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Money isn't the most important thing in life,
but it's reasonably close to oxygen
on the "gotta have it" scale
                Zig Ziglar

The Business of Martial Arts

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Kinds of Schools

As we said earlier, we're capitalist swine. We do believe in a fair exchange of service or goods for money. And that is where you run into problems with common practices in many commercial martial arts schools. If you are paying for something, then what they are providing had better well be what you are supposedly buying. At the very least that is called truth in advertising. At the worst, fraud. What makes it hard for the consumer is that common business practices of martial arts tend to operate somewhere in the middle. And, in all too many cases, closer to the fraud end.

While many of the subjects that we discuss here are not illegal, or even strictly speaking "questionable" business practices, they can very easily lead to a bad experience with a martial arts school. What they really are is a pattern of betrayal of trust, misinformation and sleazy marketing that will leave you with a bad taste in your mouth and a dent in your bank account. It's better to know about them before you let these practices sour you on the martial arts

To understand how and why some of these cash cow practices work, you have to understand something about the market and how people think ... Return to top of pag

Kinds of Schools
As a gross generalization, there are three kinds of martial arts schools.

In the first, although there are fees, teaching martial arts are not the instructors' day jobs. Teachers have other forms of employment or business interests. The instructor's regular 9-to-5 job somewhere else is what makes his or her house payments and puts food on the table. In these dojos, student fees are used to pay the building rent and school utilities. That's if the program isn't held through the local recreation center, university, YMCA or cultural center. In these cases, the fees are normally divided between the instructor and the institution. In other instances, the instructor rents space from a dance school, church or gym, and student fees pay for it. It is not uncommon for a very senior instructor to retire from the working world and open a school. His main source of income, however, tends to be his pension and Social Security. Or perhaps there is another commercial endeavor attached to the school. We have seen everything from health/fitness clubs to full-sized martial arts' equipment stores to herbal shops to restaurants connected to schools. These establishments produce the main source of income. But no matter how you slice it, the instructor isn't making his living solely from teaching the martial arts.

These kinds of schools tend to be best described as "labors of love." The people involved do it because they love the martial arts, and they love teaching. Quite honestly, what instructors may lack in polish as  professional teachers, they more than make up for by having higher standards and expectations of their students. Such instructors are less concerned with "keeping students" than making sure those students "do it right." As such, the quality of the information tends to be better.

The other kind of martial art dojang is what we refer to as a "commercial school." The teacher is not only making the school's rent and utilities, but his or her own household expenses. Now the school must not only make enough money to cover the school's operating cost, but produce enough profit to support the instructor and his or her family. At this moment there is no problem. The person is making his living by professionally teaching the martial arts. However, it is from this platform that many business establishments morph into the third kind of school, a commercialized one.

The term 'commercial' means 'a) of or referring to commerce b) engaged in commerce c) engaged in work that is intended for mass market (The Free Dictionary). In a nutshell, it's business. And there is nothing the matter with that. However, the definition of 'commercialized' is 1) To apply methods of business to for profit. 2) a) to do, exploit, or make chiefly for financial gain b) to sacrifice the quality of for profit (ibid). The connotation is very much about the cheapening and injection of other elements into a subject. We say other elements because although profit over quality is in the strictest sense commercialization, often commercialized martial arts schools have a lot of other problems. And now to really muddy the water, a dysfunctional/bad school can have many of the same faults as a commercialized one and not be entirely motivated by financial gain. Unfortunately, profiteering often goes hand in glove with these other kinds of misconduct.

It is in the realm of commercial schools that the different focuses of the martial arts are graphically evident. The discrepancies in focus require significantly different training emphasis. And the specific focus of the school will strongly influence what you will be taught. Some foci are far more lucrative in certain areas than in others. And often the culture of the area dictates what kinds of schools will be successful. This point is not often considered by many people who want to enroll their children in a martial arts program and whose decision on a school is often determined by convenience of location. Putting it simply, what they teach has a lot to do with keeping the numbers up and the cash flow going.

Aside from contracts, there are many ways such schools generate revenue. Many of these costs are neither up front or mentioned at the time of signing. They range from testing fees (every time you test for a belt, you pay extra), required uniforms (that they will gladly sell you), specialized equipment (that again they will supply), "extra" (but required) classes/seminars/workshops that you must pay for, fund raisers, yard sales, demonstrations and community events, to tournament fees (or fees for extra training required to compete). There are often books, videos and DVDs of the system, as well as patches, belts, clothing, accessories and super-cool ninja gizmos available through the school's convenient in-house martial arts supply store(1). These costs very quickly add up to much more than just the class fees.

In addition, a new trend in the last decade has been franchising (or licensing) of schools. These schools must pay fees to the franchising organization. While smaller satellite schools are often run by volunteers, the main school or organization that they pay is a commercial endeavor. Franchise fees, organizational memberships, insurance, continuing education, hosting the head instructor for seminars, testing fees, etc., etc. ... there are countless ways that money flows from satellite schools into the central organization. The requirement to keep the main association fed also requires the student numbers be kept high in satellite school, even though profits may  not go into the franchise instructors pockets. Often franchise schools are not called as such by the instructors, terms ranging from "sister" schools, "affiliated" or "part of the (fill in the blank) family" are common. If a school shares the name with a larger, stylistic organization, then it is probably a franchise. If the instructor presents himself as a "representative" of an individual, organization or lineage (such as a particular branch of Brazilian Jujitsu) then the commercial relationship can be less formal, but more complex. Although such a relationship still remains lucrative for the individual at the head of the organization.

In about 85 percent of commercial/franchised martial arts schools, cardio-programs (Tae Bo clones, "cardio-karate") and kids' classes are the bread and butter. These programs provide the bulk of the school's income. Cardio programs are basically aerobics done with martial arts overtones. While they do provide good health benefits, they should not be confused with self-defense training or traditional martial arts.

But the real money maker for most commercial schools are the kids' programs. "Karate moms" have taken their place with "soccer moms" (futball) when it comes to shuttling kids to practice. We will be the absolute first to say that martial arts can benefit children. All of those promotions about self-confidence, self-discipline, self-esteem and perseverance can be true for kids who study in such schools.

The cost of this however is a "dumbing down" of the system. This is to say that the intricacies -- that make it work -- are dropped so an eight year old can achieve his/her "black belt." Even though a lot of these schools dress up these programs in "traditional martial arts" garb and promote what they are doing as effective for "self-defense" the simple truth is most of commercialized martial arts are the functional equivalent of a car without an engine. You have the form, but not what makes it run.

The two most popular styles for kids are karate and Tae Kwon Do. In trying to avoid classes with kids underfoot, many adults seek other styles and systems. While the number of children is significantly fewer in these other styles that does not mean they are not commercial schools. And that means the school is not free of the need for high numbers or higher prices to support the head instructor.

If 85 percent of commercial martial arts schools make their living off kid and cardio programs dressed up as martial arts, a small 5 percent of commercial schools deliver what they promise. These businesses are run as professional gyms and usually lack the Oriental wall decorations and rituals that fill so many commercial schools. Usually these programs are full-contact training and run a "stable" of professional and semi-professional fighters.

Although usually far more reliable, there is a potential hitch in these programs too. Students, attracted by the "name" of the school and the success of the stable, sign up hoping to be trained by the trainers of champions. Unfortunately, in some of these schools, the quality of instruction for those not in the stable can be substandard. Such schools use the fees from the large student base to finance training the elite fighters -- where the big money is and functionally ignore  So just because they have a stable of great fighters doesn't mean you will be trained to the same standards.

The remaining 10 percent of commercialized schools try to turn a profit by selling some kind of extreme, ultimate, esoteric or deadly fighting art. For the record, we will state that the martial arts are neither fighting, self-defense nor streetfighting. Yes, there is overlap, but one does not prepare you for everything any more than studying accounting makes you qualified to be a physicist -- even though they are both based in math.

This 10 percent must be closely examined for dysfunctional and cult-like behavior, as well as students' unrealistic expectations from training. A student also must heed the caliber of instruction given in sport style schools that run a "stable" of fighters who compete professionally or semi-professionally.

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