3 Numbers Every Successful Dance Studio Owner Should Know

Hello friends. I'm Amanda Barr.

And I'm Rebecca Lou Brennan, and welcome to Dance Principles United, the podcast.

Together, we are passionate about helping studio owners with the business of running their studio.

Join us as we talk everything from marketing systems, studio culture, motherhood, life, and everything in between.

This is the Dance Principles United podcast.

Hello everyone and welcome to another episode of the Dance Principles United podcast, our second one that we're recording here in New Zealand this week, Bec, as we are on our little junket. If you didn't hear all about it, tune into last week's podcast where we gave a bit of a rundown of what we're doing and why we're here. So what else has been happening? Last week we talked about in the intro, Bec, what we were doing on this trip, but what else has been happening? What's been happening in Paul's life?

Oh gosh, we've had comps, we've had our Circus Acro concert, which is kind of a separate concert that we do at this time of year. And yeah, that's it really. It's just that crazy time of comp and stuff happening.

We know a lot of our members, we're hearing and like we're going to as dance parents as well. Comp season in full swing. But super important as well to be making sure, because comps are, we know, vitally important for those that do them, that we are still focusing on the growth and expansion of our business. Which is why we've had loads of fun this month with our SGC members talking all things numbers and finance. Or as I like to call it, fun-ance. See what I did? I replaced the I with a U and into fun-ance, right?

Look, and I know you love this topic, Nathan. Most of our members cringe at this topic. And most of you out there are probably cringing. But once they start actually learning this stuff, and Nathan's incredibly good at making this easy for us, because for me, this is a subject that I used to dig my head in the sand and not know any of my numbers or anything to do with it and didn't want to.

Yeah.

And once we start actually delving into it, they are just mind blown. And what I keep saying to everyone is, and what I wanna say to you guys out there is knowing Knowing your numbers is powerful and it makes you powerful within your business. And yes, it's scary. And sometimes we find out things that make us want to vomit. But if you don't know those things, they will chase you eventually. They will catch you. And then you're fucked anyway. You're better to know what's going wrong now in your business and be able to fix it. And that's what a lot of our members are doing now. And it has been so powerful for them, hasn't it?

Yeah. And that's what, you know, like Bringing like a little tear to my eye at some points during this month when people are like, you know what, like, I don't tell many people, but I actually enjoy numbers now. And, you know, like I said, I understand, guys, we're not going to ever bounce out of bed thinking, woohoo, spreadsheets today. Like, I can live with that, guys. I am a realist. But that when it comes time for their hour a week set aside to dig in and look at some numbers, they're actually looking forward to that little slice of their week now.

Well, It just, if you don't know where you're at, you can't have goals of where you want to get to.

Yeah.

That's the biggest thing. And like, there's so many members that I join onto a call with for the first time. And they say either they're not paying themselves at all or they're not paying themselves well. You know, like some people, most of us in studio owner land that I speak to are not even paying themselves minimum wage. And you're doing it as a passion, which I truly appreciate. And I'm very passionate about dance and the effects we have on kids. I totally get that. But you do deserve to get paid for what you're doing. And, you know, not knowing your numbers is a perfect way for you to not know how you can get yourself to where you deserve to get to.

Yeah. And you were that studio owner at some point, right?

Totally was. Yep, absolutely. Um, I had, look, I didn't know, well, I paid myself next to nothing. I didn't know what revenue was. I would not even be able to tell you what revenue was. Let alone how much I was making in revenue. Um, I wouldn't have been able to tell you my class placements. I probably knew my student numbers-ish. Um, and that's about it.

Yep.

But I did really well in competition.

But it was a path that if you continued on, PAWS probably wouldn't be here today. Is that fair to say?

It definitely wouldn't be.

Yeah.

It couldn't be. Yeah. I would be in so much financial debt and trouble.

Yeah, you would have had to close the doors years ago.

Yes, absolutely.

And that's where, you know, we focus on with studio owners and what we wanted to dive into on this week's podcast. And look, I think it's something we've mentioned before, but I think it's something that we can't hear enough because at some stages we're just not quite ready to take the leap yet. And it's something that, just like I said, I'm super passionate about. But today we want to talk about the 3 numbers that successful studio owners know inside out. And the good news about it is they're not super complicated, right? But it is the entry point to knowing these 3 numbers and building a habit around that then helps you cascade that down and get better and better at it. Just like with any skill, with any skill that we teach our students. We don't start them at Advanced 2 Ballet. They start at Pre-Prime, right? We don't ever jump straight to the top. We get people in at a level that is accessible to them now. We build habits and we grow on that over time. So those 3 key numbers that successful studio owners know, and they can— now that we've got like people that we work with in SGC that maybe even 6 months ago had no idea about these 3 numbers, they can now quote them to us. Every time we jump on a call. The 3 numbers are obviously the number of students they have. Most importantly though, more important than student numbers is the class placements.

Yes.

Okay, so, and always like to break that down. I know lots of you have heard it multiple times from us, but if Bec is doing jazz, hip-hop, and tap, she's 1 student doing 3 class placements. Okay, so that class placements number is The most important one out of those 2. They're both key. And then the 3rd of those entry-level numbers that we need to build a habit around tracking is our weekly revenue. Like Bec said, it comes with no judgment, but really, really regularly we jump on with studio owners and they say, oh, weekly revenue, like, can you explain to me what revenue is? And that's okay. Like Bec said, like she didn't know.

No, I didn't. I had no idea what revenue was. So for those of you who don't know what it is, again, no judgment from us at all. Revenue is how much money is coming into your business each week, or for some of you it's each term.

Yes.

Which makes it very tricky. And we want to talk a little bit more about that. Revenue is how much money is coming in and then profit is how much money you have after you've spent all of the money. So You know, taking out your teacher wages, your rent, your electricity, your whatever other— there's a bazillion expenses. There's a mirror that I just had to get fixed last week, Nathan, because a kid bashed into it. So, you know, that's all of your expenses and you take that out and that's where your profit is left.

Absolutely. And that's like, you know, that's the sort of the next level, like we talk about expanding. So those 3 key numbers, we do have a little For those of you that maybe don't know how to track it or anything like that, then please reach out to us, drop it in the DM. We've just got a little tool together for you on how to track those 3 numbers regularly and a nice, simple, easy place to keep them and a little bit of a coaching video around that. So please reach out to us and we can point you in the direction to get that because it's super important, right? And like we said, once we track those key numbers, And even if you are still billing by the term, which please set up to change next year, but when you start tracking your revenue weekly, it is actually a big push for you to do that because you see how hard it is that you get the big chunk of money in week 1, week 2, week 3, and then it's sort of like white-knuckling and gripping on for the rest of the term as dribs and drabs come in. And then you have to make the awkward phone calls and all those kinds of things. But it's really key to every week be tracking those 3 key numbers. Because look, once we can track them for a couple of months, then as well, what we then— some people look to do, like we said, we come in entry level, but once we've tracked them for a couple of months, then we can expand a little bit. And instead of just tracking our students and class placements, what a lot of our members do now is track preschool student numbers and preschool class placements.

Mm-hmm.

And then school-age classes and school-age class placements, because we know just once we get a bit more definition into those things as well, it can be super, super powerful for us as well, right? Yes.

And I like the preschool one for my team because then we can go, okay, what, what, where do we want to get to with preschool? You know, how many preschoolers do we want? We know growing the bottom of your school is where it's at because they're your kids coming through. And so it just allows them to differentiate those 2 things. I wanted to talk about the weekly stuff a bit more though.

Please.

I think there's so many people that we jump on with as well who, one, are not direct debiting, and two, are not direct debiting weekly. And that is the biggest change, game changer in your business that you can possibly do. Now, last week, if you listened to our podcast, we talked about things that people do just because it's the way it's always been done. And so they're worried that, you know, we've always invoiced termly and that's just the way it's always been done and that's what our parents like. But it's not what your parents like. It's what you're telling yourself in your head that your parents actually like. Parents much prefer weekly direct debit. I know that for a fact now, 'cause I've changed over to it. It's a much lesser amount coming out of their account. They don't have to stress about paying it hugely. They can, it just direct debits out like everything else in their world. Gym's direct debit, swim school direct debit, everything in life.

Netflix.

Schools, Netflix. Disney Plus, it all direct debits. We're so used to that. You are giving them the easiest solution. Also telling them that it's $80 coming out of their account over $800 is massive. And I always think about myself with this at the gym, Nath. I'm getting— I'm paying for a gym that's $65 a week. I feel like if I got told, you know, that for the next 10 weeks it's $650, to be fair, I would probably opt out of that gym because—

Yeah.

I probably don't use it enough to look at that value.

Or if it was $260, $280 a month.

Right. Totally. Whereas $65, I'm like, meh. Yeah, whatever.

It's when we bill termly, it like subconsciously gives parents a decision around opting out 3 times a year.

Yep.

At the start of term 2, start of term 3, start of term 4.

Yep.

So we know that every studio now, we hope, just presumes that enrolment rolls over term to term. But if you are billing by the term, we know that subconsciously the parents are like, oh, $500, she didn't enjoy that last week of classes. Nah, let's try netball. Whereas if it's $50 a week, oh, she had that issue the last week of term, but that's all right, like, she'll get back into it. It's only $50.

Now I can already hear studio owners with the objections because we don't like confrontation. And so I know that some of your objections are gonna be, but lots of my parents, in inverted commas, if you can, if you're watching YouTube, I'm doing that. Lots of my parents want to pay the term upfront. Okay. And 2, lots of my parents don't wanna give their bank details or credit card details. So I can tell you, I did this quite a few years ago as well, Nath. that when I did it, I had that panic-stricken in my head as well. And I made a really strong decision 'cause I knew it was what was best for my business and my team, that no one was gonna pay upfront. That was not going to happen at all. And also that everyone had to pay through direct debit, okay? And that was a big change 'cause we'd allowed all the things.

Yep.

So I remember I had one parent who did one class a week who point blank refused to give her credit card details in and do direct debit. And I said to her, which made me feel very powerful at the time, okay, I'm not the right school for you then. I'm very sorry, but that is the way it's gonna be. Yes, she did leave. I'm not gonna lie to you, she did. That was one parent, okay? And then I probably had 3 of my elite parents say they really wanted to keep paying upfront. And I said, nope, sorry, this is how we're doing it now. None of them left, and that was it. So you are probably going to get a handful of parents because people don't like change who are going to arc up. But it has been, I promise you, one the biggest game changer I have ever, ever done in my business. It just makes everything so much more automated and simple. It gave me back so much time because I, you know, that was taking so much time to have to chase all of that and I know people say, oh, but what happens if their direct debit doesn't go through? Then it's going to take you so much time. Well, no, we have systems where the system just simply does that line again and direct debits them again. And there's so much systems out there for you guys that you don't even realize.

And look guys, I think the reality is if you've got an objection, we've heard it. And we've coached studio owners around it. And we have never ever had a studio owner say, Oh gosh, that was a mistake switching to weekly direct.

Not once.

So like I said, we hear all your objections, but please know that they've been met and you will never ever look back. And look, just, I guess the paying upfront thing, just to maybe add a different perspective to that. We still did allow parents to pay upfront because people were like, oh my gosh, but I pay upfront every blah, blah, blah. Our payment terms and conditions were just super clear. Everybody still had to have a payment method on file in the system. Bec, if you'd like to pay upfront, fantastic. I know you've always been a great payer. As long as it's paid upfront before the first Thursday of term when the first week's debit comes out, you'll never get debited. Right? And that just puts the onus back on them. If Bec goes in and pays her $1,000 before week 1, the system never debits her because she's already paid. Fine. Not a problem.

Right.

But she has to also have her credit card on file because humans are fallible. And so when Bec forgets in term 3, the $100 gets debited out of her account.

Oh yeah, that's good. So what do they just put that $1,000 on their account as credit kind of thing? Oh, that's smart. Okay.

Yeah.

I never thought of that.

Like that happens as well, but we're just really clear. Not a problem. You can do that. And it just takes that objection away. But they just know that they're also going to get debited if they forget to do it.

But at the end of the day, the system is still taking it out weekly for you guys. So you know what your weekly is. That is just such a game changer for me as well, Nath. And I know I'm a big wheel, But for us, we've known now how much we've wanted to get to, which we just hit weekly dollar-wise. And it allows my team, and I do share this with my team, to go, okay, we're at— well, this time last year, if you know, Nath, we were at $35K per week.

Yep.

And then we got to $40K. And then just last week we hit $45K. And my team is really excited for that. They love seeing those numbers. And it's the same if you're working in retail. I worked in retail for years before I had a dance studio as a manager. And you have weekly amounts that you're meant to hit, right? So you're meant to hit, I don't know, whatever it is, $15K for that week. And as a team, when you get to Friday and you're at $12K and you know you've got to get to that $15K, it makes you work harder.

Yeah.

So it's just— and your team, if you've got team that are looking at that, or if it's you, if you're the team, When you're looking at that and you're like, okay, I really want to get to $10K a week and I'm currently at $8K, what do I need to do? How many class placements do I need to get that extra $2K in? Which is going to make a massive difference to your business. It really does make you smarter and makes you go, okay, I know I need to do this to get to there. That's my goal. That's why knowing these numbers is so, so important. That's why weekly is where it's at because it makes you go, okay, I can— It's more attainable. Does that make sense? When it's less amounts, it's more attainable. I think.

It's more attainable. And I think it sort of flows into what else we wanted to talk about, was that it helps us respond and react to trends and things that happen in our business at a much, much easier, like, much easier timeframe. So if we, for example, we know that with You know, one of our members that we were both speaking to separately the other day, right? Once you are tracking those numbers weekly and you've got just black and white data in front of you, right? It helps give you context to make better, less emotional decisions around the key parts of your business, right? So for example, like you were talking about, you were talking to this member about costumes, right? What were they saying about that?

She was just saying that now that she's done your brilliant spreadsheets, Nate, that she has realized that she wasn't making any money off costumes because she wasn't opting in the GST to things. If you guys aren't doing this, if you get a costume for $90, $9 of that is GST, which has to go into the GST account. Therefore, it's actually costing you $99. Therefore, If you're then charging $95, am I right in saying this, you're losing money off it.

Yeah, so yeah, look, just swings and roundabouts, but yes. If you're taking in, if you're charging $110 for a costume, you only get to keep $100 of that.

Correct.

$10 is shipped off to the government.

Correct.

Right, that's in GST. So you've got to, like, you know, just knowing all these numbers and having them black and white helped this studio owner make a better decision around what she was going to be charging. For her end-of-year costumes, right? And the same goes for, like I said, like Bec and I were speaking independently with them, but because like this person's been tracking those 3 key numbers for quite a while now, they've built a great habit around it. So because they've done that, we were able to dive into the next part of this, right? So we were able to dive into like what we call with our RFI dashboard where we literally break down every single class and look at its revenue and its profitability. And because we kind of know these things, but quite often we're guessing a little bit about it. We're like, I'm pretty sure Advanced 2 Ballet loses me money. And we're like, well, duh, the 2 kids in there, of course you're losing money.

Yes.

You don't have to be a numbers wizard to figure that out. But what we do See, is the, like, the revelation that she had is that we lined up all the classes from least fill to most fill— and full, sorry— and it was just super clear. It was like a big great line. It was like all the classes, literally, like, it actually worked out so well, but all the classes that were half full or less were actually in the red. They were losing money. And all the classes that were a little bit more than half full and above were making money.

And that was shocking for her.

Yeah.

Really shocking, wasn't it?

It's a revelation that so many studio owners that I work with come across. And, but like I said, now that she knows this, now that she could see it in black and white in front of her, it's not like a big like, oh my gosh, we need to like change everything right now. No, that's okay. But now we've just got information that we can make good decisions on around our prices for next year.

Well, prices for next year, timetable for next year, what age groups for next year, what staff she should be using for next year. Like there's so many great things that, that has now helped her with what to do for next year. And I think that's the key. Like we all have these issues within our business. If you're not aware of them, you can't even make new decisions for next year. But if you are aware, Then you can change things up.

Yep, absolutely. So that was just the, the main thing that we wanted to go through with everybody today is building good number habits to help you get clear on the things that you need to do in your, in your business. Because once we have those numbers in front of us, once we have those, we know what the 3 key numbers are that we want to track, we're able to build a really solid habit around it. And then once you've got that habit, then we'd love you to reach back out, drop us a DM, and we can chat through ways to start expanding that out and become a bit of a numbers wizard, right?

Yes, but you've got something for everyone. You said earlier that if they DM us, you'll send it to them for free.

Exactly. So if you haven't started this process yet, if you feel like you're not tracking those 3 key numbers in an effective way, then please reach out to us, drop us a message, and we will send you the link to grab You're amazing, Nath. Oh, thanks.

Really helping all the studio owners in the world.

I just love numbers.

You know that. Yeah. All right. Well, thanks guys. We hope you have an amazing week and let us know how you go with those numbers. Bye-bye.

Thanks everyone.

Bye. We hope you enjoyed this episode of the Dance Principles United podcast. If you'd love to learn more from us, we have a special offer just for our podcast listeners. Go to the link in the show notes right now to get 2 weeks free in Dance Principles United Tribe. We would love to see you there.