Posted by Mike Massie on August 4, 2010
Many martial arts school owners would like to accept electronic payments so they can do their own martial arts billing at their school, but either don’t know how or think they have to hire a billing company to do it.
You can do a better job collecting your own tuition than a billing company, for a fraction of the cost, using the services listed in this article.
In fact, you DON’T need a billing company to accept electronic payments at your school… and you can even do your own monthly billing very easily (and save money on billing too) by using one or a combination of the following services.
There are several ways to do this… some methods are more “DIY” and require you to perform a few steps to set things up yourself. Others are more “hands off” and require a minimum of technical knowledge to set up.
I have listed various in-house billing solutions below from the “easiest” to the most technical, along with links to their sign-up pages.
Method #1: Getting a Merchant Credit Card Account for Electronic Billing In-House
Description: This method involves billing your clients directly through the credit card companies by using your own merchant credit card processing account and some sort of online payment gateway system. Online payment gateways work like a credit card processing machine, except that you enter the client’s information by hand through a secure online system. Typically, they allow you to process payments in a multitude of ways.
Ease of set-up: Relatively easy as the merchant credit card company will set you up and walk you through it.
Expense: Can be much lower than other methods listed below if you have good credit and ask for a “card present” account (that means you only run credit cards when the customer is in front of you with their credit card or debit card in hand).
Types of payments you can accept: Credit cards, debit cards, electronic checks (bill checking accounts).
Automated recurring billing available: Yes. What many school owners don’t realize is that, when you sign up with a martial arts billing company, they simply run your accounts through their own merchant account and then charge you a percentage on top of the discount rate they are getting from Visa, Mastercard, AMEX, Discover, and their own bank. Doing this yourself allows you to cut out the middle man and save a ton of money over the long haul.
Set-up fees: None.
Rate: As low as 1.26% and .05 cents a transaction for electronic checks. Definitely the lowest on the list overall.
Speed of Payment: Fast. Money is transferred to your checking account in 48-72 hours.
Drawbacks: If your credit rating is extremely poor, you may not be accepted, or you might have to pay a slightly higher rate. This is rare though, so don’t be afraid to apply.
Best for: Established business owners and those with a decent credit history who want the absolute best rates.
Link to Apply: Click here to apply
Method #2: Using Your Own Merchant Account In Conjunction With A Web-Based Billing Application
Description: This method involves using an online billing application in conjunction with a merchant credit card processing account or a third-party service like PayPal to manage, track, and process your payments.
Ease of set-up: Typically it’s fairly easy to set up your account. The whole concept of using web-based billing applications is to make it easier to setup, process, and track your billing accounts. With contemporary services like Freshbooks, user interfaces are much more intuitive and feature-rich than solutions provided by most payment processing companies.
Expense: Typically these services offer free trial accounts that allow you to test their service with a small number of clients (3 or less). You can then upgrade your account based on the number of client accounts you need to bill each month using the software. Rates start as low as $10 a month up to $80 a month for an unlimited number of client billing accounts. (Note: Some services may charge an additional fee for automatic recurring billing capabilities.)
Types of payments you can accept: Credit cards, debit cards, electronic checks (bill checking accounts), depending on your payment processor.
Automated recurring billing available: Yes. The most popular applications are actually designed to make it easy to schedule and process recurring billing payments for your clients. You can also bill your clients via email invoicing.
Set-up fees: None, just a monthly subscription fee.
Rate: Whatever your payment processor charges.
Speed of Payment: Depends on the payment processor.
Drawbacks: A monthly fee on top of your processing fees. However, for the ease of use and advanced bookkeeping and tracking advantages, it is worth it to be organized and to automate your billing and bookkeeping tasks each month.
Best for: Business owners who want convenience and don’t mind paying a little extra for it.
Links to Providers: Freshbooks – Invoicera
Method #3: Using A Third-Party Merchant Services Provider
Description: This method involves using a third party provider, such as PayPal or 2-Checkout, to process your payments.
Ease of set-up: Typically requires a bit more technical know-how, as you will need to navigate their account administration panel and set up various payment methods according to your needs and preferences. In addition, you may have to know some HTML and have basic web design skills, as you’ll need to place the code for payment buttons on your websites. (Note: PayPal now has a recurring billing function you can sign up for which allows you to enter and process your client’s payments online, but it requires a monthly fee for access.)
Expense: Higher than if you get your own merchant credit card account, with processing fees averaging about 3.5%. However, if you want to get up to speed quickly, or if you have spotty credit or don’t have a business bank account set up, this may be the best option for new instructors.
Types of payments you can accept: Credit cards, debit cards, electronic checks (bill checking accounts).
Automated recurring billing available: Yes. (Note: Automated recurring billing comes standard with a 2Checkout account, but with PayPal you have to apply for it).
Set-up fees: Between $15 and $50, depending on the service and plan you choose.
Rate: As low as 2.2% with a .30 cent per transaction fee for PayPal. 2Checkout charges 5.5% with a .45 cents per transaction fee.
Speed of Payment: Fast with PayPal – with the exception of e-checks, your money is transferred to your PayPal account immediately, and you can withdraw it by transferring it to your checking account which typically takes 48-72 hours. 2Checkout transfers money to their vendors weekly via electronic deposit of funds.
Drawbacks: Higher processing rates, and you’ll need someone with a little technical know-how to set it up. Also, 2Checkout requires that you have a website setup with all your purchase information online before you apply.
Best for: Someone who wants to get up and running fast with no hoops to jump through to qualify; the technically inclined; those with less than sterling credit; and, new instructors who are just starting out.
Links to Enroll: PayPal – 2Checkout
- Have questions or comments about doing your own martial arts billing? Post them below!
Posted by Mike Massie on July 29, 2010
Q&A On Starting and Running A Martial Art School When You’re Flat Busted
Starting a martial art school with no money is tough but not impossible. Here's how I did it...
Q: Starting a martial art school from scratch when you’re flat broke is tough, but not impossible. I know because I did it facing incredible odds.
Still, I know how easy it is to become discouraged when facing such a difficult proposition. If you’re in this boat, you’re not alone. Recently, “FC” posted the following on the Starting A Martial Art School member forums:
“Lately I’ve been getting really discouraged and it’s taken a toll on my motivation. Today I sat down and wrote out why I felt I was struggling, instead of just ignoring it and fighting against the current. There were two major points of frustration for me–places where I feel very unsure of where to go and so I remain stuck–and I’m hoping that I can get some feedback as to how others might handle them.
The first point is that everything seems so daunting. I read about things like Mike’s ‘10-12 Rule’ of always having 10-12 marketing methods running at all times and about putting in 40-60 hours per week into starting up. It’s not that I’m not dedicated. It has more to do with that I have a full-time job that doesn’t pay a whole lot. So another 40-60 hours per week is tough to find, and when I do have time I’m not sure how to spend it because I don’t have much money. Instead, I find myself stressed because I don’t feel I can keep up.
My second point is that my (work) schedule fluctuates week to week. This makes it hard to maintain a routine. I also never know what I’ll make week to week… This makes it hard to budget and I feel hesitant about dropping money into different marketing methods that I’m not 100% confident in.
So my question to you guys is, how would you plan for success if you were in my shoes? Where would you start? What kind of routine would you set up? What kind of “rules” would you give yourself? What kind of goals would you feel able to realistically set?”
A: Here’s my reply:
Your main concern is money – you need more of it, right?
I was in a similar situation when I started out, so here’s what I did when I started my first school:
- First, I simplified. I cut out everything in my life that was extraneous. Social life, dating, eating out, entertainment, etc. I moved into a very small, spare garage apartment, and lived extremely frugally. This served two purposes – 1) it allowed me to pay my bills and have enough extra money from working four days a week to have some left over for a few ads and fliers each month, and 2) it kept my focus completely on my business.
- Second, regarding my jobs at the time… I purposely gravitated toward jobs that didn’t interfere with my business. I found that working as a supervisor for a security company nights and weekends (11 PM – 7 AM… yes, it sucked but it didn’t interfere with my teaching schedule) and in later in health care served my purposes (I took a job as a private care assistant, which paid as well as any other job and allowed me to work 6 AM to 4 PM four days a week, then rush off to teach classes after). You may find it tougher to do this now, since the job market sucks… but I really hustled to get those jobs, and kept my eyes open for positions I might apply for that better suited my teaching schedule. I had once canceled my classes in another town in order to take a well-paying job, and regretted that decision. So, I resolved to only take jobs that worked around my class schedule… even if it meant working two part-time jobs at times.
- Third, I prioritized, which is reflected in what I’ve already written. I put my business and goal of owning a school first before anything else. Granted, this later caused some balance issues in my life but initially it served the purpose of keeping me on track to reaching my goals.
- Finally, I made time to work on my business every day. If I went in to work late, I took time beforehand to make fliers and distribute them (I didn’t even own a computer, so I had to go to Kinko’s and rent their computers, learning on the fly). Or, I spent time working on my curriculum and planning classes. Or, I called up my students to check on them, especially making sure I called my leads first, then my MIAs and no-shows. Or, I spent time looking for new places to teach in alternate locations so I could get more students and make more money (incidentally, by the time I really got my school up and running, I was teaching in my own school, at the rec center, for the local university, at a local daycare, and for the after-school enrichment program in the local ISD – in short, I was hustling 24/7).
Yes, it’s easy to get overwhelmed… but remember, I didn’t do this all at once. I ate the elephant one bite at a time.
And good Lord, if I’d have had the internet and social media back then… well, let’s just say I would have gone from zero to one-hundred-fifty in less than a year instead of in three years (after a year of stops and starts, it took me less than a year to get my school open once I got serious, and that was all from getting focused and hustling).
You’re roughly the same age I was when I did this. I was a high school drop out, I had no local contacts, moved to Austin with $50 and dream (literally, I had $50 in my pocket and the name of a friend of a friend when I came to town), I had no money, no credit, and no one to turn to for help with any real substantial financing. Trust me, if I could do it you can as well.
The bottom line is, you need to set a definite, long-term goal and then break that down into incremental smaller steps that bring you closer to that goal. And, you need to take some sort of action every day to bring you closer to your goal.
I find that feeling a sense of helplessness comes from having no direction, no plan, and therefore from feeling like you aren’t working toward your goal. Simply having written goals and a written plan with daily, weekly, and monthly action steps and benchmarks and taking small daily actions toward your goal will improve your mental and emotional state immensely. It’s hard to be discouraged when you’re so focused on your goal that you don’t even notice setbacks and sidetracks.
So, get focused and make small, daily, incremental steps toward achieving your goal of owning a school. Small steps add up over time. That’s my advice. And, if you want to know how I did this, step-by-step, then read Small Dojo Big Profits.
I’d say good luck, but luck has nothing to do with it… 
—
Do any of you experienced school owners out there have any additional advice for FC? If so, post your comments below!
Posted by Mike Massie on June 29, 2010
The Only Job Security For Martial Art School Owners
Even the youngest students expect a level of professionalism from their instructors. Remember, children will express their views and opinions to their parents, and such conversations often influence parent's buying decisions.
Here’s a question for you…
How professional is your school?
This is an area that is typically ignored or taken for granted in martial arts schools, yet I have observed it to be a pivotal factor in the success of many, many schools.
So, here are some areas where you may consider evaluating and improving the level of professionalism in your school.
Doing so could very well pay off for you in increased enrollments and word-of-mouth referrals.
Facilities
The next time you walk into your school, make a point of looking at it with fresh eyes. Look at it from the perspective of someone who is walking in for the first time evaluating the facility as a potential customer. What would they think?
In my experience, few school owners pay particular attention to the cleanliness and orderliness of their schools. This is a huge mistake. The way your school looks (and smells) is a big part of how people perceive your facility.
In my first school, it was admittedly not in the best location. We had no external doors or windows, it was at the end of a long hallway, and the space was more or less a warehouse facility. Also, I had fixed the place up using a lot of secondhand and bargain basement building materials, which resulted in mismatched floor tiles, and a “DIY” appearance on the fit and finish of the interior.
So, we took great pains to keep the place as clean as possible. I’ll never forget the time when we had a female guest instructor teaching, and she walked out of the restroom with a surprised look on her face. “That’s the cleanest bathroom I have ever seen in a martial arts school,” she stated.
The point here is that, even if you don’t have the best facilities, you can still make a good impression by keeping them as clean as possible. Also, a fresh coat of paint on the walls once or twice a year and replacing old and worn equipment is a must. If it’s dirty, clean it. If it’s old and worn, replace it. Look at everything in your school with fresh eyes at least once a week, make a list of what needs cleaned, repaired, and replaced, and knock it out immediately.
Procedures
Do you answer the phone professionally… every time you answer? Are visitors promptly welcomed as they walk in the door? Do you return phone calls promptly the same day you receive a voice message? Do you even have a list of procedures to follow that outline how to take a new student from their first contact with the school through the entire enrollment process?
Having protocols and procedures in place are what make the difference between amateurs and professionals. Amateurs wing it, while professionals know exactly what to do at every step of the way, because they have a procedure, protocols, and contingency plans in place that they’ve memorized and practiced until they become second nature.
Customers can tell when you’re winging it. Over the last few weeks, I’ve been calling martial arts schools in my area while performing a competitive analysis in certain areas of my city. And, I’m amazed at the fact that 50% of the schools I call don’t answer their phones, while the other 50% do not have any basic phone sales training at all. That’s right – NONE of the schools I have called knew a thing about setting appointments and selling over the phone.
So, imagine what would happen if just one of them put professional protocols and procedures in place. I can assure you, they’d quickly outdistance their competition and increase their market share dramatically.
Be professional. Have professional procedures and protocols in place that cover everything from answering the phones to handling students professionally who are withdrawing from classes. All other things being equal, what separates you from your competitors is how professionally your clients are treated. Over time, this WILL make a huge difference in the volume of your referrals in your community.
Policies
How well do you treat your clients? Do you have posted policies regarding membership agreements, late fees, cancellations, and attendance? Are you of your word when it comes to enforcing those policies equally across the board? Do you treat every student fairly and without bias or preference based on your posted company policies?
Your company’s policies are part of the agreement you make with your customers that says, “I’ll provide ‘x’ service for you, you’ll pay me ‘y’ in return, and if ‘z’ comes up this is how you can expect us to handle it.” Having such policies in place assures the client that you intend to treat them fairly should things go awry, and it also lets them know what they can expect when the unexpected occurs.
Ask yourself, for instance:
- Is it fair to make someone pay the balance on their membership if they move to another town due to a change of employment?
- Would you want to continue paying for martial arts lessons if you were permanently disabled due to illness or injury?
- If you were the student, would you like to have the option to make up classes missed due to illness or vacation by attending extra classes during the weeks following the missed classes?
- Were you the student, would you appreciate having a three-day grace period before late fees were incurred on late tuition payments?
- If you were the student, would you appreciate having the NSF fees waived on the first occurrence of a check or EFT payment being returned or rejected for non-sufficient funds?
Such policies give the student the benefit of the doubt. In addition, having policies such as these posted in your school conveys the message that, while you do have policies in place to prevent unethical customers taking advantage of the school, you also have the customer’s well-being in mind. “Firm but fair” is a good attitude to have when it comes to drafting and implementing your company’s policies.
In Closing
Professionalism is the result of expertise, experience, competence, caring, and consistency in action.
And while any amateur can hang out a shingle and start a school, the professional instructor is one who emphasizes excellence in every aspect of their school’s operations. Elevating your school to the level of such excellence will take you a long way toward securing your financial future as an instructor.
Be excellent at what you do, because professionalism is job security for martial art school owners.
Posted by Mike Massie on May 5, 2010
Are You Following A Proven System To Martial Arts Business Success?
If martial arts school owners spent as much time honing their business skills as they did honing their martial art skills, we would see a lot less schools closing their doors
There are a lot of reasons why martial art school owners hit plateaus in the growth of their schools. But no matter the specific reason, their lack of growth can almost always be chalked up to internal, and not external factors.
In other words, it’s almost never “the economy”, “the area”, “the location”, or “the clientele” that’s to blame when a martial art school owner hits a brick wall in increasing their student enrollment numbers.
Nope. Instead, it’s typically something that’s going on within the school – some critical area of business performance that is being overlooked, neglected, or that is completely absent – that’s to blame.
And, this all goes directly back to lacking an overarching, integrated, complete business system to follow in every step of growing your martial art school.
It’s Not Rocket Science… But You Still Need To Follow The Instructions
Anyone can open a martial art school – it doesn’t take a whole lot of business acumen to get a martial art school open. Just a little money (enough for the rent and deposit on the space and utilities, some signage, and your permits) and you’re in business.
However, to stay in business past the first two years… well, that’s another matter. And despite how few schools truly thrive financially, I often hear people saying things like, “running a martial art school isn’t brain surgery” or “it’s not rocket science.
True, martial arts business management is not something that takes a tremendous amount of intelligence to grasp. However, just like assembling your office furniture or your kid’s toys on Christmas eve, you do need to read and follow the instructions.
Most school owners understand this, but this is exactly where the problem starts for the majority of school owners.
Imagine you’re assembling a new desk for your office. And, instead of reading the specific step-by-step instructions for that particular piece of furniture, you took the instructions from several different pieces of furniture and started following steps from different sheets at random.
I’m sure you can see where this is going – you’d soon have a confused mess on your hands.
Without following the instructions that were created to build that particular piece of furniture, you’ll soon be lost. And, by following steps randomly or out of sequence, you’ll likely have to go back, disassemble your work, and start all over again at some point in the process.
A Simple, Comprehensive, Fundamentals-First Approach To Starting And Running A Martial Art School
I wrote Small Dojo Big Profits after ten years of figuring out exactly how to start, run, and grow a martial art school from scratch. At the time I wrote it, I’d been running a successful school for eight years.
It took me the first two years to figure things out, and eight more to perfect my system. The first two years represented my trial and error process of learning how to launch a school from scratch, with no financing, credit, or start-up capital to speak of.
I then spent the next eight years developing a simple yet highly effective system for growing and operating a martial art school on a day-to-day basis.
The funny thing is, I had a very good system in place by roughly my fourth year in business. However, I tried and tested other methods along the way (often with disastrous results). In the end, I went back to the system I started with, and was much happier (and more profitable) for doing so.
The end result was that I had built a very stable, low-overhead, high-profit school – one that I could operate while only working an average of 25 hours a week.
And, that’s the system that is distilled and mapped out for you in Small Dojo Big Profits… the “step-by-step instruction manual” for starting and running a small (150 – 250 student) highly profitable martial art school.
It’s custom fit for the instructor who wants to have a thriving business and a life outside their business as well.
Interested? Check out this site to find out more, and to order the book if you’re serious about growing a successful school.
http://www.small-dojo-big-profits.com/
Posted by Mike Massie on April 14, 2010
If You Don’t Think Honesty Is The Best Policy In Customer Service… Your Days Are Numbered
"What do you mean you want to cancel your membership?!?!?"
I am simply amazed that certain less-than-ethical practices still persist in the martial arts industry… especially in light of the fact that now, more than ever, we exist in “the age of the consumer.”
What do I mean by this?
Well, observe the very website you are reading this article on… you’re reading a blog, also known as a “web-log.”
Blogs were one of the first “web 2.0″ applications that allowed the general public to quickly and easily share information on a mass-scale. Other web 2.0 applications include:
- Social networking sites
- Micro-blogging (Twitter)
- Social video sites
- Social bookmarking sites
- Review sites
- Local business listing and “maps” sites
Every single one of the above allows the consumer a near-instant and virtually unlimited ability to influence the public for or against your business.
Review Sites Spell Doom For Unethical Martial Art Schools?
Think about it; everyone knows how important it is for local marketing purposes to have your business listed in Google Maps and Yahoo Local. But have you given serious thought to the review function of these sites?
Anyone can login to their Yahoo or Google account and post a review of your business – one that will remain online for an indefinite period of time, and that you have almost zero chance of getting rid of once it is published online.
Moreover, those reviews often get copied and aggregated by other “knock-off” sites… meaning the negative review may very well show up all over the internet.
And with the advent of Facebook and Twitter, with a few keystrokes a single consumer can almost instantly spread their discontent about a business to thousands of other consumers. It also deserves mentioning that Twitter and Facebook content is increasingly being used by Google to serve up information in their search results pages.
With nearly 100% of consumers searching online when shopping locally, it’s no small leap of logic to assume that too many negative reviews and opinions posted online about a martial arts school can have a very negative effect on business.
The Positive Side Of Consumer Influence
Of course, this can be a very positive thing… if you’re an ethical business owner who treats your customers the way you’d want to be treated were you in their place.
However, as my blog readers and newsletter subscribers are all too aware – unethical and “grey area” business practices seem to be the accepted norm in many martial arts schools in America.
However, I don’t totally hold the individual school owner to blame for the vast proliferation of shady business policies in martial arts schools. That’s because you’ve been fed a lot of really bad ideas about how to run a business over the last two decades – ideas that originated with the martial arts billing companies.
You see, these companies have a vested interest in seeing to it that their clients (martial art schools) stuck it to their students, since they are paid a flat percentage of the gross income they collect.
So, it works to their advantage to influence school owners by telling them that they should:
- Sign new students up on the longest possible contract -
- Hold students accountable for paying their contracts, even if they move, or have to drop out of classes due to a legitimate health issue, or lose their job -
- Use a collection agency to chase delinquent accounts to the four corners of the earth -
- Use a billing company to handle their accounts in the first place (a service that technology has made obsolete in recent years, as I recently pointed out in this article) -
The fact remains, however, that the above policies represent a really crummy way to treat your customers. Maybe shady martial arts schools could get away with this stuff in the past, but those days are numbered (well, at least we can hope… but you know how cockroaches always seem to keep coming back).
The Potential For Abuse Of Social Media
Yes, there also remains the possibility of abuse of this new technology. In the past, we (the honest school owners) had to put up with petty little underhanded business tactics being used against us by our less-than-ethical competitors.
This may have amounted to little more than having our brochures or lead boxes stolen (this actually has happened to me on numerous occasions), or having competitors openly trying to “steal” your students and prospects through promises of rapid rank advancement or by other means (again, I’ve had to put up with these tactics as well).
But in this day and age we have to be aware that our competitors can easily create false profiles on social networking sites and other web 2.0 properties, and create fraudulent negative reviews of our schools. You may think this couldn’t happen to you, but believe me, it’s already happening right now.
(A little side note… when I released Small Dojo Big Profits 6 years ago, I almost immediately faced a slanderous smear campaign that was run against my book on the martial arts internet forums – the social networking sites of the day. My guess is that certain interests in the industry didn’t like what I had to say about the state of the industry, so they put their cronies up to it. Well, it’s six years later, I’m still here, and now there’s no way any one single entity can control the information that is disseminated in our industry…)
So, What Steps Should An Honest School Owner Take?
Here’s my advice to ALL school owners regarding the effects of social media on our industry:
- Treat ‘em right - First off, STOP TREATING PEOPLE LIKE A PAYCHECK! What I mean is that you need to start acting as an advocate for your client, from the moment they contact you to the moment they move on from your school. Always, always, always act in the interest of the client, period. You can’t go wrong by doing right by people – make that your motto.
- Make sure you’re spreading the right “idea virus” - Second, realize that you need to have public perception and opinion on your side. And, the best way to do that is to refer to item #1 above. Social media is viral, ideas are viral, everything moves at the speed of bits and bytes these days… so start an idea virus about your business that says you treat people right and offer the best possible instruction to your students. Once it spreads, the effect it will have on your business is immeasurable.
- Encourage your students to tell others - Remind your students that you’d appreciate it if they reviewed your school on sites like Google Maps, Yahoo Local, Yelp, and so forth. Remember, first you have to be listed on those sites!
- Be aware of what’s being said about you online – Don’t obsess about this, because there are always going to be a few dissatisfied customers in the crowd. However, you should occasionally monitor review sites for signs that false negative reviews are being posted about your business. If you feel that’s the case, it’s your right to take it up with the site administrators, and to ask them to take any such reviews down. Be persistent; it may take numerous requests and lots of correspondence before you get results.
Final Thoughts
In the long run, I think social media will be instrumental in forcing businesses to adopt business practices that level the playing field for consumers… and the martial arts industry is no exception.
However, the bottom line is that you need to treat your customers right. It’s always a better policy to treat people fairly and deal with them in an honest fashion.
And, by doing so you may very well be cementing a positive public opinion regarding your school that will reap positive benefits for your business for years to come.
