Fees

[Valithor]

Strewth?? Where abouts is that? I can get a year's membership at a gym for about $300.. Who would pay $250/month for training?

[WolverineGuy]

Eeesh...250? no thank you

[equaninimus]

Strewth?? Where abouts is that? I can get a year's membership at a gym for about $300.. Who would pay $250/month for training?

Picture a parking lot filled with SUVs, etc....

 

Oh, to heck with it, jhust look at these websites.

 

http://www.seosnationalkarate.com/

 

http://milehighkarate.com/

 

From the "Franchise Information" page. Can abyone say "pyramid scheme?"

 

http://milehighkarate.com/student/franchise/mainletter6.html

How does a Mile High Karate School Generate Revenue?

 

The total revenue of a Mile High Karate school will be affected by several factors. In simple terms the revenue flow ends up being a function of:

 

New Enrollments * Tuition Rate * Retention Rates * Renewal Upsells * Cash Ratio

 

First the family is exposed to Mile High Karate in one of a variety of ways. They may first come in contact with us by responding to one of our regional ads in the Rocky Mountain News or Denver Post from our Infomercial or, they may be responding from a localized ad such as direct mail, or often they are either a participant in one of our many community outreach programs or are referred by an existing student. Regardless of source they enter our introductory process and hopefully (35%-65% of the time) end up enrolling in our “trial enrollment” which is for a year.

 

They either pay an average of $259 to enroll then $159 per month (our schools currently range from $139 to $189 per month for this program) or, they pay one payment averaging $1,700 (there are small family discounts for a 2nd and 3rd family member of 10% and 20% respectively).

 

Second the student enters our White Belt class where they train twice per week for eight to twelve weeks. During that time they are being prepared for and evaluated for our Black Belt training. Prior to testing for Gold Belt (at the end of the eight to twelve weeks) they are evaluated for – and, if they qualify offered the opportunity to join the Master Club (a higher level of training which takes them to Black Belt and beyond).

 

At that point if they join Master Club (which 35-50% should do at this point) they will either pay $500 down and have an approximately $100 increase in their monthly payment or will pay one payment averaging $7,800 (again with 10% or 20% 2nd & 3rd family member discounts).

 

Third, the student enters our Beginner Class (Gold, Orange, Green & Purple Belts) and either trains as a new Master Club member (with additional class times and opportunities and teams they can participate in at that level), or they train as a Gold belt for two months and revisit the qualification process to Master Club. Most of those who have not yet joined Master Club will quit prior to the Orange Belt test – although some percentage will continue on to the trial level.

 

Additionally, upon entering the beginner’s class each student will purchase a variety of equipment including hand pads, footpads, headgear, shin pads, rib guard, and some of the basic weapons required by curriculum. In total a student will purchase between $150 and $200 in equipment (our cost varies from 35% to 50% of the retail price of these sales).

 

Fourth, students continue to train through Beginner, Intermediate, and Advanced classes. During the process there will be a percentage of the students who will drop out without completing whichever program they have enrolled to complete.

 

Our schools have encountered a low of 2% monthly attrition to a high of 7%. Our target is 3.5% or less per month is our target range. This varies monthly based upon a variety of factors – some seasonal such as Christmas Season or Summer – and, based upon instructional quality and parent-student rapport levels with the teachers and other staff.

 

In determining the monthly revenue stream of the school we categorize revenue streams as follows:

 

Tuition:

 

* Enrollment Down Payments

 

($259 first student in family, $239 2nd member, $219 3rd member – average tuition)

 

* Enrollment (1 year) Paid In Full

 

($1,700 on average)

 

* Renewal Down Payments

 

($500 – 1st family member, 10%, 20% family discounts – this number varies)

 

* Renewal Paid In Full

 

($7,800 first person, 10% off, 20% off additional family members)

 

* Monthly Tuition Payments (billed through Mile High Events by ASF via EFT or Credit Card $159, $139, $119 first, second, third family members - $100 more Master Club)

 

Retail Sales:

 

* Pads, Uniforms, Weapons, Books, etc.

 

Revenue Items

 

* Billed Tuition

 

* Enrollment Fees

 

* Renewals

 

* Master Club

 

* Products

 

Expense Items Fixed

 

* Lease/Rent

 

* Office Compute

 

* Furniture and Fixtures

 

* Leasehold Improvements

 

* Deposits

 

* Sales Taxes

 

* Printing

 

* Supplies

 

* Repair and Maintenance

 

* Lease Payments

 

* Phone

 

* Utilities

 

* Insurance

 

* Professional Fees (Accounting, Billing, Consulting, Legal)

 

* Software support

 

Variable

 

* Royalty

 

* Advertising and Marketing Local

 

* Advertising and Marketing Coop

 

* Bank and Collection Charges

 

Payroll

 

* Full Time

 

* Reception

 

* Instructor

 

* Assistants

 

* Taxes

 

Miscellaneous

 

* Auto

 

* Books- Subscriptions

 

* Depreciation

 

* Entertainment

 

* Interest

 

* Taxes

 

* Training

 

* Uniforms

 

We have a blank pro-forma work sheet we would be pleased to provide you so that you can work on your own business projections

Obviously any actual learning of KArate is secondary.

[GrrrArg]

Thats not exactly cheap...

 

Whats this about unlimited training for $50 a month Valithor? oh and how much is that in sterling do you know?

[Squawman]

Stephan Oliver does alot of business seminars and he's pretty much a car salesman.

[Shorinryu Sensei]

OK...I can see if the dojo's in Beverly Hills and paying sky-high rent for the property and teaching Hollywood movie star's kids or something, but otherwise, I think people are nuts for paying those high fees.

 

"You get what you pay for" is a bunch of bunk, if you ask me. My origional sensei trained directly on Okinawa with the head of the system for 3 years, and charged $25-30/month for 3, 2 hour classes/week the first couple of years, then decided he didn't need the money, and started charging NOTHING! We lost 75% of the students because people don't put value in anything free, but I sure did!

 

The training was hard, but excellent, and I owe that man a lot for what he did to change my life over the last 29 years.

[Valithor]

Hi GrrArg,

 

We have a full-time dojo in Brisbane, Australia.

 

There are standard karate classes at 6-7pm and 7:30pm each weekday and 10:30-12:00pm on Sat and Sun.

 

There are kids classes (under12) at 4-5pm weekdays and 9-10am on weekends.

 

At 6am there are 2 cardio-karate classes and 3 yoga-stretching classes each week.

 

The monthly membership allows to train at any of these classes.

 

Keep smiling,

 

V

 

PS: In Brisbane, this is in addition to 2 regions operating the standard $7 a class system.

[GrrrArg]

Ah, similar to what they're doing over in the states then?

[kotegashiNeo]

I hate to say this but I believe in the value of the martial arts and the benefits it can have on anyone and the thought of a super skilled sensei having shut down his school because he didn't want to be sucsessful. I think martial art teachers are real heros and should be paid accordingly. that is just me. If people will pay that much for martial arts instruction then they view it as worth it.

[backfist]

I pay $80.00/month, in a mostly upper middle class area. This is pretty typical in this area for "traditional" dojo. The McDojos start around $150.00/month and then raise the prices for Master Clubs, etc... usually averaging abour $250.00/month.

 

Wow! That's pretty stiff. But I guess if you can get that much ...