Podcast

Episode 435

Sep 23, 2022

When you run your massage practice as a business and not just a hobby, you need to know your financial health so you can make sound financial decisions for your business and personal life. Michael and Allissa even have a spreadsheet to share with you.

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EPISODE 435

Weekly Roundup

Discussion Topic

Quick Tips

  • Embrace inaccuracy

Sponsors


Transcript: 

Sponsor message:

This episode is sponsored by the Original Jojoba Company. I believe that massage therapists should only be using the highest quality products, because our clients deserve it, our own bodies deserve it. I have been using Jojoba for years for a whole bunch of reasons. But today let's talk about how it's non-comedogenic. So it's not going to clog pores. So if you've got clients that are prone to acne breakouts, Jojoba is not going to irritate or cause that reaction. In fact, Jojoba can help to clean out and clear the pore. Let's talk also about how you can get a 20% discount off the price of the product when you shop through our link, massagebusinessblueprint.com/jojoba.

Allissa Haines:

Hello everyone, and welcome to the Massage Business Blueprint podcast, where we help you attract more clients, make more money, and improve your quality of life. I, disheveled as I am today, am Allissa Haines.

Michael Reynolds:

And I am Michael Reynolds, equally disheveled.

Allissa Haines:

Equally disheveled. We are having this round of tech issues where Michael and I both get here 10 to 15 minutes early and check in and do a whole thing. And then roughly three seconds or three minutes before we have to go live, my internet crashes or something else happens. So I have just done a mad dash from my outdoor office to my partner's mad scientist office here, with a nice grainy camera going on now.

Michael Reynolds:

But new computer on the way.

Allissa Haines:

And that's just going to be how it is. Michael, what are you reading?

Michael Reynolds:

What am I reading? In full transparency and authenticity, I am going to share that I'm reading Diary of a Minecraft Zombie, because that's what Eli, my seven year old brought home from the library. He loves Minecraft as I'm sure anyone who knows me for more than five minutes knows, and that's an understatement. He's obsessed with Minecraft. He plays Minecraft. I have set up a Minecraft server for his friends. We are into Minecraft here. So he always looks for Minecraft books at the library. And there's this really cool series called Diary of a, and then fill in the blank, whatever monster in Minecraft is doing the book. And this one's Diary of a Minecraft Zombie.

And it's all about this zombie kid who's in school and his antics in school. He's basically writing about his experience in school as a zombie and his friend, Steve is a human and it's like a whole thing. So anyway, that's what we're reading, Diary of a Minecraft Zombie. And I find it delightfully entertaining.

Allissa Haines:

You know what? Liam and I, since pandemic times when I was his instructional assistant at home for several months, we started doing a little youth literature reading club and he literally would call it book club because that's what they did in school. And we would each read a book and then we would just talk about it for five minutes. And that was it, but it was a little book club and it was awesome.

Michael Reynolds:

Love it.

Allissa Haines:

Yeah. I mean, I loved reading kids' books when I was a kid. So it took a 20 some year break from it. And then have you read the Magic Treehouse series yet?

Michael Reynolds:

Yeah, all of them.

Allissa Haines:

Yeah. So we have not read all of them. We were reading them together, or he was reading one and then he would give it to me to read. And then he moved on to something else. So we stopped at 23 or something, but I would like to get back on it. I'm working on that.

Michael Reynolds:

Nice. What are you reading?

Allissa Haines:

Anyhow. Oh, yeah, that's right. I forgot I was ready to jump to the sponsor. So I've been reading garbage, so I'm not going to tell everybody about that. But I've been listening to, there's a podcast called Noble Blood and it is Dana Schwarz. I don't know it's I think it's Schwartz. I think she says Schwarz. So she's really great. I actually talked a couple months ago about her book Anatomy, A Love Story. That was part history, part gross medical drama. And there's a follow up to that coming to, and I can't remember what it is. But it's coming out soon.

But she has a podcast. She's had a podcast for a long time called Noble Blood, where she explores the stories of some of history's most fascinating Royals, the tyrants and the tragic, the murders and the murderers and the murdered, and everyone in between. And they're great stories. They're really interesting historical stories. They're usually half an hour or less, which is exactly my speed. And she'll cover things from whatever 8th century something, something of France. And also she recently covered the relationship between King Edward IV, wait V, VIII, who abdicated the throne, which is how Queen Elizabeth's father ended up king and she ended up queen.

And she read the Duke is what he became, his relationship with Adolph Hitler, which is fascinating. And so the most recent episode is of course about Queen Elizabeth, who just passed away. But specifically it covers Queen Elizabeth's greatest regret, which I had heard the story a little bit about only because I watched the Netflix series, The Crown. And it just talks about when there was, I don't know if they technically called it a mudslide, but there was some kind of environmental disaster, mudslide in a small town that was a mining town and it killed a hundred and some, almost 200 people and the bulk of them were school children.

And it talked about her response to that. And it was very interesting. I like that it was a very true and well reported story of that particular instance. I'm not super into the monarchy. I want to take a moment to appreciate that serious colonialism and holy wow. We have a lot to reckon with. And I say we, I'm not British. But I think that it is interesting to look at the history of these things from a lot of different perspectives. And I think that this particular podcast episode did so. It was very interesting.

Michael Reynolds:

Lovely.

Allissa Haines:

And that's what that's been... Oh, you know what? Did I talk about this last week? How there's a chart that's gone around of all of the dogs that were descended from Queen Elizabeth's original corgi, whose name was Susan, who she received as a gift on our 18th birthday?

Michael Reynolds:

Yeah.

Allissa Haines:

Oh my God. Okay. I'm going to find it. I'll publish it on our Instagram. But it's really cool. It's a flow chart of all the dogs that descended from Susan and they're all corgis except for a few, which were dorgies, which I had never heard of until I saw this chart a couple weeks ago, which is a dachshund/corgi. So if you Google that, they're the cutest dog in the world, except for my dog. They're the cutest dog in the world. And Queen Elizabeth actually stopped breeding dogs, I think in 2010, might have been a few years after that, I forget my numbers now, because she didn't want to leave too many young dogs that would miss her when she died, which I thought was really interesting.

So this chart follows all of the descendants of Susan and fascinating, and cute names like Willow and Basket. And there's like a Sugar and a Whiskey and they've got great dog names through the whole thing. So I don't want to harp on or glorify the colonialism aspect of Queen Elizabeth reign, but we can appreciate her dog names.

Michael Reynolds:

Well, I'm much more interested in royal dogs than Royal people. Sounds-

Allissa Haines:

Yeah. Right.

Michael Reynolds:

... interesting.

Allissa Haines:

Team Harry and Megan, by the way. Okay. So shall we move on to our next sponsor?

Michael Reynolds:

Sure. Before we do that, let's go to social media comments. We've got Andrew popping in on Facebook to say, Good morning, Alyssa and Michael." Good morning, Andrew. We're glad you're here. Andrew also mentioned, "Ooh, got to check out her book and podcast," referring to Noble Blood, I believe.

Allissa Haines:

So good.

Michael Reynolds:

And then Sequina stopped by on Facebook as well to say, "Good morning." Thanks Sequina.

Allissa Haines:

Hi, Sequina.

Michael Reynolds:

Glad you're here. All right. Who's our sponsor?

Allissa Haines:

Our next sponsor is ABMP, and I'm so delighted to talk about them today. So let's talk about the ABMP Education Center, because I spent some time on there last week, myself. You can go to abmp.com/learn to, in fact, learn more. There are over 600 hours of continuing education courses included with ABMP membership. And if you're not a member, they're available at a very reasonable price. They're actually, some of them, they're priced lower than some of the classes that the other organization charges their members for. But with a ABMP membership, it's all for free.

Topics include hands on techniques, ethics, self care, cultural competency. And they've got a whole batch of courses for massage educators that I have not dived into yet, but I've heard that they're very, very good. ABMP memberships get free CE for all courses, included with their level of membership. I've said that four times now. It's a really good way to meet your CE requirements and also to kind of virtually sort of recording wise, meet new presenters. So you can kind of decide whose style you like before you drop your money on a flight and hotel and a five day class with anyone. Again, bmp.com/learn, check it out.

Michael Reynolds:

There's just so much to be excited about with ABMP. That's why we're always so excited. We're like, "Whoa, ABMP. So much."

Allissa Haines:

Yeah.

Michael Reynolds:

We expect more.

Allissa Haines:

We're gushing.

Michael Reynolds:

And they deliver.

Allissa Haines:

We're gushing.

Michael Reynolds:

All right.

Allissa Haines:

Let's get into the nitty gritty because Michael previewed for me, some of the content of this topic that he is handling, and it's how to monitor the financial health of your massage business. And let me tell you folks, there's going to be a spreadsheet that you can download and use on your own. And it's phenomenal. So I'm going to stop talking because this is so good. Take it Michael.

Michael Reynolds:

Well, one, you may have oversold it. And two, when you said there's going to be a spreadsheet, we probably lost half our audience. But I will try to make it interesting.

Allissa Haines:

You don't have to use the spreadsheet.

Michael Reynolds:

What's that?

Allissa Haines:

You don't have to use the spreadsheet if you don't want to.

Michael Reynolds:

That's true. All right. So I'm going to, I'll kind of frame it and then I'll share my screen. Now, most of you are listening, I realize, on audio. So bear with me. We're going to make it work and you can go back later and look at the screen stuff. So what I'm putting together here today, it's super simple. This is not going to be a fancy spreadsheet. This is a very simple exercise. And it's meant to help you monitor how you're doing financially as a massage business. And here's why, I think so many of us are prone to getting in our business, running our business, doing the work, giving massage, dealing with clients, all the stuff, and all of us kind of run the risk of just not really paying attention to our numbers. We've talked about numbers in the past year on different episodes in different ways.

But I work with various massage therapists in different contexts. This is all of us have been guilty at some point. But when you ask the question, "Hey, how much money did you make last year? How much money are you on track to make this year?" A lot of times we just don't know the answer. We don't know what to say. It's very, very common for a massage therapist or any small business owner to not be able to answer that question. I frequently say like, "Hey, what do you think your revenue, your take home pay, your profit's going to be this year?" And it's just like glazed over because we just haven't paid attention. So I think it's really useful to pay attention, because this helps you make better financial decisions in your business. And it helps support your quality of life that you want for yourself.

Because, as a reminder, your business, now, if you want it to be a hobby fine, but I think most of us are running a business, not to be a hobby. We're running a business, A, because we love to serve our clients, but B, which is a close second, we want to make money. And we want to have income. And we want to support our lifestyle and have a good quality of life from that income. And I think it's easy to lose sight of it, especially in such a giving, helping profession like massage therapy. It's really easy to lose sight of that and say, "Well, my mission is to pour my soul into serving my clients." And it often results in the income side of the equation taking a backseat.

And so I think it's really important that we bring that income discussion to the forefront and the financial health of your business to the forefront. So that's what we're going to do briefly today. So here's what I'm going to do. I'm going to share my screen, which I realize if you're listening via audio, it's not going to mean much to you. So a couple ways you can do this. One, if you're watching live, you'll see it on screen. You can go back to our YouTube channel or Facebook page or wherever you want, and you can see this video in, not in real time, but in visual format, and you can see the screen share. So if you want to go back and do that, you can. All of our social channels are linked from our website, massagebusinessblueprint.com.

Or if you want to pause the episode right now via audio, you can go get the spreadsheet and do it with me. The spreadsheet is located at massagebusinessblueprint.com/finhealth, F-I-N health. Again, massagebusinessblueprint.com/finhealth, F-I-N health. That will lead you directly to a Google spreadsheet. And I'm going to go ahead and share it. And hopefully the sharing will work. It worked when I tested it. So let's hope it works again. And I think it's working. All right, Alyssa, can you see it?

Allissa Haines:

I sure can.

Michael Reynolds:

Fantastic.

Allissa Haines:

And I just want to note, I actually just copied this spreadsheet and I'm going to plug in my numbers as we go and see how things work out. So carry on.

Michael Reynolds:

Awesome. So like I said, you can go to this spreadsheet, it's view only. So what you'll want to do is you'll either want to go to the file menu and copy it to your own Google Drive. So you can go to, let's see, make a copy and it'll copy it to your own Google Drive. Or you can download it as an Excel file. So if you go to file and then download as Microsoft Excel, that will download as Excel file as well. So those are two ways you can bring it into your own system and then edit it with your own numbers. And if you're doing it on paper, you can just write these down too. That's fine. But the spreadsheet, I think, is going to be a little better eventually to work with because you can kind of tweak numbers and that's what the purpose is here.

So what we're going to try to figure out is a few numbers we want to pin down. One, we want to pin down what's your revenue? What's your monthly profit? What are you taking as owner's draw? Which is your personal compensation. What is your operating profit margin? What is your annual salary? We want to get these numbers. And again, bear with me. It's not complicated. So in the first line here, again, I'm looking at the spreadsheet. So write this down. If you're doing it on paper and kind of go with me, but the first number we're going to write down or look in the spreadsheet here is "average sessions per month". So this is how many massages you typically do in a month.

Now this is not going to be consistent. Obviously, there's ups and downs or seasonal stuff. I get it. This is not consistent, but we're looking for an average. Excuse me. So I asked her Alyssa, I was like, "Hey, Allissa, how many massages do you do in a month?" And she gave me some ranges. So I kind of plugged in, let's assume you do 15 sessions per week. So times four, 60 sessions a month. So again, just an average. Then the next line, we're going to do price per session. So I put in $100, just make it easy, round numbers, $100. Your price will probably vary.

By the way, this is a pretty decent argument for keeping your pricing consistent. I think a couple episodes ago, we talked about pricing your services a little bit, and we kind of, Allissa especially, talked about hey, it's much more simple to say, "Hey, a massage is X." Whether I'm using aromatherapy or cupping or whatever, I'll just make it one simple price. So this is a really good argument to just have one simple price for a session. It makes it easier to run your numbers for one thing.

So we've got average sessions per month, price per session. So the next number is our monthly revenue. That's pretty easy. Multiply the sessions per month times price per session. We get $6,000. So, I'm sorry. Yeah. In this example, it's 6,060 times 100. So that is our monthly revenue. That is how much money the business is taking in or gross sales is another way of saying it. Next. The next line is going to be monthly expenses. I plugged in $1,200 because Allissa gave me some benchmark to kind of go with, so $1,200 per month is what I'm putting in for total monthly expenses. This includes your office rent, your supplies, software, whatever you pay in a month to operate your business. That's what you plug in there.

Then the next line is going to be monthly profit. This is going to simply be your monthly revenue minus your monthly expenses. And that gives you your profit. So in our example, here, that's going to be $4,800 a month. So that's how much you have left over in the business after your expenses are subtracted from the revenue you bring in as a business. The next line is going to be monthly owner's draw. Now owner's draw is a fancy way of saying the money you pay yourself. So this is done by simply doing a transfer from your business account, into your personal account, or writing a check to yourself. However you want to do it. Excuse me.

Allissa Haines:

I'm going to pop in to note, just because I don't think we have yet, that this particular spreadsheet and this particular example, is applying to people who run their business as a Schedule C, as a sole proprietorship. So when they pay themselves, they haven't necessarily taken the taxes out yet, because you should set that aside when you pay yourself. So I know we do have a handful of listeners who are running their businesses differently as an S Corp like I am. But this example is Schedule C and I have actually already looked at the spreadsheet and it kind of in my head adapted it to be appropriate for an S Corp. So this could work for you too. This is just a Schedule C example.

Michael Reynolds:

Yeah, that's a great point. I just went with the most common example, but you're right. If you're an S Corp doing payroll, your payroll will be this line. It'll just kind of come out differently. So then, when you have your owner's draw, which is going to be less than your monthly profit. So you always want to make sure your owner's draw, whatever you pay yourself is less than your monthly profit on average, because you can't pay yourself more than you have. So that's going to be fairly straightforward.

Then the next line is going to be your operating profit margin. That is basically whatever's left over after you pay yourself and you're going to divide that into your revenue. So basically the formula for that's going to be in my spreadsheet example is going to be a monthly profit minus monthly owner's draw, and then divide that by your monthly revenue. Now this is not meant to be super accurate accounting terminology stuff here. This is meant to be practical cash flow. So don't get hung up on the fact that there's some accounting terminology.

For example, your profit total on your tax return's going to be just this one number here that's profit margin, not counting owner's draw. So just go with me on this. This is all about cash flow. So in our example, monthly owner's draw is going to be $4,500 per month. And then operating profit margin comes out to 5%. Then the last line I've got here in this list on the spreadsheet is going to be annual salary. And that is simply going to be your monthly owner's draw times 12, to get you an annual salary. Now I'm using the word salary on purpose here, because if you're using this spreadsheet or this formula, I want you to get in the habit of thinking, "Hey, this is my salary. This is what I'm making per year. This is what my business is paying me."

And again, this goes back to this concept of so many business owners and massage therapists, especially, get really focused on the giving and the serving and the pouring your heart into your business. And we don't think about the fact that, hey, I mean, technically I have a job at my business and I should be paid by that job and I should be paid fairly. And so I think it's really important that we look at this as an annual salary. If you were going to work at a massage chain or a hospital or somewhere else, you'd be getting a W2 income and you get a salary. You'd be getting paid a certain amount annually, and you would know what that number is.

So I think it's really important that we know what that number is so we can say, you know what? In this example, it's $54,000 per year as an annual salary. And you might look at that and say, "Hey, that feels good. That feels like I'm being paid appropriately. I'm making a good living. The work I'm doing leads to a salary that I feel is fair. I'm comfortable with that." Or maybe you'll say, "You know what? I feel like for the work I do, I should be making more money than that." And then you can go back and work on this stuff.

So what does it mean to work on this stuff? Well, let's say you put the spreadsheet together, you copy it to your own drive or you download it to Excel, and you're plugging your own numbers in here. So let's say you arrive at a point where... By the way, I'm going to go back up to operating profit margin for a moment. So what's a good number there. It's all relative. I hate to put a blanket, set in stone number here to say, "Hey, if you're a profit margin is 7.5%. That's too low." I don't know. There's a lot of variation here.

But I will say that as a general guideline, I would say at least 5% profit margin, preferably 10, 10% plus would be ideal. That means that you are paying yourself and you are leaving enough money in the business for things like new equipment, new expenditures, putting some in retained earnings, business emergency fund. You want to have extra money in the business, not too much, but you want to have enough in there that you've got a buffer and you've got security in your business. You obviously don't want to be drawing out more than you're making because then you're in a deficit and you're pulling money out too much.

Allissa Haines:

I actually think that this would be a good time to pause, because Leslie just added a great comment with a question, and it very much pertains to if you were to draw out more. So Leslie says, "If your former average was higher," I'm guessing the former salary was higher. "Is it okay that the owner's draw went above the profit for a short period of time? How long upside down," drawing more than you make, "before you cut your salary?"

Michael Reynolds:

That's a great question. The short answer is, I don't know, because it depends on your business and how much these numbers are. But I think in concept that is perfectly appropriate. One example would be, let's say you have a slow time period coming up, maybe you're doing a shift in your business. You're rebuilding something, or a seasonality or something is happening that's temporarily slowing your business down. That's a great opportunity to say, you know what? I've got reserves. I'm going to keep my salary the same. I'm going to pull from reserves a bit because I expect my revenue to go back up because of XYZ circumstances. That's kind of what reserves could be for. That makes sense.

But let's say it's something that's more permanent. Let's say that you're making a shift in your business. You're scaling back on hours, because you're doing something else or whatever reason you're scaling back and you're permanently or at least indefinitely going to have lower revenue. Well then you've got to kind of look at your burn rate and say, "Well, how long can I sustain my salary before I have to cut it?" Well, you have to kind do the math and say, "Well, I can go a couple months before I'm really getting my reserves down lower than I want them. That's when I'm going to cut my salary down lower. Or cut my owner's draw or compensation down lower."

So yeah, it's a great question. Depends on your situation. But in many cases it's perfectly appropriate to use some of that buffer if it's in your business, especially if it's a temporary dip in revenue. That's a great question.

Allissa Haines:

And Leslie follows up with, let's say you have COVID right now.

Michael Reynolds:

Oh, I'm sorry, Leslie.

Allissa Haines:

Darn it. Darn it. I'm going to paraphrase.

Michael Reynolds:

We wish you speedy recovery.

Allissa Haines:

If you have it in your business account and you need to draw it to pay your personal bills, as you are not working, hopefully in a perfect world, we'd all have a little bit of savings for sick days and sick weeks and sick months as COVID can be. That said a lot of us have destroyed our savings, while we were getting through the first two and a half years of this pandemic. So I'm really sorry to hear that, Leslie. If you need anything, give me a call.

Michael Reynolds:

Yeah. Wishing you speedy recovery, Leslie. Sorry to hear that.

Allissa Haines:

All right. Carry on, Michael.

Michael Reynolds:

All right. So what numbers are important? You want to drive this operating profit margin higher, if you can. So drive that to be a little higher if you can. You want your owner's draw to be trending up and higher as well, because you want to pay yourself appropriately. You want your monthly expenses to be going down if possible, not going down. But if you're trying to tweak things to give you more compensation, better health in your business, then try to lower monthly expenses is a possibility. Y

Yu also might want to look at your price per session. Is it a time to raise prices? Maybe how many sessions are you doing per month? Look at that. These are all numbers you can control. Well, to some extent. You can't control how many people come to book a massage. You can do activities that lead to things, but you can't control that. You can control your prices. To some extent you can control your expenses. You can control how much you pay yourself. So if you are running this spreadsheet, let's say you plug in your numbers and you arrive at a point where your profit margin is 3%.

I'm actually going to put this in for real. I'm going to put in 45 massages per month, paying $85 per session. That means my monthly profit is $2,625. So I'm going to pay myself $2,300 per month. That means my annual salary is $27,600 per year. So you might look at that and say, "You know what? That doesn't sound very high. I want to get that higher." So what do you do? Well, you go back and say, "Okay, what can I tweak?" Well, I could look at my sessions per month at 45. Maybe I want to pour some more effort into some marketing, maybe do some networking. Maybe see if I can get that number higher. Great. Maybe I pump that up to maybe 50 sessions.

But it's going pretty well, but it's kind of a struggle to get it too high. Okay, great. I'm charging $85 per massage. Maybe I raise my prices to $100. Okay. That I can control. What does that do for me? Well, now my monthly revenue is higher. My monthly profit is higher. I can pay myself a little more. My monthly profit is now $3,800. So let's pay myself $3,500. My profit margin is 6%, which is above 5%. It's something, staying in the business, which is good. My annual salary is now $42,000. That feels better. That feels like a step in the right direction.

So I would look at this, I mean, as often as you want, but I mean every month, at least I would pull this spreadsheet out, look at your previous month's numbers, get your averages, keep your averages up to date, whatever your booking software does. Maybe it'll give you those numbers. Maybe square will, whatever you're using. Get those averages and kind of tweak them over time and keep adjusting them. And simply by paying attention, you're going to do better. So much of the time, the mere act of paying attention is light years ahead of what we're doing before, which is not paying attention.

So if we're not looking at numbers every month, if we're not seeing what we're making, if we're not intentionally making note of what our compensation is, what our profit margin is, what our expenses are, what our annual salary is projected to be. If we're not making note of that, then we can't make any changes that are effective because we don't have data to make good decisions. So if you look at these numbers every month and you tweak them, and you run them, and you just take five minutes and sit with them, I predict you're going to see improvement because you're going to say, "Well, gosh is 50 massages a month for me. I don't know. Let me work on that. Is $100 a session for me. I don't know. Let me work on that."

"I'm paying $1,200 a month in expenses. Is that right for me? I don't know. Let me audit my bank statement and see if there's something else I can replace with a lower cost service or eliminate a service, or find a way to lower an expense somewhere. That's something I can tweak. What am I paying myself? Am I paying myself too much at the detriment of my business reserves? Am I paying myself not enough and leaving too much in the business?"

You can look at that as well. So that's kind of my spiel. I think it's really important that you run these basic numbers. Look at them often enough that you're paying attention to monitoring the health of your business, much like a monitoring health with a health monitor or whatever. This is same thing for your business. You're consistently looking at how you're doing and you're able to see what changes you could potentially make and tweak to do better from an income and a business health standpoint. So that's my spiel. I'd love to pause there and Allissa see what I've missed or what feedback you might have.

Allissa Haines:

Yeah. Let's stop sharing the screen.

Michael Reynolds:

Okay.

Allissa Haines:

So people watching don't have to keep looking at a spreadsheet, because, soul killer. So I have two things that I wanted to kind of contribute here, which is one, this topic actually evolved because somebody asked what percentage of your gross income or your gross sales should your expenses be. And that's one of those questions that we can't really answer because it dramatically depends, depends with dramatic differences on your the area you're in, and the situation you're in.

So yeah, if it's a multi practitioner office and you're in the heart of a city and whatever, your expenses are going to be a much higher percentage of your gross sales, than if you are like me in a podunk little suburb, who got a really good deal on an office space. So it would be nice to be able to magically say, "My expenses are only 20% of my gross sales." When I started as a massage therapist a million years ago, the chiropractor wanted to keep charging me more rent based on the fact that, "Well in business, your expenses are typically about 30% of your gross sales." And I was like, "Well, I want to take more money home. So I don't want my expenses that high."

So it is so individual and it's so depends. But that's why something like this, a spreadsheet like this, that you can just plug a few numbers in and get a good idea of what the extra is after you're taken home what you want, is really helpful. The second thing I wanted to say is this conversation came up in a local Facebook group for me the other day for massage therapists, where people were asking how much you charge for X, Y, Z treatment. Or no, they wanted to know how much someone charges just for a 60 minute massage in their town, and what town is it in Massachusetts? Because it varies widely.

The price in the center of Boston is much different from a price out in western Massachusetts, in a one person operation, which is much different from the price of a massage at Canyon Ranch. So it was an interesting conversation. There was anything from $75 to, I think the highest I saw was $175 for an hour. And a few other people around too charge about $115 an hour. And I just upped that from $110 and somebody said that first, they went off on us valuing our skills and you can't make a living charging only $115 an hour for a massage.

And that makes me frustrated when someone's like, "You can't make a living." Okay. Maybe you can't make a living charging whatever, let's say $110 per massage. Maybe you live in Boston or suburb with much higher income. Maybe you do a crappy job of budgeting your personal money. I personally have made a living for 18 plus years charging, starting at $65 an hour in 2005 and slowly incrementally raising up. So I'm $115 an hour now. I don't take tips. And I make a living. I'm not back working full time right now. I will be very soon. I've ease back in for a variety of reasons.

But I make a living charging $115 an hour. And I contribute to my retirement every month and I have savings. I'm about to put 20% down on a new car. Thank you very much. Probably a little more than that. I just haven't done all that math yet. So I want us to be really mindful when we're talking through these numbers to not compare yourself too much to anybody else. Because "making a living" is very different for all of us. Yeah, if that dude wants to drive a new car every three years and have an extra bedroom in his house to have whatever to Zen meditation space and dah, dah, dah, dah, dah, then he cannot make a living doing 30 massages a week at $115 an hour.

I, however, have made a very good living for the bulk of my career, being entirely single and self supporting and getting myself through a divorce that completely impoverished me. So maybe step back, when we start to compare ourselves to each other, when we start to have these pricing decisions and these percentage, this wage, what we're taking home conversations and decisions. It's a good time to be aware of what's going on around you and take ideas from other people's numbers, and percentages, and guidance, without internalizing it and thinking that what they do has to be what you do, or that you are not making a living, or you're not whatever.

You get to decide what your goals are financially, professionally, and personally. And if anybody gives you crap about that, you just send them to me. I am also happy to report that I actually did just text Leslie, because she's a friend of mine and she's at the tail end of COVID and recovering quite well.

Michael Reynolds:

Excellent. Leslie also commented, related to high cost of living area versus low cost of living areas. "Huge. I make a living on $85 normally, but I have low life expenses." Yeah. It's a great example.

Allissa Haines:

And there's people who would tell me be like, "Whatever it costs you to live, isn't relevant. You should charge what your skills are worth." I've gotten massage from Leslie. And I can tell you, I would pay more than $85 an hour for massage. But if that's the price that worked well for her and her client base, she's making what she wants to make. She's making her living. The rest of it is none of our darn business.

Michael Reynolds:

Yeah. That's why-

Allissa Haines:

Okay.

Michael Reynolds:

Yeah, go ahead.

Allissa Haines:

I think that's everything. Is that everything?

Michael Reynolds:

Yeah, I think so. I was going to just mention, that's why I am very careful to say it, especially in the spreadsheet, hey, adapt it to your situation. I'm not saying that salary X, Y, Z is good or bad. I'm saying this gives you visibility and gives you a way to monitor your numbers so you can make decisions for you. So again-

Allissa Haines:

Word.

Michael Reynolds:

... the spreadsheet is at massagebusinessblueprint.com/finhealth, F-I-N health. That will go straight to it. You can copy it to your Google Drive and modify it or download it to Excel. And this is episode 435. We'll link it from the show notes as well. All right, I'm done.

Allissa Haines:

All right. Let's move on to our next sponsor who is Happy Face.

Michael Reynolds:

Happy Face.

Allissa Haines:

Yay, Happy Face. And my computer's very old and I'm not loading that page properly. Okay. So this episode is indeed sponsored by Happy Face. Face cradles can be super uncomfortable for a client, and that pressure, and that stuffiness can ruin the whole massage experience. Happy Face has solved that problem. It is the most comfy face cradle. So you can give the most relaxing massage and non stuffy massage of your client's life.

Innovative, heart shape design means you don't have sinus pressure or eye pressure. There's far fewer adjustments to be made during the massage. Nobody's like switching around trying to change their neck position, no wrinkles, no makeup smearing, no wrecking those expensive fake lashes. Made in the USA. It is seamless. This is probably my favorite thing about it. It is seamless. So it's super easy to clean and to do that quickly in between clients, which is what we're trying to do.

It's designed to fit on all massage tables and face cradle frames. Your face cradle covers are going to fit it. It's got a full Velcro back. So it's going to stick where you put it on that frame. You can get 10% off your entire purchase at massagebusinessblueprint.com/happyface. Use code MASSAGEBB at checkout. But all of that information is right there at massagebusinessblueprint.com/happy face.

Michael Reynolds:

I got a massage last week and my massage therapist uses Happy Face and it was super comfortable.

Allissa Haines:

Woo hoo.

Michael Reynolds:

Loved it.

Allissa Haines:

So I'm getting a massage Friday. So the day that this publishes on all the places, and it's a massage from a woman who specializes in frozen shoulder, who emailed me some tips when I asked for tips to deal with frozen shoulder. And it turns out she's only 40 minutes from me.

Michael Reynolds:

Nice.

Allissa Haines:

So I'm going to get a massage from her. I don't know if she has a Happy Face face cradle. Maybe I'll try to remember to bring mine with me, but I'm going to forget that. But I'm so excited that I'm getting a massage on Friday. Anyhow.

Michael Reynolds:

Yay.

Allissa Haines:

So quick tip. I don't have one. You go.

Michael Reynolds:

I've got one that's sort of an add on to the main topic today. And my quick tip is embrace inaccuracy. So this is kind of for me, self-talk for me as well, because I am always really hung up and well, the numbers have to be accurate and if I can't do it perfectly, I'm not going to do it all. And so this spreadsheet was a great exercise for me as well, because the spreadsheet is wrong. But that's okay. It's wrong because you're never going to do exactly 50, I mean, you may at some point, but you're not going to consistently do exactly 50 massages in a month. You're not consistently going to have the same revenue every month.

But we're shooting for go guardrails here. So embracing inaccuracy is, to me, excuse me, getting over the need for perfection, so that you can at least get good information to help you make better decisions than you were making before. So as you're running numbers in your business, as you're doing marketing, whatever you're doing, whatever you're doing, it's not going to be a perfect, but inaccurate estimations are often better than nothing. And nothing is what a lot of us sometimes get stuck at doing. So embrace in accuracy. Let it go. Realize that your numbers are going to be wrong, but they're going to be close enough to give you what you need.

Allissa Haines:

Preach. You said it. That's everything.

Michael Reynolds:

All right.

Allissa Haines:

So if you have a topic you want us to talk about, or if you want to fight with us about this one or any other one, you can email us at podcast@massagebusinessblueprint.com. And that email goes to both of us. So we'll definitely read it. And we'll definitely get back to you. If you have enjoyed this podcast, hey, go to Apple Podcast and leave us a review. It helps other people find us. We are indeed the longest running massage business podcast with the most episodes and most consistency. And we're darn proud of that. So feel free to tell your friends. That's all I got everybody. Have a super productive, and happy, and mellow day.

Michael Reynolds:

Thanks everyone.

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