Money is a flow, not a stock

Often when I consult to owners of other martial arts schools, or in recreational services (yoga, dance, etc.), I realise many of them share a common marketing mistake upon startup. In their business plans they tend to allocate their startup-marketing budget evenly over time (say $2,000 per month for the first six months). To me, this just doesn’t make any sense.

We often hear the saying that a dollar today is worth more than a dollar tomorrow, which is true…but in marketing terms, it should be applied in this way: a dollar spent today is more valuable than a dollar spent tomorrow.

As long as you know your marketing spend is effective, and will reap you a net positive gain, then you should be thinking about front-loading your marketing spend—that is, spending more in the beginning and tapering it off over time.

As an example, if you have $12,000 to allocate over six months, then in my opinion, a marketing plan that spends as follows, is the best way forward:

  • $5,000 in month one
  • $4,000 in month two
  • $3,000 in month three
  • $2,000 in month four, five and six.

But this adds up to $18,000 you say? Yes, it does!

The thing is that if you front-load your marketing you can expect to see revenue come in faster. With that faster flow of money, you now have excess revenue to re-invest in a regular marketing budget.

If you sit on a stock of money, your bank account might look good for a while, but you just watch it gradually get eaten away with expenses…

So think about how you could front-load your budget if you’re planning on starting a new club, or how you might front-load your budget through the seasons (some months are better for marketing in our industry than others).

Good luck!

Note: This is a very simplistic example, and not indicative of our comprehensive consultation program. Each business is different and there are many complexities to take into consideration.

 

Looking to find out more? Contact Infinity today for consulting advice chad@infinitymartialarts.com.au

Chad Wright 2Chad Wright is the CEO of Infinity Martial Arts. After starting his first martial arts business with just a $5,000 credit card, Chad has grown the Infinity Martial Arts network of schools to ten, with two franchises now based internationally in the UK. Infinity is the most promising franchise opportunity for BJJ clubs in Australia right now. 

To enquire about franchising with Infinity, or business consultation, please contact chad@infinitymartialarts.com.au — all enquiries are treated with the strictest of confidence.

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