studios using billing services

[lonecoyote]

Okay, this is the second time this has happened to me. The studio where I train has turned over everything to a billing service. I don't like it. Takes a little more of the relationship away. I Usually come in when the bill is due, grab a water from the fridge, pay cash and talk a bit, now I can only talk to someone a thousand miles away who keeps wanting my bank account #, for direct withdrawal, and who is also a collection agency, who will automatically assess late fees and possibly sue me if I don't do such and such and such. If I do have trouble with the bill, or my contract or whatever, I can't just go on down and talk to the instructor, work it out, man to man, cause its out of his hands anyway. I'm not only a human being I'm your student, not a walking talking dollar bill. I guess this is the wave of the future though. Just seems like a little more of the honor and implicit trust in the student teacher relationship is falling by the wayside. I've never bounced a check or failed to pay a bill at a place I've trained in my entire life and I don't like this treatment, which seems to assume I'm going to try to pull a fast one.

 

[Shizen Shigoku]

Eeew! Yeah, that seems so cold and impersonal. That's ok for something like a phone bill, but you're right - it "Just seems like a little more of the honor and implicit trust in the student teacher relationship is falling by the wayside."


I train at two different dojo - one is quite formal (but not overly so), and the other is quite informal. At the more formal one, payments are expected in advance for the month, but if they're late or even non-existant, it's no big deal.

(I don't train with instructors that teach for money. Paying them is more of a symbolic act of minor sacrifice / gratitude, because I know that the money is just going to come back to me in the form of dojo upkeep and improvements, as well as towards my sensei's continuing education in the arts - which just means higher quality of instruction for me as they improve themselves. I have also been offered instruction for free for a short while during tight times, as my dedication was considered a payment in itself, and one of higher value).

Money is given by placing it in an envelope - similar to the traditional Japanese method of wrapping money in paper, so the recipient need not sully themselves by touching dirty money. The envelope has the name of the dojo on it, and everytime money is received, the envelope is signature-stamped with kanji representing the dojo to keep track of how many months the student has been active.

It is very personal, has a nice traditional flavor to it, and is all-around a good system, I think.

As for the other dojo, we pay as we go - before, after, or whenever; just toss sensei some cash or whatever, and it's cool.

I personally think all dojo should have both of the above options available, perhaps even giving a discount if money is received in advance for the month.

The first dojo I trained at where I used to live did that - either pay at the door the standard fee for the evening, or pay in advance for the month which covers 8 classes, but for the price of 6.

 

[Sin]

My payment is a monthly fee of 70 dollors for me and my little 10 year old sister, getting a family discount, that is what my Sensei belives as an respectable way to treat family, besides, if you teach one and the other dosn't get it then the one who understands can teach to the other at home, making my Sensei's job a tad bit easier, knowing that he has a junior instructor there helps him out a lot.

My payment is not strictly monitary. I also do whatever possible for the enrichment of our shool, let it be representing in other school tournaments, Advertising, running class a night where sensei can not be there at the appropriate time, or even getting premission to use certain words such as Ryu-Te. (witch is now in the works)

So far i have gotten my little sister and cousin into the class witch brings in more money for the school and more partisipation in classes. So i do well with my tuiton.

 

[lklawson]

Okay, this is the second time this has happened to me. The studio where I train has turned over everything to a billing service. I don't like it. Takes a little more of the relationship away.

Are you taking a martial art to learn a martial art or because you like they way they bill? Is your instructor supposed to be good at teaching martial arts or at business accumen?

If someone else takes care of billing, deadbeats, late pays, etc. that leaves more time for him to focus on teaching, improving curriculum, gaining new contacts, attending seminars, and just generally not having to deal with the stress and headache.

Now, as to showing up, grabbing a water from the fridge and shooting the breeze, what's stopping you from doing that now? Today? Right This Instant? Do you need an excuse to go talk to people you like? If you have to be forced to take money to them as incentive to go speak with them how much do you *really* like them?

Seriously, what *are* your goals here? What do you expect from a Martial Arts school? Are you looking for a Social Club where you can fraternize or are you looking for Martial Arts training?

To this day I fail to understand why people get upset that a Business is using modern Business methods simply because it's a "Martial Arts Studio." They are delivering a Service and you are paying for it.

I don't want to come down harshly on you but it seems that, for some reason, people have some unusual expectations about what Service a martial arts school should provide.

Peace favor your sword,
Kirk Lawson

 

[Ping898]

All the studios I have ever trained at have always used billing companies. I guess I never thought of it as more impersonal since I am usually at the place 4 to 6 days a week anyways. I never even considered that it was done another way either, I just sort of assumed they all used a billing company....guess I was wrong.

 

[lonecoyote]

Thank you, everyone, just had to rant a little I guess. shizen shigoku, the traditional way is interesting, thank you for talking about it, I like pay as you go best. It sounds like you have a good deal going, Sin. lklawson, sorry if I hit a nerve. I understand the purpose of a business is to make money, but if you think teaching martial arts is just any business, then I think you might be wrong, I believe there is a little more to it than that. Can't believe you went on to question my motives for training and my relationship with the people I train with. Well, since you brought it up I'll tell you. Anyone I take martial arts instruction from, well, I am guilty of thinking it is about more than just martial arts training. It is a relationship. Relationships are about respect, among other things. I would like to be able to iron out any problems, monetary or otherwise, with my instructor, face to face, like men, not through intermediaries. I keep my word. My handshake is solid. I expect that from the people around me too. I certainly understand your point of view and respect what you are saying and while I'm not sure why you let me have it with both barrels, I suspect you might have some issues beyond the scope of this subject of discussion. I am glad you posted anyway, and thank you for your point of view.

 

[still learning]

Hello, Don't be surprise, many people fail to know this is a business and bills need to be paid on time. Your teacher maybe paying rent, insurance,phone bills, adverstisment, electric bill, and so on.

Many owners find it difficult to collect and call the late payers. Lots of excuses, and lots of time involved to call. Billing companies takes the worry out.

At our school , my instructor decide not to ask for collections of fees. He makes it an honor system. He leaves it up to you to pay on time. Even the equipment and gear you order. He has loss thousands of dollars in the last 10 years. He told me if you are a true martial artist, than paying you fees is test of yourself to be honorable. We know some parents have a hard time making ends meet, and he gives them a break many times. He is different from many others instructors in our system.

His goal was to teach martial arts and to guide everyone to be a better person. It's the parents of the children that is not always on time with the fees. He knows of the none payees, but lets them train anyway. Usually the student catches up during testing time because they cannot get promoted to the next rank. For the rest that quits...part of the losses in the loss column goes into your booking keeping and deducted for tax purpose at a lost. .......Aloha

 

[Fbettincourt]

When we used to train in my fathers garage dojo, fees were not as important. When we moved to a facility where we had to pay rent, where a contract was signed for a fixed amount each month, + utilities and such, getting paid became more important so that our bills were covered.

We did not last long in that location because my father would not push to get paid. He was not asking a lot of $ for lessons. The legal bills to get out of the lease could have been avoided if my father had talked to the students about paying on time...after all, the landlord, the utilities companies, etc. all had to make timely payments to avoid late fees.

I guess that there are a few lessons to be gotten from this experience, even though they may be contradictory...depends on perspective:

1. Sometimes it is better to keep something a hobby instead of a business
2. Payment is due when services are rendered.
3. If you are going to go into business, then make sure you have a plan.

It was a sad situation and I know he was heart broken. He felt like he had let the students down. Hadn't they really let him down by not taking care of their obligations in a timely manner? It was one thing for him to be a nice guy and another for him to be taken advantage of.

Peace,

FB

 

[BrandiJo]

my schools rather informal about fees, they have flexibly rates for people (like im on a college rate but so and so who has the money and is in college isnt) and if we are ever pinched for cash we just need to go and talk with them and they will give us a break on when its due by. I have always heard from them that as long as they can pay the rent then they are happy.

 

[Simon Curran]

Hi all,

Here in Denmark we are quite lucky in that a club that is not profit oriented is entitled to state support, (although there is one person in the Kenpo community over here who has recently abused this privelage, and the authorities are taking him to task)
The club where I train and also sit on the panel for is such a club, and therefore we take only 100 danish kroners per month, which equates to roughly 6 US dollars.
Our instructor is a volunteer and does not expect remuneration, but we do sub-let our premises to another instructor to help with the bills.
I know that not everyone is as lucky as we are, but I personally prefer this system, because everyone knows that the instructor is in the game just for the love of it, and not to increase his bank account.
Just for the record though I am not opposed to people making a business of martial arts, I just prefer those who do it primarily for the love

 

[asangria]

Most places I've seen that require a billing services tended to be part of a chain of schools. I can't see how a single school could afford to pay a service to collect money. The service charge along would make it virtually unprofitable for the school.

Then again maybe if we had a billing service, advertising budget, etc our school wouldn't have had to close its doors. With the outrageous rent being charged in California - trying to keep a school open is very difficult.

The upside is that the student who choose to stay together and to continue to train in one of our instructors house/garage has made us grow closer & stronger.

 

[rmclain]

I use a billing service at my school and it is relatively inexpensive. They charged a 1-time $99 setup fee with their service and around $2/month/student billed through them.

The students pay several ways:
1. They receive a payment booklet in the mail and send a check each month.
2. They can use the EFT (electronic funds transfer) each month, where their bank sends the payment each month, based on the agreement.
3. Students may pay at the studio and I call the billing company to let them know the student has paid for a certain month.

I prefer #1 and #2, but accept #3 when a student is late for a payment or the student has a situation that makes it difficult to make the payment on time.

The billing company ultimately works for me. They don't send anyone to collections unless I give permission. They make electronic installments into my business account twice per month with the tuition collected minus the ~$2/student fee. I can cancel the student account at any time and relieve them of their tuition agreement should they move away, become ill, or any other unforeseen circumstances.

Ultimately, the students are making an agreement with my school, not the billing company. The billing company simply handles the day-to-day tuition and reminds students of payments. You wouldn't believe how much time this frees up for me to train and teach.

**The billing company shouldn't be hassling you about switching to the EFT option.

R. McLain

 

[lvwhitebir]

Most places I've seen that require a billing services tended to be part of a chain of schools. I can't see how a single school could afford to pay a service to collect money. The service charge along would make it virtually unprofitable for the school.

Actually it's not that expensive at all. I used one when I had enough students to warrent it. I have fewer students now, so I think I can do it on my own.

The problems with the studio doing itself is:

1) it takes the instructor away from teaching
2) it makes the instructor the "bad guy" when people fail to pay on time
3) it offers the student fewer payment options than are usually desired.

Billing companies usually let the money stay out of the picture of training. Neither the instructor nor the student need to really think about it and can concentrate on the martial art itself.

WhiteBirch

 

[Ray]

...Just seems like a little more of the honor and implicit trust in the student teacher relationship is falling by the wayside. I've never bounced a check or failed to pay a bill at a place I've trained in my entire life and I don't like this treatment, which seems to assume I'm going to try to pull a fast one.

There are a few students who don't pay. Unfortunately, there are expenses associated with teaching. Even though I generally teach out of my home, but I still have expenses like liability insurance (never had to file a claim against it, thank goodness).

I once had a student who hadn't paid for several months. When I asked him about it, he started popping off stuff like "I'm your senior student and help the other students learn." I showed him the door, it's not fair when everyone else pays. I'm not going to get rich teaching, but I'd better cover expenses and make a little profit otherwise mama's going to close down the studio.

 

[ArtlessArt]

I have had problems with the billing service that my school uses when I first started out. Basically I was getting double charged somehow. I talked to my instructor and he worked it out and even got me the extra money that was charged back to me.

Now that this has been fixed I have no problem with the billing service. It keeps the money out of the entire atmosphere of the dojo so we have lots of classes all the time and open floors where our instructors can help out instead of having to fret over paperwork.

So I can easily see this from both angles. But they arn't the end all most horrible thing to happen. I mean just remember, everyone has to earn money for a living and that includes martial arts instructors despite how "different" some people would like to make the whole martial arts experience seem.

 

[Eldritch Knight]

I had a bad experience with these billing services.

When I first started Tae Kwon Do, the dojang I studied at (along with my mother and brother) used one of these services. Other than a few normal kinks that worked themselves out in the first few months, it worked fine, until 4 years later, when my family moved overseas. We cancelled my membership at that club and moved, but the billing agency kept on billing us. We called them and my old dojang several times a week trying to get them to cancel it, but to little avail. The billing service said that they needed verification from the dojang before they would cancel. My dojang's secretary (the master's wife) kept everything in paper format, and it took her a good two months before she got around to even finding our cancellation notice and mailing a copy to the billing service. My old master decided that he "didn't want to get involved", even though he had taken hundreds of dollars from us every month (I could get into how crappy he was as a master and a person, but that's another story). All said and done, after nearly a year of calling internationally at odd hours of the night (during their business hours), we finally wrested our money back from them. My family got really paranoid about those things after that, and I can't say that I disagree.

 

[terryl965]

Billing service is for those that can't manage there own books, it is a very inexpensive way to get the help you need to run a business without uosetting your student body about payment. I personally won't use them but I know alot of instructors that loves the method.

 

[Fbettincourt]

Good post. As a business owner, non MA related, this is important for people to consider when they complain about fees for any service. For those who have never had the "pleasure" of owning their own business, seek first to understand before being understood. Can you honestly make an educated opinion regarding what is expensive and what is not? I think you can when you consider all the above "extras" that go into running a business.

I have one employee in addition to myself. For everything $1000 that she gets paid, I have to pay over $350 in state and federal taxes. The expenses that Rob has pointed out are real. One cannot look at the number of students x the tuition and come to an accurate conclusion.

Let's say that you have 100 students paying $100/month. This equals $10,000. Sounds like a lot of money...it is. Then lets take out $ for rent. Say you have a big space (you have a lot of students so you need adequate space to train them) and rent, taxes, and common area charges (parking lot, landscaping, garbage removal, etc.) equals around $5000. Now you are left with $5K. Still a nice sum. Now let's pay insurance. You cannot open your doors without it and no competant landlord will let you open your doors without providing proof of insurance. Insurance runs about $1000/year conservatively (I do some accounting work for martial arts schools) . Subtract about $100/ month for insurance. Next are the utilities. Gas, electric and phone. This will run about $300 average (depending on the area). Now we have to advertise or else no one will know that we are here. The general rule is 10 % of the previous month's gross. Let's just go with $1000. We now have $3600 left over. We have not even paid anyone yet.

Let's say we have 2 assistants each with one working partime 20 hours per week at $5/hour (if you can get away with such cheap labor). $800 (total) + state and fed taxes = approx $1100/month. Now we are down to $2500 left. you can afford to pay yourself maybe $1500/month and you better not forget the 30% in taxes or you will not be open long, + some emergency $ in your acct...just in case. We did no even attempt to get into health insurance. If you have a family, you better hope that your wife has a good job or that you went into this endeavor independantly wealthy and $ does not mean much.

$10K seems like a lot, and it is. What you gross is not as important and what you keep. If you have a business that grosses $100K /month but with expenses and salaries you pay out $97K...get my point?

hope this helps to clarify some things.

peace!
FB

 

[Fbettincourt]

You also have to remember that your mortgage and home owners insurance is directly taken out of your bank acct, your health insurance for the most part are directly deducted, your health club membership, and I am sure many other things are automated as well.

You must find someone that you are comfortable doing business with. If you are uncomfortable doing business with them, why would you want to train with them?

FB

 

[rmclain]

Interesting. In my case, when I incorporated in Texas, I decided to use a billing service for students that made monthly installments on their courses.

The billing service makes two installments of the tuition to my bank account per month. This is nice because it takes the 50 or so student monthly payments and consolidates them into two payments and payment reports for the records. I still have to manage expenses, in-full tuition, equipment sales, etc. I really don't know of a billing company that manages all of a school's books. Would be nice to have that.

The current arrangement sure saves me a chunk of time so that I can stay on the floor training, teaching, and sweating so I can stay in shape and continue to learn. Would bug me as a student to have an instructor that collects my check personally, but looks like they need be on a weight-watcher diet because they don't keep up their training.

R. McLain