When you started teaching privately, how did you prepare? Did you think about what your ideal student was like and where you were going to find him or her? Did you determine how much it was going to cost to teach and determine how much to charge to weigh against your cost? Did you come up with several marketing ideas to fill up your studio with your ideal students? And if you did think about all of these things, did you write them down? If not, you should have. You are the CEO, CFO, President, Accountant, Creative Director, and much more of your own company. Every legitimate company starts with a plan and you have a legitimate company. There are several reasons to write a business plan including setting clear goals as to how you will run your studio and how you will grow and if you ever want financial backing, like a business loan (you need to buy a new instrument or perhaps buy a studio space), a lender will want to see this information. So here are some steps to create the music teacher business plan.
STEP I – The Cover Sheet
In this step, you define your business and state your qualifications. Include the following:
- The name of your studio
- Your full name
- Mailing Address
- Phone number
- Website address
- Email address
The next section will be your statement of purpose. Here, write a paragraph stating why your business is going to succeed. (Have you ever thought about that before?) What is your particular niche? And then write a paragraph describing why you are qualified to run this business. You will also attach a copy of your teaching resume to support this.
STEP II – The Business
Here you define the structure of your business. Obviously, if it’s just you then you will not have to create a personnel structural tree graph. Below is a suggestion if it is just you – if you are writing a business plan for a larger organization (your music school), this section will be much more extensive. But it’s just you, define the following:
- State that you are a Sole Proprietorship and that you provide a service – list all of the services you will provide
- State where you will conduct your business – your home, renting a studio? List the expenses that are incurred (studio rental, gas/electric, phone, transportation to the studio rental, etc.)
- List any needs for additional personnel – accompanist, assistant, tax accountant, etc. and if you have people to fill these roles already, list their names and how much you intend to pay them. You will also want to come up with a sample weekly schedule for these people and calculate how much money will go out each month to pay these people
- Define your banking practices – where you will bank (make sure that you have separate business accounts for your teaching studio – do not mix your business income and expenses with your personal accounts), how often you deposit, if you have a separate credit card for your business, if you are accepting credit cards from your students (list the fees that you need to pay)
STEP III – The Marketing Plan
This very important section defines who your target customer is, who your competition is and how your are going to get clients.
- Who is your market? – Define very specifically who is your target student – the students that you want to fill your studio. What is their age, their gender, their geographic location, their experience, their socio-economic background, their ultimate goals, their reason to study with you
- Who is your competition? – Define specifically who you are competing against for students. Who is nearest to you? How are their studios different or the same as yours? What does your competition do particularly well? How will you serve your students better than your competition? What can you learn from speaking to their current or former students?
- What do you plan to charge for your services? Be specific if you have different prices for different kinds of lessons.
- What is your advertising plan? You should have an ONLINE plan (social media, email marketing), an OFFLINE plan (mailings, newspaper ads) and a REFERRAL plan (referrals from current students or colleagues, referrals from masterclasses, etc.). Be very specific here with each campaign that you are planning. Include a time frame, expenses, any materials that need to be created, and measurable ways to determine the success of the campaign. This is also a time to define the tone of each marketing campaign and how it will change (if it does) between venues (online, offline or referrals).
PART IV – The Financials
This is the final section of the plan and it gets to the heart of the matter – the MONEY! Here you will create a very detailed spreadsheet which includes your projected income and monthly expenses. Do this for an entire year. You have already put down many of your expenses in the other parts of your business plan but you may have other expenses – loan payments for your instrument, bank fees, insurance and anything else that you can think of. Divide your expenses for the year into 12 equal monthly payments even though there may be months that you will spend more or less for some things such as advertising. Also include a “Sources of Funds” chart which lists your current assets and projected income flow.
It’s Done! Now Review It OFTEN
You have put a lot of time into your business plan, so now what do you do? Well, in this process you have defined several goals – goals for the kind of students you want to fill your studio, goals for the number of students you want (i.e. how much money you want to make each month), goals for how you will go out and recruit these students, goals for growing your organization by hiring employees if you need them, etc. Now you need to act on them and then every six months to a year, review your business plan and see if you are on track or if something needs tweaking. But the process of creating this business plan makes you accountable for your business. When it’s all down in writing, it inspires action!
Feel free to let us know how your business plan can help you by commenting below!