Ep. 46: Why Martial Arts School Owners’ Problems Are Self-Inflicted

By Mike Massie
Martial Arts Business Podcast Episode 46 graphic

In this episode of The Martial Arts Business Podcast, Mike Massie discusses why most of the challenges martial arts school owners face are self-inflicted. Then, he reveals what school owners can do to overcome those challenges. In the final segment of the podcast, you’ll also find out what you should do to survive a recession.

Mentioned In This Episode:

If you want to alleviate your lack of knowledge and skill in running a small business, start with the following:

Complete Show Transcript:

You’re listening to the Martial Arts Business Podcast with your host, Small Dojo Big Profits author Mike Massie. Remember to go to Martial Arts Business Daily .com for show notes, transcripts, links to martial arts, business resources, and more. Now, here’s your host, Mike Massie.

Hey everyone it’s Mike Massie, and I’m back with another edition of the Martial Arts Business Podcast. And this week, here’s what we’re talking about. We’re going to talk about why your problems are greatly self-inflicted and what to do about it.

Now, this is this episode is actually based on a post that I had added to the Small Dojo Big Profits group on Facebook, which is a private group, but it is a free group. So if you go to the martial Arts Business Daily group on Facebook and you look for the links there, there are links to the group there and you can get in, just make sure you answer all the questions, because if you don’t answer the questions, I’m not going to let you in.

But this is something that I posted in the group and I thought it was worth sharing with podcast listeners this week, because over 20 years, I think I talked about this in the last episode too. But over 20 years of coaching martial arts instructors and school owners, you know, I’ve come to recognize certain patterns and the challenges and the problems that I address in coaching sessions with my clients.

And again, like I said last week, the same issues tend to pop up again and again, over and over again, regardless of the current state of the economy, regardless of the time of year season, regardless of the experience level of the instructor in business or otherwise. I hear the same things over and over again. So here again is a list of some of the common complaints that I hear from school owners.

Number one, it’s hard to get students.

Number two, it’s hard to keep students.

Number three, people aren’t committed these days.

Number four, people are flaky.

Number five, my overhead is killing me.

Number six, the competition is killing me.

Number seven, my location is killing me.

Number eight, no one is interested in learning X. (Insert the name of your art here.)

Number nine. I can’t find good help.

And number ten, I can’t afford to hire good help.

Last week I went through the same list. But this week, what I’m going to talk about is, is I’m going to talk about what you can do. I mean, basically we’re going to talk about the reasons why each of these things happen or why instructors find these challenges to be vexing them.

So in most cases, the instructors in the school owners I coach, they blame these issues on external factors. They might blame them on the economy. They might blame them on the season. You know, we always hear instructors talk about the summer slump and the lull in the holidays. You know, during the holiday season when, you know, everybody’s shopping and everybody’s focused on holiday stuff and they’re not, you know, interested in rolling in martial arts classes or whatever.

And you know, how students drop out in the summer because, you know, they go on vacation and this and that. There’s there’s always excuses, you know, and there’s an excuse pretty much for for everything. However, I can tell you for a fact that in most cases, these challenges instructors are facing, they are self inflicted challenges.

Now, going back to the list, items one, six and eight hard to get students. Competition is killing me and no one is interested in learning my art. Those are marketing issues. Those are issues that can be solved with just better marketing, more effective marketing, increased marketing.

Items two, three and four. It’s hard to keep students. People aren’t committed these days and people are flaky. Those are retention issues, which are problems that can be solved with better retention systems in your studio. And yes, you need to have systems. You need to have business systems in your studio. If you don’t have business systems and what our systems well, systems are actions that are repeatable actions that we can, that we can take, that are repeatable over a period of time that get us specific results. Okay. That’s basically what systems are.

And sometimes systems can be automated. We can automate those with technology. But all the technology does really is it just makes it easier for you to take those specific actions that you know, are going to get you predictable results in your business over and over and over again. So technology can’t really take the place of the actual systems. All it does is it facilitates the systems being used.

And if you don’t have systems in your studio, if you don’t have systems in place to allow you to take those actions that you know will get you predictable results that you want in your studio over and over and over again, what’s going to happen is, is you’re going to find yourself spinning your wheels. You’re going to find yourself making the same mistakes over and over and over again.

You’re going to find yourself working your butt off and yet not getting anywhere in your business because you’re going to be doing things willy nilly and you’re not going to be doing those things specifically that have been proven to get you results.

Now let’s go back to the list. So items five and seven, items five and seven five is my overhead is killing me in seven is my location is killing me. Those are planning issues. Those are issues with either planning your studio when you first started, or doing overall strategic planning in your business on an ongoing basis.

And, you know, the thing is, is that if your overhead is killing you, that means that you’re not doing a very good job of budgeting in your in your martial arts studio. And also, you might have had some, you know, some major deficits in your in your business planning when you first started out.

You know, I run into martial arts instructors and studio owners that I coach all the time that don’t even know what a business plan looks like. You know, they’ve never sat down and created a business plan for their business, so they have no idea strategically what they’re really doing in their business. All they know is, is they’re going on the floor every night and they’re teaching students and they’re doing some type of marketing, hopefully in their community and hoping that it’s going to bring them students.

But once again, without systems, the results you get are not predictable, and therefore the results you get probably aren’t going to be that good.

So back to the list. Let’s talk about items nine and ten, the last ones. Item nine I can’t find good help. And item ten I can’t afford to get good help. Those are cash flow issues. If you can’t find good help or you can’t hire good help. Typically, if you can’t find good help, it’s because you’re probably not paying enough to attract the type of help that you need in your business.

And if you can’t afford to hire decent help, if the only people that you can get are “forced volunteers” and teenagers from your black belt club, that basically you’ve been forced into indentured servitude in your in your school, or worse yet, you know, some poor schmuck who’s, you know, who’s a mid-belt level student in your, in your system, who you’ve badgered, cajoled or ordered into teaching certain classes for you as part of their training, you know, if that’s where you’re stuck.

Because financially you can’t afford to actually hire good help, decent help. You have cash flow issues, and those cash flow issues are need to be addressed in your business. Either you’re not bringing enough enough money on the front end, or your overhead is too high for you to profit, enough to have enough profit to be able to allocate some of that toward payroll, or you’re taking too much profit out of your business.

It’s one of those three things, you know, and there are ways to address that. And if you don’t have systems to address them, then guess what? You’re going to struggle. Continue to struggle with the same issues over and over and over again.

So all of these issues can be easily solved with the application of a little knowhow and a lot of elbow grease, because it does take work to implement systems and implement actions and strategies that will get you predictable results in your business. And I know this empirically because I’ve proven it in running my own studios, and I’ve seen it happen time and time again with my own coaching clients.

So, your problems are not the economy, inflation, societal changes, technology, the job market, or a myriad of other excuses for failure in business instead. Your challenges are most likely related to a knowledge gap between your business, education, and the task that you’ve undertaken in attempting to start and run a small business. So again, easily fixed, but you have to be willing to do a couple of things.

The first thing is you need to be willing to admit your shortcomings. You need to be willing to admit that you have shortcomings in your in your ability to run a small business, that you have a knowledge gap. And many martial arts school owners are not willing to admit this. I find that many martial arts school owners, for the sake of sparing their own ego. They are living in delusion and not really willing to come to grips with the fact that they suck at running a small business.

And you know, there’s this there’s this kind of phenomena that we see with people that, you know, I call the expert delusion. And what it is basically is it is when a, an expert in a certain field automatically assumes that they are an expert in every field or in many fields.

And you see this a lot in the self defense industry, because you’ll see martial arts instructors who are experts in hand-to-hand combat or so forth. And these martial arts instructors automatically think that, you know, they’re also experts in, say, firearms or in bladed combat, you know, or in, you know, small unit tactics or in clearing houses or whatever, you know, just name the topic.

They think that they’re experts and everything that they are high level military operators, just because they have a black belt in a certain particular style and, you know, it’s just not so. And that’s why we see martial arts instructors being called out by people who really know how to do these things online because they’re teaching ridiculous things, you know, and, and making fools of themselves.

In the same vein, many martial arts instructors, because they have a black belt they think that they are experts at running a dojo. In fact, getting a black belt does not make you an expert at running a martial arts studio. It might make you an expert in the technical aspects of your system, if you were trained properly, and if you have enough time and experience under your belt to have gained the requisite technical knowledge and skill to be able to pass those skills and that knowledge along to others.

And then of course, there’s also, you know, knowing how to teach properly, you know, having a proper approach to teaching, which is a whole nother bag of worms that I’m not going to get into. I’ll probably bring somebody on the podcast soon who is an expert in teaching methodologies and will go into a very deep discussion about that, but it doesn’t make you an expert in business just because you know how to get on the floor and how to run a decent class doesn’t mean that you know all the other stuff that goes along with running a business.

You know, it doesn’t mean that you know about budgeting, that you know about doing a competitive analysis, that you know about you know how to read a P&L statement, what a P&L statement means you know, which metrics are key performance indicators in your business. And you know what those metrics mean when they change and they shift in your business. That you know how to manage money, that you know how to manage employees, that you know how to hire and train employees, and on and on and on and on, all the different things that go into running a business successfully.

And you’re going to find in your business that even if you do get training in these areas, you’re going to be weak in certain areas. There are certain things that you’re going to find that you just don’t care to do or that you’re just not good at.

I’ll be honest, one of the reasons why I ended up with a small profits approach, why I created that approach, was because I found, after running my first studio for ten years, where we had a fairly large studio and we had, you know, somewhat of a sizable staff, even though it still qualified as what I would call an SDBP studio. I didn’t like managing people. I just didn’t.

I didn’t like managing a large staff, and I found in my second studio that I was much happier getting by with myself and my wife to handle most of the admin in the school, and then just a couple of key employees to do things like run my after school and summer camp for me and and maybe to teach some fitness classes here and there, you know, so, so maybe one other full time employee and then a couple of part time employees and that was it. That’s all.

I had my studio, you know, and that studio. It’s interesting because we had fewer students, but the studio was, you know, it brought in just as much gross profit as the first studio had with many, many, many more students. So, you know, it’s funny how cutting back in your overhead can end up resulting in better net profits. And then also, depending on where you’re focusing your efforts in your studio, you can also bring in more money on the front end as well. But that’s a topic for another podcast.

So that’s the first thing is you have to be able to admit your shortcomings. You have to be able to admit that you have shortcomings. And then the second thing you have to do is you have to be willing to fix them. You have to be willing to actively seek out people who can help you eliminate those shortcomings, those weaknesses in your business knowledge and your business acumen.

And sometimes this is tough because, number one, you know, it is tough to admit it. You know, it’s tough, especially when you realize that you’ve sunk, possibly maybe your entire life savings or your 401 or, you know, you’ve, you know, maxed out your credit cards or done something else silly in order to get this dream of yours started.

And there’s nothing wrong with having a dream of running a martial arts studio. It’s an admirable dream, and I think that, you know our business going into a career teaching martial arts, I think it’s an admirable pursuit because, you know, you’re choosing an industry. You’re choosing a career where you get to help people on a daily basis. And it does take a certain amount of selflessness to be a good martial arts instructor and a good martial arts coach.

But sometimes it’s difficult for us to admit that we’ve put ourselves at risk financially and put our families at risk financially, without the requisite knowledge and skills necessary to be successful in this pursuit. And it’s unfortunate because, for lack of a little humility and a lot of asking for help or seeking out help, many martial arts instructors and many martial arts studios go under each and every year. That’s pretty common for most small businesses.

If you look at some of the SBA statistics on how many small businesses actually succeed, it’s it’s always really low. You know, it varies from over a five year period or a ten year period, anywhere from the low teens up in the the low 20s, depending on, you know, how they’re parsing their information that year. But the majority of small businesses do fail.

And again, that’s unfortunate because, you know, they usually fail because of self inflicted challenges and problems and problems that are easily fixed. So admitting shortcomings is probably the most difficult for school owners. No one likes to admit they bit off more than they could chew, but with a little knowhow and a lot of hard work, you know your seemingly insurmountable task can be made eminently doable.

Getting students, keeping them, making your studio profitable all these things can become second nature to you, more or less something you do as a matter of course, that you don’t have to think about anymore. And that’s the difference that knowledge, education and skill can make. The same way knowledge and education and skill can make, you know, fighting, for example, you know, fighting in the ring or fighting in real life, overcoming an unskilled opponent, more or less a piece of cake, you know, a cakewalk.

So here’s my advice. And I’m going to do a little self promotion now, so you’ll have to forgive me. But you know, of course I’m going to steer you toward, you know, my courses, my products, my books, my materials.

So the first thing I would suggest, if you’re starting off brand new and you don’t know anything about running a studio, is that you go out and you get Small Dojo Big Profits. The original book that I wrote, and you read that cover to cover, because that book is going to tell you all the things that you need to do in what should be your first year of running a martial art studio. It’s basically your guide to your first year of running a martial arts studio. And of course, you know, the six months to a year before that in which you’re preparing to open your studio.

The reason why I say what should be your first year is because many, many, many school owners repeat the same lessons over and over and over again, making the same mistakes over and over and over again in the pursuit of growing their martial arts studio or pursuing a career teaching martial arts. So they end up stuck at 25, 35, 40, 50 students. And they never get past that. They never get past that level.

And really, in your first year of business, there’s no reason why you shouldn’t reach 100 students easily in your first year in business and running a martial arts studio. If you’ve done all the right things, if you plan correctly, and so forth. And that’s what Small Dojo Big Profits is going to help you do.

Now, the second thing you need to do is, is you need to learn how to get students. Now, I will tell you that I have a book and it’s available on Amazon. It’s also available at my site at Martial Arts Business Daily.com.

If you look at the top of the website and the navigation, you’ll see a link that says store or shop or books or something like that. And the actual link is store dot martial Arts Business daily.com. And that’ll take you to my bookstore where you can order books, ebooks either directly from me, or you can order them directly from my printer. And they do take a little bit longer to ship then than if you were purchasing them on Amazon. However, I do get a greater portion of the sale if you buy directly from me and then also, I think the printing quality actually is a little bit higher. But don’t tell anybody I said that.

Anyway, that’s where you can buy those books directly from me. And I do have an e-book that’s called Direct Marketing for Martial Arts School Owners. That’s a pretty good one. It’s a very short book, although it only goes into principles, it doesn’t go into actual techniques.

I do have a new course that’s going to be coming out in a few weeks. That is a course that’s all focused on basically applying Pareto’s Principle to marketing in your martial arts studio. I don’t want to reveal too much about that, because, you know, I don’t want to let the cat out of the bag before its time, but it’ll be coming out in a couple of weeks.

I’m about to retire my big, huge marketing course that I have. You can also look for that one too if you go to Dojo Success Coach dot com. My huge marketing course is on that website and you can still purchase that. You can still get access to that as well.

Now after you learn how to get students, after you learn marketing—and marketing is basically one of the ways that’s half of the equation for solving your cash flow issues—the next thing you need to learn is you need to learn how to sell memberships.

I do have a membership sales course. It is available at Dojo Success Coach dot com. I recommend that you go through that course if you don’t know how to sell memberships at least. I would say if you don’t know how to sell memberships without being sleazy. Because my course is all about using honesty as a tactic for selling memberships.

In other words, trying to get the best result for you and your client both. And it’s super, super important that you do that. Because what I’ve seen many trainers do in the martial arts industry is they teach studio owners how to sell memberships, but they teach them to do it in ways that are really sleazy and underhanded and kind of used car salesman-ish.

The problem with that is, is that you might sell a lot of memberships that way, but you’re going to undermine the trust that the student has in you up front, and even instilling just a little bit of doubt in a person’s mind about your integrity is going to hurt you in the long run, because it’s going to make your students less likely to stick around for the long haul.

They’re going to be more likely to, when something goes wrong, to not give you the benefit of the doubt and allow you to repair that issue. And when they leave, they’re going to be more likely to leave you bad reviews online, which, you know, something you can’t afford to get too many bad reviews online. And you know you don’t want to be like one of those, you know, again, scummy martial arts school owners that, you know, has to change the name of the studio, like every six months because you’re getting so many bad reviews online, you know, you don’t want to fall in that trap.

So if you want to learn how to sell memberships, honestly, go check out my course at Dojo Success Coach dot com.

Also, you need to learn how to teach intro lessons and I have a book on that. You can get it again at Store dot Martial Arts Business Daily dot com or on Amazon. And basically the title of the book says it says what it is, it’s how to sell, how to teach intro lessons to sell memberships. So that’s a very good, again, short book and lots of good info in there.

The next thing you need to learn how to do after you learn how to sell memberships and after you learn how to get students, which are the two things that you do to solve your cash flow problems. And I will tell you those two steps. And your growth as a martial arts school owner will solve 80% of the problems that you have in a martial art studio.

Okay, so after that, you need to learn how to keep your students. Keeping your students. In other words, what is commonly called in industry as retention or student retention. Is the key to growth in your martial arts studio.

What a lot of school learners don’t realize when they first start out is they think that it’s all about just getting students. It’s all about just packing them in through the front door, and they don’t realize that they have holes, gaps in their retention systems and that they have students constantly creeping out the back door while they’re not looking.

And see, because a lot of martial arts school owners don’t pay attention to their attendance or active attendance. In other words, the number of students that are actively attending on the floor each and every week. And because they don’t look at their retention numbers or their attrition numbers, the number of people are actually dropping out every month. They don’t realize they have these problems.

And if you have an attrition rate that is over 5% of your students on a monthly basis, you have serious problems in your studio. They’re either serious problems with your customer service. There’s serious problems with the product that you’re delivering. In other words, how you’re teaching classes on the floor, how your staff is delivering classes, or you simply have serious problems with the actual systems themselves. Probably a lack of systems to retain students.

So you need to learn how to retain students. First thing I recommend you read is you read my book, The Profit Boosting Principles for Martial Arts Schools, and you can find that again at Store dot Martial Arts Business Daily dot com. You can also find it on Amazon.

That book is the follow up to Small Dojo Big Profits, and it actually tells you. Pretty much everything you need to do in the second year of running a martial arts studio to be successful. So I recommend that you read that book and that you pour over it, and that you go through the book and you implement all of the principles and all the action steps in order in sequence.

Now, there are certain things in there that I would say, because when I wrote that book, I was more or less a traditional martial arts instructor, and there are certain things in there that are going to seem like that. They’re geared toward a traditional martial arts studio, like a karate or taekwondo or a traditional kung fu studio.

But I can tell you that my clients who teach other styles like Brazilian jiu-jitsu, Jeet Kune Do, Muay Thai, things of that nature, Krav Maga, that they have taken that book and implemented the principles in the book and implementing the action steps, just adapting them to their own martial art system and the way that they run their studios. And it’s worked perfectly fine for them.

So don’t let anything you see in the book put you off. Or if you see things, if I’m talking about black belt clubs and things like that, because one of the things I talk about in the book actually is how to run an ethical black belt club, which is probably one of the best things you can do for retention in your studio, but you can find info on that in the book.

I would recommend my Martial Arts Character Education Lesson Plans for Children book, which you can also get on the site or get on Amazon, I would recommend that you implement that in your mat chats and your children’s classes if you teach kids.

And I would also recommend that you read How to Teach Martial Arts Using a Rotating Curriculum, which is a very short, simple book. It is probably one of the most polarizing books that I’ve written because some people hate it, some people love it. But that whole approach to teaching martial arts using a rotating curriculum, is probably the single most important key to your growth or handling growth in your martial arts studio.

Because once you solve your cash flow problem by learning how to get new students and how to sell memberships—in other words, how to get students through your door and how to sell the memberships. And then you learn how to plug your retention holes, the holes in your retention and your studio, you’re going to very quickly find out that you have a growth problem in your studio, and you’re going to have to learn how to solve that.

One of the ways that you solve it is by teaching using a rotating curriculum. And a rotating curriculum is nothing more than having a system to teach large groups of classes of varying ranks, all in the same classroom at the same time. It’s as simple as that, but it’s much more complicated than that to explain.

So I recommend that you buy the book, but the books only like 3 or 4 or 5 bucks or something like that. So go pick it up and read it.

Now after that, after you’ve done those things, you’re going to have to learn how to duplicate yourself. And this is all about hiring a training staff. So I strongly suggest that you get my book on staff and leadership team training.

And again, https://store.martialartsbusinessdaily.com/ is where you can pick it up directly from me. Or you can find that on Amazon and that martial arts school staff and leadership team training book.

Again, it’s one that some people have criticized because they say, you know, that people have criticized it for stupid reasons, actually, because it’s a really good book. It’s very thick and it’s very in-depth, but the whole book is just about basically building your own bench.

It’s about training your own employees and, you know, actually having some forethought and looking at kind of, as I said, building a strong bench of people that you can draw from when you need to hire employees from within your studio, which is the best place to hire for them, actually.

And it’s not that you can’t bring in people from outside your school and train them. It’s just that was never an approach that worked very well for me, although I had done it. And that’s why I focus this book on hiring from within. So I recommend you get that book.

Also, as far as scheduling goes get my Business Growth Strategies for Martial Arts Schools book. That book is actually a really good one too. I would say you should read that book last, probably after the other books that I mentioned, but it is one that you should read because it’s going to tell you how to schedule for growth.

It’s also going to explain some things about retention, about building culture in your school and so forth that are really important, that are kind of more high level strategies. But these are things that you really need to know when you’re going into probably your third year of business, and it’s not something that you can’t read and implement and start implementing immediately in your studio. So that’s another good book to read.

Also, I recommend to everybody that you should get at some point in your career as a martial arts instructor or studio owner, you should get some coaching and you should get some support. I run my MAbizU group and I’ve run that for years in many different iterations. I started running that group and way back and gosh, I’d say the mid aughts, I think as a forum, you know, as a private forum, a paid forum, and there’s not many of those things left.

You know, I think I belong to a couple of forums in the, in, like, the motorcycle, you know, like motorcycle rider, you know, type pursuits among motorcycling enthusiasts. But that’s I think that’s that’s the only place where I’ve seen any forums that are really very active anymore. And that’s just because, you know, a lot of guys who ride motorcycles are old guys like me.

But now everything’s on Facebook and everything’s in social media and so forth, and that’s one of the places where I run my coaching group is we have a private, a very private Facebook group on discoverable that you can only get to by joining through my website at Dojo Success Coach. Now I will have another product coming out soon. That will allow you to get some access to me, some limited access to coaching from me, you know, to be able to ask me questions and so forth and, and get weekly lessons and whatnot.

But I’m not going to talk about that too much just yet. That’s something that I’m going to reveal over the next couple of weeks in the podcast. But for those of you that can’t afford the couple of hundred bucks a month or whatever it is for you, that’s fine. I understand that I’ll have something coming out that’s going to give you a little bit of limited access to me, but I think it’ll be helpful for those of you that are on a budget.

So then, you know, once you’ve done all those things, the whole goal really is to get you to the point where you don’t have to worry about paying your bills each month to where you know that your bills in your martial arts studio are paid every single month, and you don’t have to worry about money anymore. And, you know, the thing is, once you have enough cash flow coming into your studio to where you don’t have to worry about money and paying your bills and all that stuff anymore, it takes a tremendous amount of stress off of you, and it makes it so much easier to grow your studio.

And the reason why is, because you’re no longer desperate to get students. See, that desperation is a thing that causes people to leave your studio before they’ve enrolled, because people can sense when you’re desperate. And we talk a lot in my sales training, in MAbizU and when I’m working with clients, about having posture in sales and how posture is everything.

It’s basically an attitude, I guess you could say of confidence in dealing with the person you know, knowing that you have the deal and and being willing to walk away from the deal at any given time. This is so, so, so important.

Because when people sense desperation in your approach to trying to get them to enroll, it’s going to put them off. And when people sense desperation, they tend to run the opposite direction because they don’t trust desperation. And especially in today’s day and age when people are so, so, so skeptical.

So, so you want to get to the point where your bills are paid, where you’ve got 100, 150 students and you’re cranking along in your studio and things are going well for you because you manage your money well.

So take these steps and I’ll include all this stuff in the show notes for this week’s podcast episode. I’ll include some links and stuff in there as well. For the last couple episodes that I’ve recorded, you know, I’ve used, I transcribed notes, which are fine. You know, they get some typos and there’s some typos on their stuff that they get wrong because it’s just an eye. But I’ll get a little more detailed this time. So I make it easier for you to find these resources.

So you can always find show notes at https://www.martialartsbusinessdaily.com/podcasts/, so be sure you go there if you want to find the show notes for this particular podcast.

Okay. Now let’s go ahead and move on to the tip of the week.

The tip of the week. It’s time for our featured martial arts business tip of the week. For more great tips, be sure to visit Martial Arts Business Daily to subscribe to our newsletter. And while you’re there, click on the Business Resources tab for links to all Mike’s martial arts business books and courses. Now here’s your martial arts business tip of the week.

Our tip of the week for this week is what to do in a recession. What do we do in a recession? Now, I know there’s all kinds of talk in the media right now about how a certain president’s economic strategies and and what they’ve implemented is so, so, so successful in bringing the economy along. And actually today we did get some news that GDP growth is up, which is good. That’s all positive news.

But the economy’s really wonky right now. One of the economic indicators that I find really interesting is how home prices are at nearly an all time high or an all time high, but yet home sales have slowed down quite a bit, quite drastically. Other economic indicators, you know, consumer debt is at an all time high. But yet, supposedly we’re being told that consumer saving and investment is also, you know, at a 20 year high or something like that.

You know, there’s all these contradictory indicators in the economy. But what it all boils down to is, is when you talk to people on the street, what families are going to tell you is they’re going to tell you that they’re hurting right now because inflation has been so, so terribly high for the last couple of years since the pandemic, because of quantitative easing and all the other strategies and and action steps that the government took to try to save the economy and, you know, mostly big business.

Let’s be frank about that, because anybody who tried to get a PPP loan during the during the pandemic can tell you that small businesses did not get those PPP loans in the first and second round, that all that money went to large businesses. But all those things they did, you know, printing money like crazy, it has forced inflation through the roof. You know, it’s a wonder that we didn’t have runaway inflation. But that’s that’s that’s a topic for a totally different podcast.

But what I will tell you is people are hurting out there. And so what you need to know is when we’re in a recession, which we’re still in a recession, and, you know, no matter how much they move the goalpost and how much they they lie to you and tell you that we haven’t been in a recession. We have been we’ve been in a recession and people are hurting.

So what do you do? Well, 1s typically what happens is when new and inexperienced school lender start hearing talk about recession is they start to panic. And my advice to you first is when you start hearing talk about recession or inflation or how this is going to impact consumers and how they’re going to start cutting out, you know luxuries like martial arts lessons and so forth, things that aren’t necessarily, you know, necessities.

Don’t panic, okay? Don’t freak out about it. I have run martial arts studios over the course of some 30 years. I’m close to being hitting my 40th year in the martial arts world as a martial artist, as a practicing martial artist. And, you know, I taught professionally over the course of some 30 years. And, and I spent about 25 years of that time as a professional martial arts instructor, at least as an active martial arts instructor who earned at least some of my income from teaching martial arts, if not spent that time running martial arts studios full time, which I did for roughly 20 years.

During that time, I ran martial arts studios during the recession that followed the Dot-com bust and 9-11, which was a terrible time, as most people will remember. Also, during the Great Recession and more recently during the pandemic, and I would say I’m probably one of the few martial arts instructors who actually ran a highly profitable studio or martial arts teaching operation through using the Small Dojo Big Profits approach, but mostly the Micro Dojo approach, which I teach in MAbizU.

And so I can tell you that lean times come and go, okay? And times of plenty come and go. Everything is cyclical. And what you’re going to see is, is about we’re about on. I’d say we used to have 20 year cycles for recession and now it’s gone down to about we’re on about ten year cycles. We’ll see these soft recessions and so forth and these economic slowdowns that happened.

But you can’t let that bother you, because I can tell you from coaching people over the last 20 years and being in the industry for almost 40 years, people make money during times of recession. Martial arts school owners are out there making money during lean times. People are out there succeeding during lean times, so you can’t really panic about it.

What you need to do is, is you need to think about what are you supposed to do or what should you do during lean times or during times of recession? One of the core tenets that I teach is that it’s always business as usual.

Is it boom time? Business as usual. Bust time? Business as usual. Bull market, business as usual. Bear market, business as usual.

Nothing should change in the way you conduct your business during times of boom or bust. Except perhaps maybe that you tighten up your belt even more during recessions, meaning you run your business even leaner than is usual for a Small Dojo Big Profits studio. That simply means you don’t spend money on luxuries like extra staff members or, you know, expensive equipment. You know, new mats.

You know, maybe you, you know, you keep the mats you have for a couple more years, maybe flip them over, you know, every every couple of mats or something like that. But you just do things to kind of, you know, basically just tighten up your belt a little bit, you know, a couple of notches during lean times. It’s no big deal. It’s nothing more than common sense decision making that that you you make in the pursuit of running your school profitably.

So the bottom line is that you need to focus on three things, no matter what the economy is doing. The first thing is marketing to generate leads. And I explained in the earlier portion of this podcast episode what you need to do to learn how to market, to generate leads and to get new students through your door. The second thing you need to focus on, and this is on a daily basis, people, this isn’t like you market, you know, only when you need students.

That’s a huge mistake. I see martial arts instructors do that a lot where they’re like, oh my gosh, you know, all of a sudden my floor is empty. And for some reason, you know, my monthly recurring revenue is down, you know, which is one of the KPIs, key performance indicators in a martial arts studio, your monthly recurring revenue.

And they’re like, oh my gosh, you know, my monthly tuition collections, which is most people, what most people call it in the industry is down for some reason. You know, I’m like, you know, I was bringing in 10,000 a month and I’m only bringing 5000 a month. That’s barely enough to cover my rent and my expenses, and I can’t pay myself, so I better start marketing to get students.

That is the wrong thing to do. You should be marketing on a continual basis. Marketing is something that you repeat, something you do on a daily basis. I know a lot of school owners don’t want to hear this. A lot of martial arts instructors don’t want to hear this, but from the moment you open your doors on your studio, marketing becomes one of the chief hats that you wear.

And for the first couple of years, you’re in business. It is your primary job. Your primary responsibility is getting new students through the door. I know you don’t like to hear that because you think your primary responsibility is teaching classes. It’s not, okay? As a small business owner, your job is getting business first. And it’s keeping business second. You know, at least for the first couple of years.

So after you learn or after you focus on marketing to generate leads, then the second thing you need to focus on a daily basis is following up on those leads and enrolling students. And again, in the earlier portion of this podcast episode, I told you how to gain the information, gain the knowledge, gain the skills to learn how to do those tasks successfully.

Okay, this is something you need to focus on a daily basis. You need to be following up in your leads. And so, so often I will coach martial arts instructors who are running martial arts studios, and they don’t follow up in their leads. You know, they just they just want everything to be automated. They want everything to happen automatically, you know?

And yes, there is a tremendous amount of automation that you can implement in your systems today with the technology that we have that we did not have, you know, 30, 40 years ago when I first started teaching martial arts. You know, I didn’t start teaching martial arts 40 years ago, but I did start when I was pretty young.

I actually started teaching when I was about 15 years old, assisting my instructors, and I started teaching with a partner sometime around age 19. So it was about at 19 years old. You know, I’m 52 now. I was about 19 years old when I started teaching martial arts professionally and honestly, you know, if we’d had the technology back then that we have now, I’ll be honest, I don’t think I would have succeeded.

Because I had to learn how to do things out of desperation, simply because we didn’t have tools and we didn’t have technology and things that made it so, so easy to go out and market and get students. Now there is a lot of noise in the market now, and it is harder to be heard in the market much harder than it was when I first started.

But man, you know, I can remember driving to like find a place that had a computer center because I couldn’t afford a computer, I couldn’t afford a printer, and driving like ten miles to find a place that had a computer that I could rent and a printer that I could rent. So I could make flyers for my business and print them up and, you know, going to purchase the paper and, you know, making these flyers, then having to go after that and post them all over town, and just the crazy things I had to do in order to be able to market my business on a budget.

You don’t have that now. You have technology. You have all kinds of tools at your disposal. So definitely use them and make sure that you’re automating as much as you can in your business. Automate the follow up on your leads and and as much as you can, automate the front end and rolling students.

But you know you’re still going to talk to people. You’re still going to have to do some of the work. So don’t expect this stuff to just happen automatically. You need to be following up on leads yourself personally okay.

And then finally, third, you need to focus on keeping the students you have during a recession. Super, super, super important. Because in times where it becomes harder, more difficult, more challenging to get students, keeping the students you have and maintaining your income is much more important than in those times of plenty where it just seems like you can’t swing a stick without hitting a new student.

Okay, so focus on keeping the students that you have.

To reiterate the three things you need to focus on during times of lean when you’re operating in a recession. Marketing to generate leads. Following up on leads and enrolling students, and then keeping the students you have. That’s it. All other tasks in your school or ancillary to those three priorities.

And some of you are going to say, you know, well, what about teaching Mike? What about teaching good classes and teaching quality martial arts? Isn’t that important?

Of course it’s important. Everything that I teach and everything I talk about in this podcast is taught with the assumption that I’m speaking to serious martial artists who are serious about teaching their art, who are serious about teaching quality martial arts, and are serious about maintaining standards in their studio.

In other words, that I’m not talking to charlatans. Okay, I’m going to tell you something. The charlatans out there, they already know this stuff because they know that the only way that they can make a living, because the martial arts they teach and their skills are crap. The only way they can make a living is by knowing how to do this stuff. And then also cheating people. You know, so this is your competition. So when I’m speaking to you out there, the listener, I’m talking to the serious martial artist in you.

And to answer that question, teaching is part of student retention, quality teaching, quality instruction, being a quality instructor, a quality person, the floor is all part of student retention. So yes, it’s important and it falls under it falls under category two. Okay.

But getting back to what I was saying, just don’t worry about what the economy is doing. Simply focus on the high priority tasks in your studio each and every day. Keep your overhead low, your program quality high, and you’ll do just fine.

Alright, that’s it for this episode of the podcast. I want to thank you for joining me this week. And once again, I encourage you to go out there and kill it this week, and I’ll see you in the next podcast. Have a good one, everybody.

You’ve been listening to the Martial Arts Business podcast with Mike Massie. Be sure to subscribe to this podcast on iTunes and if you’ve enjoyed this show, leave us a positive review while you’re there. Thanks for your support and tune in again next time for more great martial arts business tips and advice from Martial Arts Business Daily.

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