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Never Ask Clients To Buy Another Package Again

Why hire a pilates instructor?Easier said than done, right?  Not exactly,

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and I’ll tell you why.  When I first decided to open my studio in 2004, I was so pumped up and excited the last thing I was thinking about was the business side of it – I thought it would just fall into place.  It didn’t quite happen that way.

Let me explain. I believed everyone charged clients according to Joseph Pilates’ quote of 10…20…30…sessions.  You know the one. I firmly stand behind this quote which is why I originally used the same pricing guidelines that many Pilates studios used, I charged by packages of sessions. However, it was stressful every time clients’ packages were due. This created other issues too. I wasn’t sure if they were committed to continue.  What if they forgot their sessions were used up or they forgot their check or credit card? This happened to me plenty of times and I felt like a collections representative trying to get my money. It was very frustrating and I’ve spoken with many other business owners and instructors who also dreaded when their clients are on session 8 of a 10 package series.

I finally realized it would be much easier if we only had to deal with signing up clients for billing one time. Rather than charge by the package I switched over to monthly billing. Not only was I able to better track monthly income, my clients benefited by being more committed to their workout schedule so they could achieve their fitness goals.

Monthly billing enabled me to set goals and understand what was needed to attain those goals. For example, if you have 5 clients paying $200 a month, and they are debited on the first of each month, you know that every 1st of the month that $1000 would be deposited into your account.  If your goal is to bring in $3500 per month and you charge $200 a month (assuming 2 sessions per week) you would need approximately 17.5 clients per month.

Recurring Revenue Benefits

Other benefits to using monthly billing, which is also known as electronic funds transfer (EFT) are:

  • Avoiding the problem of late cancellations—it is written into my agreement that if clients do not give 24 hour notification of cancellations then that session is forfeited.  Before, it could be awkward when these situations arose.
  • Being able to track my monthly income and earning more money. When clients were paying based on packages, monthly income was sporadic and unpredictable. If they had a 10 session package, it could carry over into one month or two which didn’t benefit them or my business. EFT helps the client by keeping them consistently working out and helps the business by having consistent, predictable income.
  • Reduced stress for me and my instructors—no one has to worry about the financial side of things after the client’s initial visit.
  • It allows me to concentrate on teaching Pilates which is what I love to do.

Recurring Revenue Resources

Setting up EFT is fairly simple, here are a couple of EFT companies I personally have used:

  • U.S. Merchant Systems (www.usms.com) -online auto debit (EFT) system

You don’t have to lock your clients into a long-term contract.  You can offer it to them on a month-to-month basis.  Best of all, you can set goals for yourself and know exactly how many clients and sessions you need to achieve it!  Pilates is a lifestyle so let’s set it up that way.

By · Posted on June 2, 2009 · Topic Business

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12 Responses to “Never Ask Clients To Buy Another Package Again”

  1. Margrette Field on June 2nd, 2009 10:23 am

    I have been looking for ways to streamline my billing as well. This article really helped me see how I might do that. I have a question. You say they are paying on the 1st of the month. What if they start with you in the middle of the month. Do you just wait to bill them until the 1st? Or do you pro-rate their sessions?

  2. Jill Cuzzone on June 2nd, 2009 6:57 pm

    Ok, this sounds like it could be great. How do you handle it then if someone does cancel with 24 hours notice, do you give them a credit toward the next month and how do you keep track?

    Thanks!

    Jill

  3. Sylvia Camarillo on June 18th, 2009 10:53 pm

    Hi Jill,

    I sent out an email to you directly, I hope you received. In case you didn’t what I normally do if someone does cancel within the 24 hour time I make up their session that week or as fast as possible. I do not allow any sessions to trail over to the following month.

    Thank you very much for your question…
    Sylvia

  4. Sylvia Camarillo on June 18th, 2009 10:56 pm

    Hi Margrette,

    I sent you out an email but I want to make sure you received my response. What I usually do when a new client starts is set their debit date the day they started. I do not give a specific debit (unless of course you want to and if you do you may need to prorate that amount).

    I hope this helps…Thank you for your question…

    Sylvia

  5. Anne on July 4th, 2009 8:06 pm

    Great article Sylvia. I’d love to chat with you more about your coaching program.

    :)

  6. Delia on July 9th, 2009 2:59 pm

    Sylvia,

    This was a terrific article in Pilates Digest. I live in a small town and have recently been dealing with cancellations Its really difficult to enforce my cancelation policy. Also, It is really difficult to put yourself on a budget just like you stated in the article when clients pay you for packages.

    I have questions on how to start applying the monthly billing in the studio and convincing clients that this is the way to go. What is your email address?

    Thanks so much,
    Delia

  7. Caroline Trude-Rede on July 10th, 2009 2:35 pm

    Sylvia,

    While this sounds like a really good idea.. I think it depends on where your studio is located. I am not a studio owner but rather a client. From my perspective, I would not be in favor of this. Here’s why: with my job, I travel a lot. I could be here one week and gone the next. I love my pilates studio, however I would be fairly upset if I was billed monthly and stuck in the Virgin Islands for 3 weeks of that month. How far is it for me to pay the same amount every month while I cannot constantly utilize it the same? I know it may seem like an individual case but I know for a fact, a lot of other clients at this studio are in the same boat. This is why I like paying for packages. I understand your point of view as well, you do not want to seem like a bill collector but at the same time, people generally hate automatic payments and I don’t feel that in this economy, they would be happy to add another bill every month. Just my two sense as a client..

    Thanks!

  8. Sylvia Camarillo on July 14th, 2009 1:43 pm

    Hi Caroline,

    I completely understand what you are saying. Three of my personal clients constantly traveled every month. They always got there workouts in and they never lost a session. i always made sure to keep a strong line of communication with all my clients especially the ones that traveled and it always worked out. In this day I found no problem for my current and past clients to go on automatic debit, It actually worked out to be better for my clients since I was able to give them a slightly lower rate per session. I didn’t ever have a problem with any of my clients not wanting to be put on auto debit.

    thanks for your response…

  9. Greg Burns on July 23rd, 2009 12:37 am

    Hi Sylvia,
    With the monthly billing some months are longer and will have more sessions,
    do you adjust the price each month for more or less sessions or just make it a flat fee?
    Have you ever thought about a 4 week month/13 pay periods a year?

    Thanks

  10. Barbara on May 25th, 2011 11:56 am

    Hi Sylvia,

    This is an awesome article. I would like to learn more about your coaching. I have many questions on the billling and how to get started with a business. How would you handle No Shows whom signed up and taken all the spots ? And do you spilt reformer and mat classes or does their membership include all classes? I look forward talking to you soon. I looked for your email address on your website but couldn’t find it.

    Thanks

  11. Kim Jackson on August 8th, 2012 9:03 pm

    Sylvia,
    I have several questions about your monthly pricing strategy. 1. You state you based your $200 per month on 2 sessions /week. How do you handle months with extra weeks /partial weeks. 2. Do you actually state that this program includes a limit of 2 classes per week? If so, how do you monitor that? How does a client pay if they want to take a 3rd class in one week?
    3. Do you use any scheduling software? 4. . Does this price include mat as well as equipment classes? If not, are these classes priced differently?
    If clients don’t want to choose the monthly billing option, how do they pay for classes?
    I would love to vist with you further about this. Thanks!

  12. James Muthana on November 15th, 2012 9:49 am

    Monthly recurring is such a powerful concept. We currently offer blocks of sessions, and yes, when it comes to the final session, not everyone will sign up right away. A monthly billing approach makes so much sense. Thanks for the wake up call!

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