A cautionary tale on operating yoga studios

It’s almost a year since I closed down the yoga studio, where I worked as studio director, senior teacher, and director of teacher training for almost six years.  Time and distance has given me a chance to reflect upon what went wrong and how to use this knowledge to help others to avoid the same mistakes that I made.

Operating a yoga studio is first and foremost a business, and it needs to be treated as such.  If you do not acknowledge basic business practices when you open a studio, you will spend a lot of time learning through trial and error.

I speak from a unique position.  I’ve worn every hat possible in the yoga industry.  I started as a student, twenty years ago.  I became a teacher, then a studio manager.  I took on the roles of teacher trainer and then studio partner.  Since the closure of my business, I have served as an informal advisor for several yoga studios, local and national.

I’ve never worked in an office. Never been desk-bound in a cubicle.  I’ve always been self-employed, self-directed, self-taught, with lots of wonderful mentors who have guided me on the way, sometimes explicitly, other times through example.

If I failed, it was because I did not apply what I had learned.  I took my eye off the ball.

I don’t have an MBA from Harvard or Stanford.  My MBA is from the School of Hard Knocks.  My case studies were conducted in real time, with real people.  I didn’t get As or Bs on business projects.  I was rewarded with more customers or punished with less customers.  I learned to negotiate business deals, oftentimes at my disadvantage, and had to live with the consequences.

I learned that people are not always honest, trustworthy, or direct, even if they say they are.  Words can mislead, deeds never lie.  One famous instance was when my landlord revised fine print in the lease when we decided to take over more space (Mistake # 9, listed below), telling us in person that nothing except the square footage had been changed.  When we reached year 5 and expected to have half of the deposit returned, he informed me that I should look at the lease again.  He had changed the wording in the fine print so his company would hold all of the $20,000 of security deposits (my savings) in escrow until the end of the 10-year lease.  (Lesson learned: read the lease with a fine tooth comb.  Then spend $300 to hire a lawyer to comb through it a second time.  Compare the results and then proceed if all is good).  That was a bitter pill to swallow, and I lost the money when the business closed in year 6 and the landlord used it to pay for the rent.

There are so many more stories.  Toilets overflowing.  Vandalism.  Early mornings checking the bank account balance.  Late nights brainstorming marketing ideas to increase membership retention.  Endless hours writing emails, newsletters, and handling customer issues and teacher issues.

And more.

But I want to get to the whole point of this post, which is to provide a postmortem of a yoga studio failing.  A cautionary tale, if you will.

These factors are in no particular order, and no single factor was the main cause.  A business is very much an organism. Once one organ starts failing, then systemic problems start to multiply and further wreak havoc on the body.  Sure, the cancer may have started in the liver or the lung, but when it metastasizes, does it really matter which organ was at fault?

It would be wise to read through these points if you have any aspirations to open a yoga studio.

  1. High cost of studio rent – commercial rent in DC (and most major cities) is expensive.  By the time we closed, we were paying close to $7,500 a month, just to keep the doors open.  That doesn’t include taxes (retail and employment), utilities, phone, internet, security, cleaning, maintenance, renovations, or any of the other costs associated with running a business.  Basic business monthly operating expenses, just to break even, was close to $30,000.  Lesson learned: Rent is too damn high!  Develop a robust business model, like in #6, with yoga diversified.
  2. High payroll – If you teach all of the classes yourself, you can reduce your payroll by a lot.  The problem is you will drop dead within a week, after teaching 20 to 30 classes.  So you have to hire other teachers.  It helps if you have a partner to share the workload, but hiring other teachers is inevitable if you want to have any semblance of a work/life balance.  Hire more teachers, and your expenses go up.  But the good thing is you develop a team of experienced teachers who bring a lot of love, commitment and expertise to building a community.  Lesson learned: pretty self-evident.
  3. Low revenue from classes – you have to run a lot of yoga classes every week in order to meet your customers’ needs and desires. Stay open seven days a week, most holidays and during all types of weather.  Forget snow days. If people are home, they will want to do yoga (good!)  Run classes morning, afternoon and evening.  An average, one-room yoga studio will have about 25 to 35 classes a week.  Add a second room and you can double your evening classes, and push the weekly schedule to 50 or 55.  Which brings me to point number 4, 5 and 6.  Lesson learned: if you open a yoga studio, you will eat, breathe, sleep yoga, 24/7, 365/year.  Be prepared.
  4. Market prices for yoga are too low – Yoga is cheap nowadays.  Plain and simple.  You’ll pay $20 for a single drop-in, compared to SoulCycle’s drop-in rate of $34 (!) and SolidCore’s drop-in for $35.  If you purchase a class pack, you get a few bucks knocked off each class. The downside of class packs is this: they are much more volatile.  Someone buys a class pack and then you hope that they purchase another class pack when they finish the pack.  Memberships, on the other hand, are more reliable source of income: if you have 200 memberships, at $89 per month, then you know you will have $17,800 every month, with maybe 5% fail rate from expired credit card or membership attrition.  Lesson learned: yoga studios need to charge higher prices for yoga classes, to stay competitive with other fitness studios and to meet rising costs.
  5. Groupon/LivingSocial/ClassPass were a blessing and a curse.  When we first opened, we ran a deal on LivingSocial, where we sold 5,000 vouchers.  The good thing was that it put us on the map, and provided seed capital to continue to run the business and to grow.  But the bad outweighed the good: the studio became known as a Groupon studio, where, because we educated the client to not want to pay full-price, it was very difficult to completely remove it from our business model.  For a time, we had too many students, trying to get into too few classes, and we were getting slammed on Yelp.  Lesson learned: Do not do daily deals.  They will condition your customers to pay less and will condition you to use it as way of generating revenue.  Believe in the value of the service you are giving to customers, and NEVER be ashamed or shy to ask for payment.
  6. Too much dead space during non-primetime hours – This wasn’t always the case.  When we first opened the studio, there was one practice space and then a set of separate rooms where a massage therapist and an acupuncturist offered their services.  It was a nice model – students could take regular yoga classes, supplement their practice with regular massage or acupuncture.  Both arms of the business had different revenue models, so, in retrospect, it seemed more robust, more resilient to volatility.  (If I had to do it all again, I would keep that set-up).  Once we closed down the massage rooms and renovated it into a second space, the big problem became under-utilization of space.  Now, there was a second studio which stood empty on most mornings and afternoons, but was full in the evenings and weekends, with classes, workshops and teacher trainings.  Lesson learned: be careful about how much space you take on.  Figure out how to make the most of it. Negotiate hard with the landlord to get the best price per square footage. If you don’t like the deal, walk away, and mean it.
  7. Opening of second location stretched the business too thin – Absolutely do not open a second location until your first location is stable and profitable.  You really have to ask yourself, when you are thinking about opening a second location, “Why do I want to do this?  What could I gain from opening a second studio?”  If you are thinking about trying to sell your yoga studio (as I tried towards the last year to save the business and to pay everyone), just a word of advice from a broker: yoga studios are incredibly slow to sell.  If you are thinking about going corporate or public (as YogaWorks tried to go public earlier this month, before withdrawing their IPO at the last minute due to investors’ concerns of its profitability), then you are in the wrong business.
  8. Too many renovations in the early years: We renovated three times in the space of 4 years. That’s three times too many.  It ended up putting a heavy financial strain on the business, even though it did improve the appearance.  Lesson learned: Renovate early, then wait for five or six years before you renovate again.  Make use of the space you are in.
  9. Closing the second location caused a huge backlash from the customers –
    People don’t like things taken away from them.  We tried to market the hell out of the second location, and students were genuinely interested in the second location.  Classes were small, but the second location suffered from a lack of attention.  It was in the basement, and the landlords were intractable about fixing signage and addressing flooring issues.  As one businessman described the situation for me, “Imagine going to the ATM every morning.  Take out $400, and then flush it down the toilet.  That’s what is happening here.”  The only choice was to close down, to end it at the right time.

WHEW!  I sweated through my shirt writing this.

You might think, given the chance to do everything over again, I wouldn’t have started this business.

Oddly enough, I don’t regret it at all. I wouldn’t give up these experiences for anything in the world.

I met so many wonderful students and teachers, some of whom have become good friends and trusted allies.  I got to collaborate with some of the most dedicated professionals I have met in my life.  I had the honor to host major yoga teachers, such as David Williams, Tao Porchon-Lynch, AG Mohan, Jules Febre, Tamar Samir, Lama Norbu, and Leslie Kaminoff.  We hosted holiday parties, a business launch, speeches given by activists and prominent thinkers, kirtans, and celebrations.  Over 50 people went through our teacher training, many of them now teaching at local yoga studios around DC. We participated in yoga festivals, international retreats, and fundraising campaigns for local and national non-profit organizations.

The lessons I learned hardened me, made me much more of a realist, tempered my naivete with nerves of steel (although I still get rattled from time to time).  They also made more compassionate, more understanding of people.

The last class (right) I taught there touched me deeper than any class I have ever taught.  Or will ever teach.  Such an outpouring of love, compassion, and appreciation.

The other day, I was re-reading some old Yelp reviews about the studio, as I was researching this post.  Yes, many people complained about one thing or another: too hot, too many student, not enough classes, too vegan (or not vegan enough).  Yes, there were some genuinely eccentric (read: crazy) people who posted some bizarre things. I laughed quite a bit.

But I was overwhelmed with the majority of reviews which were positive, which complemented the beautiful space, the teachers, the sense of community, the overriding mission of the studio, and the students’ appreciation for having an oasis from the stresses of office, school or home.  I was overwhelmed by people sharing what they really wanted from yoga: peace of mind, better health, and a chance to connect.

Yoga is often translated as “union,” which has always struck me as a bit sanitized.  I prefer nowadays that yoga means “relationship, intimacy, connection, contact.”  That’s more compelling.

Would I do it all over again?

Yes, but better, leaner, clearer.

Thank you for reading.

 

Student, teacher, owner

First, be a student for 10 years before you consider becoming a teacher.  Practice regularly.  Read the classic books.  Study a traditional form (my top recommendations are Ashtanga and Iyengar).  Stick to one or two teachers for a few years – if not longer – at a time.

Second, teach for 10 years before you consider opening a yoga studio.  Become remarkable at teaching students.  Figure out what makes your approach unique.  Why should a student practice with you?  Also, observe how studios operate.  Work for other studios.  See how they do things.  What do they do well, where do they underperform.  Study the mechanics of the business of yoga.

Third, operate a studio for 5 years before you consider starting a teacher training program.  Why?  80% of small businesses fail within the first two years.  You will spend the first two years keeping your overhead low.  Which means teaching a lot of classes.  Developing a teacher training takes a lot of time to write manuals, to design modules, to build up enough customers who want to learn how you do things.

 

Next week’s post will be about pitfalls of operating a yoga studio.  A cautionary tale.

Stay tuned.

 

Apprenticing in Yoga: the first steps

The following ideas have been gleaned from Robert Greene’s book, Mastery, which is serving as the basis for my new course on The Business of Yoga, starting this fall.  The first part of this course will be “How to Be a Student of Yoga.”  We will then cover, in subsequent courses, how to be: a yoga teacher, a studio manager, a studio director, and a brand.  The overarching goal of this series is to generate a dialogue for the student and for the community about what it means to practice yoga, in all of its forms and manifestations, and to encourage a more thoughtful, profitable, systematic approach to yoga teaching as a business.


Mastery is about the transformation of your mind and your inner attitude.  Mastery in any field of study begins with a period of apprenticeship, where you subjugate your own opinions and preferences to learn the rules and conventions of the field.  Contrary to current popular notions about skill acquisition and refinement, there is no shortcut to mastery.  It takes time and effort – the proverbial “blood, sweat, and tears.”  This view applies to the study of yoga as well.

In essence, you must learn the rules before you start to break them.  And it can take a significant amount of time to reach that stage, sometimes between 7 and 10 years (or more) of consistent, persistent, thoughtful study.  Our current cultural attitude does not support such endeavors, as we want instant gratification, instant success, and a feeling of having mastered some skill or practice in a short period of time.  “Accelerated learning,” “life hacking,” and other phrases indicating that you can master something in a quick, bloodless manner are boosts to the ego, but rarely result in any truly lasting mastery and proficiency.

Let’s take a look at the model of apprenticeship.

In the traditional model of apprenticeship, most commonly associated with the medieval period, there are 3 phases:apprentice

  1. Apprentice
  2. Journeyman
  3. Master

As an apprentice, a student would spend a minimum of 7 years with a master, imitating his work through countless repetitions and lots of hands-on work, often supervised and reviewed by the master. At the end of the 7 years, the apprentice had to pass a Master Test, at which point they were elevated to the rank of Journeyman.  As a journeyman, the student could then travel wherever he or she wanted, practicing skills and techniques in different settings.

But they were still not masters yet.  It may take many, many more years and many projects before the Journeyman could demonstrate mastery or his or her field. Success and, more commonly, failure were essential ingredients to the Journeyman’s progress to mastery.

How does this apply to the practice of yoga?

Most people are introduced to yoga through the following four practices:yoga mudra

  1. Asana (the practice of yoga postures)
  2. Meditation (the practice of calming and stilling the mind)
  3. Pranayama (the practice of experimenting with and refining breathing patterns and the underlying psychological patterns)
  4. Devotion (the practice of devoting your efforts and actions to some higher cause or being)

Regardless of which practice you take up, you will need to go through the following three phases that Robert Greene outlines as keys to an ideal apprenticeship:

  1. Deep observation (the passive mode)
  2. Skills acquisition (the practice mode)
  3. Experimentation (the active mode)

We will discuss Deep Observation in this post.  Skills acquisition and Experimentation (Stages 2 and 3, respectively) will be discussed in forthcoming posts.

In Deep Observation, you want to learn the rules and procedures that govern any system of practice.  You want to learn the fundamental styles and values in that system. This will make the acquisition of skills and the experimentation further on easier and more stable.

For instance, Ashtanga Vinyasa Yoga places a great deal of emphasis on:

  • daily practice of the Seriessurya A banner
  • adhering to the set sequence, with little to no variation
  • respecting the traditional lineage (parampara) as taught by Sri K. Pattabhi Jois
  • studying with an authorized or certified Ashtanga teacher
  • humility
  • patience

The rules and procedures will be different for practices such as meditation, devotion, and pranayama, but the underlying principle remains the same.  Also, this way of looking at practices can give you a solid, reliable way of separating passing trends from more stable methods.  It will make you a more discriminating student of yoga.

Every day spent in practice is an opportunity for you to observe these rules in action.  By practicing daily, you memorize the sequence.  By adhering to the set sequence, you build up neuromuscular patterns to make the practice, over time, more efficient and smooth, than if you just practiced sporadically or without method.  By respecting the tradition (at first, more on this in later posts), you avoid the costly mistakes of causing emotional turmoil with a teacher or a community.  By cultivating humility and patience (acquired skills, no one is born with either), you open yourself to a positive learning environment.

In closing, I want to relate something about how students used to learn Ashtanga, when the first Westerners were visiting Pattabhi Jois in Mysore.  andre van lysebeth 2

Back then, there were no videos, books or primers on Ashtanga Yoga.  Outside of Mysore, India, Ashtanga Yoga was unknown.  If someone was interested in the series, the student was told to sit on the side of the room and to watch a regular Mysore session.  If the student liked it and wanted to learn the series, then Pattabhi Jois would tell them to come back the next day, and they would learn Surya Namaskar  A and B.

If the student could demonstrate enthusiasm, memorization and drive, then he or she would learn the series in the traditional manner: one posture at a time, one day at a time, progressing based upon skill and stamina.  Learn and earn, in essence.

This is in direct contrast to how most people learn yoga nowadays: from a video, from Youtube increasingly, from group conducted classes.  Although such an approach has some advantages (increased popularity of yoga practices, building a larger community, and exposure to the teachings), it tends, in my mind, to stifle individual progress in postures, sequences, and methods.

In exchange, you get students focused on exploiting strengths at the cost of addressing weaknesses; on “nailing” a posture at the cost of the well-rounded development of breathing, movement, and method; of investing in the superficial aspects of practice at the cost of understanding the deep principles.

In short, the student makes uneven progress across the spectrum of postures and practices and has an incomplete picture of the bigger picture of what yoga is about.

That being said, I hope that these series inspire you to re-evaluate your practice and to start asking high-quality questions about what you are doing, how you are doing, and most importantly, why you are doing it.

 

 

 

 

 

 

 

An important perspective on the business of yoga

The subject of “the business of yoga” has been on my mind for quite some time. It’s the proverbial tiger under the table in this industry, and no one really wants to discuss it at length.

Reflecting upon more than 16 years of teaching yoga, I’ve been writing an article about the trials and tribulations of being a professional yoga teacher. I keep revising it, because it feels too much like a rant, not enough like a reasoned analysis of the problem. And I’ve also been researching other articles about the same problem, to see if anything I have been observing has already been tackled more eloquently.

 

So for the time being, my own article on the business of yoga will remain unpublished.  (Update: you can now read that article I wrote here, A Cautionary Tale for Operating Yoga Studios).

Instead, I would like to direct you to this article by Michelle Marchildon.  It is one of the more insightful ones I’ve come across. I encourage you to read it. She hits upon a lot of the troubling aspects of this industry- high rents, low teacher pay (yet teachers demanding to be paid more per session), low revenue, low return on investment in teacher education, and competing demands between neighboring studios and local festivals. And there is a lively discussion in the comments section between readers and the author.

From my corner, here are a few suggestions if you want to turn this situation around for studios and teachers:

1./ Pay full price for classes and workshops. It shows that you value the information the teacher is sharing with you and support his or her work. Think about it: would you ask any other working professional for a discount on their service? Would you ask your hair dresser for half off on your haircut? (You might get half off your hair in the process). Would you ask your lawyer for half off his service? How about a discount on your surgery? (And teachers, stop giving away your classes for free! Studios, stop giving discounts on memberships. Pick your price and then stick with it!)

2/. Ask yourself why you practice yoga. If you love it and it has changed your life, then tell your friends about your favorite studio and your favorite teachers. Word of mouth is the greatest form of advertising.

3/. Be a student first before you decide to become a teacher. Practice for five or, better yet, ten years to acquire the experience and the discipline in your own practice before you decide to sign up for a teacher training (See 3a).  Once you find a style and a teacher you like, then stick with them for a few years. Feel free to try other classes and styles, but make your priority digging a deep well.

3/a/ Newsflash!  The world does not need more yoga teachers.  We need more yoga students.  Why?  Every yoga student who becomes a teacher wants to do what?  Teach!  Which means that these newly minted yoga teachers, who happened to possibly be your most dedicated students, now become your competition or your replacement, instead of your students.  Plus, from a purely financial standpoint, the return on your investment in your yoga education ($3,000, at least), will take a long time to pay off.  Say you start subbing classes at $25 per class, flat rate.  You will need to teach 120 classes to pay that off.  If you consider that you will be paid as an independent contractor for these classes, you will need to save approximately a third of each class pay.  So that one class is now really worth $16 per class, and now you have to teach 187 classes before you break even.  That being said, let’s say you teach one class a week.  It will take you three and a half years to pay it off.  If you teach two a week, then it will take you a year and a half to make a return. You would have to teach 3 classes a week, from the start, to pay it off in less than a year.  And teaching 3 classes a week from the start is highly improbable. (End of rant)

4/. Support your local businesses. Whether the studio says it or not, every yoga studio wants to be profitable. Yoga studios are businesses. The purpose of business is to make a profit while providing a service or a product. Businesses that don’t make profits end up closing. Simple.

5/. If you are a teacher and you think that opening your own studio is the solution to your problems (or the realization of your dreams), please do me a favor. Lie down and what until this feeling passes. (You do not have to be in savasana for this to be effective). Business is one thing; teaching is another. If you decide to take the plunge, know your downside.  And running a yoga studio is not the same as teaching a class: different skills, different expectations, etc.

You can reach Michelle’s article via this link.

http://bit.ly/2q1afZo