Earning, and Working for Two...Rooms

In my last post, I mentioned that when you are self-employed you need to earn enough to support two:  you and your business. Roughly speaking, half your earnings go to you and half go to your business.

Continuing the "2" theme: if you think of your business as a house, it's a house with two rooms -- the first room is your practice room. The second room is your office. You need to spend time, energy, and money in both rooms.

 

In the practice room, you spend your time, energy, and money on being the best massage therapist you can be. In your office, you spend time, energy, and money being the best business owner you can be.

 

How are your energies currently being divided between these two rooms? If I were to guess, a lot of MTs probably split their time 95 / 5:  95% of their time, energy, and money are devoted to being a good massage therapist; 5% are spent on being a good business owner.

 

In my experience, a more useful split would be 80 / 20. If you're just starting out, it might be more like 60 / 40, maybe even 50 / 50.  You may be able get away with 90 / 10 if you have a mature practice full of repeat clients who never leave you. But it's never going to be 100 / 0 (or even 95 / 5) if you want to be truly proficient in both sides of the house.

 

What does it mean to devote 20% of your time, energy, and money to your business?

 

In a 40-hour week, spend about 8 hours on your business. That includes doing your bookkeeping, updating a website, writing a newsletter, doing the laundry (sigh), buying supplies, reading trade pubs, etc.

 

If you spend, say, $1,000 a year on continuing education, set aside at least $200 for business-related workshops.

 

When you dream about your ideal practice, remember to imagine what the business side looks like too!

 

If you go to a conference offering workshops, take at least one business-related workshop (if they're offered). If you organize those conferences, make sure you offer business courses.

 

Spend at least one weekend a year on a business retreat. What would you do there? Close out your books for the year and get them ready for filing taxes. Update your business plan for the coming year. Begin writing a business plan! Evaluate how you did meeting your goals for last year. Decide what continuing ed you'll take in the coming year. Catch up on your massage magazines. Finish reading that massage book you bought at your last conference. Get a massage. That sort of thing.

 

See how I'm thinking about this? Running your business happens every day. Making time, energy, and money available to become a better business person needs to be part of your regular schedule as well.

Now on to a more self-serving note....

If you find taxes, bookkeeping, or marketing (important business-owner kind of activities) baffling, The Healing Core is offering two workshops to help you:

Taxes & Bookkeeping for The Healing Arts Professional (early bird discount ends in a week)

One Year To A Successful Massage Therapy Practice (which is all about marketing)

Both are taught for massage therapists by massage therapists. Signing up for either can be a first step in getting your 80 / 20 lined up properly.

Did You Hear About Massage Envy.....?

Our clients often presume we are the Masters of Mellow. But then, most of them have never seen us get into a conversation with each other about Massage Envy. In case you have somehow missed the buzz, Massage Envy is a national corporation that sells franchises. These franchises offer mostly massage therapy but sometimes they will also offer some spa services.

Massage Envy -- at least in the DC area -- prices their massages at $65 (which is 20-25% below what most individual practitioners charge). They also offer "memberships" through which clients can get even better price breaks, especially if they book massages more often than once a month. They advertise broadly and are active in the massage industry at the regional and national level.

So, what makes your average self-employed MT get so nutty when we talk about them? It comes down to two things, based on my conversations with MTs:

• Rumors about how they treat their MTs
• Fears that their size and influence will put the rest of us (solo practitioners) out of business.

I'd heard all the stories and I've had a mostly disdainful view of Massage Envy for years. Then I learned that a massage school classmate, who I respect, was working for a local Massage Envy franchise and was their new massage therapist manager. Well, damn.....

I had two choices: think less of my classmate, Carla Lawson, or learn more about Massage Envy. I called Carla and asked if I could come out to talk to her and get the lowdown on Massage Envy. I warned her that I specifically was hoping to write a blog post based on our conversation.

She agreed. I met with her and the franchise manager for about an hour. I also ran into an MT buddy I haven't seen in a while and she talked to me about her experience working there.

Let me go ahead and lay bare my conclusions before I get to the details:  Massage Envy is not the spawn of Satan. I don't believe they intentionally plan on driving the rest of us out of business but they do have an aggressive corporate plan for growth. They represent a distinct sea change in the business of massage. I am probably not a good candidate to work at a Massage Envy because of some core personality traits but it can be a good deal for the right therapist.

So, let's take a look at some facts about Massage Envy. In fact, let's start with the one that horrifies most of us the most.

Rumor: Massage Envy only pays an MT $15 - $20 per massage!

Fact: True but.....

Let's start with a crucial difference between an MT working at Massage Envy and an MT working for, say, the local group practice -- Massage Envy has employees; the local group practice has independent contractors. You cannot compare the two directly because they are fundamentally different.

As an independent contractor I have to support both myself and my massage practice. In addition to paying my home mortgage and buying groceries and dropping a little something in the offering plate on Sunday, I need to buy sheets and tables and linens and oils, and possibly my own health and disability insurance. I need to pay 100% of my social security contribution and pay for web hosting and business cards, flyers, and brochures, etc. I am supporting two on my massage income: Kelly Bowers and Kelly Bowers' massage practice.

An employee gets to take almost everything they make home for themselves (I don't think Massage Envy picks up the tab for license renewals; a given franchise may offer some assistance with continuing education). Plus, of course, the employee is only paying 50% of their social security contribution.

In my previous life as a tech writer, there was a rule-of-thumb for calculating how much you needed to charge as a contractor to match what you made as an employee:  twice as much. If I made $60,000 as an employee (about $29 / hour), I needed to charge at least $58 / hour as a contractor to come out roughly even.

I did some number-crunching on my own earnings and profits as a massage therapist for about 5 years and I'd say that's still a decent rule of thumb – about half of my businesses income goes to support the business so my “salary” is actually about half what my practice brings in.

If my solo practitioner/independent contractor massage practice makes $45,000 a year, I could make $23,000 a year as an employee and still be in roughly the same financial shape at the end of the day / week / month / year (it's tough to do an actual head-to-head comparison; hence the roughly).

And, of course, an employee doesn't need to spend the time and energy doing the bookkeeping, marketing, quarterly tax filings, scheduling, etc. etc. etc. that eats up so much of our weeks.

Interesting factoid: individual franchise owners have a lot of leeway about how they balance pay and benefits to MTs. Rumor has it the Massage Envy franchise in Bethesda pays up to $40 per massage! I'm curious if they offer the same or fewer benefits than the Herndon franchise.

Interesting factoid: the full-time MT employees (at least in Herndon) are offered medical benefits and paid leave. You have to work 32 hours a week to be considered full-time and eligible for the benefits. According to my classmate, most of the 30 MTs at the Herndon franchise are considered full-time.

Interesting factoid: Massage Envy actively encourages customers to tip. According to my classmate, she receives tips for virtually all of her sessions and they can easily be as much as she makes in wages. MTs keep 100% of their tips. Which makes her actual "per massage" rate more like $30 - $40.

Interesting factoid: you still get paid the same amount when a client cancels at the last minute or is a no-show.

Rumor: Massage Envy makes you "push product".

Fact: Maybe, depending on the franchise

Here's an important thing to know about Massage Envy -- because they are franchises, the individual franchise/location owner has a lot of leeway in how they run their franchise. Massage-only or massage + spa services?  Big benefits or big pay?  (One thing is always true: Massage Envy does not offer energy work and they are not interested in offering energy work)  If you're in a franchise that also has a significant spa services side, you may or may not be expected to support that side of the house too.

It really does depend on the franchise owner. The Herndon franchise has a great reputation, even among other local Massage Envy franchises, and regularly has MTs leaving other Massage Envy franchises to sign on with Herndon.

While the customer may have a fairly consistent experience from one franchise to another, the working reality is going to depend heavily on the franchise owner (and, of course, the on-site managers).

Rumor: Massage Envy is full of new MTs with little experience (who don't know any better).

Fact: Depends on the franchise

Of the 30 or so MTs at the Herndon franchise, at least 1/3 of them have been in practice 10 years or more, including Carla and the MT buddy I ran into on my way out. Fewer than 10% of their MTs have been practicing 2 years or less.

Rumor: Once an MT gets good, they leave Massage Envy. If you find an MT you like, they won't be there in a year.

Fact: Depends on the franchise.

Carla has been at the Herndon franchise for several years. She started as an MT and moved up into management, which is something you can do if you have such aspirations. "Part of what drew me to the company was that there were places to go beyond practicing massage. Let's fact it, I'm not getting any younger and one day the hands are going to want out."

Some of the other things that attracted Carla to Massage Envy was the stability of the operation and the price of the massages. She was uncomfortable working in places where the price of the massage was so high she, as a massage therapist, wouldn't have been able to afford it! "Somebody like me could afford to come here," she said.

Rumor: You have to do 50-minute sessions and see clients on the hour.

Fact: True

Yes, they do "50 minute" hours and you have 10 minutes between clients. The front office staff takes care of the health history form and answers any initial questions the clients may have but you’ve still only got 50 minutes with them. Carla says that takes some MTs some time to get used to because it's not negotiable.

Frankly, that would drive me nuts but I am the Queen of the Long Intake.

Rumor: You have to work long hours without a break

Fact:  False

Most MTs, at least at Herndon, take a break after 2 or 3 clients. They can also take more or fewer breaks if they want to.

Rumor: MTs are expected to see an absurd number of clients in a day.

Fact: False

Carla says (again, at least at Herndon) they have an on-going challenge with new hires who insist they can "power through" 6, 7, 8, or 9 clients a day. They actively discourage MTs from doing that because they know it won't work. But because the employees have a certain freedom to fill up their schedule as much as they can, management will sometimes say "OK, give it a try" but they usually find the MT themselves backs off for their own health and welfare.

As Carla showed me around the facility after our conversation, I ran into an MT buddy I haven't seen in a few years. She walked out with me and we talked on the sidewalk for another 15 minutes afterwards.

She graduated from PMTI in the early 90s and had a private practice (combo of home, corporate, and a yoga studio) for years. About 5 years ago she decided to step away from massage for a while. She started going to the Herndon Massage Envy to get bodywork for herself and enjoyed it. She found herself on the table one day thinking "Gosh, I miss doing massage..." and at the end of her session talked to the manager about coming to work there. She's been there for 2 years and loves it.

She says she works 3 days a week, which makes her part-time, and makes $32,000 per year, which is the average for a full-time massage therapist in the DC region according to the American Massage Therapy Association.

Best of all, after more than 15 years of self-employment, she is intensely grateful for the chance to do what she loves and still have the time and energy for the rest of her life. She is keenly aware of all the behind-the-scenes work it takes to run a healthy practice (the stuff our clients rarely see) and she's happy to no long have to do that.

I appreciate her viewpoint and I'm envious of her ability to just go in, do her work, and go home. I know, however, that I would be a bad fit for a Massage Envy. First of all, the 50-minute hour would drive me bananas. Then there's my fundamental temperament....

The Spring 2012 issue of the AMTA Journal carried an article by Jean Bailey, "The Separate Selves". In this article Jean explored the 3 aspects of our personalities that we need to run a massage practice:

• Entrepreneur (the part of us with ideas! and visions! and a desire to build something! and create things!)

• Technician (the part of ourselves who wants to be better and better at what we do and wishes we could just ignore the rest of it)

• Manager (the part of ourselves that deals with all the behind-the-scenes stuff and enjoys organizing, scheduling, analyzing, etc.)

We are usually strongest in one area but it's important, if we're self-employed, to be at least competent in all three.

It strikes me that the Technician could really thrive in a well-run Massage Envy franchise. They can expend their energy on honing their craft and ignore the rest of it. Me, I'm all Entrepreneur and that wouldn’t be a good fit for a Massage Envy.

In fact, Carla says that the ideal MT for them is someone who cares deeply about clients, has a strong sense of professional identity, and isn't in it just for the money (the Technician). Their biggest challenge is MTs who have trouble being on time and sticking to the schedule (weak as Manager).

I'll say it again:  Massage Envy isn't for everyone. It's not for me. But for some MTs, it could be a good thing.

One Size Does Not Fit All

Have you ever bought a piece of clothing labeled "one size fits all"? How did it fit? The odds are (if your experience is like mine) that sometimes it fits and often it doesn't. I think "one size fits all" should really say "we're too lazy to make multiple sizes, good luck".

With the growth of the healing arts industry, there are a lot of people offering us business advice. Blogs, columns, and articles in the trade pubs. Continuing education. Books. There's a lot of advice being tossed about. There's a divide, though, between the types of advice we're being given.

On one side is "conventional" business advice. It's the sort of thing you'd hear in business school or from the Small Business Administration. It's meant to be useful for all types of businesses. It may or may not have been customized or shrunk to fit a one-person service-oriented type of businesses, which so many of us are.

On the other side is experience-based business advice. It's more business experience than business knowledge. It may be supported by academic learning but it's primarily based on things the writer/speaker has learned from doing business. They are sharing what they have gone through and learned will work for them. The question is whether it will also work for you.

The first type -- the conventional business advice -- often feels like "one size fits all" to me with about the same degree of success. Conventional business advice assumes some things that just aren't true for me (or most of the MTs I know) -- a staff, for example, or a lot of spare time and interest for "business".

Conventional business advice is usually based on product-oriented businesses rather than service-oriented businesses like massage therapy. I have very few issues around inventory management or my "supply chain" (whatever that is) for example.

Here's my biggest disconnect with conventional business advice: it's based on the assumption that my primary motivation is profit, lots and lots of profit. I love the idea of making heaps of money (pause while I fantasize about what it would be like to make heaps of money....) but it's not what gets me up in the morning and keeps me doing the never-ending laundry. What keeps me going is the complete buzz of making a difference in someone's life, of having a body really talk to me, of feeling tissue open and breathe beneath my hands. It's the work that keeps me going.

Now, since I'm trying to support myself with massage, making a profit comes in a pretty close second in my passions! But it is second and most conventional business advice places it first. That's a disconnect for me.

Does that mean that there's nothing to learn from conventional business education? Not quite. There is a core of basic (albeit generic) information to be gleaned from conventional business education. There's often an under-appreciated "translation" problem -- translating the generic advice into something that's specifically useful to us.

When you read these business columns, articles, and blogs, when you are tempted to take the continuing ed or sign up for the workshops do you hear the voice of someone who loves the work first? Do you sense the compassionate heart that drives most of us? Do you get a sense of someone who fundamentally understands your priorities and appreciates that same passion? If the writer / speaker / teacher isn't coming from that place (or at least somewhere in the neighborhood) take a look for that "one size fits all" label.

It won't be easy. While the "biz advice" industry is growing, it's still much smaller than they "here's another way to rub the naked person" training / blogs / columns. When it comes to business advice and training, you will have to do a little work (but less and less with every passing year). If you've only got a limited amount of time, money, and energy for business education, make sure you're spending those limited resources in the way that will help you, specifically, the most.

The Best Teachers

I've been thinking about teaching a lot lately. I'm still very excited to be teaching Business Plans Deciphered in October at the AMTA national convention (and I'd love to see any of you there!). I'm working on promoting the workshops of The Healing Core and the very first workshop we're offering is Create Quality Continuing Education. I keep coming up with courses and seminars I want to offer next year and I get excited by the possibilities.

Teaching is on my mind.

I am also in a group with a few other MTs who meet monthly to work our way through Twelve Months to Your Ideal Practice. This month's exercises are all about marketing, starting with writing a newsletter for you practice. Well, don't I feel pretty smug about that, what with being a professional writer and having written a newsletter for my practice for 10 years now!

Then my "teaching" brain and my "writing" brain collided. I started contemplating whether I should offer a workshop on writing newsletters for your practice. And I quickly realized I am the wrong person to teach that class. I, literally, do not know how to teach people how to write.

We often assume that the best teachers are the ones who are the most skilled at a certain task. However, some of my worst training experiences were with teachers who were excellent at their craft....and always had been. Therein lies the problem.

When something has always been easy for you, has always come naturally to you, it is very difficult to put yourself in the shoes / mind / heart of someone who has never been adept at a thing, who is struggling, who just doesn't get it. A teacher who teaches from their own personal experience of a subject or task rather than from the student's experience with a subject or task is rarely a good teacher.

The best teaching is less about the data than it is about empathy with the student. It's about the instructors ability to recognize and appreciate where the student is and help the student move from a place of discomfort / ignorance / inexperience to a place of competence, comfort, and knowledge. A great teacher is as much a guide and a mentor as they are the resident expert, especially when a workshop is geared to beginners.

I think this happens a lot with energy work. The teachers are often people who have always been able to feel chakras / see auras / feel energy / etc. and they genuinely want you to have and enjoy that experience too. But they've never had to learn to feel chakras, see auras, or feel energy so it's difficult for them to teach that part of the experience.

I can't teach writing because I've never had to learn how to write. Oh, I've had to learn how to write well and I've had to work at honing my craft but words have always come easily to me. I was a writer in the first grade! I never had to learn to write, I could always write (well, once I learned how to read). I do not know how to put myself in a non-writers shoes, to feel that experience.

Think about your favorite courses and instructors. Think about your least favorite courses and instructors. How often was the difference between them an instructor who genuinely understood where you -- as the student, as the novice -- were coming from?

And if you're thinking about taking up teaching, honestly ask yourself if you can put yourself in the shoes of someone who genuinely does not know how to do the thing you want to teach. (And if you want to ensure you design a great course, sign up for our workshop! You really will be amazed at how much goes into creating a truly great course.)

No Better Teacher

I had a friend visit this weekend from Lynchburg VA. She loves to come to DC to visit art museums. We spent Saturday in Baltimore and this is a shameless plug for the American Visionary Art Museum. Best four hours I've spent in a museum lately. It just lit up my imagination. Even the gift shop was fun and inspiring!

ANYWAYS (back to the topic at hand), my friend runs a house cleaning service. Like me (and many of us), she's a one-woman self-employed operation. Always working on managing her client base (enough but not too many), finances, marketing, lugging equipment, transportation, working with people from all walks of life, dealing with people who have the wrong idea about her work, even dealing with unwanted advances (yes, it happens to cleaning people too!). It all sounded very familiar.

She's casually contemplating other career options (carrying vacuum cleaners is getting old) and asked me about massage therapy. I talked about the two biggest challenges I find in this profession:

*  being a business owner and taking that seriously

*  becoming the kind of person who can meet the interpersonal, psychological, and spiritual aspects of our work

She was completely unfazed by the business challenges. They are no different from what she's experienced running a cleaning service. In fact, the best training for running a small service-oriented business is....having run another small service-oriented business.

In our drive to be taken seriously, we compare ourselves to other healthcare providers:  doctors, nurses, acupuncturists, chiropractors, etc.  How do they earn respect, get paid, set up their practices, etc.?

I suggest that if you want to learn practical business skills you also need to talk to self-employed cleaning ladies, plumbers, car mechanics, dog walkers, home inspectors, and house painters. Talk to them about how they set their rates, advertise their services, maintain a client base, save for retirement, do their bookkeeping, etc. Their challenges are, in many ways, more like ours than a doctor's practice ever will be.

There are teachers everywhere. You just need to learn to recognize them and find opportunities to listen to them.

Looking At Pay-What-You-Can Like A Hippie

I'm discovering that there's a small but steady drumbeat that business can be done with heart, specifically the heart of healer. Mark Silver is one of those putting some great stuff out. I recommend you check him out.

Mark has come out strongly against "flex pricing" (sliding scales, pay-what-you-can, etc.). What I admire about him, even though I disagree with him, is that when he encountered a cogent argument in favor of pay-what-you-can (PWYC), he listened, he liked what he heard, and he changed his mind! More than that, he put the word out among his considerable network about this new way of thinking.

The PWYC defense was put forth by Tad Hargrave, who does what he calls "Marketing For Hippies". He's all about the alternative economy and he has used PWYC in his workshops and classes. Along the way he's worked out how we communicate with our clients around PWYC to make it work and not be a burden on our clients.

I'm adding a few things to my website in response to what Tad has to say. Mark interviewed him (in 4 segments, for some reason) and posted the interview online. If you're interested in being creative and open in your pricing, I strongly recommend you listen to the interview(s) and read some of what Tad has to say. I know I signed up for his emails (while I'm unsubscribing from almost everything else!).

There's good people out there defining a new better way to do business, a way more in synch with healer values. Have a listen.

There’s Employment and Then There’s Employment

I’m a word geek. I find words fascinating -- their different meanings, how we use them, how they evolve, how to carefully express an idea or a sentiment with them, the beauty of a well-constructed sentence -- it all speaks to me.

It’s why I can get a bit testy about people using words too carelessly. Masseuse vs. massage therapist. Impact as a verb. Impactful under any circumstances. Employment...

Wait (I hear you saying) that's a good word! Yes it is. The problem is that too many people use "employment" when they should be saying "contracting". The difference matters. A lot.

In the February 2012 issue of Massage Today, columnist Angie Patrick suggested that our two work choices as MTs are entrepreneur or employee. We work for ourselves or we work for others. The problem with this either/or categorization is that there is a third choice (there's almost always a third choice) and it's the one masses of us find ourselves in: independent contractor.

Am I splitting hairs? Absolutely not.

Angie is right that, very broadly speaking, we can work by ourselves or we can work with other people. When we work with other people, however, we aren't necessarily working for other people.

When we work with an organization as an independent contractor we are not an employee. (Approximately 99% of the MTs I know here in DC who work as part of another organization [spa, group practice, chiro, etc.] are independent contractors.) We don't have the privileges of an employee -- paid time off, regular salary, medical benefits, etc. -- but we also don't have the restrictions of an employee -- employer decides when, how, and where you will work using what tools, processes, and procedures, etc.

There is a balance of power inherent in working relationships. When you are an employee, the employer has more control but they also have more responsibility. When you are an independent contractor, you negotiate more of the details of your working relationship and the balance of power is less one-sided.

Here's another sneaky little truth in our industry: even when we are officially employees, we often don't get the goodies we assume come with employment, such as paid time off or medical benefits. I have learned from talking to a number of MTs who are officially employees that even when companies offer these benefits, the rules governing what it takes to actually qualify are usually not written in our favor.

In one case here in DC, an MT could be scheduled to be at work for 40 hours a week but the only hours the company would count towards qualifying for benefits would be the hours the MT was actually in session with a client. If you had 25 one-hour sessions in a week (a completely full schedule for most of us), the company would say you were only "part-time" so you weren't eligible for benefits. Yes, despite the fact that you were scheduled to be on-site for 40 yours and might actually be getting paid for 40 hours. For the purposes of qualifying for benefits, you were only "working" 25 hours, not enough to get benefits.

Is that fair? In an official employment relationship, remember, the employer has more control to go along with their greater responsibility. I don't think it's fair but it's within their rights as an employer.

The IRS is very particular about the difference between contracting and employment. You and your "employer" can get into trouble if your working reality and your contractual arrangement are not in synch with each other.

I get frustrated by how casually writers in our trade pubs use the word "employment" when they really should be saying "contracting". I suspect this happens most often when the writer is not an MT and has never been self-employed. The difference between the two words is enormous for us and using the words incorrectly has led way too many MTs astray.