Like many businesses around the world, fitness studios have been hit hard by Covid-19. Lockdowns and enforced closures have slashed revenue for owners. But despite the challenges, some studios have adapted quickly and begun to thrive in the new normal. Here’s how one company did it (and you can too)…
In this article – Katy Richardson from NEIGHBORHOOD barre explains how fitness studios can survive Covid-19 and flourish on the other side.
Resilience, adaptability, determination – three things we’re told are necessary to make it through COVID-19 as a fitness studio owner.
Current feels – defeated, overwhelmed, tired.
If you are struggling to keep your fitness studio open amidst the challenges of COVID-19 you are not alone. In fact, there are upwards of 30,000 of us who are all experiencing this crisis.
So, what do you do? How do you make it through? Better yet – do you even want to make it through?
If you answer that with a yes and you do want to fight to make it through this, then there are three important things you must do to survive.
- Lower your overheads
- Streamline your class offerings
- Dig in deep with your community
One thing you should not do is lower your prices – stay with me, I’ll cover this later.
1. Lower your overhead to protect your profit margin
You don’t have to build a fancy financial pro forma in order to do this. Simply take your average revenue from the past two months and do two quick calculations to back into your new budget:
- 35% – payroll
- 30% – profit margin
- 35% – the remaining portion should be able to cover your rent, software, utilities, etc.
As a studio owner, our two biggest expenses are typically payroll and rent. Currently, unless you have a great landlord, you probably can’t do much about your rent. So, the best way to lower your overheads is by cutting the number of classes or class types you offer.
2. Streamline your class offerings
Over the past few years, our industry has been soaring. You can literally find a fitness studio on every corner in most cities.
It’s become so saturated that we are literally fighting for the same group of people – insert competing class times, letting the clients dictate how often and when we offer classes, because if we don’t, they can just go to X studio instead.
With so many studios around you closing, struggling, or simply not offering in-studio classes right now, it’s time to take your power back. Let your loyal clients tell you what works for them, and start by only offering 1-3 classes per day.
Sounds crazy, I know, but given the current status of most countries, you most likely won’t even be filling all of your spots. The difference in payroll will be astounding. I personally have dropped my payroll 50% since reopening in a COVID environment.
I am offering a staggered schedule (offering peak times M/W/F and other peak times T/TH) and supplementing other class times with a virtual offering. This is something that we coordinated throughout our franchise in order not to overwhelm each of us as owners.
By sharing the schedule we are able to provide up to 45 virtual classes to our clients and only personally staff 3. It has allowed us to retain most of our clients and substantially lower our overheads.
If you are not part of a system, experiment with recorded classes that you can distribute to your clients who are unable to come in-studio. There are several platforms that can protect your content, including Zoom and Vimeo OTT.
3. Focus on community
Three things that will strengthen your bond with your community and your clients are:
- join forces with other studio owners who may have previously been your competitors
- communicate constantly with your clients
- do not pushback if someone needs to pause or cancel their membership
Lead by example. Rise above past competitions you may have had with other area owners. An easy way to do this is to create a group outdoor community experience (one part yoga, one part barre, one part bootcamp as a fun and free circuit workout).
Another idea is to create an instructor sponsorship program where you all allow instructors to attend open spots in your classes for free! It’s a great way to get more involved with other types of fitness studios and to give instructors a point of reference with a particular studio that you have partnered with to help cross-promote.
Communicate clearly and constantly with your clients. Answer potential questions with your messaging so that you aren’t getting overwhelmed by individual reach out and follow up.
If someone doesn’t feel comfortable coming to class or can’t get on board with virtual, do not push back on pausing or canceling their membership.
Remember, your clients are probably stressed and overwhelmed too, and part of your job is to make their life easier.
Right now you’re probably tired and might even feel like you are starting over. These feelings can create anxiety and panic. You must lessen your financial stress as much as possible by lowering your overhead to mitigate the damage to your profit margin.
Trust me, I know this doesn’t seem believable, but in June I had more cash in the bank than I did pre-COVID, so it is possible. Let go of your previous mentality regarding class offerings – whether it be competitive or people-pleasing and do what is best for your business.
Do not run sale after sale or drop your prices. Just because the world is in the midst of a pandemic doesn’t mean your services are worth any less! And in all reality, if you make it to the other side of this, your services will be worth more because there will be fewer fitness studios, which will increase the demand, and drive prices UP!
Don’t think short-term. You must realize your value and let people weed themselves out if they don’t see it.
Stop trying to be something for everyone and nurture the clients who stick with you. You will see that the cheesy saying “your vibe attracts your tribe “is actually true. If you stick with it, you will start filling open spots with more of your ideal clients and end up with a stronger and more profitable business.
Katy Richardson is the Founder of boutique barre franchise, NEIGHBORHOOD barre.