Beat the January Cash Flow Blues

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 Principals United podcast. Hey, friends, and welcome back to another episode of the Dance Principles United PODC podcast. Today we're talking about January Cash Flow Blues because we've all experienced. But before that, I'm joined by Nathan. Hello.

Hello. How's it going?

Good, good. I want a little bit of a life update for you. I think we're going to start Life updates at the beginning of our podcast. So what's your life update?

Look, Life update. We had to leave our new puppy, Comet, for the first time heading up last week. I'm not going to say fur baby. I'm not sure I'm that kind of person just yet. We went up to. I know lots of people follow you and Beck personally on socials as well as the DPU stuff, but we were up at Showcase National Dance Championships at the sunny Gold coast for like. Beck was there obviously as a studio owner and a dance parent, but for the first time ever, we were just there as dance parents for the first time in 20 something years, which was a little bit odd. Right. But lovely to be able just to focus on our three girls who are in troops for dance Sensations and had the time of their life.

They absolutely did. It was kind of nice to be able to give them a bit more of an experience of just, you know, normally when we go to Nationals, yes, they dance, but like, I don't let them do anything afterwards. You know, they're not allowed to go out with their. Their troops and they're not allowed to go to the pool party and they're not allowed to do that because I can't manage it. But we did all those things. We were good dance mums and dads.

We didn't make the theme parks this time, but we were there. We were there this time.

We had to get back to Comet.

Ye.

Get back to the dog. And it was awesome. Beck's daughter, BB1 dancer of the year, which was incredible. And such a moment. Oh, my gosh. I got to share that video of Beck crying.

Yes.

On our stories. I will do that because it's so amazing.

Yep. And Babies was in the top two against a Dance Sensation student as well, which was lovely as well.

One of my ex students and one of the Dance sensation students was the other One in the top two and had another one in the younger age group as well. It was all happening.

Y.

It was a great. It was a great week. It was fantastic.

All right, we've heard enough of my life updates. How about what's your life update?

Me, My life update, obviously, dealing being a puppy mum for the first time. I've never had a dog. I'm a bit unsure. I never actually knew I liked dogs. I'm still not a. I'm trying. I'm trying. So we've got this beautiful new puppy we got for Christmas for the girls. So we're back at puppy preschool. It was great to be back at work, you know, when you've just kind of had enough of holidays and you're ready to go back to work. So yesterday was awesome. We had calls for tribe, we had calls for Studio Growth Club. I jumped on and was a guest speaker on Little Groovers Training Day as well. It was all happening. We're getting ready for event in Melbourne for Dance Principals United. We're counting down to Dance Teacher Expo. Oh, my gosh. So many exciting things happening in our world.

Absolutely. Absolutely. And that's. That's the way we like it. Right.

Like, I like to be busy.

Exactly. Like I said, we had our break. It was over Christmas news. We did jump back in and do work, obviously, before heading up, but five days off, Hubbard Showcase was enough for us. And we're ready to go.

Absolutely. All right. Should we get into this?

Absolutely.

Because we know that so many studio owners, and we have been there many, many times, have Cash Flow Blues in January where you're, you know, the concert money comes in, or perhaps you're like, holding out for the concert payout and the theater hasn't paid out early enough or something like that. Or you're starting to get to these kind of last two weeks in January, last couple of weeks of term, and you're like, is there enough money in the account? Are we going to make rent? Am I going to be able to pay my staff for that training next week? It's starting to look a little tight.

Yeah, yeah, absolutely. And that's what, you know, one of the amazing studio owners we work with, or I think put it well, we always refer back to it after we'd worked with her for a little bit and she came through the first January after we started working, she's like, I just love. Like, for the first time ever in January, I don't feel like I'm. I'm sketchy. Morgan. Sorry. Sorry for dropping your name. In it there, Morgan. But you know, and that's the whole thing. Right. Like, like Manda said, like we've all been there as business owners. The way that our businesses work in like the termly cycles that by the end of January that things can get. Yeah. A little bit sketchy if we're not managing things in the right way.

Absolutely. So we wanted to give you a couple of quick fire tips today to make sure that this doesn't happen to you again. You know, if you're feeling like now, this year, obviously, you know, for most people that might be one or two weeks till you go back. You know, hopefully not three. Probably some of you might still have three to go depending on when you're listening to this. But you know, obviously we need to start planning now and being proactive so this doesn't happen again next year. That's what it's all about. So let's give some quick fire tips to really make sure this doesn't happen again. Right?

Yeah, for sure. Like we, like Amanda said, like this isn't something that, you know, this episode's dropping on the 22nd of January. If we're being like realistically, this isn't fixing this January.

Absolutely.

And it's a, it's a, it's a long term play. But we don't want this to happen to you again in 12 months time. We want you to be sitting here 12 months time January 2026, thinking, awesome, I'm set. I'm ready to start the new year on a high because I've got my cash flow sorted and yeah, I'm ready to go.

Absolutely. All right, tip number one, Nath, take us away.

So tip number one, and this is something to start now, it's to know your class numbers. Yeah. To look at enrollments that you've got in your classes now and don't overstaff. Yeah, we know that. You know, sometimes like I sat down, the example I wanted to talk about was towards the end of last year I sat down with a Studio Growth Club member and they, we went through their classes and there was a whole host of classes that they had two or three teachers on.

Preschool ones, I presume.

Yeah, some preschool there was even macro things like that. And maybe they'd put those teachers on like they'd staff that at the start of the year with a certain number of enrollment. I'm not, I'm not sure what had happened. But when we went through it, there were some classes that we went. Like there was eight students in one class with two teachers and 10 students in a class with three teachers on it. And those sorts of things really add up without us realizing. And I know some people say, oh.

Like it's one class or just one.

Class or it's a junior teacher. And look like there is slight exceptions to the rule. I guess sometimes, like if you've got a staff member that you're investing in training up, I can sort of understand that. But for this staff member, there wasn't a lot of that going on. They were just overstated.

More just that they put them on with the hope that that class would build and it never kind of did or numbers dropped or whatever it was.

Right, exactly. And they hadn't put their business owner hat on. They put their lovely human being kept their lovely human being hat on. And like, oh, no, like, I just want to keep, keep these person's hours up and things like that. But when we went through those, I think it was about 10 classes or so we trimmed off, but we saved them. $250 per week.

Yep.

Just of just on staff costs, just by pulling those, like I said, from three back to two in some instances, from two back to one, even from three back to one for one of the classes, $250 per week.

And sometimes you think, ah, you know, $250 a week. Oh, yeah, obviously that'd be nice in my pocket. But it's not end of the world money. Right. But it adds up.

Oh, 100%. So like, that's $10,000 over a year. Right? Ten thousand dollars over a year. Pretty much would have covered the studio owner's rent over the December, January period when, when, when it gets. Cash gets tight.

Yeah. So when you put it like that, because, you know, even I sit there and go, yeah, $250 a week. Oh, yeah. Like it's not, you know, but it.

Adds up and it adds up quickly.

Yeah, absolutely. And then, you know, if you're doing that and spending that extra money each week, like that's where you lose it in January and you don't have enough to pay rent or yourself or whatever that is. Right.

Yeah. And it's not just in, in teaching stuff that this can happen as well. Sometimes we let our admin staff bloat out more than it. More than it should. You know, basically guys like every three to four extra hours of administration that you're paying for is $100 a week. And again, that just adds up so quickly. That's $1,000 a term, $4,000 a year.

Yes.

If it's just for the. Those 40 weeks that you potentially open during term times. Yeah. Like, it just adds up so quickly. If you double that, you know, you're getting to $8,000. Like, these numbers just skyrocket so quickly.

Yes.

And it's money that makes big differences when that cash flow situations get tight.

Yeah. I love that about admin hours, because I think so. It's so easy to. We've got a bird. I don't know if anyone else can hear this bird in the background, but it's going nuts. So our apologies if you can hear the bird in the background. But what I was going to say is I feel like, you know, especially with admin stuff, you're like, oh, you know, you just give them. Oh, it took them a little bit longer to do that. Or I just gave them. I wanted them to just, you know, do a little bit of extra tidying or, you know, you saw them just, you know, sitting and playing on their phone for a little bit during their shift. That one rings true to a lot of us. Right?

Yeah.

But, like, could you have cut their, you know, if they didn't play on their phone for 10 minutes every, you know, whatever it is, hour or whatever, could you cut their weekly hours by two or three hours if you were a little bit stricter and harder on that, and that end up saving you 4,000, $5,000 a year? Like, that's a significant amount just from you being a little bit harder on, you know, managing their time better and then being effective, their time helping them.

Be efficient and effective. And I think it's, you know, I know so often within dance, like, you know, we always had staff on. I want to help build their skills.

Absolutely.

For, you know, obviously their employment with us. I want them to get. I want them to add as much value to our business as possible. Always. But always thinking about, you know, they're probably not going to work for me forever.

Yeah.

And, you know, I want to send them off into their. Into the next part of their career with incredible skills as well. So, like, if you're not helping them be efficient and effective and have good time management, then you're not really helping set them up for success later on in life.

Yeah, it's a good point. All right, so tip one is, know your numbers. Don't overstaff. Save that money throughout the year and really look at it, you know, consistently. Things change throughout the year. Don't just put the teachers on and then leave it. Keep looking at it and going, do I really need that teacher in that class? Do I really need that admin stuff for that two hours on a Friday. Like, keep refreshing it all through the year.

Yeah, Put your business owner's hat on instead of your nice person's hat.

Absolutely. All right. Sometimes we just got to do it. Tip number two, Nath, what is it?

Okay, so this is one that I'm super passionate about, that I always talk about with our tribe members, our SJC members. Look, basically, anyone that will listen, if.

I'm honest, you just start shouting it down straight at random people as they walk past. Yeah, okay.

Or business. Any business owner that I talk to really is to be proactive and look, plan for your taxes, number one. But it's a bigger part of a book that I read years and years ago that I think made the biggest impact to our business and our revenue, our profitability, and our cash flow. And it, like, you know, comes back to the saying, you know, revenues, vanity, profit, sanity. But cash flows, reality.

Yes.

Right. And, you know, the book Profit first by. By Mike Mallowitz really helped us get all of that into focus and, you know, helped our business be super successful. But then, you know, as the business owners, helped us translate that into our own personal wealth, which is super important to. To us as well. So, you know, the biggest thing that I see around this, that Profit first helps with, like, yeah, it could be a whole series of podcasts on itself. But the thing that I see most studio owners get stung by around cash flow issues is not planning properly for their taxes. And that's one of the core pillars of Profit First. And I'm sure so many people are going to resonate with this situation where you're like, yes, sweet. Like, I'm finally feel like I'm getting back on my feet. You open up your banking app, you're like, sweet, some cash in. Then, like, your concert money comes in, you're like, oh, thank God. Like, in your head, you're calculating December rent, January 1st week of payroll. Like, and rent's actually the start of Feb. So. Yeah, sweet. Yeah. Or yeah, you do those quick calcs back of a napkin. You're like, sweet. I'm all good. Then your accountant's like, oh, hey, here's your. Here's your bass. Here's your tax bill.

You're like, oh, yeah, and just completely forgot about it.

Yeah.

Just saw that number and went, oh, that's all mine. And got a bit excited. And it's not.

No. And like I said. So, like I said, Profit first talks about, like, splitting your money up into multiple accounts that you know the core premise of it, like, please, if you haven't already, get the book and read it. But of all the money that comes in to your account, all of your revenue that comes in revenues, money that's coming into your business that you should be aiming to really operate your expenses on. No more than 70% of that.

Yeah.

So for every, like, $10,000 that comes into your business, too often, studio or business, not just studio owners, Business owners see that $10,000 sitting in the account, they're like, sweet. I can spe thousand dollars. Like, no, not really. Guys. Like, you should only be looking to spend $7,000 because you've got so many other things that are going to be there. So you know what I did religiously every single week, and it's something that I know a lot of our studio growth club members have started doing as well, is that religiously every week on a specific day, I would, and I still do it with our dance principles United Money. Now Wealth Wednesday. For me, every single Wednesday, I will sit down and I will look at the money in a specific account. It's just one account that all my revenue comes into.

Yep.

And I just send that money to a whole bunch of different accounts.

Yeah. Awesome. And specifically tax. Right. That's the big one that we're in. So, like, absolutely. Let's talk about, like, what should they be putting aside for their tax? Generally?

Cool. At an absolute minimum, it has to be 10%.

Yeah.

Like, absolute minimum. And again, Australia's got one of the most complicated tax systems in the world, so we can't dive into the full tax law here today, but we know registered for GST, you've got to pay minimum 10% on your BAS.

Yeah.

When you get your bas, it's two main sections. The GST you've got to pay and the pay as you go income tax, you've got to pay for your employees. So, yeah, for every $11,000 that you take into your business, only $10,000 of it is yours.

Yeah.

Like that, that other thousand dollars, it's just literally never ever yours.

So take it out straight away. That's the big thing, right? Like, don't even look at it. Put it in a bank account that you can't see on your banking app.

Yeah. If you spend that extra thousand dollars, it's literally like using a credit card because it's. It's just never, ever been yours. So, like, please, at the very minimum, every week or every two weeks, like, whatever you want to set. But look at all the money that's come in in that last week or two weeks and just throw at least 10% of it straight into an account for tax that you're never ever going to touch or spend unless, like it's an absolute, like urgent, urgent, urgent, emergency. But please try not to.

Yeah, okay, awesome. So to start the conversation, you kind of said about the 30% that's kind of diving deeper into the profit first.

Exactly. Yeah.

Go and read that book. It's perfect. It's an awesome book. But, you know, in the very least, be putting away, you know, 10% in the very least into an account that you can't touch. If you could make it 30% and then you've got some money sitting there. Awesome. That's not such a bad thing either. Or dive further into profit first. Is that your best advice on a quick five minute podcast?

Yeah, exactly. Just start with 10%. Start with 10%. Just get your taxes, get your GST portion out so that at worst case scenario, like I said, when you get that tax bill, you're like, oh, yes, sweet, money's there. Well, yeah, your tax bill might come in for 12,000. You look at your tax account, you're like, oh, there's 9,000 there. It's so much easier to find or hurts a lot less to pull $3,000 out of the rest of your stuff than it does the full.

Absolutely. And my big tip is hide it from your view. Yes, do it every week, but hide it from your view because, you know, just sometimes it's just the seeing it in your account and you think it's yours. Even if you've got a big, you know, tax written across it, just hide it because it's not yours. So don't ever touch it.

Right. Yeah. I'm not sure, like, I know, I'm not sure what other banks do, but I know, like WeBank with CommBank and you can, on your Internet banking view, you can literally hide account from your login.

Yeah.

And so, yeah, you literally don't see it.

Absolutely. That's our biggest tip. All right, let's go into tip number three now for this one, I wanted to have a chat about that if that's all right with you, Nath.

Yes.

And it's, you know, of course, probably at this time of the year, most of you have set your class fees for the year, all of those things. But we want to be here to remind you that January cash flow blues won't happen if you increase your prices as needed. And don't feel bad for charging things have gone up. Let's talk about costumes. That's a big one that we're talking about. Costumes have gone up significantly. You know, if you do a concert fee, all of our theater costs, our, you know, for tickets, our T shirt costs, if you're doing like a T shirt or a trophy or whatever that is. Right. All of those costs have gone up significantly in the last couple of years. So don't absorb those costs. I think sometimes we really get too emotional, right. We're like, oh, it's too much money. My parents, I picked an expensive costume. You know, the costume was $100, but I'm just going to charge the parents 90 for it. Don't do it to yourself. You are a business. Kmart is not charging you less than what they buy. The goods forever. Please, please, please don't do it to yourself. As a small business owner, you know, that's why you get January Blues, because that's happened and it makes you resentful.

Yeah, absolutely. And like, you know, to circle back to everybody's favorite topic, taxes. But like, if you've, let's say you've imported directly from China, so you won't have paid any GST on it and it's cost you $100 to get it in that whole notion, guys, if you only charge $100 for that costume to your clients, you only get to keep $90.91 of that.

Yes.

So you've actually lost nearly $10 on that costume just because you think you've charged. You've, you know, you've done a break even thing on it, but you haven't accounted for your GST properly, plus your.

Merch fees on that. You're shipping the spare costume. You know, the child that didn't show up or didn't pay the bill or whatever that is. There's all of those things plus a profit. So don't be afraid to charge what you're worth and charge what goods cost you. So please do not, please do not feel bad and not pass costs on to parents, because that's the reality. You need to pass all costs plus your profits.

Exactly.

Plus your tax, plus your merch fees, plus your spare costume.

Yeah. And if you're ever unsure about your taxes or your GST or what should be like, pick up the phone and talk to your accountant.

Yeah.

That's what they're there for. They're there to help you and explain these things for you, to make sure that you're operating as efficiently as possible. And yeah, it doesn't just go with that as well. Like it can be anything across the board from costumes to your commentary fees to anything like that. You know, if somebody else puts the prices up on you, you've got to, you've got to put that up onto your parents as well. It's just a fact of life. You don't like remove the emotion from it. Hey, guys, like I know that, that this comp fee was in years gone by, hasn't been included down comp levy. They've actually put the prices up by 30% on me.

I'm really sorry, but I can't include it anymore. Yeah, absolutely. And you've got to be okay with that. You know, if you're sitting here and you're one of those people that are thinking, shit, money's tight this week, you know, like, let's think back, you know, did you absorb $10 per costume for 200 costumes, you know, throughout the year? Quite possibly. That's $2,000.

Good maths.

Thanks. Which should be really good in your pocket this week. Right. You know, if every One of those 200 parents had paid the $10 more for the costume that they really should have, you know, that would have been an extra $2,000 in your pocket. That would have got you through this week. So really make sure you're thinking about that. And when you're making the decisions throughout this year, think about January next year and how that can relate. Absolutely. Let's move on to tip number. What are we up to? 4?

I think so. Yeah.

My numbers get confused.

Which is good when we're talking about numbers.

Absolutely, absolutely. So tip number four. Wow, this was fun.

Yep.

We did this exercise and if you haven't done this exercise, I would love for you to like grab your phone calculator and just do a back of a napkin calculation right now.

Yes.

Do you know how many, how much revenue you take each week in your studio?

So if you're doing like weekly direct debit, it should be relatively easy.

Yeah. Pretty obvious.

If you do it, do it on a 10 week term. Do you know you might have just billed your term fees? Take that, divide it by 10.

Absolutely. Now let's think about the extra weeks that we sometimes choose to close. Most of us shut. 12 weeks with school.

Yep. So operate for 40 weeks of the school year. Shut for the 12 weeks.

But there's a lot of studio owners and you might be one of them. And I've been one of them as well. That opens the week after school starts back. So that's an extra week. That's the 13th week that you closed or what about finishes the week, you know, that concert is, which is the week before school finishes. So that's taken it up to 14 weeks. Right. So like let's talk about, you know, what do you do in your weekly revenue. Was it $10,000? If you were sitting there going $10,000 and I closed for 14 weeks, it's $140,000, guys.

Yeah. And obviously you can't, like we're not saying you should open all 14 of those. That's not what's going to happen. But let's just think about those two weeks that Manda talked about.

Yeah.

By starting one week later and finishing one week earlier at $10,000 a week, you've just given up $20,000 in revenue.

Yeah, yeah.

Obviously like you've got expenses, you've got expenses for that but like most of them are fixed anyway that you're going to pay. You're still paying your rent. Like. Yes. You've got to take your teachers wages out of that $20,000. But still, but still that's going to be a huge chunk of change that's missing from your pocket, from your bank account to be able to cover those bills through January.

Yeah. And look. Yes, I get it. Sometimes it's nice to finish the week of concert. You're exhausted, you know, you're like, I just want a holiday. But how much do you want a holiday like that? $10,000. Do you think you could stumble through another, you know, five days of work.

Yep.

To take that extra money, 10,000, whatever your weekly revenue is.

12 weeks off is a long time, guys.

It's a long time.

Yeah. The state, like if you work a full time job in. Yeah. Private sector, you get four weeks off a year. Full stop.

Yeah, absolutely. So we would love to encourage you to think about how many additional weeks you're closing a year and what can you do about it? One of the best things that a lot of our members have started doing, which I am obsessed with, is they've just started preschool back a little bit early, which I think is a great thing. Right. Because daycare start back. A lot of preschools start back. You know, quite a lot of people have been starting preschool like mid January, even though they're not starting school age kids till later. But just that, you know, just the preschool, especially if you've got a big preschool program, a couple of weeks of extra revenue on the preschool, that helps beat those January blues. Right?

Absolutely. And again, staff costs are going to be minimal because you're only getting them in for a couple of hours a week and your rent's still there. Yeah. Everything else is still there that you're paying. And it's just like been an absolute game changer for so many of our members. So. Super, super recommend looking at that for 2026. January.

Absolutely. All right, last point, Nathan. Do you want to take us away?

Yeah. And look, I think it's something that a lot of, again, our SGC members have had success with is, you know, maybe in January 2026, like start looking at it now, just like put it in your diary and think, I'll get to this later. But, you know, some January holiday workshops. Yeah, and when we say holiday workshops, we don't mean the workshops where you're getting in the big choreographers and trying to sell tickets and things like that. We're just talking about at the end of January, guys. Like, we've just sent our kids off with my mum today because we need to get some shit done. They're booked in with Manda's parents another day. They've got. My dad's going another day. Because parents need to be getting back to work and have stuff to do at the moment.

It's mid. It's end of January. We need to go to work at some point.

We need to pay for our house as well. Like. Yeah, it's that sort of thing. Like parents are looking for these things. So you don't need to get the high end dance workshops necessarily, but if that's your jam, do that as well. But parents are looking for stuff for their kids to do. So lots of our members have had success running maybe like three days of workshops. And you know, these workshops look like they come in, they do a little bit of dancing, they do craft activities, they watch a movie over lunch, they do another little bit of dancing, some more craft, and then parents pick them up and you know, they can chart. You can charge what? Yeah, 60, $70 at least per day, more if you're in city areas for those things. If you can get 20 to 30 students in there for three days, that is a really, really good chunk of revenue. You can put a couple of your younger staff members on it while you're there in the studio getting stuff ready for the year anyway, like it's. It can be an absolute game changer.

Absolutely. We hope that you have enjoyed these quick tips to beat the January blues. Hey friends, if you're listening and you are in Melbourne, we would love to see you at our event in Melbourne. Drop us a dm and we'll send you all the information about it. We're going to have an awesome time. I'm pumped for it. We haven't been to Melbourne before.

Yeah, I know. Not for an in person event.

No. Yes, Melbourne, but not for a work thing. Yeah, yeah.

So yeah, it's in what, 9th of Feb, Sunday, the 9th of Feb. So reach out. We'd love to hear. Drop us a DM about that or anything to do with what we've talked about today. We'd love hearing from our listeners. 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 two weeks free in Dance Principles United Tribe. We would love to see you there.