selecting Great Staff

One of the keys to running a successful business. In fact, any business, not just supply.

The studio is finding the right people to be on your team. Do you have any advice about how you can, during that interview period, you know, discover whether that person really wants to be a true polarities professional? You know, that they want to continue with their education, they want to deepen their learning or whether or not they're really kind of more of just, you know, an exercise person. They might be happier doing, you know, maybe group classes in the gym to music. Yeah, no, it's a great question. Um, I think the first thing you need to do when you're interviewing somebody is describe to them what the job is, what the job entails, who, who, what do they represent by being, applaud these professional in your studio. To me, they represent an individual who, um, help guide, uh, help teach and coach any body that walks into that studio, um, or doesn't walk into that studio, maybe comes in in a wheelchair that the plot is professional, isn't somebody who's going to do a can to act every day in my studio. Flood is professional as somebody who's going to take each individual as they come with whatever abilities they do and do not have, and they are going to coach them, guide them, and teach them more about their bodies, more about their potential and help them lead more successful physical lives and therefore spiritual and emotional lives.

So I think you as the owner needs to describe what the heck goes on in your business and what your expectations are. And if that person doesn't feel prepared and they feel frightened, then it's your job to raise them, um, to the level of professionalism that you, that you demand at your studio. Um, I think a lot of times when you see that people are running away from being, um, real piles professionals, it's because they're there, they don't know enough yet. And then the question is how do you support that person to become, um, confident enough at their job? Um, but the first thing you have to do is really lay out what, what is a studio and what are your expectations? Because I want everybody on my floor to be able to handle anybody who walks in there with grace, respect, dignity and knowledge. Period. The end,

Chapter 14

How to Stay Up to Date

the world is always evolving.

Businesses are changing and sometimes you go into a business, not just, I'm not talking just about our policies when I'm talking about things in general and you just walk in and you think, oh my God, this is trapped in the 80s. Yeah. What happened to those people? And you know that those people are great working people. They were doing things, they just haven't spotted that the world has moved on and the world has changed. So do you have any advice for [inaudible] studio owner in terms of how do they keep themselves relevant given that the world is evolving around them? Hmm, yeah. How do you stay kind of relevant and on top of what's going on, understanding what's happening and adjusting so that you can continue to have a viable, viable studio? Um, yeah, I mean I think there are a couple things there. I think number one, your space itself, you know, I think it's very easy when you've been in a business for a long time to sort of forget that you haven't changed your carpet or you know, that you could use a freshen up.

So I think you want to really keep an eye on your space, make sure that it's, you know, um, bright and shiny and current. Um, and you know, making choices about, you know, maybe the way your bathrooms operate. Maybe you want to be green and you want to do towels. You know, look at the way that businesses sort of invite, um, attitudes of mind into their spaces. So we do that. I look everywhere I go, I look at how people have, you know, oh, they have little ponytail holders on their thing. Or they have the, they have this new green product they're using or they're doing their own laundry or, oh, the, like when I was in Europe, everybody had the, the Nespresso machines and I thought, oh, that's a nice touch. People could make an espresso, uh, after there, you know. So I think you want to be looking around for the way your environment can stay updated and comfortable and current. Um, in terms of content, the programming that you're offering. Um, I think, you know, we always need to be updating the way we're, we're teaching and whether we, we offer a lot of theme classes like ski season, we do stuff for skiers or we may do some rehab stuff, or you're looking at the demographic of your studio and you want to continue your neighborhood. Um, you know, did a new apartment building come up? And who are those people and how could you invite them in?

What do they look for? So, um, you know, you need to walk around your neighborhood. You need to think about who's around, what they want, listen to your clients, you know, um, they're, they're almost always saying what they want in the dressing room. I mean, you can take time to hear, uh, what they're asking for. Um, you, you work for them, you run a business, you work for the public, um, and you should be changing based on what their needs are as much as you can. I think. And, and that can be tricky, um, when you're used to doing things a certain way. So I, I empathize with the struggle around that.

Chapter 15

Becoming a Top Pilates Teacher

Do you have any advice for people who want to go from, you know, maybe they're just beginning their career and, uh, you know, the renting space in a studio and they want to get to the top of their profession. They want to be one of the most popular presenters at the PMA conference. They want to be on the, on the tour circuit. You know, how, how do you get there when you're just beginning? Yeah. What's, what's your advice for making it to the top of the industry?

Well, first of all, I love that teacher. Um, and I want that for as many teachers out there as possible, um, that their ambition is to really go to the top of the field. Um, because what a great way to spend your time getting better at what you do. Right. Um, so you gotta be ambitious. Um, you have to be interested and, um, you have to continue to learn. Um, and you sometimes have to fake confidence, um, meaning you gotta get your, your self out there. You know, you got to teach that first workshop, um, and it's going to be a disaster and that's okay. You know, you have to be willing to suck a little bit and get better over and over again. Um, and you know, if you, you could practice with a group of friends, a little workshop, you could video yourself, um, you, you have to practice becoming these things. Um, it doesn't just happen. You don't just get an opportunity. I mean, you, you, you need to have the vision for it. You need to take the steps, you need to do the work. Um, and, and sometimes you have to fake it till you make it a little. I mean, I look back at some of the first workshops I ever taught and I'm like, ah, you know, but that's okay. You know, that's okay. I'm still out here teaching and I'm changing and I'm growing and, and we want to encourage people to become experts through that path.

Um, I think finding a mentor is super important and I know that word is kind of overused these days, but it means somebody that you actually want to learn from and who will give you the time and the space. Um, maybe you have multiple mentors. Um, it means, uh, risk taking and really committing. And with all of that it will happen. Um, it will happen. And I think more of us in my position in the field today need to be thinking about how we're going to replace ourselves to keep this industry really current and important, as important as it is. So I think we should be thinking about how do we raise this next generation who are better than us? Because I think being a mentor, being a teacher, what you want to be doing is raising people who will surpass you, who you'll look back to when they'd say, Shit, I wish I had been that good.

You know, and we should all be working a little harder, I think, to, to create that culture in this industry because we want this, this work to stick her out. It's been a pleasure to talk with you today, Tara and I welcome.

Chapter 16

Wrap Up

We both welcome, uh, comments. So comments below please. And if there are other questions that you'd like Carol and I to explore on camera, write them down and hopefully Kara will be kind enough to come and visit us again in the near future. Thank you. Thank you.