This is kind of a serious blog. Womp womp. So. You’ve decided to start teaching – FABULOUS!!! It’s awesome. You’ve got your equipment, your insurance, your mad skilz (naturally), and now, you just have to figure out how much to charge. But, how do you DO that? If you’re like many, it goes something like this:
“Swingin’ Sisters aerial studio charges $35 per hour for classes. Mergatroyd Metz charges $30 per class. So, to pretty much guarantee I’ve got full classes, I’ll charge $20!”
Hold up, partner. You’re making one of the biggest mistakes small business owners make: you are competing on price. You are positioning yourself to be the Bargain Basement of the aerial teaching world. Slow clap. So, what’s the problem? And what should you be competing on?
The Problem With Competing on Price
If you’re starting out smart (and I know you are!!!), you’ve made a list of the costs to run your business. In the aerial teaching world, we generally fall (fly?) into two categories: 1) teaching for a studio or 2) teaching for ourselves.
- Teaching for a studio! Big benefits: the studio carries most of the hard costs – you generally just show up, teach classes, and collect your paycheck. The studio usually takes care of studio/venue rental, website and promotional expenses, insurance, equipment, taxes, and sign ups. Big drawback: loss of control. The studio usually sets costs and pay rate, and is in charge of who you teach, when, how, etc. Your paycheck is smaller than if you taught on your own, but you also aren’t carrying the expenses of running a business.
- Teaching for ourselves! Big benefits: you teach what you want, when you want, for however much you want. Big drawback: you’re footing the bill for everything (and I do mean everything).
For me, there’s no question: I love autonomy, and I love running my own business. But it does mean that I have to treat it like a business, not like a hobby, or the bill collectors will start camping in my hallway. Step one in determining how much to charge? Add up your hard expenses for a month, determine what you personally would like to make as a salary/need to live, and divide it by the number of students/classes you teach. This will give you an excellent idea of whether or not you’re working in a sustainable way. Numbers coming out a bit wonky? Consider:
- what the market will bear. There is generally a range of pricing that will bring in students. Here in NYC, for example, it’s around $25-$35 per student for a one hour aerial class; but if you live in an area where everything costs $1, your range will be smaller. You may need to keep your day job until you have a committed student base.
- if you’re not able to teach enough to make your numbers come out to an I-won’t-have-to-eat-ramen-for-a-year wage, consider ways to decrease your costs (sharing space rentals with another instructor, for example), or look at teaching for a studio.
Aside from simply covering your costs and making a living, competing on price will have you visiting the Bitter Business Bureau in no time. People have deep-rooted attitudes about money and value, aerial classes included. Consider:
- People generally do not value what they don’t pay for. Be honest – you care a LOT less about sitting on that crap pair of sunglasses you got for $3 at Target then you do about your Kate Spades (or whatever you crazy kids are wearing these days). We esteem what we invest in.
- You will attract “price hoppers”. These students are always hopping from studio to studio, or activity to activity – whatever they can get a Groupon for. If you’re looking to build a long-term community of committed students, good luck with that.
- You’re missing the big picture (see below). Price is only PART of the reason people choose a class. In fact, if someone feels like it’s worth it, they will find that money come hell or high water.
But Miss Laura! If I Don’t Compete on Price, What SHOULD I Compete On?
Compete on reputation. Compete on skill and training. Compete on your offerings, with your marketing, or within your niche market. Methodology. Community. People consider ALL SORTS of things when deciding to take a class, not just the cost. And here’s the Deep Dark Truth about working cheap (oh yes – I’m gonna say it): your clients will believe that you are worth what you charge.
So, the question is really: what is a fair price for my offering? What will support both my career and this industry? If you want to work for $1, all I can do is shrug, and wish you luck. But I think you’re being foolish and short-sighted, and a house built on sand spontaneously combusts in a strong wind. Or something like that. Love and pull-ups, Laura
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