Fixed costs don't take vacations
But studio owners might need one by now
It’s July. If you’re a studio owner, you know what that means.
Your schedule likely has gaps that were not there in April. The same clients who waitlisted in January are in Italy, on the coast, at the lake, or wherever people go for the month when they have that option. The studio is quieter. The energy is different. And somewhere in the back of your mind, anxiety is building.
Over the years, I have experimented with closures, rate adjustments and scheduling changes to minimize the impact of a slow season. Since COVID, summers in my studio have become increasingly quiet. In Texas, it’s hot as blazes, and many of our clients have second homes or family in cooler parts of the country. So they leave for a month or two, returning in late August or after Labor Day.
Last year, we experimented with closing for two weeks: the week of Christmas and the week of July 4th. In both instances, payroll was significantly reduced, but hard costs like rent, software and insurance remained. The July closure in particular was confusing for clients. So we nixed that this year.
Approximately 65% of our revenue comes from 12-month contracts. In the months leading up to mid-summer, this source of recurring revenue is the very definition of financial stability. But come July, it falters. Steady clients clear their schedules to leave town.
I built freeze provisions into my 12-month contracts because I know what to expect. A client who has to pay through a monthlong vacation will resent doing so. A client who can pause while traveling and come back to their usual schedule and fees typically comes back. Freezes are still the right call in my book.
But the right call does not make July’s numbers look better. The freeze stops the client’s payment. But it doesn’t stop those hard costs. My teachers are on flat hourly rates, and my front desk is salaried. Payroll lightens slightly when sessions thin out, but not enough to offset what the fixed costs keep taking.
The takeaway is not that closing is wrong. The takeaway is that the bulk of your costs are not variable, and they continue to stack up in July in a way that feels like a downward trend even though it’s just seasonal.
This July, we didn’t close. Our teachers are thoughtfully staggering their vacations. Clients are out in the world enjoying their families. This is the part of studio ownership that requires a plan and the patience to see it through. So I’m experimenting with new ideas to ease the pinch of our summer slowdown.
Here’s what I’m doing:
I’m refining rates and rethinking our offer suite:
We don’t discount for summer, as I believe it trains clients to wait for one. It also opens the door to the upside-down payroll ratio I covered in-depth in Issue #5, About That Payroll Ratio….
But I do refine our rates based on financials from Q1 and Q2. And in our case, it looks like this:
Slight reduction for our semi-private group classes
Slight increase for our private appointments
We’re starting our win-back outreach now, not in September:
The window where a lapsed client is still thinking about returning closes faster than you realize. For us, late July/early August is the right moment to prebook them for a post-summer return.
I’ve organized multiple segments of lapsed clients based on method, service and lifetime value, each set to receive a unique message and return offer.
I filled the downtime with actual downtime and vision planning:
I took a few days off and celebrated my 50th birthday on Grand Cayman.
I revised existing job descriptions and posted them. I’m anticipating needing one or two new teachers this fall.
I’m organizing my teacher training calendar. I like to draft it a year out.
I’m scrutinizing my KPIs and our expenses. The privates-based studio world is changing rapidly, and I’m in the early stages of making foundational changes to my business.
And on that note, I’m nit-picking my studio’s revised business plan. We have a major evolution planned at the start of 2027.
July is slow, but it’s usually not the start of a downward trend. It’s a seasonal slump. But it’s also an invitation to breathe, to catch up on what's been neglected and to plan for what comes next.
So if you have some extra time, enjoy a few personal days, then do some planning. The efforts we make in the next three weeks can help determine how September feels.
Amanda