“But these same people are unable to ask for more money for their own product.” “People have prices raised on them every day-blueberries, strawberries, milk,” says business and sales expert Grant Cardone. “They’re providing a service.” Building in a profit margin is, in fact, what defines you as a business and not a charity. But “dance teachers are no different from any other business,” Campbell says. From time to time, you’ll need to raise prices, something many studio owners seem loath to do. Setting a reasonable-and profitable-price for your services is only the first step. “It’s OK to charge a higher rate to show value.” Next, in establishing prices you need to look at the marketplace: What are your competitors charging and what is the perceived value of your service-that is, how much do you think your customers are willing to pay for your studio-owner know-how? “You should always keep an eye on the competition, but don’t dictate your prices based on what they’re doing,” says Michael Campbell, director of North Florida operations at The Jim Moran Institute for Global Entrepreneurship.
#Dance studio fixed monthly expenses plus#
When setting prices, a savvy business owner will keep the following factors in mind: First, what are all your costs-not just what you pay staff for teaching a class or the cost of a costume, but all direct, indirect, fixed and variable costs involved in delivering that service? Don’t forget overhead, such as rent, insurance, taxes, advertising and administrative help, plus a profit margin to fuel growth (more classes, better teachers), which should all be factored into the price you set for every service you offer. Instead of just calculating how much it costs you to make something, you need to determine the worth of your expertise and the value of your time as a studio owner.
Pricing a service such as dance education is more difficult than pricing a product. How do my rates compare to other studios in town? How much should I be marking up my costume fee to pay for the time I spend ordering and organizing? I really need to raise my rates this year-but what will my students’ parents think? If you find yourself asking these questions as each new studio year looms, take comfort in the fact that you’re not alone. Pricing is a slippery slope for dance studio owners to navigate. Burns Dance Studio in Aiken, SC, offers classes in ballet, tap, jazz, hip hop, contemporary, acro, musical theater and karate to 275 students. Courtesy of Burns Dance Studio Here’ s how two veteran studio owners handle it. And as costs and the market change, you’ll need to raise them occasionally to stay profitable. Pricing a service such as dance education can be tricky.
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