How to set up a Yoga or Meditation Centre, Advice from an Accountant
Most of the yoga centre owners have the passion for yoga and would not want to get into yoga for business management; you just want to run a centre because you love what you do.
No matter what business you are in having a true passion and love for what you do is what leads to running a successful business. If you are wondering how to open a yoga or meditation centre, plenty of advice from a business as mentioned below:
Find a CA and Lawyer
The first thing I would do is find a good lawyer and CA. So the obvious question is how do you find a good lawyer and CA to work with? I would definitely start with tapping your business network.
Ask other yoga centre owners who they use and why. See if you can find a CA and lawyer that have experience with other businesses in the yoga industry.
You will want a good lawyer to make sure you have the business set up properly and protected. They should be able to give you advice on the type of insurance to carry.
A CA will play a crucial role in your big picture tax and financial planning items. Having a good lawyer and CA will also help you choose the correct entity type for your yoga centre.
Choose an Entity Type
I would definitely have a conversation with both my lawyer and CA to choose the correct entity type. The entity type should take into consideration items such as liability concerns and big picture tax planning.
Having a conversation with both will help you choose the entity type that is right for your business as well as your personal situation.
Your CA and lawyer will also be able to help you file the correct paperwork with the state and central agencies to ensure that you are set up properly and legally with the government.
Yoga Centre POS System
Let’s get to the fun stuff; bringing money into the bank. You are not going to stand at the entrance with a bank bag full of money, you need to look professional. These days most consumers want the flexibility to be able to pay how they want.
The last thing you want is potential customers choosing another centre because they are keeping up with the times.
I have found that many yoga centre prefer to use the POS software throughout the industry for the functionality and affordability of the product.
Bookkeeping for a Yoga Centre
When you start your centre you are going to need a way to track the finances of the business, so you need to set up a bookkeeping system (I know you just cringed at the word). We highly recommend using QuickBooks Pro for windows at the very least.
To really over simplify the bookkeeping system for your yoga centre you need to be able to track the money that comes in and leaves your business.
Your money going out can be easily recorded by tracking your credit card purchases and checks written to vendors. We highly recommend doing as much digitally through credit and debit card payments as well as utilizing online bill pay.
Payroll and Independent Contractors
Payroll – You can handle the payroll needs yourself through QuickBooks assisted payroll or have your CA handle it. Outsourced payroll companies are very competitive and it is no secret that they don’t make much money on the payroll service itself.
Independent Contractors – Independent contractors are a touchy subject for yoga centres. I have seen many centres go through a wage audit and have their yoga instructors reclassified from independent contractors to employees. The back payroll taxes owed can be detrimental for many centres.
You want to make sure you follow the independent contractor rules for your state and make sure you get all of the proper documentation. This is an area I would highly recommend getting some advice on from your CA.
Financial Reporting
Having small business financial reporting in place for your centre is important no matter how small your centre is. You should develop a set of reports with your accountant that you review on a regular basis. If you are not analyzing financial reports regularly then you are running your business blind.
At the very least you want to learn how to run a simple profit & loss and learn how to compare that to previous periods. You should also understand the balance sheet for your business and what it means to the health of your business.
Avoiding or disregarding your financial reporting can give you a false sense of if your centre is succeeding or not.
Filing Taxes
I highly recommend that you consult with an excellent CA on all tax related issues.
In a very simple approach to taxes I would say you can break things down into payroll taxes and independent contractors, sales taxes and income taxes.
Setting up a yoga or meditation centre is not much different from starting any other business. However, if you are new to business you may not know all of the proper steps you need to take to set your yoga centre up properly the first time.
If you need any help along the way please don’t hesitate to reach out to us.
