contracts

[MasterKiller]

One year agreement, paid monthly, usually. You're still locked into a monthly payment if you decide to quit and the school enforces the contract.

[Judge Pen]

The most you would be out is one month's tuition under my schools contract. At $40 a month that's hardly worth pursuing. My teacher would never pursue that anyway.

[red5angel]

I'm best with paying monthly....

I'm ok with siging a contract, paying monthly, if I can get out of it whenever.

I'm not ok with having to pay a full contract and not getting my money back if I decide to get out.

[Tigrentera]

Originally posted by MasterKiller
This is what I'm arguing against. Basically, the owner is forcing the person to pay for services never rendered. National chain gyms like Gold's and Reaction Fitness are notorious for this. They EXPECT people will drop out after a short period yet enforce the contracts anyway. It's a scam to make money with the intent on never providing the full services to most of their clients, plain and simple.

But if the intent is to deliver services and the buyer never shows to collect on them then is it the fault of the deliverer or the buyer?

The deliverer of services has to have some way to protect himself.

Let's take a theoretical. Say you owned an airline and you hired a cleaning service to clean your planes. They sign a contract with you for a years worth of work. If all of a sudden you say you don't want there cleaning service too bad for you. You signed a contract with them for one year.

You signed a contract and the onus is on you to prove that they are not fulfilling there end of contract.

The problem in the "fitness" world is that people sign up but don't stick with it. It wasn't that the gym or school did something wrong. It's that people in general are too lazy to stick with it.

You can't run a viable school or health club when you have people signing up and quitting all the time and your income is uncertain. What if you had a bunch of people quit in one month? You couldn't pay your rent.

So martial arts schools find ways to stabilize their income either by contracts OR other ways like Lion Dancing or equipment sales.

You have to have some source of consistent income and trust me it rarely is coming from the students.

[MasterKiller]

If you can get out of it whenever, what is the point of having a contract? Unless the teacher is doing what JP's is, using a 3rd party billing agent, I don't see how a contract can guarantee income.

You have to have some source of consistent income and trust me it rarely is coming from the students.

Then perhaps you should find another line of business. You are basically extorting money from a consumer class that doesn't want your product.

[Tigrentera]

Originally posted by MasterKiller
, using a 3rd party billing agent, I don't see why you need to have a contract.

That's genius. And if they don't pay you can send a collections agency after 'em.

[emre]

Originally posted by MasterKiller
If the instruction is good enough, the students will keep coming month to month and you won't have to rely on legal intimidation to pay your rent.

Exactly.

[GLW]

Not all contracts are bad...

Ones where there is no escape clause and the school uses collection agencies (a common thing) are mainly done by schools that want a quick and easy buck...and this is also the method used by the Health clubs and such.... They get you for everything they can when you walk in the door...and expect that more than 50% will never come in to take the services they paid for.

A FAIR contract involves the student getting a reduced fee for making a committment to the school for a period of time.

While I do not do contracts where I am - don't need to ...I HAVE given it some thought if I were to ever need to...and it goes like this...


Say the nominal fee for classes by the month is $50.

A 6 month contract if just monthly fees would be $300, a 1 year - $600.

So, if you want a 1 year from a person, you have to make it worth more than 2 6 month setups.

So, 6 months - $250. (translates into 1 free month)

Then 1 year - $450 (translates into 3 free months)

Then, the escape clause...

In writing
Escape applies to the NEXT beginning month
Refunds are based upon charging the student for the months they have used at the NO DISCOUNT rate...(you burn your paid months BEFORE you burn your free ones)

So, if a person has a 1 year contract and they come in during month 9, they have burned 9 months of dues (i.e. 9*50 = $450)...so no refund.

If they came in during month 3 and quit, they would have burned 3*50 = $150. They had paid $450 so they get a $300 refund.

If they come back after being gone for 3 months and try to say "I quit 2 months ago...I deserve those two months in the refund since I was not here...."

Nope, it is a courtesy thing. Instructor was there for the classes. It is NOT their fault that the student did not show up or take responsibility for their own tuition issues until 2 months later....

[Tigrentera]

That's a good set up. I like it.

[norther practitioner]

GLW hit the nail on the head....

I think in some instances, contracts are OK. The way that his would be set up seems good.

[Serpent]

Originally posted by GLW
Not all contracts are bad...

Ones where there is no escape clause and the school uses collection agencies (a common thing) are mainly done by schools that want a quick and easy buck...and this is also the method used by the Health clubs and such.... They get you for everything they can when you walk in the door...and expect that more than 50% will never come in to take the services they paid for.

A FAIR contract involves the student getting a reduced fee for making a committment to the school for a period of time.

While I do not do contracts where I am - don't need to ...I HAVE given it some thought if I were to ever need to...and it goes like this...


Say the nominal fee for classes by the month is $50.

A 6 month contract if just monthly fees would be $300, a 1 year - $600.

So, if you want a 1 year from a person, you have to make it worth more than 2 6 month setups.

So, 6 months - $250. (translates into 1 free month)

Then 1 year - $450 (translates into 3 free months)

Then, the escape clause...

In writing
Escape applies to the NEXT beginning month
Refunds are based upon charging the student for the months they have used at the NO DISCOUNT rate...(you burn your paid months BEFORE you burn your free ones)

So, if a person has a 1 year contract and they come in during month 9, they have burned 9 months of dues (i.e. 9*50 = $450)...so no refund.

If they came in during month 3 and quit, they would have burned 3*50 = $150. They had paid $450 so they get a $300 refund.

If they come back after being gone for 3 months and try to say "I quit 2 months ago...I deserve those two months in the refund since I was not here...."

Nope, it is a courtesy thing. Instructor was there for the classes. It is NOT their fault that the student did not show up or take responsibility for their own tuition issues until 2 months later....

This needs quoting again!

The only change I'd make is to have two free months rather than three with the one year subscription, but offer something else as well. A free training shirt or something like that, which a student would need to replace every year or so anyway. That affects your cash flow much less.