Feb 23, 2018
What’s a better way to start up a massage practice: fixed/flat rent or paying an hourly rental? We examine the options and the factors to consider.Listen to "E143: Fixed Rent or Pay as You Go?" on Spreaker.
What’s a better way to start up a massage practice: fixed/flat rent or paying an hourly rental? We examine the options and the factors to consider.
This episode is sponsored by:
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Michael Reynolds Hey, everyone. Welcome to the Massage Business Blueprint podcast, where we discuss the business side of massage therapy. I’m Michael Reynolds.
Allissa Haines And I am Allissa Haines.
MR And we’re your hosts. Thanks for joining us today. Allissa, what’s going on? You buried in snow?
AH Little bit. It’s not too bad. But it’s going to turn into ice later; so that’s exciting.
MR Still snow. I guess, you know, it’s February; so we should not be surprised.
AH No. And we’re planning our Massage Business Blueprint retreats to somewhere warm in future winters. I like that we’ve got that on the back burner.
MR Ah. My brain is already going there. Yeah. [laughs] Let’s work on that after this episode. Today we’re going to talk about rent. Specifically, fixed rent or pay-as-you-go. That’s a great question. I don’t think this has come up before. So what you got?
AH You know. It’s come up a bunch of times, but in private conversations in our Massage Business Blueprint premium member discussion group. Premium members get to be part of a Facebook group, and so this question has come up a couple of times, especially with people starting up. The question came up recently
“Which is best when you are starting out? Renting a room for a regular, whole day at a fixed fee or renting a room at an hourly rate at a similar price on a flexible hour-by-hour basis? I can see the pros and cons to both, but since I don’t have any actual clients at the moment, my first months are likely to be very sparse.”
So we had — and this has come up a couple of times, and it’s a coin toss, and there’s a lot of context involved. My initial opinion, and then we can — Michael, make sure to stop me at some point because I am going to give my thoughts, and then we’ll do our halftime sponsor, and then we’re going to provide a whole bunch of context, but I’m totally going to roll right through if you don’t stop me.
MR I will try to jump in.
AH Thank you. I like flat rates. I think that, especially when you’re starting up, a flat-rate rent is going to increase your hustle. You have to pay that amount of rent no matter how many clients you see. With a flexible rate, it’s a lot easier to slack off and not hustle, because you’re not paying rent; you’re not out that money unless you work. With a flat rent, you’re out that money; you need to make it; you need to see clients; you need to hustle. When you’re paying a flat rent for a day or two, or whatever your set schedule is at a time, that forces you into a nice business structure, which is great for boundaries. You’re only going to to see clients on those days and times that you’re renting the space. And a good business is built on good, consistent, structured boundaries. And you can grow without it costing you more. So I’m paying that flat rent, let’s say, for two days a week. If I see two clients a week, I’m not paying any more rent than if I stay — or any less rent than if I see 15 clients a week, pardon me. But with a flexible pay-per-hour, the mentality’s a little different. You aren’t as inspired to see more clients because you’re not seeing that full amount in your take-home. You don’t think to yourself Yes. I’m going to make a hundred bucks off this client today. You’re like Uh. I’m going to make a hundred bucks, but then I have to give 40% of that to my landlord. And, ultimately, that does heavy psychological impact. And also, usually a flat rent ends up being more economical once you hit a certain number of clients. And having that certain number of clients you need to clear every week or every month is a really good goal. It’s a great, hard goal to have set to motivate you to reach that certain number of clients and beyond. I like flat rent, ultimately, because it usually ends up being more economical, it provides a great boundary and structure to your business as your business starts up — and that is vital — and it increases your hustle. And that’s why I like flat rents more than flexible ones. But there’s a whole bunch of context to this; so, Michael, before I jump into context, who is our halftime sponsor today?
MR I didn’t even have to stop you. You were all set. We —
AH I know.
MR I know, right? We actually have a new sponsor today I’m excited about. We’re talking about Mother Earth pillows today, a new sponsor bringing on board. Yeah. Welcome, Mother Earth.
AH Welcome and thank you. I have been using Mother Earth pillows in my massage practice for years; so it’s such a victory for us, and I feel such a great catch for us to finally get them in as a sponsor.
Sponsor message Mother Earth pillows are the original herbal flaxseed pillows handcrafted in Missouri. They are made with golden flax, which I’m going to tell you a little bit about why this is awesome. Golden flax is a food-grade golden flax that they use — flax seed, pardon me, and it holds heat and cold longer than other products. And this is a big selling point, because I retail these in my office. They stay warmer and they stay colder for longer periods of time than those cheap wraps you get at a mall kiosk. They are, indeed, the highest quality product for self-care and for therapists themselves and using in treatment. They have 100% cotton fabric and recyclable and reusable packaging; so you can feel good about using them and about selling them. And this is a huge deal they’re giving our our people — free shipping on your next order of over $50. You use coupon code BLUEPRINT, all caps, BLUEPRINT. Do not use this in conjunction with another coupon or with sale items. But to get free shipping on an order of over $50 of merchandise is huge, because shipping’s a killer with these big, heavy pillows. Visit massagebusinessblueprint.com/motherearth and learn more and order your massage earth — pardon me, Mother Earth pillows. Again, that’s massagebusinessblueprint.com/motherearth.
AH I got so excited, I fumbled a lot of that. I’m sorry.
MR I’m just looking at their website right now feeling at peace, because it just looks so peaceful.
AH It is. And it’s a new website —
MR I’m going to hang out here on their website. [laughs]
AH — so if you struggled with navigating the old website years ago or even several months ago, they have a beautiful new interface; it’s lovely. I’ve enjoyed our conversations with the owner, Jeff. The business changed hands a couple years ago. Jeff is just delightful. Their products are wonderful, and I’m — I really do feel like this is such a coup for us to have them as a sponsor. We’ve been referring people there, and I have been referring colleagues there for years anyhow; so I feel so good and so heartened about this partnership. I just am thrilled.
MR Way to make it official.
AH Yay! I put a ring on it.
AH I don’t know what’s wrong with me. [laughs]
MR All right. Back to the topic at hand.
AH Back to the topic at hand. Some context about flat rent versus flexible, hourly rents. Things to consider. Now, I obviously have placed my vote for flat rents for a variety of reasons, but this isn’t always best. Things you have to consider: Do you have cash set aside to pay the first few months of rent and expenses even if you don’t have enough clients to cover those costs? What is your financial situation at home? If you immediately need to be bringing in more money, then a flexible situation to start up might be better, because you’ve got a lower threshold of bills to pay. You’re not paying out unless you are making the money in. How long can you front a business? How many months do you have set aside if you’re not seeing enough clients to cover the rent? What’s your bottom line that you would need to cover the rent? And, mostly, do you have a plan to bring in new clients? How you going to get them? You want to know before you commit to any rental situation that you have a plan, a solid foundation, to have a good website — hopefully you have it already — to have some system of capturing people’s information so you can contact them at a future date. So getting someone’s email or phone number for texting purposes to send them more information about your massage after they visit your website. What is your plan for networking? How are you going to get bodies on your table? If you don’t have any answers to that yet, then you probably don’t want to rent anything until you have those answers, or maybe a flexible situation is a little bit better as your start up. An ideal situation would be one where it’s flexible and maxes out. So you pay, let’s say, $20 for every hour massage you do there, but your rent maxes out at $200 a month or whatever depending on the days it’s available or whatever it takes. That’s ideal, but that’s not available for most of us. Also considering, when you are weighing your options, is the environment supportive? Is it a place where you’ll get lots of cross-referrals or are you just going to be on your own, which is okay, too, but it’s a thing you want to think about. There’s a lot of context. Michael, what can you think of for factors people might want to consider?
MR No, I can’t think of anything to add to that. I think you’ve covered it all. I like fixed rent, personally, myself, but of course, the caveats you mentioned kind of make sense.
AH Yeah, and I think it’s important to really push ourselves to meet certain goals and having that hard line of rent that you have to pay really moves this from being an Oh, I’m trying this kind of hobby into treating our business like a real business. And if you’re someone who tends to be a little bit all over the place, maybe you need a really solid goal like this. You need a real solid deadline of a rent being due to push you to do the things you know you need to do to build that strong foundation for your business. That’s what I think.
MR Right on. I like it. All right. We’ll wrap it up there, then. Thanks, everyone. Appreciate you joining us as always. Our website is massagebusinessblueprint.com. We’ve got a lot of content there as well as a premium member community you can check out. It’s $9 a month; it’s growing every day. We’re getting new members all the time; so the group is getting better and better. I love it. If you want to send us a note, you can always find us via email at email@example.com. Thanks again for all the iTunes reviews; we read every one of them and appreciate it. And we appreciate you joining us today. See you next time. Thanks, everybody.