In our previous blog, we explored how to manage your current staff’s workload to assess the opportunity for expanding program offerings based on demand. We also discussed the possibility of hiring additional staff when necessary.
Before jumping into recruitment, it’s essential to fine-tune your existing staff schedule and consider a few key factors to avoid unnecessary risks. Let’s take a look at how to ensure you’re ready for growth and minimize the chance of program cancellations due to low registration numbers.
The Risk of Program Cancellation Due to Low Registration
When you’re bringing a new coach on board, it’s crucial to make sure the hours you’re offering them are guaranteed. Offering hours that later get cancelled is a fast way to cause frustration and lose trust. To prevent this, follow these tips to secure your program registrations well in advance:
- Open Registrations Early: If you’re launching a new program, start the registration process three months in advance. Consistently communicate with your customer base, at least every two weeks during the first month, letting them know about the available spots and how fast they’re filling up.
- Release Spots Gradually: Instead of offering all spots at once, release them in stages. As spots fill, create a sense of urgency by promoting the limited availability. Once those spots are taken, open up more if needed. People tend to act quickly when they see only a few spots left, but when there’s plenty of availability, they often wait too long.
It’s much better to have a class fully booked two months before its start date than to scramble to fill it two weeks out, worrying about whether you’ll need to recruit new staff at the last minute.
Example: For adult programs, start by opening 4 spots on one court. Promote the limited availability, and once those spots are sold, open 4 more on a second court. Emphasize the high demand and success of the program to create excitement. Remember: first come, first served!
Preparing for Unfilled Classes
Even with the best planning, some classes may not fill as expected. This is where understanding your business dynamics becomes crucial:
- Opportunity Cost: Calculate the revenue you could make from the court if a program doesn’t run. For instance, if a court can be rented for $35 an hour, you should weigh whether running the program or renting the court makes more financial sense.
- Breakeven Enrollment: This is the minimum number of spots that need to be sold to cover the cost of running the class, factoring in opportunity costs like court rentals.
Example:
- Court rental rate: $35/hour
- Class fee: $30/player/hour
- Ratio: 4 players per court with 1 coach
- Coach rate: $50/hour
Breakeven enrollment = (Coach fee + Court rental fee) / Class registration fee
= ($50 + $35) / $30
= 85 / 30
= 3 participants needed to break even.
For a program using 2 courts, with a lead coach at $50/hour and an assistant coach at $30/hour: Breakeven enrollment = [(2 x $35) + ($50 + $30)] / $30
= ($70 + $80) / $30
= 5 participants needed to break even.
Key Recommendations
- Think Big Picture: Don’t just cancel classes that don’t hit the breakeven point. Instead, look at the overall program offering. The goal is to expand programs while giving your coaches a reasonable number of hours to ensure their retention.
- Consider Short-Term Flexibility: Sometimes, it’s okay to run a program below breakeven in the short term if it serves a larger purpose. For example, if you’ve hired an assistant coach and a few classes don’t need their full support, you can still keep them on. While this isn’t sustainable long-term, it can be treated as a learning opportunity for the coach to better understand how classes are run at your facility.
- Assign Additional Tasks: If some classes aren’t filling, think about other ways to use the coach’s time. Offering private lessons is a great way to maximize their hours, so always keep a list of private lesson requests handy. However, for new coaches, it’s sometimes better to assess their skills before assigning them private clients. In the meantime, consider assigning other tasks like front desk duties, court maintenance (especially for outdoor facilities), or helping to run events like junior tournaments.
Once you’ve considered all these factors, you’ll be ready to meet with your HR department to create the ideal profile for the new coaches you’re looking to hire. By thinking ahead and making informed decisions, you can successfully expand your program offerings while keeping both your staff and customers happy.