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Financial Management for Cheer Gyms: Budgeting, Forecasting, and More

Financial Management for Cheer Gyms: Budgeting, Forecasting

By Steve Pawlyk

Published September 1, 2023

Let’s talk money, shall we? 💰

Running a cheer gym is a blast, but let’s be real—it’s also a business. And like any business, you’ve got to keep an eye on the dollars and cents. From budgeting and forecasting to managing cash flow, the financial side of things can make or break your gym. So, grab a coffee, and let’s dive into the nitty-gritty of cheer gym financial management.

*YouHitZero and IPP Music have no financial interests in any service or product recommended in this article.

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1. Budgeting 101: Know Your Numbers

  • What to Do: Create a detailed budget that outlines your income and expenses.
  • Example: Break down your budget into categories like coaching salaries, equipment, utilities, and marketing.
  • Scenario: You allocate $5,000 a month for coaching salaries, $1,000 for equipment, and $500 for utilities. At the end of the month, you find that utilities only cost $400. You decide to reallocate the extra $100 to marketing, specifically to a Facebook ad campaign targeting local parents interested in cheerleading for their kids.
  • Tool Tip: QuickBooks offers a comprehensive budgeting feature that allows you to set budget limits for different categories, integrate with your bank for real-time tracking, and even generate monthly or quarterly budget reports.

2. Revenue Streams: Diversify, Diversify, Diversify

  • What to Do: Look for additional revenue streams beyond membership fees.
  • Example: Offer cheer camps, workshops, or a pro shop.
  • Scenario: You decide to host a summer cheer camp and charge $200 per participant. You market the camp through your gym’s social media and newsletters. With 20 sign-ups, you make an extra $4,000. You use this revenue to purchase new tumbling mats and also set aside a portion for your emergency fund.
  • Tool Tip: Square not only provides point-of-sale solutions but also offers robust inventory management features. You can track product sales, set low-stock alerts, and even manage vendor relationships, all from a single dashboard.
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3. Cash Flow: Keep the River Running

  • What to Do: Monitor your cash flow.
  • Example: Maintain a cash reserve for at least three months of operating expenses.
  • Scenario: You aim to keep $30,000 in reserve to cover unexpected situations. When the pandemic hits, you find that your reserve is enough to cover three months of minimal operational costs, allowing you to weather the storm without laying off staff.
  • Tool Tip: Float offers real-time cash flow forecasting that integrates with your accounting software. It allows you to visualize your cash flow on a daily, weekly, or monthly basis and even set cash flow scenarios for events like hiring a new coach or buying new equipment.

4. Pricing Strategy: Finding the Sweet Spot

  • What to Do: Set your pricing based on value, competition, and your target market.
  • Example: If you offer specialized coaching, you can charge a premium.
  • Scenario: You decide to increase your monthly fee from $100 to $120 due to new equipment and a specialized tumbling coach. You communicate this change transparently to your gym members, explaining the added value. The increase is well-received, and you even see an uptick in new sign-ups interested in the specialized tumbling classes.
  • Tool Tip: SurveyMonkey allows you to create targeted customer surveys that can be sent via email, social media, or embedded on your website. The analytics feature helps you interpret the data, giving you valuable insights into what your customers value most and what they’re willing to pay for it.

5. Expense Management: Cut the Fat

  • What to Do: Review your expenses and look for cost-cutting opportunities.
  • Example: Negotiate with vendors for better rates.
  • Scenario: You review your expenses and find that you’re spending a lot on cheer mats. You reach out to your vendor and negotiate a 10% discount for bulk orders. This saves you $200 on your next order, which you then allocate to upgrading your sound system for better practice sessions.
  • Tool Tip: Expensify automates the entire expense management process. You can import expenses directly from your bank or take photos of your receipts. It categorizes and tags each expense, making it easier to review and identify potential cost-saving areas.
budgeting-for-cheer-gyms

6. Financial Forecasting: Look Into the Crystal Ball

  • What to Do: Use past data to predict future income and expenses.
  • Example: Plan for slow seasons in your budget.
  • Scenario: After reviewing past data, you notice a 20% membership drop during the summer months. You decide to adjust your budget accordingly, cutting back on non-essential expenses and ramping up marketing efforts to attract summer camp attendees.
  • Tool Tip: Google Sheets offers built-in financial templates and the ability to create custom financial models. You can use formulas to forecast based on past data, and even collaborate with your financial advisor in real-time.
cheer coach in gym office

7. Emergency Fund: Prepare for Rainy Days

  • What to Do: Set aside income for emergencies.
  • Example: Save 5-10% of your monthly income.
  • Scenario: You set up an automatic transfer to save 10% of your monthly income into a high-yield savings account. When your air conditioning unit breaks down in the middle of summer, you’re able to cover the repair costs without affecting your operational budget.
  • Tool Tip: High-yield savings accounts offer better interest rates than regular savings accounts, allowing your emergency fund to grow faster.

8. Tax Planning: Don’t Get Caught Off Guard

  • What to Do: Plan for taxes.
  • Example: Set aside a percentage of each month’s income for taxes.
  • Scenario: You set aside $500 each month in a separate tax account. When tax season arrives, you find that your estimated tax bill is $6,000, exactly what you’ve saved up. This allows you to pay off your tax bill without any stress or need for payment plans.
  • Tool Tip: TurboTax Business offers a step-by-step guide tailored for business taxes. It helps you identify potential deductions, navigate complex tax codes, and even offers a double-check feature that reviews your tax return for errors or missed opportunities.

9. Debt Management: Tread Carefully

  • What to Do: Have a plan for paying off loans or credit.
  • Example: Prioritize high-interest debt.
  • Scenario: You have a high-interest loan with a minimum monthly payment of $300. After reviewing your budget, you decide you can afford to pay $400 a month. By doing this, you not only pay off the loan faster but also save $1,200 in interest over the life of the loan.
  • Tool Tip: Mint can help you track all your debts in one place, allowing you to see the bigger financial picture. It also offers features to help you create a debt payoff plan. By inputting your loan details, interest rates, and monthly payments, Mint can calculate the most efficient way to pay off your debts and even project a debt-free date.

Managing the financial aspects of your cheer gym doesn’t have to be a headache. With the right tools and a solid plan, you can keep your gym financially fit while still having time to perfect that killer routine for the next big competition. Got any financial wisdom to share? I’m all ears! Until then, may your tumbles be tight and your balance sheets balanced! 🎉

 

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