Before deciding on the payment model and frequency, you will need to have an in-depth understanding of your business operations. In addition to your payroll expenses, you will need to consider other significant costs such as rent and equipment, which is why it is imperative that you have a well-defined budget. Other factors to account for include the type of services your studio offers, the size and frequency of classes, the credentials and certifications of instructors, and more. Assessing these factors will enable you to decide on the appropriate compensation arrangement that matches both the needs of you and your fitness instructors.
Types of Employment
Firstly, you will need to decide the employment type of fitness instructors you would like to hire as it will affect not only how you wish to pay them but also how your studio operates.
1. Freelance instructors – independent contractors who work for themselves rather than your studio, and they most commonly earn money on a per-class or per-hour basis.
Studio Advantage(s):
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Provides flexibility and a larger, diverse talent pool for you to draw from; hence increasing the quality of your studio’s workout experience.
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Provides cost-effectiveness as freelance instructors typically do not incur extra costs such as medical benefits and insurance.
Studio Disadvantage(s):
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Lack of supervision as it will be harder to ensure that all your freelance instructors adhere to your expectations
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Can potentially create scheduling issues whereby some freelance instructors might be unwilling to teach at certain time slots
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Lack of commitment as your freelance instructors can quit easily or they might be working for your competitors, should you neglect certain clauses in their contracts.
2. Full-time instructors – treated as employees of your studio who are typically paid a regular monthly salary
Studio Advantage(s):
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Increased power over full-time instructors as you are able to better manage your class schedules and ensure a certain level of standards. .
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Increased loyalty as the additional benefits of full-time employment tend to create more engagement and dedication.
Studio Disadvantage(s):
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Increased management responsibilities as you will need to handle more administrative work such as training and development.
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Additional financial costs with regards to their remuneration packages such as paid leave and medical benefits.
Types of Payment Model
1. Flat-rate model – a flat hourly or class wage.
Studio Advantage(s):
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Increases predictability as you are able to easily plan for future payroll expenditure.
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Improves efficiency as your instructors are provided with a steady, agreed-upon salary.
Studio Disadvantage(s):
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Instructors will not be incentivized to attract more members as they are guaranteed the same wage rate regardless of the size of their classes.
2. Pay-per-head model – a commission-based model that pays fitness instructors a stipulated amount for every student that attends a particular class.
Studio Advantage(s):
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Incentivizes your instructors to recruit more members for the studio, which will in turn increase their salary.
Studio Disadvantage(s):
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Makes it more difficult to make accurate financial projections due to irregular payments.
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Creates negative, or even hostile, competition between instructors as their salary is at stake.
3. Combination of flat-rate and pay-per-head – in addition to a base salary, instructors will be paid a bonus for every additional student in a particular class.
Studio Advantage(s):
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Provides instructors with a stable income and incentivizes them to earn a bonus by attracting more members.
Studio Disadvantage(s):
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Instructors might still compete for members and class time slots.
Additional Employee Benefits
In addition to the basic salary, you might also want to consider offering additional benefits to your fitness instructors to reward them for their efforts as well as reinforce their positive behavior thus far. Some incentives could include providing opportunities for upskilling, subsidising the cost of certifications or fitness events, and making your studio’s space and equipment available for their own personal use. Organising team-bonding events or retreats could also build stronger relationships and increase loyalty to your studio. Such extra perks could serve as an excellent way to not only attract talents but also retain them in your studio.
Frequency and Method Payment
You will also need to decide when to pay your fitness instructors, and the following are the most common options:
1. Weekly – More tedious to process weekly paychecks and it might affect your cash flow.
2. Bi-weekly – Paid every other week, amounting to 26 paychecks a year.
3. Monthly – Easiest to process as payroll is done only once a month.
The two primary methods of paying your fitness instructors would be either through direct payment into their bank account or by cheque.
For a detailed guide on paying salary in Singapore, please visit:
https://www.mom.gov.sg/employment-practices/salary/paying-salary
There is no one-size-fits-all solution so it is important that you think carefully about how you wish to implement a compensation model that attracts and retains talents. You will need to strike a balance between your studio’s resources and the needs of your fitness instructors. After all, your fitness instructors are the ones who help to achieve your studio’s goal of delivering the best workout experiences for your clients, so it is paramount that they are well compensated and taken care of.
With these considerations well taken care of, you might want to ensure that you have a proper solution that helps track your staff compensation. Vibefam is a solution built for boutique fitness, which helps you track and record staff compensation and payroll so you don’t have to worry about managing it on your own. Find out more about what we offer here, and when you’re ready to chat, schedule a call with us for a personalized product demo!
This article was written by Joshua Kek.
