Many instructors dream about earning a living teaching martial arts and for many, this dream will include running their own full time martial arts centre. Before you jump in feet first though, you need to know that as well as having a good grasp of modern coaching, it is just as important that you understand the basics of business. Hopefully this quick guide will help instructors have a better understanding of the process of setting up a full time martial arts centre. Please note that this guide is specifically written for the UK market though most of the tips will be relevant to other countries too.
After opening two full time venues with over 500 members and helping other coaches set up their own venues, here is my top 10 list of important considerations.
1. Are you self motivated and how well do deal with pressure?
I personally deliver about 6-7 weekly classes out of around 60 but in the beginning, I was doing everything myself. Even though I do not lead as many classes now, I am still always busy.If you don’t like being busy, this path is probably not for you.
With the growth of online marketing it no longer essential to be located on a busy main road. That said,you will need to be within a 15 minute travel time of your target market.
What does the cost of the rent include? Do you need to add VAT? Is there an extra charge for building insurance? If the unit has any shared areas with other tenants, is there a service charge? Are the utilities (heating, electricity, water) included in the rent or separate?
Is the space big enough to provide a suitable training area? You will probably also need at least 1 toilet, an area for a desk and filing cabinet, a spectator area and a little storage space.
Where are your customers going to park? Do you have allocated private parking or are you relying on public parking. Visit the parking areas at the times you would be open to get a better overview availability.
6. Rateable value
The rateable value of a property is set by the Valuation Office Agency. If the rateable value is under £12,000 you will not pay any business rates. If it is between £12,000 and £15,000, it will be calculated on a sliding scale. If you have to pay business rates with no reduction, this will cost roughly around half of the rateable value annually. You can normally spread these payments over 10 months.
If full business rates are due you can sometimes get a reduction from the local council if you’re a ‘not for profit’ or a mandatory reduction of 80% if you are a Community Amateur Sports Club.
How long will your lease be? I initially take a 6 year lease with 1 way break clause on the 3 year mark. Make sure you know how much notice you need to give, when the rent review is (and the basis of the review), who is responsible for the upkeep of the building and if you need a Schedule of Condition before you more in.
8. Access to toilets
They could be in your unit or shared with other tenants. The different type of access will usually dictate if you are responsible for the cleaning and upkeep or a third party.
9. Use class
Business buildings in the UK all have a designated ‘Use class’. Martial arts centres usually come under the D2 (Assembly and leisure) classification. If the building you are looking at is currently under a different classification, you may need to submit a ‘Change of Use’ planning application. This is not necessarily a show stopper but my top tip is to phone the local planning office and ask the question ‘Could you see any potential problems with thisapplication?’. They sometimes come back with a list of problems but as long as there is no ‘showstoppers’ you can work through these one at a time.
10. Solicitors fees
Before you sign a lease, find a local solicitor that deals with commercial leases. You may want to shop around and get 2-3 quotes. The landlord will normally ask you pay his solicitors feestoo. On more than one occasion I have had the solicitor pay their own fees but this is usually dependent on how desperate they are to get a new tenant in an empty building. Don’t forget that there will probably be VAT to add on to these fees too.
Hopefully this crash course will help some instructors on the verge of committing to a full time centre.